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Cook Inlet Areawide Oil and Gas Lease Sale November 2, 2018 COOK INLET AREAWIDE OIL AND GAS LEASE SALE Final Finding of the Director Recommended citation: DNR (Alaska Department of Natural Resources). 2018. Cook Inlet areawide oil and gas lease sale: Written Finding of the Director. November 2, 2018. Questions or comments about this final finding should be directed to: Alaska Department of Natural Resources Division of Oil and Gas 550 W. 7th Ave., Suite 1100 Anchorage, AK 99501-3560 907-269-8800 The Alaska Department of Natural Resources (DNR) administers all programs and activities free from discrimination based on race, color, national origin, age, sex, religion, marital status, pregnancy, parenthood, or disability. The department administers all programs and activities in compliance with Title VI of the Civil Rights Act of 1964, Section 504 of the Rehabilitation Act of 1973, Title II of the Americans with Disabilities Act (ADA) of 1990, the Age Discrimination Act of 1975, and Title IX of the Education Amendments of 1972. If you believe you have been discriminated against in any program, activity, or facility, please write to: Alaska Department of Natural Resources ADA Coordinator P.O. Box 111000 Juneau, AK 99811-1000 The department’s ADA Coordinator can be reached via phone at the following numbers: (VOICE) 907-465-2400 (Statewide Telecommunication Device for the Deaf) 1-800-770-8973, or (FAX) 907-465-3886 For information on alternative formats and questions on this publication, please contact: Alaska Department of Natural Resources, Division of Oil and Gas 550 W. 7th Ave., Suite 1100 Anchorage, AK 99501-3560 Phone 907-269-8800 Division of Oil and Gas Contributors: Kirk Morgan Lynn Noel Bryan Taylor Michael Redlinger Jonathan Schick Kyle Smith COOK INLET AREAWIDE OIL AND GAS LEASE SALE FINAL FINDING OF THE DIRECTOR Prepared by: Alaska Department of Natural Resources Division of Oil and Gas November 2, 2018 Executive Summary Contents Page A. Director’s Final Decision ........................................................................................................ i B. Public Process .......................................................................................................................... i C. Description of Lease Disposal Area ........................................................................................ i D. Habitat, Fish, and Wildlife ..................................................................................................... ii E. Current and Projected Uses ..................................................................................................... ii F. Petroleum Potential and Likely Methods of Oil and Gas Transportation in the Sale Area ... iii G. Governmental Powers to Regulate Oil and Gas .................................................................... iv H. Reasonably Foreseeable Effects of Disposal and Oil and Gas Activities ............................. iv I. Mitigation Measures ................................................................................................................ v COOK INLET AREAWIDE OIL AND GAS LEASE SALE | Final Finding of the Director Executive Summary The director of the Division of Oil and Gas (DOG), with consent of the State of Alaska Department of Natural Resources (DNR) commissioner, determines whether issuing oil and gas leases serves the state’s best interests (AS 38.05.035(e)). This document presents the director’s final written finding for the disposal of interest in state oil and gas through lease sales in the Cook Inlet Areawide lease sale area (Sale Area). All relevant facts and issues within the scope of review that were known or made known to the director were reviewed. The director limited the scope of the final finding to the disposal phase of oil and gas activities and the reasonably foreseeable significant effects of issuing oil and gas leases (AS 38.05.035(e)(1)(A)). Conditions for phasing have been met under AS 38.05.035(e)(1)(C). The content of best interest findings is specified in AS 38.05.035(e), and topics that must be considered and discussed are found in AS 38.05.035(g). A. Director’s Final Decision After weighing the facts and issues known at this time, considering applicable laws and regulations, and balancing the potential positive and negative effects given the mitigation measures and other regulatory protections in place, the director finds the potential benefits of lease sales outweigh the possible negative effects, and the director finds that Cook Inlet Areawide oil and gas lease sales are in the best interests of the State of Alaska. B. Public Process The process of developing a best interest finding includes opportunities for input from a broad range of participants, including: the public; state, federal