Alaska Statewide and Regional Economic and Demographic Systems: Effects of OCS Exploration and Development , 1990

Abstract

This report contains projections and analyses of cumulative economic and demographic effects of petroleum exploration and development that may occur in Alaska from areas leased as of January 1990 on the federal Outer Continental Shelf (OCS). Econometric modeling techniques are used to develop projections for the state of Alaska and for the Anchorage-Mat-Su Region.

The projected cumulative effects of the Leasing Program include an increase of approximately 4 percent in population and employment for both the state and for the Anchorage-Mat-Su Region. The statewide effects begin with exploration activities in the first half of the 1990s, then grow quickly during construction of development and transportation facilities for OCS development near the end of the decade. The effects then decline slowly as petroleum development moves into the operations phase after the year 2000. Economic activity related to expanded OCS development yields significant new petroleum revenues for state and local governments. Including state income taxes potentially available from the expanded employment base, the revenues added by OC development are more than sufficient to offset new demands on public services created by the larger population.

The effects on the Anchorage-Mat-Su Region are projected to be nearly as large in 2015 as in 2000 and reach the same percentage increases in population and employment as observed for the state as a whole. The effect of OCS leasing on the Anchorage-Mat-Su Region population and employment is likely to occur slightly later than for the state as a whole due to the lags in the multiplier process producing these largely indirect effects.