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State issues preliminary Beaufort BIF Comments on preliminary BIF for 2009-18 Beaufort Sea areawide lease sales accepted through June 1; final BIF planned for July Kristen Nelson Petroleum News
The Alaska Department of Natural Resources’ Division of Oil and Gas has issued a preliminary best interest finding for Beaufort Sea areawide lease sale 2009. Comments on the preliminary BIF are due by June 1.
DNR will hold public hearings on the proposed lease sale in April and May, with dates, times and locations to be announced later.
The division anticipates issuing the final best interest finding in July.
The first BIF for Beaufort Sea areawide oil and gas lease sales was issued in July 1999; supplements to the finding were issued in 2000, 2004 and 2008.
The BIF process begins with a request for agency information, which the division issued in April 2008.
Once a BIF is issued, it is good for 10 years; each year before holding a lease sale the state issues a request for significant new information and issues supplements to the finding if necessary.
NSB wants permanent deferrals In response to the request for agency information the North Slope Borough, among other recommendations, said that areas deferred from past sales should be permanently removed from consideration.
The division said it carefully considered the borough’s comments and plans to continue to defer from this proposed lease sale all tracts from Point Barrow to Tangent Point (tracts 555, 557-573) and from Barter Island to Pokok Bay (tracts 27-39). The tracts will not be offered for lease in the proposed 2009 areawide sale,
The division said ConocoPhillips Alaska expressed serious concerns about operational restrictions, strongly encouraged the division to resist delays in scheduled sales and recommended that there be no decrease in the current surface extent of sales.
The division said it has determined that the proposed Beaufort Sea lease sale has “moderate to high petroleum potential” based on a resource evaluation including geology, seismic data, exploration history and proximity to known hydrocarbon accumulations.
But while chances of finding undiscovered petroleum reservoirs are good, the division said “under current market conditions, the remaining undiscovered reservoirs are expected to be non-economic to marginally economic accumulations. In light of this, the petroleum potential of this basin for the discovery of new fields is moderate.”
The state has held 56 oil and gas lease sales involving North Slope and Beaufort Sea acreage since the first North Slope lease sale in 1964 and more than 11.5 million acres in 3,065 tracts have been leased.
Of the leased tracts, the division said 407 (about 13 percent) were drilled and only 292 tracts, about 10 percent of those leased, have been commercially developed.
About 81 percent of the state-leased acreage was onshore and about 19 percent was offshore.
The division said directional drilling is the method favored by the U.S. Army Corps of Engineers for bringing offshore oil and gas to shore. While marine terminals and tankers are used elsewhere, shallow waters in the lease sale area will likely preclude their use here, the division said.
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