Overview

1

• Overview
• MMS Offshore Alaska Program
• Getting Back to the Resources
• AAPL OCS Workshop
• The Woodlands, Texas
• John Goll
• U.S. Minerals Management Service
• January 2004

2
Todays Topics

• Access
• Lease Sales
• Beaufort Sea
• Cook Inlet
• Economic Incentives
• North Aleutian Basin
• Permitting
• Info Sources

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Alaska OCS Potential(Risked, Undiscovered,
Conventionally Recoverable)Low to High Estimates

• Oil
  Gas
• 
  billions barrels TCF
• Alaska OCS Total 17 - 35 55 - 227
• Chukchi 9 - 25 14 - 154
• Beaufort 4 - 12 13 - 63
• Hope 0 - 0.3 0 - 11
• Norton 0 - 0.2
  0 - 9
• Cook Inlet 0.3 - 1.4 0.7 - 2.5
• (MMS 2000 National
  Assessment)

4
Access The OCS 5 Year Plan2002-2007-- Alaska

• Traditional Sales
• Beaufort Sea
• 2003, 2005, 2007
• Cook Inlet
• 2004, 2006
• Interest Based Sales
• (annual calls)
• Chukchi Sea/Hope Basin
• Up to 2 sales
• Norton Basin
• 1 sale

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Beaufort Sea Sale 186 September 2003
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Beaufort Sea Economic Incentives

• Royalty Suspension volumes/per lease
• Up to 30 or 45 Million barrels, (depending on
  Zone A or B)
• With price floor 18/barrel
• With price ceiling (28/barrel 1994 inflation
  adjusted)

• Royalty rate 12.5
• Primary Term 10 years
• Minimum bid 15/10
• Rental rate sliding
• 3 12.50/acre (Zone A)
• 1 8/acre (Zone B)

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(No Transcript)
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Beaufort Sea
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Beaufort Sea Planning Area Oil (billion
barrels) Gas (trillion cubic ft) CRR 3.6 - 6.9
- 11.8 12.9 32.1 63.3 ECR (18/bbl
2.11/mcf) 0.0 - 1.8 - 6.6 0.0 2.9
9.7 ECR (30/bbl 3.52/mcf) 1.0 - 3.2 - 7.8
0.6 4.2 - 10.7 Beaufort Sea models
assume that oil is transported through TAPS and
on to West Coast markets. Natural gas produced
with oil would be reinjected for enhanced oil
recovery until oil depletion and then produced
and transported by a future gas pipeline to
outside markets.

• Request for Information out now due 1/30
• Next Sale March 2005

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Alaska Permitting

• State//MMS MOU
• Recent Beaufort Sea permitting successes

http//www.dnr.state.ak.us/
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Working with the Communities

• North Slope Borough
• Tribes - Government-to-government
• AEWC
• Keep communities informed
• Visits
• Consultation on Projects
• Nuiqsut Paisanich  Nuiqsut Heritage  A
  Cultural Plan
• In this Place  A Guide for Those Who Would Work
  in the Country of the Kaktovikmuit.

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Cook Inlet Sale 191

• November 2003
• Letter to Governor
• FEIS
• Coastal Zone Consistency Determination
• PNOS
• Defer 2 areas
• April 2004
• Final Notice of Sale
• May 19, 2004
• The Sale

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Cook Inlet Sale 191 Proposed Economic Incentives

• Royalty
• 12.5 fixed
• Royalty Suspension Volume
• 30 Million BBls Oil Equivalent (includes natural
  gas)
• with floor ceiling
• Minimum Bid
• 10/acre (was 25)
• Rental Rate
• 2/acre (was 5)
• Initial Lease Term
• 8 years (was 5 yrs)

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Cook Inlet
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Cook Inlet Planning Area Oil (billion
barrels) Gas (trillions cubic ft) CRR 0.3 -
0.8 - 1.4 0.7 1.4 2.5 ECR (18/bbl
2.11/mcf) 0.1 - 0.4 - 1.0 0.1 0.6 1.3 ECR
(30/bbl 3.52/mcf) 0.2 - 0.6 - 1.2 0.5 1.0
1.7 Cook Inlet models assume oil and gas
production is sent to local refineries and
markets in Alaska.
Sale 191 May 19, 2004 2nd Sale May
2006
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The 5 Year Plan Chukchi Sea/ Hope Basin
Norton Basin
Chukchi

• Keeping Options Open
• Local Use (?)
• Interest approach
• Chukchi/Hope
• 2 sales
• Local use?
• Call 2 early 2004
• Norton Basin
• gas for locals?
• Call 3 early 2004

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Chukchi Sea Planning Area Oil (billion
barrels) Gas (trillions cubic feet) CRR 8.6 -
15.5 - 25.0 13.6 60.1 154.3 ECR (18/bbl
2.11/mcf) 0.0 - 1.0 - 7.2 not
available ECR (30/bbl 3.52/mcf) 1.4 - 6.1
- 11.0 not available Chukchi Sea models
assume that oil is transported through TAPS and
on to West Coast markets. Natural gas was not
assessed owing to lack of gas transportation
system and availability of known gas reserves
close to current facilities at Prudhoe Bay.
18
Hope Basin Planning Area Oil (billion
barrels) Gas (trillions cubic ft) CRR 0.0 -
0.1 - 0.3 0.0 3.4 11.1 ECR (18/bbl
2.11/mcf) 0.0 - lt0.1 - 0.1 0.0 0.6
4.9 ECR (30/bbl 3.52/mcf) 0.0 - lt0.1 -
0.2 0.0 1.5 6.0 Hope Basin models assume
a local market exists for natural gas.
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Norton Basin Planning Area Oil (billion
barrels) Gas (trillions cubic ft) CRR 0.0 -
lt0.1 - 0.2 0.0 2.7 8.7 ECR (18/bbl
2.11/mcf) 0.0 - lt0.1 0.1 0.0 1.0 5.0 ECR
(30/bbl 3.52/mcf) 0.0 - lt0.1 0.1 0.0 1.6
6.4 Norton Basin models assume local
consumption of gas and gas-products.
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North Aleutian Basin

• Moratoria
• Presidential
• Congressional
• Gas Prone
• 7 TCF Mean
• 17 TCF (5)
• Oil
• 230 MMB Mean
• 570 MMB (5)

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Lift Moratoria?

• Before Consideration
• Congress
• Lift appropriations ban
• State
• Request from Governor
• Support in the Communities

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MMS Geological Information
http//www.mms.gov/alaska/ref/akref.htm

• Geological Reports
• Beaufort Sea
• Chukchi Sea
• Norton Basin
• Gulf of Alaska

• Summary packages
• Beaufort Sea
• Chukchi
• Cook Inlet
• Norton Basin

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MMS Research
Walrus haulout

• Technology and Assessment Program
• engineering and oil spill response
• Environmental Studies Program

• University of Alaska
• CMI
• Marine Minerals Technology Center

Monitoring
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DOI/State/UAA

• Whatever Information you need on resources
• Moving to UAA Library this summer

http//www.arlis.org
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Upcoming MMS OCS Saleswww.mms.gov/alaska/907-271
-6010

• Cook Inlet 191
• May 19, 2004
• Beaufort Sea 195
• March 2005

Alaska DNR www.dnr.state.ak.us/ BLM Alaska
www.ak.blm.gov/
MMS