Interior Finalizes Plan to Make All Highest-Resource Areas in U.S. Offshore Available for Oil & Gas Leasing
Next Five-Year Strategy Includes Frontier Areas in the Alaska Arctic
As part of the Obama administration’s all-of-the-above energy strategy to expand safe and responsible domestic energy production, Secretary of the Interior Ken Salazar and Bureau of Ocean Energy Management (BOEM) Director Tommy Beaudreau announced the release of a proposed final offshore oil and gas leasing program for 2012-2017 that makes all areas with the highest-known resource potential – including frontier areas in the Alaska Arctic – available for oil and gas leasing in order to further reduce America’s dependence on foreign oil.
Consistent with the President’s direction, the Obama administration’s Proposed Final U.S. Outer Continental Shelf Oil and Gas Leasing Program makes available areas focused on the most likely recoverable oil and gas resources that the U.S. Outer Continental Shelf is estimated to hold. It schedules 15 potential lease sales for the five-year period, including 12 in the Gulf of Mexico and three off the coast of Alaska.
“Put simply, this program opens the vast majority of known offshore oil and gas resources for development over the next five years and includes a cautious but forward-looking leasing strategy for the Alaska Arctic,” said Secretary Salazar. “President Obama has made clear his commitment to expanding responsible domestic oil and gas production in America as part of this all-of-the-above energy strategy, and with comprehensive safety standards in place, this plan will help us to continue to grow America’s energy economy and further reduce our dependence on foreign oil, while protecting marine, costal and human health.”
The announcement builds on a series of actions taken by the Obama administration to meet President Obama’s directive to continue to expand safe and responsible production of America’s important domestic resources. Successful offshore lease sales held by the Department of the Interior in the Western and Central Gulf of Mexico in recent months have made available approximately 60 million acres of resource-rich areas for industry leasing that will bring additional domestic resources to market.
The Proposed Final Program is designed to account for the distinct needs of the regions across the OCS, and considers a range of factors, including current and developing information about resource potential, the status of resource development and emergency response infrastructure, recognition of regional interest and concerns, and the need for a balanced approach to the use of the Nation’s shared natural resources.
“Offshore oil and gas leasing should not be ‘one size fits all,’” said Director Beaudreau. “For example, the area-wide leasing model that works for the Gulf of Mexico, where there is a long and consistent history of offshore exploration and development, is not suited to the Arctic. Within the Arctic, where significant resource potential exists, there are also substantial environmental challenges, and social and ecological concerns that warrant a different and more targeted approach that will focus leasing to offer the greatest resource potential while minimizing possible conflicts with environmentally sensitive areas and the native Alaskan communities that rely on the ocean for subsistence use.”
The 15 scheduled potential lease sales contained in the plan will occur in six planning areas – the Western and Central Gulf of Mexico, the portion of the Eastern Gulf Of Mexico not currently under Congressional moratorium, and the Chukchi Sea, Beaufort Sea and Cook Inlet Planning Areas offshore Alaska.
In the Central and Western Gulf of Mexico Planning Areas, which have the most abundant proven and estimated oil and gas resources as well as broad industry interest and mature infrastructure, the Proposed Final Program includes annual area-wide sales of all available, unleased acreage, as has been the typical practice in the Central and Western Gulf of Mexico. Additionally, within the portion of the Eastern Gulf of Mexico Planning Area made available for leasing under the Gulf of Mexico Energy Security Act, there are two scheduled sales there.
For offshore Alaska, the Proposed Final Program schedules three potential sales – one each in the Chukchi Sea and Beaufort Sea Planning Areas that span the Alaska Arctic, and one in the Cook Inlet Planning Area off of south-central Alaska.
“We are committed to moving forward with leasing offshore Alaska, and scheduling those sales later in the program allows for further development of scientific information on the oil and gas resource potential in these areas and further study of potential impacts to the environment,” said Deputy Secretary of the Interior David J. Hayes. “We must reconcile energy resource development with the sensitive habitats, unique conditions and important other uses, including subsistence hunting and fishing, that are present in Alaska waters.”
The Proposed Final Program re-affirms existing protections for Arctic coastal areas by continuing to exclude certain areas from leasing, including a 25-mile buffer area near the coast of the Chukchi, as well as two subsistence whaling areas in the Beaufort near Barrow and Kaktovik, Alaska. The program also identifies an additional exclusion area in the Chukchi, near Barrow, that will not be made available for leasing because of input received from Native Alaskan communities and because the area is known to be of particular importance for subsistence hunting and fishing. With respect to all other areas in the Arctic that are open to oil and gas exploration and development in the Proposed Final Program, BOEM will identify targeted areas to offer in the lease sales based on information the agency will gather about industry interest, resource potential, subsistence hunting and fishing, wildlife, and environmental sensitivities.
“We are taking a cautious approach to leasing in the Arctic that accounts for the Arctic’s unique environmental resources and the social, cultural and subsistence needs of Native Alaskan communities, and draws from the best available science as well as any new information that we may learn from activity on current leases,” added Secretary Salazar. “When it comes to domestic production, the President has made clear he is committed to producing more oil and natural gas safely and responsibly. The numbers speak for themselves: every year the President has been in office, domestic oil and gas production is up, imports of foreign oil are down, and currently the nation is producing more oil than any time in the last eight years.”
As is mandated by the OCS Lands Act, the Proposed Final Program has been submitted to Congress. The Secretary may implement the Program in 60 days, however no further action is needed prior to its implementation, and BOEM is on track to hold the first sale under the new program later this year. Earlier this month, BOEM held a lease sale for nearly 39 million acres in the Central Gulf of Mexico, which attracted more than $1.7 billion in high bids for more than 2.4 million acres. That follows on a Western Gulf of Mexico lease sale held in December 2011, in which 21 million acres were offered for lease.
To increase transparency and improve public dialogue as the Five Year Program is implemented, BOEM has developed several new tools, including an alternative and mitigation tracking table and regionally-tailored interactive maps that can be viewed on the Five Year Program website.
Source: U.S. Department of the Interior