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Interior Testing Interest by Oil, NatGas Industry for Alaska's Cook Inlet

The energy industry has, for now, eschewed interest in exploring and developing oil and natural gas reserves offshore Alaska, but a federal environmental review is underway regardless for Cook Inlet offshore the south-central coast, to determine whether to proceed with a scheduled auction next June.

The Department of Interior's Bureau of Ocean Energy Management (BOEM) "recognizes that interest in exploration and development in Cook Inlet may be limited at this time," but a "necessary environmental review" is needed to inform a decision about potentially moving forward with Lease Sale 244. To that end, BOEM has issued a draft environmental impact statement (DEIS) last week to solicit public comment.

"Cook Inlet has oil and gas potential, as well as sensitive marine and coastal resources that Alaska Native communities depend on for subsistence," said BOEM Director Abigail Ross Hopper. Federal officials want to discuss the DEIS "with the public and representatives from Cook Inlet communities" to ensure there is "meaningful feedback."

In a Cook Inlet lease sale held in May, there were no bids (see Daily GPIMay 6). And industry has shown little appetite to work in the arctic waters offshore Alaska. Led by leading leaseholder Royal Dutch Shell plc, most of the offshore operators since have shelved their programs, which have been focused in the Chukchi and Beaufort seas (see Daily GPIJune 9May 11).

However, Interior's five-year offshore leasing program finalized for 2017-2022 includes one lease sale for Cook Inlet (see Daily GPIMarch 15Oct. 19, 2015Jan. 27, 2015).

The Cook Inlet DEIS includes an analysis of the environmental resources and uses (e.g., sea otter and beluga whale populations; subsistence activities; commercial fishing of pacific salmon and halibut; and more) that currently exist within the Cook Inlet planning area. It also identified "robust mitigation measures" that would be considered before leasing is allowed.

Four years ago BOEM issued a request for information to determine the energy industry's interest in oil and gas exploration in the federal submerged lands of Cook Inlet. Areas for potential leasing were identified in November 2013 as part of BOEM's Lease Sale 244.

BOEM used scientific information and stakeholder feedback to determine which parts of the planning area would be carried forward for environmental analysis, focusing on those specific areas that had the most resource potential and industry interest, while reducing potential conflicts with environmental and subsistence considerations.

"Specifically, the area identified for the potential Cook Inlet lease sale is close to existing leases in Cook Inlet's state waters; avoids nearly all of the areas designated as critical habitat for the beluga whale and the northern sea otter; avoids the critical habitat for the Stellar sea lion and excludes much of the subsistence-use area for the Native villages of Nanwalek, Port Graham and Seldovia, as requested by the Native villages," BOEM noted.

The DEIS was completed following a public comment period and scoping meetings in communities around Cook Inlet.

The notice of availability of the DEIS, scheduled to be published in theFederal Register on Friday (July 22), analyzes a range of alternatives to be considered for leasing. A public comment period is scheduled through Sept. 6. The DEIS and directions to provide comments online are available at www.boem.gov/ak244/.

Public meetings are planned for Aug. 15 at the Dena'ina Center in Anchorage; Aug. 17 at the Alaska Maritime National Wildlife Refuge Islands and Ocean Visitor Center in Homer; and Aug. 18 at the Alaska National Guard Federal Armory in Kenai/Soldotna.

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