02/28/2005 01:00 PM House RESOURCES

SJR  5-REAUTHORIZE METHANE HYDRATE RESEARCH ACT                                                                               
                                                                                                                                
CO-CHAIR  SAMUELS  announced that  the  first  order of  business                                                               
would be SENATE JOINT RESOLUTION  NO. 5, Urging the United States                                                               
Congress  to   reauthorize  the  Methane  Hydrate   Research  and                                                               
Development Act.                                                                                                                
                                                                                                                                
JOE BALASH,  Staff, to Senator  Gene Therriault,  Joint Committee                                                               
on Legislative  Budget and  Audit, said SJR  5 urges  Congress to                                                               
reauthorize the  Methane Hydrate Research  Act of 2000.   He said                                                               
it  asks  Congress  to  reauthorize  it for  five  years  and  to                                                               
appropriate  $70 million.   Mr.  Balash said  that the  potential                                                               
additional  reserves in  gas hydrates  in the  North Slope  could                                                               
change the way the state  proceeds with the gas pipeline project.                                                               
The  sizing of  the  pipe, access  points,  financing costs,  and                                                               
tariffs may all be impacted  if additional reserves are verified,                                                               
he opined.                                                                                                                      
                                                                                                                                
REPRESENTATIVE  GATTO asked  what the  cost was  of the  original                                                               
authorization.                                                                                                                  
                                                                                                                                
MR. BALASH said it was about $47 million.                                                                                       
                                                                                                                                
REPRESENTATIVE GATTO noted that  the background materials said it                                                               
was time to get  out in the field, and he  questioned how so much                                                               
money could be spent "moving paper."                                                                                            
                                                                                                                                
MR. BALASH  answered that "a  tremendous amount of the  money was                                                               
spent here in  Alaska, but not solely in Alaska."   He added that                                                               
there was  computer-modeling work, seismic  work, and "as  far as                                                               
how the money was spent, I don't know."                                                                                         
                                                                                                                                
REPRESENTATIVE  GATTO asked  if  there is  any  evidence of  this                                                               
being successfully done anywhere else in the world.                                                                             
                                                                                                                                
MR. BALASH said,  "There is a field in Siberia  that, it appears,                                                               
gas hydrates may be releasing  into free gas form and maintaining                                                               
pressure  that  otherwise  would  have declined,  but  it's  very                                                               
limited information."                                                                                                           
                                                                                                                                
REPRESENTATIVE  CRAWFORD  said  he believed,  "we  were  actually                                                               
getting some gas hydrates [that]  were regenerating into free gas                                                               
on the North Slope."                                                                                                            
                                                                                                                                
MR.  BALASH  said  the  presence   of  hydrates  is  from  [cold]                                                               
temperature or  [high] pressure, and  he is  not aware of  any of                                                               
the  hydrate  releasing into  free  gas  in  any of  the  fields.                                                               
"Maybe it has  been," he said, but  he has not read of  it in his                                                               
literature reviews.                                                                                                             
                                                                                                                                
CO-CHAIR SAMUELS  said, "You can either  reduce the pressure...or                                                               
you have to  change the heat...using glycol or  even replacing it                                                               
with CO2."  He added that  the hydrates are only found under deep                                                               
water or very  cold temperatures.  In Alaska,  hydrates are found                                                               
north of the Brooks Range, he added.                                                                                            
                                                                                                                                
DALE BONDURANT, Soldotna, stated his  opposition to any effort to                                                               
develop coal or methane  gas in the Homer area.   He said it will                                                               
destroy  that  area, pollute  Cook  Inlet,  and adversely  affect                                                               
fisheries.    He  added  that he  attended  several  meetings  in                                                               
opposition to  the development of  shallow gas wells  and shallow                                                               
coal seams of  Kachemak Bay.  As  of now the City of  Homer has a                                                               
supply  of good  water, but  in low  areas the  water is  not for                                                               
human consumption,  he said.   He  discussed the  negative impact                                                               
oil development had on farms in  the Texas area where corn stalks                                                               
were  small and  stopped  producing.   The  pumping  of coal  and                                                               
methylene gas  will pollute  the bay  and destroy  the fisheries,                                                               
he said, and  the noise itself will drive  visitors and residents                                                               
away, making Homer  a ghost town.  Schools will  have to move, he                                                               
concluded.                                                                                                                      
                                                                                                                                
CO-CHAIR  SAMUELS  thanked  Mr.   Bondurant  and  said  that  gas                                                               
hydrates will be found only on the North Slope.                                                                                 
                                                                                                                                
CO-CHAIR RAMRAS moved  to report HCS SJR 5(O&G)  out of committee                                                               
with  individual recommendations  and zero  fiscal notes.   There                                                               
being no objection, it was so ordered.