[Federal Register Volume 70, Number 26 (Wednesday, February 9, 2005)]
[Notices]
[Pages 6903-6909]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-2523]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service


Outer Continental Shelf (OCS), Alaska Region, Chukchi Sea/Hope 
Basin and Norton Basin Planning Areas

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Call for information and nominations.

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SUMMARY: The Secretary's decision to consider offering the Chukchi Sea/
Hope Basin Planning Area and the Norton Basin Planning Area in the OCS 
Oil and Gas Leasing Program for 2002-2007 provides for an 18-month 
``special-interest'' process beginning with

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publication of this Call. Based on the information and specific 
nominations received as a result of this Call, a decision will be made 
whether to proceed with a sale for these separate planning areas. In 
the past MMS has issued separate Calls for these areas; however, 
because the areas are both ``special-interest areas'' and tentative 
process milestones are the same, the decision was made to combine the 
Calls.

DATES: Nominations and comments on the Call must be received on or 
before May 10, 2005.

FOR FURTHER INFORMATION CONTACT: Please call Phyllis Casey at (907) 
334-5272 or Steve Flippen at (907) 334-5268 in MMS's Alaska OCS Region 
regarding questions on the Call.

SUPPLEMENTARY INFORMATION: The objective of this ``special-interest'' 
leasing option is to foster exploration in a frontier OCS area with 
potential oil and gas resources, but due to high economic costs, may 
have questionable industry interest. This allows us to offer the 
option, but with minimal upfront time and effort required for holding a 
typical lease sale. The general approach is to query industry regarding 
the level of interest in proceeding with sales in the Chukchi Sea/Hope 
Basin and the Norton Basin that would offer only very small, very 
focused areas of specific interest for exploration and to request 
nominations of such areas. The lease sales are being proposed to 
provide opportunities for industry to pursue the high resource 
potential of the Chukchi Sea area in conjunction with potential natural 
gas resources that may extend into the adjacent Hope Basin area. The 
Norton Basin may contain quantities of natural gas, which might be used 
for western Alaska communities if economically feasible. Comments are 
also being requested from the general public on this special-interest 
leasing process, including the terms and conditions of the sales. The 
MMS will consider all comments and nominations in the decisions on 
whether and where within the Chukchi Sea/Hope Basin or Norton Basin to 
proceed with leasing and on the terms and conditions of lease sale 
proposals. A decision to offer a nominated area for leasing will be 
conditioned on a commitment from industry to explore the area leased 
within a specific time period. Any lease sale would be open 
competitively to all qualified bidders.
    This is the third Call issued for the Chukchi Sea/Hope Basin for 
this 5-year program. The first two Calls were published in the Federal 
Register on March 25, 2003, and January 30, 2004, respectively. No 
interest was expressed for either Call; therefore, the process was 
stopped and deferred to this year. If no interest is expressed in 
response to this third Call, Sale 193 may be called again later this 
year.
    This is the fourth Call issued for the Norton Basin for this 5-year 
program. The first three Calls were published in the Federal Register 
on January 22, 2002, March 25, 2003, and January 30, 2004, 
respectively. No interest was expressed for any of these Calls; 
therefore, the process was stopped and deferred to this year. This is 
the last Call scheduled to be issued for Norton Basin in this 5-year 
program.
    This Call does not indicate a preliminary decision to lease in the 
areas described below. If the MMS decides to proceed with the sale 
process, the MMS will make the final decision on the specific areas for 
possible leasing at a later date in the presale process and in 
compliance with the 5-year program and with applicable laws including 
all requirements of the National Environmental Policy Act (NEPA) and 
the OCS Lands Act (OCSLA). The MMS may adjust the dimensions of a 
nominated area after discussions with the nominating company.

Call for Information and Nominations

1. Authority

    This Call is published pursuant to the OCSLA, as amended (43 U.S.C. 
1331-1356, [1994]), and the regulations issued thereunder (30 CFR part 
256 and 30 CFR part 260); and in accordance with the OCS Oil and Gas 
Leasing Program 2002 to 2007, approved June 27, 2002.

