470 



should lease huge areas of the Outer Continental Shelf, such as the 

 4,000-odd blocks that are proposed for the February 1984 lease sale. 



I think that that is a mistaken notion. And I take great issue 

 with the idea that we should be leasing, for instance, in areas of 

 very low potential, such as on the top or the northern end of 

 Georges Bank. 



Mr. D' Amours. If we are not going to be able to rely on USGS 

 estimates, that is, if we cannot accept low estimates, very low esti- 

 mates as a reason for excluding systems such as Georges Bank, and 

 there is no demonstrable harm at least to date, then would you not 

 be, in effect, approving of the inventory basis, unless you can give 

 me another standard? 



One of the things I am getting at here is what Congress might do 

 to provide a better standard. 



Mr. CoLGAN. Well — - 



Mr. D'Amours. You say you are against inventorying, but you 

 are not for anything else that I can find, except possibly harm from 

 drilling muds to benthic populations. 



Mr. CoLGAN. Let me then turn the statement around and say 

 what I think we are for, which is that in areas where there is geo- 

 logic potential for oil and gas, particularly high geologic potential 

 for oil and gas, and where in the absence of specific, reasonably 

 available information which indicates that there is specific harm to 

 be done to that area, then we think it is worthwhile to go ahead 

 and explore for oil and gas. 



There is an opportunity later on in the process 



Mr. D'Amours. Is that when there is good reason to believe there 

 is a large quantity of energy produced in the area? 



Mr. CoLGAN. I think there has to be a reasonable potential for 

 commercial find, for commercially producible hydrocarbons. 



Mr. D'Amours. How do you define that? 



Mr. CoLGAN. Well, there are I suppose two tests. One is a market 

 test in the sense that if you put the oil lease up for sale — and it is 

 bought, that is one test. 



Another test, and I think one which the Department has failed 

 to occasionally apply, is a reasonable estimate of economics of oil 

 and gas production from the Outer Continental Shelf, and the pos- 

 sible size of hydrocarbon fields that are producible. 



You take the sale 52 case, which is a good example. The 55 mil- 

 lion barrels of oil, if it were located in one tract, would probably 

 not be commercial. But the gas estimate might be. 



Mr. D'Amours. You are back to your geologic estimate, aren't 

 you? 



Mr. CoLGAN. You are back to some estimate. 



Mr. D'Amours. Your first test is if the oil companies want to 

 drill, you let them, because there is proof of commercial viability. If 

 they are willing to buy. 



Mr. CoLGAN. That is one test. 



Mr. D'Amours. And your second test is 



Mr. CoLGAN. That test is: What do you as a responsible public 

 lands manager, what information do you need to decide whether to 

 offer that land for sale? 



Some indication that there is oil and gas there ought to be your 

 first test of whether you want to put it up in an oil and gas lease 



