NCPA - National Center for Policy Analysis

North Dakota Ahead of Alaska in Oil Production

August 15, 2014

Alaska is struggling to compete with oil-rich states like North Dakota, according to the Wall Street Journal. While North Dakota gained residents between 2012 and 2013, Alaska lost more residents than it gained.

Texas leads the nation in oil production, followed by North Dakota, California and, in fourth place, Alaska. Two years ago, Alaska was the United States' second largest oil producer. 

  • Oil production in Alaska has dropped almost 75 percent since its height in 1980.
  • Alaskan gross domestic product (GDP) decreased 2.5 percent in 2013, while the 49 other American states saw their GDPs increase.
  • Alaska's unemployment rate is at 6.4 percent, higher than the national average. In North Dakota, the unemployment rate is a tiny 2.6 percent.

Much of Alaska's state revenue is tied to the taxes and royalties on oil, which generate enough funds that the state can send checks to its residents each year, with additional funds left over. The amount per Alaskan was at $2,069 in 2008, a record high, but it was just $900 in 2013.

This is not to say that Alaska isn't producing great amounts of oil, but it has certainly seen a shift as companies have moved to other oil-rich states. To encourage drilling, the state cut its energy taxes last year, and companies have indicated their intention to drill more as a result. The state saw 360 new jobs in the oil and gas industry in the first five months of 2014.

Still, Alaska is expecting $4 billion less in oil revenue than it had previously estimated for 2014 and 2015.

Source: Cassandra Sweet and Jim Carlton, "In U.S. Energy Boom, Alaska Is Unlikely Loser," Wall Street Journal, August 10, 2014.


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