Alaska is considering unconventional oil plays to increase production but a federal agency said it might be difficult to do so economically.
Oil production in Alaska peaked more than 20 years ago with slightly more than 2 million barrels of oil produced per day, state figures indicate. Slumping oil production in the state has left the Trans-Alaska Pipeline system operating at about 30 percent of its capacity.
Dan Sullivan, commissioner for Alaska's Department of Natural Resources, said shale oil development in the North Slope may be key to revitalizing the oil sector.
"We've had a close eye on the unconventional play in Canada and North Dakota, and to some extent, we've been viewing it as competition," he was quoted by The Washington Post as saying. "But we view it less as competition and more as an opportunity."
The Trans-Alaska Pipeline system has an expected service life of 10 years given anticipated declines in oil flows from the state.
The U.S. Geological Survey in February said unconventional reserves could be bountiful in the state.
David Houseknecht, a USGS scientist, was quoted by the Post as saying the prospects were uncertain, however.
"It is really an unknown whether that oil can be recovered from the source rock and can that oil be recovered at a rate and volume per well that would be economically viable," he said.