[Federal Register Volume 60, Number 155 (Friday, August 11, 1995)]
[Notices]
[Pages 41100-41104]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-19828]



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DEPARTMENT OF THE INTERIOR
Minerals Management Service


Request for Comments on the Draft Proposed 5-Year Outer 
Continental Shelf (OCS) Oil and Gas Leasing Program for 1997-2002

SUMMARY: Comments are requested on the Draft Proposed 5-year OCS Oil 
and Gas Leasing Program for 1997-2002. This is the first proposal for a 
new program to succeed the current program that expires in July 1997.
    Section 18 of the OCS Lands Act (43 USC 1344) specifies a multi-
step process of consultation and analysis that must be completed before 
the Secretary of the Interior may approve a new 5-year program. The 
required steps following this notice include the development of a 
proposed program, a proposed final program, and Secretarial approval. 
Pursuant to the National Environmental Policy Act, the Minerals 
Management Service (MMS) also will prepare an Environmental Impact 
Statement (EIS) for the new 5-year program.

DATES: Please submit comments and information to MMS on or before 
October 10, 1995.

ADDRESSES: Respondents should mail comments and information to: 5-Year 
Program project Director, Minerals Management Service (MS-4430), Room 
1324, 381 Elden Street, Herndon, Virginia 22070. The MMS will accept 
hand deliveries at 1849 C Street, NW, Room 4230, Washington, DC. 
Envelopes or packages should be marked ``Comments on the Draft proposed 
5-Year OCS Oil and Gas Leasing Program for 1997-2002.'' When submitting 
any privileged or proprietary information to be treated as 
confidential, respondents should mark the envelope, ``Contains 
Confidential Information.''

FOR FURTHER INFORMATION CONTACT:
Carol Hartgen, 5-Year Program Project Director, or Tim Redding, Program 
Decision Document Project Manager, at (703) 787-1216. To order copies 
of the new Draft Proposed Program decision document and maps or 
documents describing the current 5-year program for 1992-1997, 
telephone (703) 787-1216.

SUPPLEMENTARY INFORMATION: The MMS requests comments from States, local 
governments, Native groups, tribes, the oil and gas industry, Federal 
Agencies, environmental and other interest organizations, and all other 
interested parties to assist in the preparation of a 5-year OCS oil and 
gas leasing program for 1997-2002 and applicable EIS.

Background

    Management of the Nation's offshore oil and gas resources is 
governed by the OCS Lands Act, which specifies the conditions under 
which the Secretary of the Interior grants rights to explore for, 
develop, and produce those resources. The Secretary has assigned the 
responsibility for implementing the requirements of the OCS Lands Act 
to the MMS.
    Section 18 of the Act requires the Secretary to prepare an oil and 
gas leasing program that indicates a 5-year schedule of lease sales 
that he determines will best meet the Nation's energy needs. Section 18 
requires that the 5-year program be prepared in a manner consistent 
with four main principles: (1) Consideration of economic, social, and 
environmental values and the potential impact on marine, coastal, and 
human environments; (2) consideration of diverse environmental, 
geographical, and equitable regional factors; (3) a proper balance 
among potential for environmental damage, discovery of oil and gas, and 
adverse impact on the coastal zone; and (4) assurance of receiving fair 
market value. There is no set equation for the weight to be accorded 
each principle and factor. It is within the Secretary's discretion 
after taking these matters into consideration to determine how best to 
proceed.
    In addition to the requirements of section 18, the following policy 
objectives endorsed by the President and the Secretary have been 
considered in developing the Draft Proposed Program: consensus-based 
decisionmaking, science-based decisionmaking, and the use of natural 
gas as an environmentally preferred fuel.
    On November 16, 1994, the MMS published a Federal Register Notice 
requesting comments on the preparation of a new 5-year program for 
1997-2002. Over 2300 comments were received from affected State and 
local governments, Alaska Native organizations and communities, federal 
agencies, environmental and other interest organizations, the oil and 
gas industry, and the general public. Those comments have been 
considered in developing the Draft Proposed Program.

