Legislature(2005 - 2006)BUTROVICH 205

04/13/2005 03:30 PM RESOURCES


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= SB 53 AK PENINSULA OIL & GAS LEASE SALE; TAXES TELECONFERENCED
Heard & Held
*+ SB 163 COOK INLET OIL & GAS TAX CREDIT TELECONFERENCED
Heard & Held
*+ SCR 6 COOK INLET OIL & GAS PLATFORM ABANDONMENT TELECONFERENCED
Moved CSSCR 6(RES) Out of Committee
*+ SCR 7 OIL AND GAS REG REVISIONS TELECONFERENCED
Moved SCR 7 Out of Committee
                SCR  7-OIL AND GAS REG REVISIONS                                                                            
                                                                                                                                
CHAIR THOMAS WAGONER announced SCR 7 to be up for consideration.                                                                
                                                                                                                                
MARY  JACKSON, staff  to Senator  Wagoner,  said this  resolution                                                               
came  from  the  Kenai  meeting  also.  Practically  speaking,  a                                                               
gentleman named James  Udelhoven who began work in  Cook Inlet in                                                               
the late  1960's cautioned, "Don't  make the first hurdle  so big                                                               
that the new kid won't try to take the hurdle."                                                                                 
                                                                                                                                
She said this resolution was  created to applaud the efforts that                                                               
have been made to streamline  permitting and to insure that those                                                               
efforts are continued.                                                                                                          
                                                                                                                                
MARK  MYERS,  Director,  Division  of   Oil  and  Gas  and  State                                                               
Geological  Survey, supported  SCR  7 saying  it would  eliminate                                                               
overhead and duplication.                                                                                                       
                                                                                                                                
4:19:01 PM                                                                                                                    
CHAIR  WAGONER said  the Regulatory  Commission  of Alaska  (RCA)                                                               
could work  at a  faster rate and  has already  demonstrated that                                                               
recently.                                                                                                                       
                                                                                                                                
SENATOR   RALPH   SEEKINS   asked  for   examples   of   enhanced                                                               
attractiveness of exploration and development.                                                                                  
                                                                                                                                
MR.  MYERS replied  that  some outstanding  examples  are in  the                                                               
Beaufort Sea  where Teck Cominco  and Armstrong  Resources bought                                                               
leases and within  four months had their permits to  drill in the                                                               
Beaufort  Sea, which  is usually  one  of the  hardest places  to                                                               
permit  because  of  the   environmental  issues,  remoteness  of                                                               
location  and  concerns  over subsistence  resources.  They  have                                                               
developed  good  working  relationships   with  the  North  Slope                                                               
Borough, which  is necessary.  Kerr McGee did  the same  with two                                                               
separate rigs  this winter  and last.  These companies  are brand                                                               
new to Alaska.  He explained that the hearing  process within the                                                               
communities has  to happen up front  and that while it  is labor-                                                               
intensive, it streamlines the process later on.                                                                                 
                                                                                                                                
4:22:51 PM                                                                                                                    
SENATOR SEEKINS  asked if the streamlining  had been accomplished                                                               
through  efforts of  the legislature  or just  through incentives                                                               
initiated by the administration.                                                                                                
                                                                                                                                
MR. MYERS replied  that the legislature has  enhanced the process                                                               
by  funding  some  positions  and  moving  program  offices  like                                                               
Coastal   Zone  Management   into  the   Department  of   Natural                                                               
Resources. It  has provided funding  on a case-by-case  basis for                                                               
project coordinators and supported  budget increases at times for                                                               
agencies like DEC in critical  areas. Having extra folks on staff                                                               
has been critically important.                                                                                                  
                                                                                                                                
4:24:45 PM                                                                                                                    
CHAIR WAGONER related that other  companies are going to drill in                                                               
the Beaufort Sea.                                                                                                               
                                                                                                                                
MR. MYERS replied that ConocoPhillips  has a well, Kerr McGee has                                                               
multiple  wells and  Pioneer is  looking at  development. Another                                                               
well will  potentially be shallow-drilled off  the Point McIntyre                                                               
area.                                                                                                                           
                                                                                                                                
CHAIR WAGONER  asked if Pioneer  was in  the process of  having a                                                               
platform built for them.                                                                                                        
                                                                                                                                
MR. MYERS replied  yes, it is lighter weight and  more mobile. He                                                               
said Pioneer  is not  actively drilling this  year, but  they are                                                               
assessing  sanctioning a  development  project  from the  earlier                                                               
successful drilling out there about two years ago.                                                                              
                                                                                                                                
4:26:19 PM                                                                                                                    
SENATOR  SEEKINS  moved  to  pass   SCR  7  from  committee  with                                                               
individual recommendations  and zero  fiscal note. There  were no                                                               
objections and it was so ordered.                                                                                               

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