U.S. Department of Energy, Divestment Administrator, NPOSR, FE-60 1000 Independence Ave., SW, Washington, D.C. 20585

NOTICE OF INTENT TO SELL NAVAL PETROLEUM RESERVE NUMBERED 1, ELK HILLS, KERN COUNTY, CALIFORNIA POC John W. Bartholomew, Divestment Administrator, (202) 586-4410. Pursuant to section 3412 of the National Defense Authorization Act for Fiscal Year 1996 (Public Law 104-106), the U.S. Department of Energy publishes this Notice of Intent to Sell all right, title and interest of the United States in and to all lands owned or controlled by the United States inside Naval Petroleum Reserve Numbered 1 (``Elk Hills''), near Bakersfield, California. Title XXXIV, Subtitle B, of the Defense Authorization Act, enacted on February 10, 1996, directs the Department of Energy to sell the United States' interest in Elk Hills, subject to certain conditions, within two years of the effective date of the Act. The Act also establishes specific requirements, timetables and deliverables for the retention of independent consultants whose work is preparatory to the sale of Elk Hills. These consultants are an investment banker/financial adviser to independently administer the sale in a manner consistent with commercial practices and in a manner that maximizes sale proceeds to the Government; 5 independent experts to prepare valuation assessments; an independent petroleum engineer to prepare a recommendation on final equity figures of the known oil and gas zones; and an independent petroleum engineer to prepare a reserve report consistent with commercial practices. The Department anticipates selecting an investment banker/financial adviser in mid-April 1996 and otherwise expects to meet the sale schedule established in the Act. As provided for under the Act, the investment banker/financial adviser will conduct the sale on behalf of the Department and, subject to the Department's overall direction, will be establishing a sales process that meets the Act's objectives of maximizing sales proceeds to the United States and of ensuring that the sales process is fair and open to all interested and qualified parties. Accordingly, further information regarding the sales process, including the availability of technical, geological and financial information relevant to the sale of Elk Hills, will be forthcoming following the development and approval of the sales strategy. In the interim, parties interested in the sale may contact John W. Bartholomew, Divestment Administrator, Naval Petroleum and Oil Shale Reserves, FE-60, Office of Fossil Energy, U.S. Department of Energy, 1000 Independence Ave., SW, Washington, D.C. 20585 (telephone (202) 586-4410; telefax (202) 586-0835). (100)

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