June 19, 2014 PROPOSED ALASKA PENINSULA AREAWIDE OIL AND GAS LEASE SALES Preliminary Written Finding of the Director Recommended citation: ADNR (Alaska Department of Natural Resources). 2014. Proposed Alaska Peninsula areawide oil and gas lease sales. Preliminary written finding of the director. June 19, 2014. Questions or comments about this preliminary 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 Phone 907-269-8800 The Alaska Department of Natural Resources (ADNR) 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: ADNR 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: ADNR, 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: Lori Yares Anne Weaver Cari Ruffino Saree Timmons Julie Houle Susan G. Browne Kathleen King Paul Decker Marta Mueller Dave Norton Andrew deValpine Kathie Livesley Rosie Nethercott Joseph Rolfzen This publication was produced by the Department of Natural Resources, Division of Oil and Gas. The purpose of the publication is to meet the mandate of AS 38.05.035(e). Printed in Anchorage, Alaska. PROPOSED ALASKA PENINSULA AREAWIDE OIL AND GAS LEASE SALES Preliminary Written Finding of the Director Prepared by: Alaska Department of Natural Resources Division of Oil and Gas June 19, 2014 List of Abbreviations Agencies Other ADCRA Alaska Division of Community and 2-D 2-Dimensional Regional Affairs ADEED Alaska Department of Education and 3-D 3-Dimensional Early Development ADF&G Alaska Department of Fish and Game AAC Alaska Administrative Code ADGGS Alaska Division of Geological & ACIAC Alaska Climate Impact Geophysical Surveys Assessment Commission AOGCC Alaska Oil and Gas Conservation ACRC Alaska Climate Research Commission Center BLM Bureau of Land Management ANCSA Alaska Native Claims Settlement Act BOEMRE Bureau of Ocean Energy Management, ARRT Alaska Regional Response Regulation and Enforcement Team CF Alaska Department of Fish & Game, AS Alaska Statute Division of Commercial Fisheries COE U.S. Army Corp of Engineers AVO Alaska Volcano Observatory DCCED Alaska Department of Commerce, C-plan Oil Discharge Prevention and Community, and Economic Development Contingency Plan DEC Department of Environmental DRR Dismantlement, Removal, and Conservation Remediation DMLW Division of Mining, Land and Water ERD Extended Reach Drilling DNR Department of Natural Resources FOSC Federal On-Scene Coordinator DO&G Division of Oil and Gas FLIR Forward-Looking InfraRed DOLWD Department of Labor and Workforce FY Fiscal Year Development DOT&PF Department of Transportation and Public GMU Game Management Unit Facilities EPA Environmental Protection Agency ICS Incident Command System GAO U.S. Government Accountability Office ILI In-Line inspection Habitat Alaska Department of Fish & Game, IR Infrared Division of Habitat MMS Minerals Management Service LNG Liquefied Natural Gas NMFS National Marine Fisheries Service LOSC Local On-Scene Coordinator NOAA National Oceanic and Atmospheric MWD Measurements While Drilling Administration NPDES National Pollutant Discharge Elimination MCH Mulchatna System NPS National Park Service NAP Northern Alaska Peninsula NRHP National Register of Historic Places NGL Natural Gas Liquid OHA Office of History and Archaeology NGO Non-Government Organization PHMSA Pipeline and Hazardous Materials Safety OCS Outer Continental Shelf Administration PSIO Petroleum Systems Integrity Office PERP Prevention and Emergency Response Program SF Alaska Department of Fish & Game, RRO Risk Reduction Options Division of Sport Fish SPCO State Pipeline Coordinator’s Office SAP Southern Alaska Peninsula USCB U.S. Census Bureau SOSC State On-Scene Coordinator USFWS U.S. Fish and Wildlife Service SWAMC Southwest Alaska Municipal Conference USGS United States Geological Survey UIC Underground Injection Control Measurements in inches ft. feet mi miles sq. mi square mile mm millimeters m meters km kilometers lb. pounds gal gallons bbl. barrel(s) (42 gallons) % percent o degrees F Fahrenheit C Celsius MMSTB Million Stock Tank Barrels BCF Billion Cubic Feet Table of Contents Table of Contents Page Executive Summary ............................................................................................................................... i A. Director’s Preliminary Decision ................................................................................................... i B. Public Process ............................................................................................................................... i C. Description of Proposed Lease Disposal Area .............................................................................. i D. Habitat, Fish, and Wildlife ............................................................................................................ i E. Current and Projected Uses .......................................................................................................... ii F. Oil and Gas in the Lease Sale Area .............................................................................................. ii G. Governmental Powers to Regulate Oil and Gas .......................................................................... ii H. Reasonably Foreseeable Effects of Leasing ............................................................................... iii I. Mitigation Measures ..................................................................................................................... iii Chapter One: Director’s Preliminary Finding and Decision .............................................................. 1-1 A. Director’s Preliminary Written Finding .................................................................................... 1-1 B. Disposal Phase Decision ........................................................................................................... 1-3 C. Exploration Phase Decision ....................................................................................................... 1-4 Chapter Two: Introduction ................................................................................................................. 2-1 A. Written Findings ....................................................................................................................... 2-1 1. Matters Considered and Discussed ........................................................................................ 2-2 2. Scope of Administrative Review ........................................................................................... 2-2 3. Phased Review ....................................................................................................................... 2-3 4. Process ................................................................................................................................... 2-4 a. Request for Agency Information and Preliminary Finding ............................................... 2-4 b. Request for Public Comments ........................................................................................... 2-4 c. Final Finding ..................................................................................................................... 2-4 d. Requests for Reconsideration and Appeals ....................................................................... 2-4 B. Annual Lease Sales ................................................................................................................... 2-5 1. Calls for New Information ..................................................................................................... 2-5 2. Bidding Method and Lease Terms ......................................................................................... 2-5 3. Lease Adjudication and Lease Award………………………………………………………2-5 Chapter Three: Description of the Alaska Peninsula Sale Area ......................................................... 3-1 A. Property Description ................................................................................................................. 3-1 1. Land and Mineral Ownership ................................................................................................ 3-3 B. Boroughs and Communities ...................................................................................................... 3-3 1. Aleutians East Borough ......................................................................................................... 3-3 a. Population.........................................................................................................................