Goll: Some tracts likely to be removed

Posted: Friday, January 24, 2003

Based on what's been heard so far, certain tracts near the mouth of Kachemak Bay and down around the Barren Islands eventually could be removed from proposed federal Lease Sale 191 scheduled for 2004, according to the regional director of the U.S. Minerals Management Service.

"We are looking at a couple of areas to take out in this area," said John Goll, who was in Homer on Thursday for a public hearing on the proposed lease sale, as well as on Lease Sale 199, which covers the same area and is scheduled for 2006. He said tracts just outside Kachemak Bay and extending south around the western side of the Barren Islands could be cut from the sale.

"And those were driven by what we heard in these communities, and even in this community (Homer), for example with regard to view shed," he said.

Many Homer-area residents look directly out the mouth of the bay from their homes -- exactly where a platform might be built. Goll acknowledged that many people don't want to look at a large industrial structure in an otherwise pristine panorama.

On the other hand, Goll noted the platforms of upper Cook Inlet, while visible in good weather conditions, hardly dominate the view from the east side of the inlet.

The decision to remove tracts from the sale will be made about a year from now, either by Interior Secretary Gale Norton or her designee, Goll said.

Essentially the same region was under consideration for bids as Lease Sale149 in the mid-1990s. Large tracts were removed prior to that sale in part because of public concern about the danger to the environment.

Eventually, 427,889 acres were offered. Bidding resulted in two leases totaling 9,766 acres, Goll said.

Many residents asked then, and continue to ask today, why the lower Cook Inlet and Shelikof Strait region can't simply be removed from consideration permanently, or at least long-term, so it doesn't keep coming up for lease sales every five years.

For MMS officials, it isn't as simple as removing it from some list. They are bound by the Outer Continental Shelf Lands Act to periodically consider the areas for lease sales, Goll said. Short of a federal law designating the area as some sort of protected zone, it will continue to come under consideration for lease sale offerings on a cyclical basis, especially when industry is showing an interest, he said.

Portions of Cook Inlet-Shelikof Strait planning already are excluded from the proposed sale, he said. Environmental considerations and the lack of existing infrastructure led to a decision to drop tracts in Shelikof Strait. The current proposed lease-sale area stretches from south of Kalgin Island to the northern tip of Shuyak Island.

It was industry interest, especially in natural gas, that led planners to key in on areas of lower Cook Inlet. Oil likely would be developed if commercial quantities are found, but it is the potential for natural gas that is driving industry interest in the lower inlet now, Goll said.

If gas and oil are discovered, those products are likely to be used right here in Alaska, Goll said. He doubted any product would end up overseas, largely because there is a growing demand for gas in Southcentral Alaska, especially on the Kenai Peninsula. Meanwhile, it takes tankers bringing oil to the inlet to satisfy the oil demand.

Goll said if gas were discovered, a pipeline likely would be built to ship it to the central peninsula. That could be an incentive to complete the Nikiski-to-Kachemak Bay gas pipeline.

A pipeline would be needed if commercially recoverable amounts of oil were found, as well, he said.

It is oil that has many residents concerned. Time has not dulled the memory of the Exxon Valdez disaster. But Goll suggested that if oil were found, developed and sent north by pipeline, the number of tankers coming to the inlet might be reduced--- perhaps equating to a net decrease in the overall danger of a spill.

An environmental impact statement attached to Lease Sale 149 made two analyses of the potential hazard of oil development. The worst-case scenario suggested there was a three-in-four chance that a spill greater than 1,000 barrels would occur during the active life of the field. The lower-case scenario put that at about a one-in-four chance.

In Lease Sale 191, however, the hazard is put roughly at one-in-five. Goll said the latest environmental impact statement takes a more realistic look at the hazard.

For one thing, he said, one platform may be all that is needed, depending on what is found and where.

Although it will be years before whatever is eventually found is brought to market, he said, it is still important to explore now.

"If you don't plan ahead, you're not going to have it available in 10 or 20 years," he said. "Hopefully, in that time frame we'll have more alternative energy, but there will still be a need for natural gas."

Goll said MMS is merely offering an option.

"Whether people will come to the sale or not, if we have the sale, we'll have to see. If we don't do it, then people won't have that potential supply if people need it."

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