Legislature(2009 - 2010)BARNES 124
02/03/2009 03:00 PM House ENERGY
| Audio | Topic |
|---|---|
| Start | |
| HCR2|| HCR3|| HCR4|| HCR5 | |
| HCR2 | |
| HCR3 | |
| HCR4 | |
| HCR5 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HCR 2 | TELECONFERENCED | |
| *+ | HCR 3 | TELECONFERENCED | |
| *+ | HCR 4 | TELECONFERENCED | |
| *+ | HCR 5 | TELECONFERENCED | |
HCR 2-IN-STATE GAS PIPELINE HCR 3-IN-STATE GAS PIPELINE HCR 4-IN-STATE GAS PIPELINE HCR 5-IN-STATE GAS PIPELINE 3:03:36 PM CO-CHAIR MILLETT announced that the order of business would be HOUSE CONCURRENT RESOLUTION NO. 2, Requesting the governor to provide energy security for all Alaskans by pursuing development of a natural gas bullet pipeline from the North Slope to the Cook Inlet region; and requesting the governor to identify and negotiate with one or more persons capable of producing natural gas from the Gubik area, and other areas on the North Slope if necessary, in sufficient quantities to support a bullet pipeline project; HOUSE CONCURRENT RESOLUTION NO. 3, Requesting the governor to provide energy security for all Alaskans by taking and encouraging all action that would support a natural gas bullet pipeline from the North Slope to the Cook Inlet region, including initiating any necessary negotiations to reopen the Agrium plant in Kenai; HOUSE CONCURRENT RESOLUTION NO. 4, Requesting the governor to provide energy security for Alaskans by taking and encouraging all action to support development of a natural gas bullet pipeline from the North Slope to the Cook Inlet region including advocating an increase in the amount of natural gas that may be exported under authority granted by the United States Department of Energy; and HOUSE CONCURRENT RESOLUTION NO. 5, Requesting the governor to provide energy security for all Alaskans by working on significant elements and components to support the timely construction of a natural gas bullet pipeline from the North Slope to the Cook Inlet region and to take necessary action to assist and facilitate the process for a private entity to make a final investment decision to commit to the pipeline before November 1, 2010. 3:03:49 PM CO-CHAIR EDGMON moved to hear as a block HCR 2, HCR 3, HCR 4, and HCR 5, and objected for discussion purposes. [Therefore, the committee heard the resolutions individually.] HCR 3-IN-STATE GAS PIPELINE 3:25:43 PM CO-CHAIR EDGMON moved to hear HCR 3 and objected for purposes of discussion. 3:26:26 PM REPRESENTATIVE RAMRAS explained the purpose of introducing resolutions that incrementally address how to build the in-state gas line. In fact, the construction of a bullet line has incremental components, thus the first resolution sources out a supply of gas. The second resolution, HCR 3, addresses re- opening of the Agrium plant. Representative Ramras reminded the committee the fuller the pipe, the lower the tariff, and it is in the state's best interest to have a full pipe; however, light commercial and residential consumption of natural gas throughout the Railbelt represents only 60 billion cubic feet (bcf) per year and would fill the pipe to one-third of its capacity. Re- starting the Agrium plant would demand another 60 bcf per year of industrial usage, in addition to reinstating 250 jobs in the Kenai area. He opined that more economical energy from the bullet line "solves the [economical] problem for Agrium." 3:30:04 PM REPRESENTATIVE RAMRAS continued to explain that the cost of fertilizer in the state is anticipated to rise by 400 percent due to the closing of the Agrium plant. In addition, the company was contributing to Alaska's short list of value-added products by exporting urea to much of the world; however, this industry requires a source of cheap natural gas. An additional benefit of the plant's operation was to provide affordable fertilizer to the green belts in the Matanuska-Susitna (Mat-Su) Valley and Delta Junction, possibly for the future growth of bio-fuels. He stressed that operation of the Agrium plant serves many functions for the Kenai area, the Mat-Su Borough, the Delta region, and for recreational gardeners across the state. Representative Ramas surmised that the present administration's only involvement in this situation is to determine the company's production tax status. He expressed his belief that the administration can take a more active role in restoring the operation of the Agrium plant; in fact, Agrium officials desire contact with the administration, and that contact is encouraged by HCR 3. 3:33:54 PM REPRESENTATIVE PETERSEN asked whether building the bullet line will delay the building of the major natural gas pipeline. 3:34:35 PM REPRESENTATIVE RAMRAS assured the committee that there has been previous testimony from representatives of TransCanada, and Denali - the Alaska Gas Pipeline Project, that the in-state gas pipeline is complementary to their projects; in fact, bullet line take-off points are helpful to them. Moreover, the Gubik area is not a source of gas for the large diameter pipeline, he said. 3:35:21 PM CO-CHAIR MILLETT opened public testimony on HCR 3. 3:35:36 PM LISA PARKER, Spokesperson, Agrium, Inc., Agrium U.S., stated that the resolutions before the committee are very important to provide economy stability to the state. She read a brief history of the Agrium Kenai Nitrogen Fertilizer plant and said that after 40 years of operation the plant closed in September 2007, due to a lack of natural gas supply from Cook Inlet. She informed the committee that Agrium supports the bullet line, and HCR 3, and opined that construction of the bullet line and negotiation of successful contracts to purchase [gas] would restore a billion dollar industrial facility to operation along with jobs, a tax base, and economic benefits to the Kenai community. The reopening of the plant would also provide urea needed by the state's agricultural industry and the Department of Transportation & Public Facilities (DOT&PF). Ms. Parker corrected Representative Ramras in that there are currently 10 employees "mothballing" the Kenai facility. 3:38:18 PM REPRESENTATIVE RAMRAS observed "[there is] no greater clarion call for why we need an in-state bullet line... ." 3:39:04 PM JERRY MCCUTCHEON informed the committee that construction of any gas line is not in the best interest of Alaska. What is needed is a gas liquids pipeline of 150,000 barrels a day built along the George Parks Highway to Cook Inlet. He stated that gas liquids are worth more than oil; furthermore, there is not enough gas for a gas line in all of the North Slope, or in the Gubik area. He reminded the committee that in 2004, ENSTAR announced that the gas required [for a gas pipeline] was 1.2 bcf; however, it now plans a line on 500 million cubic feet (mcf). He opined that [ENSTAR'S plans] are to keep the legislature "off balance ... so Conoco can continue to pedal its overpriced gas." Mr. McCutcheon expressed his support for drilling efforts by Escopeta Oil in Cook Inlet. 3:41:38 PM CO-CHAIR MILLETT closed public testimony. 3:41:49 PM CO-CHAIR EDGMON removed his objection. 3:41:57 PM REPRESENTATIVE DAHLSTROM relayed that a group has been working with Escopeta Oil and the Department of Natural Resources (DNR) since November. 3:42:26 PM CO-CHAIR MILLETT added that DNR has allowed an extended period of time for the formation of a unit. 3:42:46 PM CO-CHAIR EDGMON moved to report HCR 3 out of committee with individual recommendations and no attached fiscal note. Hearing no objection, it was so ordered. 3:43:04 PM The committee took an at-ease from 3:43 p.m. to 3:45 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Sponsor Stmt HCR 2 020309.pdf |
HENE 2/3/2009 3:00:00 PM |
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| Sponsor Stmt HCR 3 020309.pdf |
HENE 2/3/2009 3:00:00 PM |
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| Sponsor Stmt HCR 4 020309.pdf |
HENE 2/3/2009 3:00:00 PM |
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| Sponsor Stmt HCR 5 020309.pdf |
HENE 2/3/2009 3:00:00 PM |