2. Purpose of Call

    The purpose of the Call is to gather preliminary information, to 
request nomination of specific areas of interest to industry, and to 
request comments on the terms and conditions of offering these special-
interest lands. The Call also serves to initiate public outreach to 
assist in preparation of the NEPA analysis for this proposal. This 
proposal is in keeping with Sec. 102(9) of the OCSLA Amendments of 
1978, which states as a purpose of the statute, ``* * * to insure that 
the extent of oil and natural gas resources of the OCS is assessed at 
the earliest practicable time.'' The objective of the ``special-
interest'' leasing process is to encourage exploration in a frontier 
OCS area that might contain natural gas for potential use in local 
communities, as well as oil to meet national energy needs. The sale 
would offer for lease both oil and gas.
    Comments, information, and nominations on oil and gas leasing, 
exploration, and development and production within the Chukchi Sea/Hope 
Basin and Norton Basin are sought from all interested parties. Comments 
are also being sought on the terms, conditions, and economic incentives 
of a sale in the Chukchi Sea/Hope Basin and Norton Basin. Industry and 
other interested parties are strongly encouraged to contact the MMS, 
Alaska OCS Region, Phyllis Casey at (907) 334-5272 or Steve Flippen at 
(907) 334-5268, with questions or to discuss interest in these areas. 
This early planning and consultation step is particularly important to 
this special-interest lands process. The MMS will base its decision on 
whether to proceed with the presale process and the terms and 
conditions of a sale on the nominations and other information received 
in response to this Call. This process will ensure a decision that 
considers the concerns of all respondents in future decisions in this 
leasing process pursuant to the OCSLA and regulations at 30 CFR part 
256 and 30 CFR part 260. Commenters are also encouraged to submit 
comments and suggestions on the ``special-interest'' leasing process in 
general using this process.
    This Call is being issued in accordance with the OCS Oil and Gas 
Leasing Program 2002 to 2007, approved June 27, 2002. The program 
offers two sales in the Chukchi Sea/Hope Basin during the 5-year 
program. If no interest is expressed in response to this third Call, 
Sale 193 will not be held for this 5-year program. However, a new Call 
for the Chukchi Sea/Hope Basin for Sale 203 is scheduled to be issued 
November 2005 with a tentative sale date in May 2007. No more than two 
rounds of lease issuance in the Chukchi Sea/Hope Basin were to occur 
during this 5-year program. This is the fourth Call issued for the 
Norton Basin Program Area. The first three Calls were published in the 
Federal Register on January 22, 2002, March 25, 2003, and January 30, 
2004, respectively. No interest was expressed for any Call. This is the 
last Call scheduled for the Norton Basin in this 5-year program.

3. Description of Areas

    Chukchi Sea/Hope Basin: This area is located offshore the State of 
Alaska in the Chukchi Sea, between Cape Krusenstern and Point Barrow. 
The Chukchi Sea area consists of approximately 6,155 whole and partial 
blocks (about 34 million acres). It extends offshore from about 10 to 
approximately 200 miles in water depths from about 32 feet to 
approximately 230 feet. A small portion

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of the northeast corner of the area drops to approximately 3,000 feet. 
The Hope Basin area consists of approximately 1,243 whole and partial 
blocks (about 6\1/2\ million acres). It extends offshore from about 3 
to approximately 110 miles in water depths from about 32 feet to 
approximately 230 feet.
    Norton Basin: This area is located offshore the State of Alaska in 
the northern Bering Sea, west and south off the coast of the Seward 
Peninsula. It consists of approximately 4,742 whole and partial blocks 
(about 25 million acres). It extends offshore from about 3 to 
approximately 320 miles in water depths from about 25 feet to 
approximately 650 feet.
    Page-size maps of the areas accompany this Notice. Large scale Call 
maps showing the boundaries of the areas on a block-by-block basis are 
available without charge from the Public Information Office at the 
address given below, or by telephone request at (907) 334-5206 or 1-
800-764-2627. Copies of Official Protraction Diagrams (OPDs) are also 
available at the following location: Alaska OCS Region, Minerals 
Management Service, 3801 Centerpoint Drive, Suite 500, Anchorage, 
Alaska 99503.
    In addition, the OPDs are available on the MMS Web site at http://www.mms.gov/ld/alaska.htm.

