02/12/1998 11:10 AM House O&G
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HOUSE SPECIAL COMMITTEE ON OIL AND GAS
February 12, 1998
11:10 a.m.
MEMBERS PRESENT
Representative Mark Hodgins, Chairman
Representative Scott Ogan
Representative Norman Rokeberg
Representative Joe Ryan
Representative Con Bunde
Representative Tom Brice
MEMBERS ABSENT
Representative J. Allen Kemplen
COMMITTEE CALENDAR
HOUSE BILL NO. 274
"An Act relating to the qualifications of the members of the Alaska
Oil and Gas Conservation Commission; and providing for an effective
date."
- MOVED CSHB 274(O&G) OUT OF COMMITTEE
(* First public hearing)
PREVIOUS ACTION
BILL: HB 274
SHORT TITLE: OIL & GAS CONSERVATION COMMISSION
SPONSOR(S): REPRESENTATIVES(S) GREEN
Jrn-Date Jrn-Page Action
05/08/97 1656 (H) READ THE FIRST TIME - REFERRAL(S)
05/08/97 1656 (H) O&G, RES
01/15/98 (H) O&G AT 10:00 AM CAPITOL 124
01/15/98 (H) MINUTE(O&G)
01/22/98 (H) O&G AT 11:00 AM CAPITOL 124
01/22/98 (H) MINUTE(O&G)
02/05/98 (H) O&G AT 10:00 AM CAPITOL 124
02/12/98 (H) O&G AT 11:00 AM CAPITOL 124
WITNESS REGISTER
JEFF LOGAN, Legislative Assistant
to Representative Green
Alaska State Legislature
Capitol Building, Room 118
Juneau, Alaska 99801
Telephone: (907) 465-6841
POSITION STATEMENT: Presented CSHB 274.
REPRESENTATIVE JOE GREEN
Alaska State Legislature
Capitol Building, Room 118
Juneau, Alaska 99801
Telephone: (907) 465-6841
POSITION STATEMENT: Answered questions on CSHB 274.
MIKE DUNN
address and phone number not provided
POSITION STATEMENT: Testified in favor of CSHB 274.
ACTION NARRATIVE
TAPE 98-9, SIDE A
Number 0001
CHAIRMAN MARK HODGINS called the House Special Committee on Oil and
Gas meeting to order at 11:10 p.m. Members present at the call to
order were Representatives Hodgins, Ryan, Bunde, Brice.
Representatives Rokeberg and Ogan arrived at 11:11 a.m.
Representative Kemplen was absent.
Number 0068
CHAIRMAN HODGINS stated that before the committee addressed its
business he wanted to make an announcement. He noted that this
report is currently incomplete: Yesterday, there was a collision
between the fishing vessel, Alaska-1, and a foreign container ship,
the Hanjin. The accident occurred in state waters around Akutan
Pass and the Alaska-1 sank. He stated that all 33 crew members
were rescued by another vessel, the Dominator. The Alaska-1 sank
with the following fuels on board: 800 gallons of hydraulic fluid,
6,800 gallons of lube oil and 95,000 gallons of diesel fuel. The
extent to which it is leaking is currently unknown, the coast guard
is going to fly over the site to determine the size of the oil
slick. He stated that both vessels are unregulated with regard to
oil spill response plan. He stated that he will keep everyone
informed as information is made available.
HB 274 - OIL & GAS CONSERVATION COMMISSION
Number 0156
CHAIRMAN HODGINS announced that the committee would hear HB 274,
"An Act relating to the qualifications of the members of the Alaska
Oil and Gas Conservation Commission; and providing for an effective
date." He stated that there is a committee substitute and asked
Jeff Logan to present the committee substitute.
JEFF LOGAN, Legislative Assistant to Representative Joe Green,
sponsor of HB 274, informed the committee that Representative
Green is in Anchorage and will be on teleconference.
