Alaska Statewide and Regional Economic and Demographic Systems: Effects of OCS Exploration and Development, 1986

Abstract

This report contains projections and analyses of economic and demographic effects of petroleum exploration and development that may occur in Alaska under the proposed Five-Year program, 1987-1991, for leasing the federal Outer Continental Shelf (OCS). Econometric modeling techniques are used to develop projections for the state of Alaska and the state's Southcentral Region.

The projected cumulative effects of the Five-Year Program include an increase of approximately 3 percent in population and employment for both the state and for the Southcentral region. The statewide effects grow during construction of facilities for OCS development and remain relatively constant as petroleum development moves into the operations phase in the late 1990s. Economic activity related to expanded OCS development yields modest new revenues for the state, by the new revenues are not sufficient to offset new demands on public services created by the influx of new residents.

The effects grow more slowly in the Southcentral Region, continuing to increase until 2010 to reach or exceed the same percentage increases in population and employment as observed for the state as a whole. The effect of the Five-Year program on Southcentral Region population and employment occurs later than for the state as a whole due to the lags in the multiplier process producing these largely indirect effects.