Skip Navigation Minerals Management Service Minerals Management Service MMS Home pagesSearchMMS Topic IndexAbout MMSWhat’s New
Offshore Energy and Minerals Management
Alaska OCS RegionAtlantic OCS AreaGulf of Mexico OCS RegionPacific OCS Region		 United States Department of the Interior

Alternative Energy Home Page
5-Year OCS Leasing Program
Moratoria
Past 5-Year Programs
Coastal Impact Assistance Program
Public Comment System
Offshore Energy Home Page
spacer
Link to Director's Page
Link to Strategic Planning
Minerals Revenue Management
Link to Offshore Minerals Management Home Page
Newsroom
Congressional Affairs
Link to Advisory Committees
Link to Minerals Management Service Library
Freedom of Information Act (FOIA)
Link to Kids' Page
Link to Privacy Act/Disclaimers
Links to Related Organizations
MMS Products & Services
Navigation Tips
Job Opportunities
Contact Us
spacer

Content:
   Terry Scholten

Pagemasters:
   OEMM Web Team

spacer
FirstGov
spacer

 
 5-Year OCS Leasing Program

What is the 5-year program?
 
The 5-year program is the basis for the leasing program. It identifies the areas to be offered for leasing during a 5-year period. It establishes the schedule for individual lease sales. No area will be offered for sale that is not included in the 5-year program. During the course of developing the 5-year program, all affected States and applicable Federal agencies will be consulted; comments from interested parties and the general public will be solicited. Section 18 (133 KB PDF file) of the OCS Lands Act (273 KB PDF file) requires the Secretary to develop a 5-year program and prescribes the major steps in the process (24 KB PDF file). Once the program is developed, it is presented to and approved by Congress prior to implementation.

bullet What are the steps (24 KB PDF file) in the 5-year leasing process required by section 18? (133 KB PDF file)
Throughout the 2-3 year process (16 KB PDF file) of developing the 5-Year Program, we consult with our constituents, ensuring that the program takes into account the concerns of all parties. The section 18 process includes solicitation of comments; development of a draft proposed program, development of a proposed program, development of a proposed final program, and Secretarial approval. In addition, MMS is requesting comments on an accompanying Environmental Impact Statement (EIS) to the 5-Year Program.
 
bullet What type of environmental review occurs during the 5-year leasing program development process?
The five-year leasing program is subject to analysis under the National Environmental Policy Act of 1969 (NEPA). Comprehensive analyses of the environmental and socioeconomic impacts are required by NEPA. The MMS will use the highest level of review and documentation under NEPA, the Environmental Impact Statement (EIS), to evaluate the five-year leasing program. It will identify any adverse environmental effects that cannot be avoided or mitigated, alternatives to the proposed action, the relationship between short-term resources and long-term productivity, and irreversible and irretrievable commitments of resources. This process also incorporates opportunities at several steps in the process for public and stakeholder review and comment. EISs for the past two five-year leasing programs can be ordered through MMS' Information Center. For further information on NEPA, please visit the President's Council on Environmental Quality website.
 
bullet How many planning areas are there for offshore minerals exploration and development in the OCS?
MMS has created 26 planning areas. (2.0 MB PDF file)
  
bullet Which planning areas are considered to be under moratoria/executive withdrawal from leasing?
On January 9, 2007, President George W. Bush modified the 1998 OCS leasing withdrawal in order to allow leasing in two areas -- the North Aleutian Basin planning area offshore Alaska, and the 181 South Area of the Gulf of Mexico. These actions were in response to the requests from Alaska state officials and local communities and enactment of the Gulf of Mexico Energy Security Act (GOMESAct) of 2006 (51 KB PDF file)respectively.

The Gulf of Mexico Energy Security Act of 2006 mandated a sale in the original Sale 181 area -west of the military mission line, and 125 miles from Florida in the Eastern Gulf of Mexico and 100 miles in the Central Gulf of Mexico. This mandated sale, Sale 224 is scheduled for March 2008. The act also established moratoria to 2022 in rest of the Eastern Gulf of Mexico and in a near shore portion of Central Gulf of Mexico within 100 miles of Florida.

