Exploration in Alaska during 1965 was highlighted by the high success of exploratory drilling. Nineteen exploratory wells were drilled with 52.6% successful oil or gas completions.

Seventeen exploratory wells were drilled in the Cook Inlet basin and 10 were successful. Alaska's 5 new-field discoveries were made in this basin, and for the first time oil discoveries were made on the west shore of Cook Inlet.

Exploratory drilling is expected to increase in the Cook Inlet basin during 1966 and to continue on the Arctic slope.

Geological surface work and geophysical activity decreased during 1965. A marked increase in both is expected during 1966, particularly in geophysical activity in the Cook Inlet basin. It is anticipated there also will be an increase in the Gulf of Alaska and in Bristol Bay. Activity on the Arctic slope is expected to continue at the same rate or to increase slightly.

State land sales on the Arctic slope and in Cook Inlet resulted in bonus bids of $10,819,816. Two large blocks of Federal land were released on the Arctic slope. Leasing activity is expected to remain high in 1966.

The first oil production from the Middle Ground Shoal field in Cook Inlet was marketed through a newly completed offshore pipeline. Six more pipelines are expected in Cook Inlet in 1966.

Development drilling accelerated with the development of the Kenai gas field. Two development wells were drilled in the Middle Ground Shoal field and development drilling in this field is expected to increase greatly during 1966.