Moving From Conflict to Consensus

    Preparation of the 5-year Draft proposed Program for 1997-2002 
recognizes the need not only to incorporate and consider analyses that 
were updated from the 1992-1997 program but also to engage in dialogue 
with the parties that would be most affected by the program. In its 
1993 report, Moving beyond Conflict to Consensus, the Subcommittee on 
OCS Legislation of the OCS Policy Committee, an independent body that 
advises the Secretary of the Interior, recommended that the Secretary, 
where local constituents were willing, use regional task forces 
representing OCS program stakeholders to focus on reaching consensus on 
OCS lease sales. The OCS Policy Committee also recognized that 
``overall, the prevailing controversies and the measures used to deal 
with them have seriously diminished the effectiveness of the federal 
OCS oil and gas program in helping to meet the Nation's energy needs.'' 
This program embraces the advice provided by the OCS Policy Committee 
and reflects the beginning of a long-term movement from conflict to 
consensus in the OCS program.
    The OCS Policy Committee established an Alaska Regional 
Stakeholders Task Force consisting of diverse Alaskan constituencies 
which was a first attempt to reach consensus on recommending to the 
Secretary the appropriate planning areas to be 

[[Page 41101]]
proposed for evaluation in an OCS 5-year program. The OCS Policy 
Committee approved the continued existence of the task force to advise 
the Secretary throughout the remainder of the 5-year program.
    The Draft Proposed Program provides for environmentally responsible 
oil and gas leasing in selected prospective areas of the OCS where it 
appears there is sufficient industry interest, where the laws and 
policies of adjacent States and localities are not a significant 
impediment to OCS program activity, and where there is agreement among 
interested and affected parties that further evaluation of leasing is 
reasonable. The program provides a framework for resolving concerns 
relating to new leasing and development of existing leases on a basis 
supported by sound science. In addition, to help assure that the new 
program and future leasing decisions are based on good science, the 
Director of the MMS has asked the OCS Policy and Scientific Committees 
to form a subcommittee to provide an independent review and evaluation 
of specific information needs for areas where controversy has led to 
executive and/or legislative restrictions on leasing.

National Energy Needs

    Analysis in the Proposed Final Program for 1992-1997 (April 1992) 
showed the economic dangers associated with the Nation's dependence on 
imported petroleum and how OCS production had helped reduce the need 
for even greater volumes of imported petroleum.
    The growing need for imported petroleum remains a serious concern. 
In its December 1994 report to the President, The Effect of Imports of 
Crude Oil and Refined Petroleum Products on the National Security, the 
Department of Commerce concluded that petroleum imports threaten to 
impair U.S. national security.
    Increasing imports will make the Nation more vulnerable to supply 
disruptions and increase the Nation's balance of payments deficit. 
Environmentally responsible development of OCS oil and gas resources 
will have to play a role in any effort to slow or reverse the increase 
in imported energy.
    The decisions on the new 5-year program will have a long-term 
effect on the contribution of OCS resources to meeting the Nation's 
energy needs and improving its trade balance. Most production resulting 
from lease sales held under the new 5-year program is likely to begin 
over the first decade of the next century and continue for another 25 
years.
    Maps 1 and 2 contain the areas proposed for leasing consideration 
in the new program. Table A is a summary of the proposed schedule of 
lease sales for the new program. Individual planning area maps are 
included in the Draft Proposed Program decision document.

                                     Table A.--Proposed Lease Sale Schedule                                     
----------------------------------------------------------------------------------------------------------------
          Region and planning area                Year                        Proposed activity                 
----------------------------------------------------------------------------------------------------------------
Alaska:                                                                                                         
    Beaufort Sea...........................  1998.........  Small sale, focusing on nearshore blocks in center  
                                                             of program area (Map 1).                           
                                             2000.........  Sale in program area (Map 1).                       
    Cook Inlet/Shelikof Strait.............  1999.........  Sale in program area (Map 1).                       
    Gulf of Alaska.........................  2001.........  Sale in program area (Map 1).                       
    Chukchi Sea/Hope Basin.................  2002.........  Combined sale in program area (Map 1).              
Gulf of Mexico:                                                                                                 
    Western Gulf of Mexico.................  Annual.......  Sale in program area (Map 2).                       
    Central Gulf of Mexico.................  Annual.......  Sale in program area (Map 2).                       
    Eastern Gulf of Mexico.................  2001.........  Sale in program area (Map 2) (offshore Alabama, 100 
                                                             miles off Florida).                                
----------------------------------------------------------------------------------------------------------------