The following planning areas are still subject to a 1998 Presidential withdrawal from leasing through June 30, 2012, under the authority of Section 12 of the OCS Lands Act (43 USC 1341). All but North Aleutian Basin, Alaska, are also subject to annual Congressional moratoria, some from as early as Fiscal Year (FY) 1982:
 
green bullet   Washington-Oregon
 
green bullet   Northern, Central and Southern California
 
green bullet   Eastern Gulf of Mexico, except for the portion located off Alabama and more
      than 100 miles off Florida that was proposed, but not offered, for Lease Sale
      181 in 2001
 
green bullet   South, Mid and North Atlantic

In addition, in 1998 President Clinton withdrew indefinitely all National Marine Sanctuaries, which are located in the following planning areas:

green bullet   Washington-Oregon (Olympic Coast)
 
green bullet   Central California (Cordell Bank, gulf of Farallones and Monterey Bay)
 
green bullet   Southern California (Channel Islands)
 
green bullet   Western Gulf of Mexico (Flower Garden Banks)
 
green bullet   Straits of Florida (Florida Keys)
 
green bullet   South Atlantic (Gray’s Reef)
 
green bullet   Med-Atlantic (Monitor)
 
green bullet   North Atlantic (Stellwagen Bank)

bullet What is the history of the Congressional Moratoria for the planning areas?
The first Congressional moratorium was enacted in FY 1982, prohibiting leasing off the Central and Northern California coast. In 1984, Southern California, the North Atlantic, and part of the Eastern Gulf Of Mexico, basically south of the 26 degree N latitude, were subject to moratoria. In FY 1990, the North Aleutian Basin, Alaska, and the Mid-Atlantic became moratoria areas. Washington/Oregon and the Florida Panhandle area of the Easter Gulf of Mexico were added to the moratoria list in FY 1991. The South Atlantic was added in 1992. These areas have been continued to be subject to annual congressional moratoria, with the exception of the North Aleutian Basin, Alaska, which has not been included since FY 2004.

The Administration supports the current Congressional moratoria/Presidential withdrawal.
 
bullet What has changed since the last 5-year program?
In the year 2000, when the Request for Comments for the current 5-Year Program was issued, oil prices averaged $26.72 per barrel and natural gas prices averaged $3.68 per thousand cubic feet (mcf), which for natural gas, itself was a 68 percent increase over the prior year. In 2004, those prices averaged $36.80 and $5.42, respectively. The Energy Information Administration (EIA), in its Annual Energy Outlook 2005, projects that oil prices will reach $52 per barrel and natural gas prices will reach $8.20 per mcf in 2025.
 
bullet Is the demand for energy growing?
Yes. Projections done by the Department of Energy (DOE) anticipate that the demand for oil will grow by 30 percent and natural gas by 40 percent in the next 10 to 15 years. That’s an annual growth rate of about 1.4 percent.

Petroleum products and natural gas are projected to account for almost 65 percent of domestic energy consumption in 2025, a slightly larger share than today. Petroleum demand is expected to grow from 20 million barrels per day in 2003 to 27.9 million barrels per day in 2025. U.S. natural gas consumption is expected to grow from 22 trillion cubic feet (tcf) in 2003 to almost 31 tcf in 2025.
 
bullet Is energy production keeping up with the demand for energy?
No. Domestic production has not kept pace with the rising demand for energy. Today we import a staggering 60 percent of the oil we need. We import 15 percent of the natural gas we need, and that number is expected to rise dramatically in the coming decades. Domestic production of oil, while increasing through the end of this decade, primarily because of increasing deep water Gulf of Mexico production, will fall by about 1 million barrels per day by 2025. A larger share of this oil will be coming from overseas in future years. Imports will account for 68 percent of demand by 2025, compared to 56 percent in 2003. Domestic production of natural gas will grow only from 19.1 tcf to 21.8 tcf, meeting only about 30 percent of demand growth.
 
bullet How important is natural gas to our nation?
Natural gas accounts for 23 percent of all energy consumed in America. Half of all American homes, about 56 million, are heated by natural gas. And about 90 percent of the new energy plants coming online in the next decade will be powered by natural gas.

