NEWS BULLETIN

February 05, 2001 --- Vol. 7, No. 17February 2001

Shallow gas leasing program reprioritized, not suspended

Alaska Department of Natural Resources Commissioner Pat Pourchot said Feb. 2 that, contrary to a report in PNA's Jan. 29 News Bulletin, the state's shallow gas leasing program has not been suspended.

The commissioner said that he has authorized the Division of Oil and Gas to "reprioritize its workload with respect to issuing oil and gas leases. This reprioritization of title and adjudication work will have the effect of slowing down the process of issuing shallow gas leases" but will accelerate the issuance of leases for Cook Inlet, North Slope and Beaufort Sea areawide competitive oil and gas lease sales held last year, Pourchot said in a Feb. 2 letter to Sen. John Torgerson.

Pourchot noted that the income the state will receive from the balance of bonus bids and first year's rental for leases from the three competitive sales "is approximately 15 times greater than that it will receive from the shallow gas leases."

Both programs, he said, use the same seven employees for processing applications, adjudicating leases and doing the required title work.

"Part of the problem," he said, "was created when the shallow gas legislation authorized no additional funding for that program's implementation."

The commissioner also said that the time it takes to do the required title work and adjudication varies from area to area of the state, "depending on the complexity of land ownership. Most of the shallow gas leases are in the most complex areas. Therefore, it takes more staff time and effort to issue a typical shallow gas lease than a North Slope or Beaufort Sea conventional lease."


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