Draft Proposed Program Decision

Alaska Region

    The Draft Proposed Program for 1997-2002 includes lease offerings 
in 5 of the 15 Alaska OCS planning areas--Beaufort Sea, Cook Inlet/
Shelikof Strait, Gulf of Alaska, Chukchi Sea, and Hope Basin. The lease 
offerings do not encompass the entire planning areas, rather they are 
focused on specific areas within the planning areas. These planning 
areas were recommended for further evaluation by the Alaska Regional 
Stakeholders Task Force, established by the OSC Policy Committee in 
November 1994 to make recommendations on the Alaska component of this 
5-year program. The Task Force consists of representatives of Federal 
and State agencies, local governments and community organizations, 
Native/subsistence and development communities, oil and gas and 
commercial fishing industries, and environmental interests. Task Force 
members met in Alaska as a group and conducted meetings in selected 
communities before preparing a report to the Secretary recommending 
areas to be considered in the new 5-year program.
    The Draft Proposed Program for 1997-2002 proposes no leasing for 
the remaining 10 Alaska OCS planning areas. St. George Basin has 
relatively low net social value and low industry interest, and 
consensus among interested parties including the Alaska Regional 
Stakeholders Task Force was that this area should be excluded from the 
new program. Norton Basin, Navarin Basin, St. Matthew-Hall, North 
Aleutian Basin, Aleutian Basin, Bowers Basin, Aleutian Arc, Shumagin, 
and Kodiak were excluded from the current 5-year program based on low 
net social value, low industry interest, and other section 18 
considerations. No new information supports including these areas for 
leasing consideration in the new program, and the Alaska Regional 
Stakeholders Task Force did not recommend that they be evaluated 
further.

Gulf of Mexico

    Annual area wide sales for the Central and Western Gulf of Mexico 
Planning Areas are proposed to continue to provide industry and others 
with the flexibility and the reliable schedule so important to long-
term planning. The proposed Eastern Gulf of Mexico lease sale would 
cover blocks offshore Alabama and in the deep-water areas along the 
boundary of the Central Gulf of Mexico Planning Area. It recognizes the 
high potential for the development of natural gas in the areas of 
current development offshore Alabama and the potential for deepwater 
development along the Central Gulf of Mexico and Eastern Gulf of Mexico 
Planning Areas' boundary line. It is also consistent with Florida's 
continued opposition to activity within 100 miles of its coast and 
Alabama's desire to share in the benefits 

[[Page 41102]]
of new OCS leasing and development. The MMS will concentrate its 
efforts on resolving disputes relating to those existing leases in the 
Eastern Gulf of Mexico offshore Florida rather than exacerbate an 
already contentious situation with additional leasing.

Pacific Region

    There are no proposed lease sales offshore the west coast. There 
are outstanding scientific information needs that have not been 
fulfilled.
    The MMS will continue working with interested and affected parties 
to resolve issues concerning existing leases in the Southern California 
Planning Area. In previous comments and in response to the November 
1994 Federal Register Notice soliciting comments on the development of 
a new 5-year program, the State of California has opposed any leasing 
off its coast. Local government policies and ordinances have reflected 
this opposition as well. The MMS Pacific Regional Office and officials 
from Santa Barbara, Ventura, and San Luis Obispo counties in Southern 
California and several State agencies have formed a Tri-County Forum to 
address issues related to exploration and development on existing 
leases. Because of the cooperative nature of this forum to date in 
resolving oil and gas issues, two of the local counties indicated they 
would not oppose limited leasing off their coasts provided that several 
conditions such as impact assistance and an enhanced local role in OCS 
leasing decisions were met. However, there are still several issues to 
resolve for the future development of significant oil reserves under 
existing leases. Rather than propose additional acreage for leasing 
consideration, the MMS will continue working with interested and 
affected parties on issues concerning the existing leases.