4. Instructions on Call

    The Call for Information Maps and indications of interest and/or 
comments must be submitted to the Regional Supervisor, Leasing and 
Environment, at the above address.
    The Call maps delineate the areas that are the subject of this 
Call. Respondents are requested to indicate very specific areas of 
interest in and comment on the Federal acreage within the boundaries of 
the Call areas that they wish to have included in a proposed sale in 
the Chukchi Sea/Hope Basin or Norton Basin.
    If you wish to comment, you may submit your comments by any one of 
the following methods:
     You may mail comments to the Alaska OCS Region, Minerals 
Management Service, 3801 Centerpoint Drive, Suite 500, Anchorage, 
Alaska 99503, in envelopes labeled ``Attn: Comments on Call for 
Information and Nominations for Proposed 2005 Lease Sale in Chukchi 
Sea/Hope Basin.'' or ``Attn: Comments on Call for Information and 
Nominations for Proposed 2005 Lease Sale in Norton Basin.'', as 
appropriate.
     You may fax your comments to MMS at (907) 334-5242.
     You may also comment using Public Connect at: https://ocsconnect.mms.gov/pcs-public.
     Finally, you may hand-deliver comments weekdays between 8 
am and 5 pm to the Alaska OCS Region, Minerals Management Service, 3801 
Centerpoint Drive, Suite 500, Anchorage, Alaska 99503.

Please note that all comments need to identify which areas they pertain 
to.
    Our practice is to make comments, including names and addresses of 
respondents, available for public review during regular business hours. 
Individual respondents may request that we withhold their address from 
the record, which we will honor to the extent allowable by law. Under 
certain circumstances we can withhold a respondent's identity, as 
allowable by law. If you wish us to withhold your name and/or address, 
you must state this prominently at the beginning of your comment. 
However, we will not consider anonymous comments. We will make all 
submissions from organizations or businesses, and from individuals 
identifying themselves as representatives or officials of organizations 
or businesses, available for public inspection in their entirety.
    A. Areas of Interest to the Oil and Gas Industry. Industry must be 
candid and very specific regarding the areas they nominate if this 
process is to succeed. The purpose of this process is to identify and 
offer only small-focused areas where industry has a significant 
interest in exploration. Nominations covering large-scale areas will 
not be helpful in defining these areas.
    Nominations must be depicted on the Call maps by outlining the 
area(s) of interest along block lines. Nominators are asked to submit a 
list of whole and partial blocks nominated (by OPD and block number) to 
facilitate correct interpretation of their nominations on the Call 
maps. Although the identities of those submitting nominations become a 
matter of public record, the individual nominations are proprietary 
information. The telephone number and the name of a person to contact 
in the nominator's organization for additional information should be 
included in the response. This person will be contacted to set up a 
mutually agreeable time and place for a meeting with the Alaska OCS 
Regional Office to present their views regarding the company's 
nominations.
    B. Terms, Conditions, and Economic Incentives Pertaining to Lease 
Issuance. Respondents are requested to comment on the terms, 
conditions, and economic incentives pertaining to lease issuance for 
any leases that may be issued as a result of a sale in the Chukchi Sea/
Hope Basin or Norton Basin. The MMS is aware of the lack of 
infrastructure and distance from shore to some of the blocks in this 
area and will consider these factors in designing any incentives. The 
following are being considered for use in this sale:

--Lease term of 10 years
--Submission of an exploration plan within 8 years of lease issuance
--Economic incentives similar in form to those contained in the Notice 
of Sale for Beaufort Sea Sale 186 (68 FR 50549) and those proposed for 
Beaufort Sea Sale 195 (69 FR 61402). Incentives for Beaufort Sea Sale 
186 were:
--Royalty suspension volumes for oil production (with possible 
consideration for gas)
--Reduced rental rates
--Lower minimum bid requirements

    C. Relation to Coastal Management Plans (CMPs). Comments also are 
sought on potential conflicts with approved local CMPs that may result 
from the proposed sale and future OCS oil and gas activities. These 
comments should identify specific CMP policies of concern, the nature 
of the conflicts foreseen, and steps that MMS could take to avoid or 
mitigate the potential conflicts. Comments may be in terms of broad 
areas or restricted to particular blocks of concern. Commenters are 
requested to list block numbers or outline the subject area on the 
large-scale Call map.