Long-term predictions of high natural gas prices are causing American companies to move natural gas-based manufacturing overseas, to locations where gas is available at lower cost. Since 1998, 2 million manufacturing jobs have been lost, and energy costs are a major contributing factor.
 
bullet How much energy does the OCS provide our nation?
The Federal OCS produces 30 percent of all domestic oil production - more than we import from any given country and more than is produced from any single state. It also accounts for 23 percent of all the domestically produced natural gas.
 
bullet Where on the OCS does this energy come from?
 The Gulf of Mexico produces the majority of the domestic oil and gas for our nation. Today, there are approximately 4,000 platforms operating in the Gulf of Mexico producing nearly 1.6 million barrels of oil per day and 12.1 billion cubic feet of natural gas per day. Now in its ninth year of expansion, deepwater oil and gas development in the Gulf of Mexico is a workhorse for U.S. domestic oil and gas production. Deepwater oil production rose 535 percent between 1995 and 2002, and deepwater gas production rose 620 percent over those same years. If current trends continue, by 2006, as much as 77 percent of daily oil production in the gulf and 26 percent of daily gas production could come from the deep water regions.
 
bullet How much oil and gas is available on the outer continental shelf?
MMS estimates that 76.0 billion barrels of oil and 406.1 trillion cubic feet of natural gas are technically recoverable from federal offshore areas. These estimates represent the potential hydrocarbons of an area that can be produced using current technology, without any consideration to economic feasibility. Current technology includes drilling in water in excess of 3000 meters (10,000 feet) deep and to depths in excess of 9600 meters (31,700 feet).
 
bullet What are some of the benefits OCS oil and gas provides to our nation?
 Overall oil production in the Gulf will increase to a record 2 million barrels per day by 2006, compared to the current rate of 1.5 million barrels per day, and could reach 2.25 million barrels a day by 2011, according to MMS projections. This projected increase alone will provide enough additional energy to heat 3.5 million new homes.

More than 92,000 barrels of royalty-in-kind crude oil per day are being delivered to the Nation’s Strategic Petroleum Reserve (SPR). MMS and the DOE began the current fill initiative in April 2002 and anticipate that the SPR's 700-million-barrel capacity will be reached in the summer of 2005. As of early February 2005, the inventory in the SPR was more than 681 million barrels of oil. The SPR is the world's largest supply of emergency crude oil, with the federally owned oil stocks stored in underground salt caverns along the coastline of the Gulf of Mexico.

MMS also collects, accounts for, and disburses mineral revenues from OCS lands as well as onshore Federal and American Indian lands, averaging $6 billion a year. Last year those disbursements were close to $6 billion and have totaled more than $146 billion since 1982.
 
bullet Is offshore energy exploration considered safe?
For years, MMS has worked to advance the safety of offshore operations worldwide. Off U.S. shores, the agency is required, under the OCS Lands Act, to conduct annual announced and periodic unannounced inspections of all oil and gas operations on the OCS. The Act also requires MMS and the U.S. Coast Guard to investigate major accidents that include deaths, major fires or spills. In 2003 alone, MMS inspectors conducted over 23,000 inspections. After September 11, 2001, the agency developed guidelines to enhance existing security measures.
 
bullet Is offshore energy exploration a major source of ocean pollution?
No. The record of the last 50 years, but particularly in the last 20, shows the offshore industry is one of the safest industrial activities in the United States. A recent study by the National Academy of Sciences reports that in the last 15 years there were zero platform spills greater than 1,000 barrels. Compared to worldwide tanker spill rates, outer continental shelf operations are more than five times safer. Imports present an environmental risk of spills about 13 times greater than domestic production. In fact, annual natural seeps account for 150-175 times more oil in the ocean than OCS oil and gas operations.

Privacy | Disclaimers | Accessibility | Topic Index |  FOIA

Last Updated: 07/30/2008, 07:52 AM Central Time

Top of Page