Due to the amount of Federal and State oil and gas activity in the Arctic subregion and the need for comprehensive planning, State and local officials requested coverage of all oil and gas activity in the area.

The first lease sale of offshore lands in the Beaufort Sea was held by the State of Alaska in 1969. The leasing process for oil and gas exploration on the Beaufort Sea Outer Continental Shelf (OCS) began in April 1976 with the first Federal lease sale in the subregion (Joint Federal/State Beaufort Sea Lease Sale) held in 1979. This sale was held jointly by the Department of the Interior and the State of Alaska because of conflicting jurisdictional claims to certain tracts in the sale area. The jurisdictional dispute will be resolved by the U.S. Supreme Court, but a decision is not expected for several years. The joint sale was held on December 11, 1979. However, bids on the Federal tracts were not accepted until July 1980 because of litigation. Of the 117 tracts offered, 86 were leased as a result of the sale. Of these 86 tracts, 24 are federally managed and 62 are State-managed.

Two exploration plans have been submitted for the federally managed joint lease sale (Sale BF) area. Both plans call for building a gravel island and exploratory drilling of several tracts, but no drilling permits have yet been filed. Three exploratory wells have been drilled on or into State-managed tracts. These include one well drilled directionally into Tract 75, one into Tract 76, and one well drilled from Challenge Island, a natural barrier island. Additional exploratory wells are planned for the 1981-82 drilling season on State-managed tracts.

The next OCS sale in the Beaufort Sea, Lease Sale 71, is proposed for September 1982. The first two sales in the National Petroleum Reserve in Alaska are being planned for December 1981 and the late spring or early summer of 1982 and will involve a total of 2 million acres (809,200 hectares). In anticipation of future leasing, plans for geophysical surveys in the Arctic National Wildlife Refuge are also being formulated.

Four State lease sales have been held in the Arctic, in addition to the Joint Federal/State Lease Sale. These onshore sales have resulted in the leasing of lands on which a number of commercial discoveries have been made, including the discovery of the largest hydrocarbon accumulation in North America at Prudhoe Bay. Exploration, development, and production are continuing on these State lands. The State of Alaska has plans for three future lease sales in the Arctic to be held in the spring of 1982 and 1983 and the fall of 1984. Leasing and exploration are also under way on Arctic Slope Regional Corporation lands.

Transportation systems in the Arctic have been developed to accommodate production on State lands. Some of the production from OCS tracts, as well as other Arctic lands, may be handled by the existing Trans-Alaska Pipeline System. However, a number of additional transportation strategies are being considered, including the Alaska Natural Gas Transportation System, additional oil pipelines, and tanker transport. The pace of oil and gas production in the Arctic will depend in part on the number and type of transportation modes available.

The support bases at Prudhoe Bay are expected to be used to some extent for future activities on the OCS. However, expanded and new facilities will also be required, depending on the location of discoveries on the OCS and on other Arctic lands. The impacts resulting from OCS activities in the Arctic will be particularly important because of their contribution to the regionwide and cumulative impacts arising from Federal onshore, State, and regional corporation oil and gas exploration, development, and production in the Arctic.