Number 0220
CHAIRMAN HODGINS stated that there is a committee substitute to HB
274.
Number 0226
REPRESENTATIVE NORMAN ROKEBERG made a motion to adopt CSHB 274( )
as a working draft. He asked what version the committee is
addressing.
CHAIRMAN HODGINS responded that the committee is addressing CSHB
274( ), 0-LS0998\L, Glover, 2/11/98, as amended.
REPRESENTATIVE SCOTT OGAN asked if Mr. Logan could explain the
changes to the bill.
Number 0336
MR. LOGAN stated that the first change is on page 1, line 7,
"Before making an appointment, the Governor may solicit the
recommendations of professional or industry representatives for
appointment of a commissioner." He explained that this language
is a result of comments to the sponsor by professional and industry
groups, who would appreciate the opportunity to forward names to
the Governor. He stated that these groups believe that they know
who the most qualified members of their industry are and they would
like to be able to forward the names to the Governor.
Number 0420
REPRESENTATIVE OGAN stated that the Alaska Oil and Gas Conservation
Commission, (AOGCC), are the policemen of the pipeline. He stated
that the bill is then proposing that the oil companies will be able
to choose who will be their policemen. He asked if that was
correct.
Number 0448
MR. LOGAN replied that it was not exactly correct. He referred to
Line 8, and noted the word "may". The Governor may solicit the
recommendations of the industry. The industry representatives were
hoping to have a formalized process toward the Governor in regards
to positions on the commission. He noted that there have been
previous members on the commission from the industry and it has not
been a problem in the past.
Number 0507
REPRESENTATIVE JOE GREEN, testified via teleconference from
Anchorage that the reason for this language is because the
Governor's past two appointments have been unqualified for the
position. The reason being that he could not find professionals in
the industry that would qualify. He stated that this does not
preclude him from finding other qualified representatives.
Number 0575
REPRESENTATIVE TOM BRICE stated that he wanted to make sure he was
clear on this. The section is 31.05.005(a) and asked if it is
referencing the petroleum engineer's and the geologist's seat or if
it is referring to all members of the commission.
Number 0606
MR. LOGAN replied that subsection does not apply to membership of
the commission.
Number 0642
REPRESENTATIVE BRICE stated he just wanted to be clear; the
subsection pertains to input on the engineer's and the geologist's
seats and Section 1 is applicable to all the seats.
Number 0680
REPRESENTATIVE GREEN asked Representative Brice to refer to line 9
and the word "professional". He stated that the third member does
not have to be a professional in anything.
Number 0698
REPRESENTATIVE ROKEBERG asked that the addition in Section 1
applies to all three seats on the commission.
Number 0725
REPRESENTATIVE GREEN reiterated that the third member need not be
qualified in either the geological or engineering area of
expertise, therefore there is no need for a professional review of
the third seat.
Number 0775
REPRESENTATIVE OGAN stated that the way the additional information
is written in Section 1, it pertains to all three positions and
asked whether the language could be tightened to apply only to the
petroleum engineer.
Number 0810
REPRESENTATIVE GREEN responded that he the word "may" is being used
and it is the Governor's discretion if he is going to seek any
recommendation. The intent is to help the Governor find the
required professionals to fill the two professional seats.
Number 0885
REPRESENTATIVE CON BUNDE stated that there seems to be some concern
that the oil industry would be forwarding recommendations. He
asked if it was correct that there is nothing in the existing law
that would prevent the Governor from asking the AOGCC for
recommendations.
REPRESENTATIVE GREEN replied that is correct.
Number 0897
REPRESENTATIVE BUNDE stated that it seems like it is intent
language, carrying all the weight of a butterfly.
Number 0934
MR. LOGAN stated that additional changes are found on page 2,
subsection (B), line 6, deleting the requirement that the person
selected for the petroleum engineering seat have a degree in
petroleum engineering. The word "petroleum" has been deleted.