5. Use of Information From Call

    Information submitted in response to this Call will be used for 
several purposes. We will use responses to:

--Determine whether to proceed with a competitive oil and gas lease 
sale in the Chukchi Sea/Hope Basin or Norton Basin
--Identify specific areas of interest for oil and/or gas exploration 
and development
--Identify environmental effects and potential use conflicts
--Assist in the public outreach for the environmental analysis
--Develop possible alternatives to the proposed action
--Develop lease terms and conditions/mitigating measures
--Identify potential conflicts between oil and gas activities and the 
Alaska CMP

6. Existing Information

    An extensive environmental, social, and economic Studies program 
has been underway in the Alaska OCS Region since 1976, including 
studies in these

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areas. The emphasis has been on geologic mapping, environmental 
characterization of biologically sensitive habitats, endangered whales 
and marine mammals, physical oceanography, ocean-circulation modeling, 
and ecological and socio-cultural effects of oil and gas activities.
    The MMS has had two past sales in the Chukchi Sea area. In May 
1988, Sale 109 was held and resulted in 350 leases being issued. In 
August 1991, Sale 126 was held and resulted in 28 leases being issued. 
There were four exploratory wells drilled, but all have been 
permanently plugged and abandoned. All 378 leases have since been 
relinquished or expired. No lease sales have been held in the Hope 
Basin area. The MMS has had one past sale in the Norton Basin area. In 
March 1983, Sale 57 was held and resulted in 59 leases being issued. 
There were six exploratory wells drilled, but all have been permanently 
plugged and abandoned. All 59 leases have been relinquished or expired. 
The Alaska OCS Region document ``Undiscovered Oil and Gas Resources, 
Alaska Federal Offshore, December 2000 Update'' (www.mms.gov/alaska/re/uogr/uogr.pdf), estimates the undiscovered conventionally recoverable 
resources at:

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                                                                  Oil and NGL (BBO)              Gas (TCFG)                   BOE (BBO)
                            Area                            ------------------------------------------------------------------------------------   MPhc
                                                               F95      Mean      F05      F95      Mean      F05      F95      Mean      F05
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CHUKCHI SHELF..............................................     8.60    15.46    25.03     13.56    60.11   154.31     11.32    26.21    49.60      1.00
HOPE BASIN.................................................     0.00     0.09     0.28      0.00     3.38    11.06      0.00     0.69     2.25      0.61
NORTON BASIN...............................................     0.00     0.05     0.15      0.00     2.71     8.74      0.00     0.53     1.70     0.72
                                                                        (NGL)
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BBO, billions of barrels of oil and natural gas liquids; TCFG, trillions of cubic feet; BOE, total oil and gas in billions of energy-equivalent barrels
  (5,620 cubic feet of gas=1 energy-equivalent barrel of oil); reported MEAN, resource quantities at the mean in cumulative probability distributions;
  F95, the resource quantity having a 95-percent probability of being met or exceeded; F05, the resource quantity having a 5-percent probability of
  being met or exceeded; MPhc, marginal probability for hydrocarbons for basin, i.e., chance for the existence of at least one pool of undiscovered,
  conventionally recoverable hydrocarbons somewhere in the basin. Resource quantities shown are risked, that is, they are the product of multiplication
  of conditional resources and Mphc. All liquid resources in Norton basin are natural gas liquids that would only be recovered by natural gas
  production.

    Information on the Studies program, completed studies, and a 
program status report for continuing studies in these areas is 
available on the MMS Web site at http://www.mms.gov/alaska, or may be 
obtained from the Chief, Environmental Studies Section, Alaska OCS 
Region, by telephone request at (907) 334-5230, or by written request 
at the address stated under Description of Area. A request may also be 
made via the Alaska OCS Region Web site at www.mms.gov/alaska/ref/pubindex/pubsindex.htm.

7. Tentative Schedules

    If MMS receives specific nominations from industry in response to 
this Call and decides to proceed with the pre-sale process, the 
following is a list of tentative milestone dates applicable to a 
Chukchi Sea/Hope Basin and/or a Norton Basin sale in 2006:

------------------------------------------------------------------------
                                      Tentative process milestones for
                                    proposed 2006 Chukchi Sea/Hope Basin
                                         Sale and Norton Basin Sale
------------------------------------------------------------------------
Call published/public outreach     February 2005.
 initiated.
Comments due on Call.............  May 2005.
Decision whether to proceed/Area   June 2005.
 Identification.
NEPA analysis....................  February 2006.
Consistency Determination/         May 2006.
 Proposed Notice of Sale.
Governor's Comments due..........  July 2006.
Final Notice of Sale published...  August 2006.
Sale.............................  September 2006.
------------------------------------------------------------------------
If MMS determines that an EIS might be required, this scheduled may be
  lengthened by 6 months.


    Approved: January 24, 2005.
R.M. ``Johnnie'' Burton,
Director, Minerals Management Service.
BILLING CODE 4310-MR-P

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[FR Doc. 05-2523 Filed 2-8-05; 8:45 am]
BILLING CODE 4310-MR-C