Atlantic Region

    There are no proposed lease sales. The MMS will continue working 
with interested and affected parties to resolve issues concerning 
existing leases in the Mid- and South Atlantic Planning Areas. In 
keeping with the Administration's goal of encouraging the use of 
natural gas, the MMS examined gas-prone areas off the coast of North 
Carolina and another off the coast of New Jersey. The areas offshore 
North Carolina are currently leased and are subject to litigation 
relating to application of the Coastal Zone Management Act and the 
Outer Banks Protection Act. No new leasing is proposed in these areas 
at this time, but the MMS will continue to pursue resolving disputes 
related to the existing leases outside of litigation. The area offshore 
New Jersey has been leased in the past. A significant natural gas 
discovery was made in the 1970's. Given the recent dormancy in this 
area, rather than proposing leasing during the 5-year program, the MMS 
will begin preliminary discussions with constituents in the area.
    No leasing is proposed in the North Atlantic and Straits of Florida 
Planning Areas. No new information supports including these areas for 
leasing in the new program.

Configuration of Planning Areas

    The Draft Proposed Program decision moves the boundary between the 
Beaufort Sea and Chukchi Sea Planning Areas to more accurately conform 
those areas with the bodies of water after which they were named. In 
addition, Official Protraction Diagrams were created and planning area 
boundaries revised to be consistent with the current projection of the 
U.S. Exclusive Economic Zone as depicted on official maps prepared by 
the National Oceanic and Atmospheric Administration. Whole and partial 
Official Protraction Diagrams have been added to the Beaufort Sea; 
Aleutian Arc; Washington-Oregon; Northern, Central, and Southern 
California; and South Atlantic Planning Areas; none of the additions 
would be considered for leasing. The Official Protraction Diagrams 
beyond the OCS and Exclusive Economic Zone in the Gulf of Alaska have 
been deleted.

Assurance of Fair Market Value

    The basic minimum bid level would be set at $25 per acre, subject 
to sale-by-sale reconsideration, and the current two-phased bid 
adequacy process is retained. As announced in the Call for Comment 
published in the Federal Register on April 20, 1995, both of these 
measures are under separate review to ensure that fair market value is 
obtained through the MMS's leasing policies. Relevant comments received 
in response to that Notice will be considered in developing the fair 
market value provisions of the new 5-year program. The existing 
measures will be maintained until the separate review is complete. The 
results of the analysis will be addressed in formulating the proposed 
program.
Information Requested

    We request all interested and affected parties to comment on the 
size, timing, and location of leasing and the procedures for assuring 
fair market value that are proposed in the Draft Proposed Program for 
1997-2002. Information provided by commenters should relate to the 
principles and factors of section 18, and suggestions for revising the 
Draft Proposed Program should include rationale corresponding to those 
considerations and to the policy objectives identified by the MMS, as 
discussed in the background presented above. Respondents who submitted 
information in response to the April 20, 1995, Call for Comment 
discussed above may wish to reference that information, as appropriate, 
rather than repeating it in their comments on the Draft Proposed 
Program. We also invite comments and suggestions on how to proceed with 
the section 18 analysis for the next draft of the new program, the 
Proposed Program.
    As the scoping process continues for the programmatic EIS that will 
be prepared, we again request comments on significant environmental 
issues attendant to OCS leasing and development and on alternative 
options for size, timing, and location of sales that should be 
evaluated.
    Respondents who wish to provide illustrated information pertaining 
to the size and location of lease sales can obtain larger OCS block-
specific maps by calling (703) 787-1216.
    Section 18(g) authorizes confidential treatment of privileged or 
proprietary information that is submitted. In order to protect the 
confidentiality of such information respondents should include it as an 
attachment to other comments submitted and mark it appropriately. On 
request the MMS will treat such information as confidential from the 
time of its receipt until 5 years after approval of the new leasing 
program, subject to the standards of the Freedom of Information Act. 
The MMS will not treat as confidential any aggregate summaries of such 
information, the names of respondents, and comments not containing such 
information.

Next Steps in the Process

    The Proposed Program and draft EIS are scheduled to be issued in 
January 1996 followed by a 90-day comment period. The Proposed Final 
Program and final EIS are scheduled to be issued in August 1996. The 
Secretary may approve the new 5-year program 60 days later.

    Dated: August 7, 1995.
Cynthia Quarterman,
Director, Minerals Management Service.

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[FR Doc. 95-19828 Filed 8-10-95; 8:45 am]
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