This has also been done on line 10 and line 11. He stated that
otherwise it limited the pool of candidates to a level of
impracticality.
MR. LOGAN stated that on page 2, line 6 the insertion of the word
"subsurface" requires the person to have at least 10 years of
professional subsurface experience.
REPRESENTATIVE ROKEBERG referred to page 1, line 13, "one member
shall be a petroleum engineer" and stated that the definition of a
petroleum engineer on page 2, is one who meets the requirements for
program accreditation by the Engineering Accreditation Commission.
Number 1090
MR. LOGAN stated that it is an omission on his part and the word
"petroleum" on page 1, line 13 should have been deleted.
REPRESENTATIVE ROKEBERG asked Representative Green if he wished to
leave the word "licensed professional" in as well.
Number 1134
REPRESENTATIVE GREEN responded, "There is an (A) and a (B) and
there is an 'or' in there. And that 'or' is very important because
that person can be a registered petroleum engineer or would have
these other qualifications which would insure that he has the
knowledge that is required for the position."
Number 1167
REPRESENTATIVE BUNDE stated therefore, on page 1, line 13 there
would be no deletion of word "petroleum".
Number 1199
MR. LOGAN stated that on page 2, line 14, there is the requirement
to complete "course work specific to petroleum engineering" that
deals with the subjects listed in line 16 through line 18.
Number 1239
REPRESENTATIVE BUNDE stated that the term "course work" is not very
well defined. He asked if it meant course work in every one of the
subjects listed.
Number 1260
MR. LOGAN replied that it could be a course, or courses; as long as
the course work illustrated "application of engineering principles
to the problems encountered and methods used in the petroleum
industry". He explained that could be obtained in a variety of
different courses.
Number 1300
REPRESENTATIVE BUNDE asked at what level is the course work. Is it
a week-end seminar, a community college course, et cetera.
Number 1327
MR. LOGAN replied that he believed it is covered on line 12 through
line 13. The course work has to be at a university that is
accredited by the Engineering Accreditation Commission of
Accreditation Board for Engineering and Technology, (ABET) which is
the most basic and broadest accreditation for engineering programs
in the United States. He added that this is the organization in
which the University of Alaska of Fairbanks, engineering programs
are accredited by.
Number 1428
REPRESENTATIVE BUNDE stated that he understood that a member would
have to obtain an undergraduate or graduate degree in engineering
that meets the requirements as listed in line 12 through line 13.
He asked if it would be more to the point say that "includes course
work".
Number 1428
REPRESENTATIVE GREEN asked if on line 13, "by competing" was
deleted and "that includes" was inserted, would be more to
Representative Bunde's liking.
Number 1490
REPRESENTATIVE BUNDE stated that would be fine, but maybe he is the
only one who sees it as a problem.
Number 1519
REPRESENTATIVE BRICE stated that there are two requirements in
subsection (B), the member has to earn a degree from a university
and have 10 years of professional subsurface experience. In
defining the degree, it has to come from an ABET school and during
that course work at the school one must have taken courses to
include drilling, production, reservoir engineering, fluid flow
through subsurface formations and hydrocarbon transportation. He
stated that on page 2, line 8 through line 18 defines the type of
educational experience that a person has gone through to get that
degree from a university. He stated that it does address the
question that a person could not just take a few week-end seminars
and meet the requirements. He stated that is at least the way he
reads it.
Number 1600
REPRESENTATIVE BUNDE offered that on page 2, line 13, "including
and completing course work specific to petroleum engineering".
Number 1610
REPRESENTATIVE GREEN stated that would be fine.
Number 1613
REPRESENTATIVE BUNDE made a motion to amend CSHB 274( ), page 2,
line 13 to delete the word "by" and insert the word "including", so
that line 13 would read "Accreditation Board for Engineering and
Technology including and completing".
Number 1671
CHAIRMAN HODGINS asked if everybody understood the amendment.
