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MMS Calls for Interest in Alaskan Frontier Exploration

MMS Calls for Interest in Alaskan Frontier Exploration

A part of its plan to help foster exploration in largely unexplored areas of the Alaska Outer Continental Shelf, the Minerals Management Service (MMS) is asking companies about their interest in exploring for oil and gas in the Chukchi Sea, Hope Basin, and Norton Basin.

Published in the Federal Register on Jan. 30, the call for information and nominations seeks comments on the proposals from industry and the public and requests that the industry "nominate small, very specific areas" where they are willing to commit to exploration. The MMS said that this would be the first step in the special 18-month leasing process for Federal OCS tracts in frontier areas, noting that it is considering offering economic incentives similar to those offered recently in the Beaufort Sea Sale 186 held in Sept. 2003.

"The Chukchi Sea and Norton Basin have great potential as sources of oil or gas but the accompanying high economic cost due to the distance from any infrastructure make them challenging areas to lease," said John Goll, MMS Alaska regional director. "Our objective through this 'special interest' process is to see whether any companies are interested at this time to explore these frontier areas. If they are, we can design a sale. If no one expresses interest, we save a lot of work and money."

The government agency said it will use the information received to make the decision whether to proceed with leasing. If there is insufficient interest this year, MMS said it will postpone the sales and reissue the calls next year, noting that this process will continue throughout the 2002-2007 five-year program until sufficient interest to hold a sale is expressed.

If a company does show interest, the MMS will ask them to identify the specific area. The agency would then proceed through steps to hold a sale, with competitive bidding, in the general area of interest. One of the terms will be a commitment from industry to explore the area leased within a specific period.

The sales in five-year plan include Sale 193, Chukchi Sea and Hope Basin, and Sale 188, Norton Basin. They are tentatively scheduled for Sept. 2005. In addition to identifying specific blocks to be included in a possible lease sale, the MMS said comments are sought about particular economic terms and conditions of a sale, geologic, environmental, biological, archaeological, or social and economic conditions and other information that might bear on potential leasing and development in the area.

According to the bulletin, nominations and comments must be received by April 29. For more information about the proposed sale or the call for information and nominations, contact MMS Alaska Region at 907-271-6070, toll-free at 1-800-764-2627, or via e-mail at akwebmaster@mms.gov.

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