Twelve exploratory wells were drilled in Alaska, resulting in 1 gas discovery on the Arctic Slope. At year end, a deeper pool test (DPT) in the Cook Inlet basin's Beaver Creek field was testing possible new pay zones. All 14 development wells were successful--8 in the Cook Inlet basin and 6 in the Prudhoe Bay field on the Arctic Slope.

Surface geologic activity decreased 25% to 37.3 crew-months, but geophysical activity decreased only 4% to 42 crew-months. Oil production decreased for the second year and gas production decreased for the first time. Federal acreage under lease at year end decreased to 4,831,648 acres, whereas state acreage under lease increased slightly to 3,970,085 acres. State Lease Sales 25 and 26 in the Cook Inlet brought $2,885,282 for 359,115 acres.

Two proposals to drill 30 shallow stratigraphic holes in state waters in the lower Cook Inlet and 8 deep holes in state waters from the Gulf of Alaska to Kotzebue Sound generated considerable industry interest. Both programs are planned for 1973 if necessary equipment is available and sufficient industry support is received.

The Federal District Court ruling in 1972 in favor of the trans-Alaska pipeline was appealed, but at year end no decision had been rendered by the Court of Appeals.

Opening to exploration of the state-federal disputed area in lower Cook Inlet moved a step closer when the U.S. District Court ruled in favor of Alaska.

In the absence of a significant discovery, a national emergency, or a major price increase, exploration activity is expected to remain near the present level until new federal, state, or native acreage is made available for exploration. No definite dates can be established as to when large blocks of new acreage will be available.