Number 1681
REPRESENTATIVE OGAN asked if this language would then require a
degree in petroleum engineering.
Number 1689
REPRESENTATIVE GREEN replied that it would not. He stated that it
would avoid the situation of someone just having 10 years
experience in drilling, because it states there would have to be
some course work in the other disciplines. There is a broader
understanding of what members on the AOGCC need to be aware of.
Number 1727
CHAIRMAN HODGINS asked if there were any objections to the
amendment. Hearing none, Amendment 1 passed.
Number 1734
MR. LOGAN stated that the final change is on page 2, line 23, it is
the insertion of the requirement for a minimum of 10 years
professional experience in the field of petroleum geology in order
to serve on the commission.
Number 1706
MIKE DUNN stated that he is representing himself and he has worked
for a major oil company as a petroleum engineer for 15 years. He
stated that he has worked in drilling, production, reservoir and
exploration. He stated that the underlying intent of the bill is
to raise the standards that the state has to manage the resources.
He pointed to the city of Long Beach and the Texas Railroad
Commission as a model, as they are recruit side by side with the
major oil companies on campuses, hiring the best and the brightest
engineers.
Number 1868
REPRESENTATIVE OGAN asked if he thought the bill raised the
standards for petroleum engineer.
MR. DUNN replied that a minimum standard is a good idea and this
bill is a direction that the state needs to take.
Number 1925
REPRESENTATIVE BUNDE stated that the zero fiscal notes accompanying
the bill contained, in the justification section, lobbying against
the bill. He stated that a fiscal note should just contain fiscal
analysis and if someone wants to lobby about the bill they should
come to the meeting and discuss their views. He stated that this
backdoor approach to lobbying is unacceptable.
CHAIRMAN HODGINS stated that he whole-heartily agreed.
Number 1966
REPRESENTATIVE ROKEBERG asked Representative Green if the
description of the course work that now will have to be included
and completed, would be the curriculum necessary to obtain a degree
in petroleum engineering.
Number 1902
REPRESENTATIVE GREEN replied that they are just individual areas
and not necessarily course work and in any one of those areas there
are several courses that a petroleum engineer takes. He explained
that they are not requiring the completion of all of them, just
that they be introduced to them and complete a course in that
field.
Number 2026
REPRESENTATIVE ROKEBERG stated he wanted to verify for the record
that under the stated engineering statute there is not a
requirement to indicate what a petroleum engineer is. He asked if
there is a regulatory definition of a petroleum engineer.
Number 2060
MR. LOGAN replied that there is a petroleum engineering license and
there is regulatory language in Alaska Administrative Code that
addresses that.
Number 2108
REPRESENTATIVE ROKEBERG asked that the rationale for removing the
petroleum engineer language is to widen the pool of availability.
Number 2117
MR. LOGAN replied that is correct.
REPRESENTATIVE ROKEBERG asked if it would be okay to hire an out of
state person for the job.
MR. LOGAN replied that it was discussed at the last hearing in a
letter from the Department of Law, which stated that in order for
a person to serve on a board or commission in the state they must
be registered to vote at least 30 days prior to last general
election.
Number 2137
REPRESENTATIVE GREEN stated that in the Alaska Administrative Code,
12 AAC 36.990 "item 14" described petroleum engineer.
Number 2151
REPRESENTATIVE BUNDE made a motion to move CSHB 274(O&G), 0-
LS0998\L, Glover, 2/11/98, as amended without the attached fiscal
note.
Number 2172
CHAIRMAN HODGINS asked if there was an objection. Hearing none,
CSHB 274 (O&G),0-LS0998\L, Glover, 2/11/98, as amended without the
attached fiscal note was moved out of the House Special Committee
on Oil and Gas.
ADJOURNMENT
Number 2194
CHAIRMAN HODGINS adjourned the House Special Committee on Oil and
Gas meeting at 11:50 a.m.
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