02-1414. Outer Continental Shelf (OCS), Alaska Region, Norton Basin

AGENCY:

Minerals Management Service (MMS), Interior.

ACTION:

Call for Information and Nominations (Call).

SUMMARY:

The Secretary's preliminary decision to consider offering the Norton Basin planning area in the Proposed OCS Oil and Gas Leasing Program for 2002-2007 provides for an 18-month “special-interest” process beginning with 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. The MMS is issuing a Call at this time recognizing that the final decision on the 2002-2007 5-year program has not been made. Final delineation of the program areas and number of sales may change from that included in the proposed program.

DATES:

Nominations and comments on the Call must be received no later than April 22, 2002.

FOR FURTHER INFORMATION CONTACT:

Please call Tom Warren at [phone] 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 that is estimated to have over 1 trillion cubic feet of natural gas without investment of the considerable 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 a sale in Norton Basin that would offer only very small, very focused areas of specific interest for exploration. Norton Basin may contain quantities of natural gas, which might be used for western Alaska communities if economically feasible. We request comments from the general public on this special-interest leasing process, including the terms and conditions of a sale. The MMS will consider all comments and nominations in the decision on whether to proceed with leasing and on the terms and conditions of a lease sale proposal. A decision to offer an area for leasing will be conditioned on a commitment from industry to explore the area leased within a specific time period.

This Call does not indicate a preliminary decision to lease in the area described below. If there is no interest expressed, the MMS will defer the sale for one year and reissue the Call the following year. If the MMS decides to proceed with the sale process, the MMS will make the final delineation of the specific areas for possible leasing at a later date in the presale process and in compliance with the final 5-year program and with applicable laws including all requirements of the National Environmental Policy Act (NEPA) and the OCS Lands Act (OCSLA).

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 in accordance with the Proposed OCS Oil and Gas Leasing Program 2002 to 2007, issued October 26, 2001.

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 the scoping process to assist in preparation of the NEPA analysis for this proposal. This proposal is in keeping with section 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. Any 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 Norton Basin are sought from all interested parties. Comments are also being sought on the terms and conditions of a sale in Norton Basin. Industry and other interested parties are strongly encouraged to contact the MMS, Alaska OCS Region, Mr. Tom Warren at [phone], with questions or to discuss interest in the area. 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. Commenters are encouraged to submit comments and suggestions on the “special-interest” leasing process in general and on the potential for offering other frontier areas of the Alaska OCS, such as the Chukchi Sea and Hope Basin Planning Areas, using this process.

This Call is being issued in accordance with the Proposed OCS Oil and Gas Leasing Program 2002 to 2007 announced on October 26, 2001. The proposed program offers one sale in the Norton Basin during the 5-year program. If no interest is expressed in response to this first Call, the MMS will defer the sale for one year and reissue the Call the following year. This process will continue throughout the 5-year program until there is sufficient interest to hold a sale and the area nominated is deemed appropriate for leasing. Only one round of lease issuance in Norton Basin would occur during this 5-year program.

3. Description of Area

The area subject to this Call 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.

A page size map of the area accompanies this Notice. A large scale Call map showing the boundaries of the area on a block-by-block basis is available without charge from the Public Information Office at the address given below, or by telephone request at [phone] or 1-800-764-2627. Copies of Official Protraction Diagrams (OPDs) are also available for $2 each.

Alaska OCS Region, Minerals Management Service, 949 East 36th Avenue, Room 308, Anchorage, Alaska, 99508-4302

4. Instructions on Call

The Call for Information Map and indications of interest and/or comments must be submitted to the Regional Supervisor, Leasing and Environment, at the address stated under Item 3, Description of Area.

The Call map delineates the area that is the subject of this Call. Respondents are requested to indicate specific areas of interest in and comment on the Federal acreage within the boundaries of the Call area that they wish to have included in a proposed sale in 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, 949 East 36th Avenue, Room 308, Anchorage, Alaska 99508-4302.
• Finally, you may hand-deliver comments to the Alaska OCS Region, Minerals Management Service, 949 East 36th Avenue, Room 308, Anchorage, Alaska.

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 rulemaking 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 map 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 map. Although the identities of those submitting nominations become a matter of public record, the individual nominations are proprietary information.The telephone number and 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 and Conditions of Lease Issuance

Respondents are requested to comment on the terms and condition of lease issuance for any leases that may be issued as a result of a sale in Norton Basin. The following terms and conditions have been used in past sales and are being considered for this use in this sale:

—Lease term of 10 years

—Annual rental rate of $13 per hectare or fraction thereof

—Minimum cash bonus bid of $62 per hectare

—Royalty rate of 12.5 percent

In addition, the following are suggested additional terms and incentives:

—Submission of an exploration plan within 4 years of lease issuance

—Cancellation of lease for failure to submit exploration plan within 4 years

—Suspension of royalties on initial production

—Delayed payment of cash bonus bid

—Other incentives

—Mitigating measures

C. Relation to Coastal Management Plans

Comments also are sought on potential conflicts with approved local coastal management plans (CMP) 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 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 scoping process 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 this area. 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.

Information on the studies program, completed studies, and a program status report for continuing studies in this area may be obtained from the Chief, Environmental Studies Section, Alaska OCS Region, by telephone request at [phone], or by written request at the address stated under Item 3, Description of Area.

7. Tentative Schedule

The following is a list of tentative milestone dates applicable to a Norton Basin sale in 2003:

	Tentative process milestones for proposed 2003 Norton Basin sale
Call published/scoping initiated	January 2002.
Comments due on Call/scoping	April 2002.
Decision whether to proceed/Area Identification	May 2002.
NEPA analysis	February 2003.
Consistency Determination/Proposed Notice of Sale	April 2003.
Governor's Comments due	June 2003.
Final Notice of Sale published	August 2003.
Sale	September 2003.

Dated: January 3, 2002.

Lucy Querques Denett,

Acting Director, Minerals Management Service.