and local government agencies; Alaska Native organizations; resource user groups; non-government organizations (NGOs); and any other interested parties. More information on public comments is found in Chapter Two. A summary of the comments received and responses to those comments are included in Appendix A of this Final Finding. C. Description of Lease Disposal Area The Sale Area totals about 3.9 million acres that includes about 2.2 million acres of uplands located in the Matanuska and Susitna River valleys generally south and west of Houston and Wasilla, the Anchorage Bowl, the western and southern Kenai Peninsula from Point Possession to Anchor Point, and the western shore of Cook Inlet from the Beluga River to Harriet Point. The Sale Area also includes about 1.7 million acres of tide and submerged lands in upper Cook Inlet from Knik Arm and Turnagain Arm south to Anchor Point and Tuxedni Bay. The Sale Area falls within the Matanuska-Susitna Borough, the Municipality of Anchorage, and the Kenai Peninsula Borough. The area includes about 30 cities, towns, villages and communities, ranging population from a few hundred to almost 300,000. There are 815 tracts ranging in size from 640 to 5,760 acres in the Sale Area where the State owns the majority of surface and subsurface land. The State of Alaska is the predominant landowner in the Sale Area. The Matanuska-Susitna Borough, Kenai Peninsula Borough, Municipality of Anchorage, City of Houston, City of Kenai, and City of Soldotna own land within the Sale Area as a result of the state’s municipal entitlement program. Other institutional landowners include Mental Health Trust and the University of Alaska. Private land holdings include subdivisions, homesites, Native allotments and corporations, and homesteads. Descriptions of historic and cultural resources, COOK INLET AREAWIDE OIL AND GAS LEASE SALE | Final Finding of the Director i Executive Summary fresh and marine waters, climate, geologic hazards, and other natural hazards in the Sale Area are also found in Chapter Three. D. Habitat, Fish, and Wildlife The Sale Area is within the Cook Inlet Basin ecoregion, an area bounded by the Alaska Range to the north, the Aleutian Range to the west; and the Talkeetna, Chugach, and Kenai Mountains to the east. Key habitats of the Cook Inlet ecoregion include terrestrial, freshwater, and marine habitats that support fish and wildlife populations. The Sale Area includes all or portions of 20 legislatively- designated special areas, and is adjacent to or near others. About 1 million acres are included in these legislatively-designated areas, many of which have legislatively-defined restrictions. The Cook Inlet area is home to a wide diversity of fish and wildlife representing a broad spectrum of life histories and habitat requirements. Freshwater and anadromous fishes are found in the area’s waters with all five species of Pacific salmon occurring in Cook Inlet waters. Many of the freshwaters of Southcentral Alaska provide important spawning, rearing, or migration habitats for anadromous fishes such as salmon, trout, char, and whitefish. Marine forage fish, ground fish, and shellfish are prominent fisheries resources within the Sale Area. Numerous species of terrestrial mammals inhabit the Cook Inlet area. Big game mammals include moose, caribou, black bear, brown bear, Dall sheep, and mountain goat. Other terrestrial mammals include furbearers, such as wolves, lynx, marten, otters, beaver, mink, wolverines, and small game. Marine mammals include Cook Inlet beluga, fin, and humpback whales; harbor porpoise and seals, northern sea otters, and Steller sea lions. Over 450 species of birds are found in Alaska, most of which can be found living in the Cook Inlet area year-round, migrating through, or breeding in the area. These include waterfowl, seabirds and shorebirds, and land and water birds that find important habitat areas within Cook Inlet. Some species listed as threatened or endangered under the federal Endangered Species Act include the Cook Inlet beluga whales, the southwest distinct population segment of northern sea otters, the western distinct population segment of Steller sea lions, fin whales, the Western North Pacific distinct population segment and Mexico distinct segment of humpback whales and the Alaska breeding population of Steller’s eiders. E. Current and Projected Uses Several state and federal wildlife refuges, critical habitat areas, recreation areas, and parks exist within or near the Sale Area. These areas have significant scenic and recreational value, provide important habitat for fish and wildlife populations, and are used extensively by recreationists, fishers, and hunters. All five species of Pacific salmon are harvested commercially in Cook Inlet which is the most
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