Legislature(1997 - 1998)
03/31/1998 10:04 AM House O&G
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE SPECIAL COMMITTEE ON OIL AND GAS
March 31, 1998
10:04 a.m.
MEMBERS PRESENT
Representative Mark Hodgins, Chairman
Representative Scott Ogan
Representative Norman Rokeberg
Representative Joe Ryan
Representative Tom Brice
Representative J. Allen Kemplen
MEMBERS ABSENT
Representative Con Bunde
COMMITTEE CALENDAR
SENATE CONCURRENT RESOLUTION NO. 20
Relating to support of the State of Alaska's areawide leasing
program.
- MOVED SCR 20 OUT OF COMMITTEE
*HOUSE BILL NO. 469
"An Act approving the sale of Prudhoe Bay Unit royalty oil by the
State of Alaska to Mapco Alaska Petroleum, Inc.; and providing for
an effective date."
- SCHEDULED BUT NOT HEARD
(* First public hearing)
PREVIOUS ACTION
BILL: SCR 20
SHORT TITLE: STATE Areawide LEASING PROGRAM
SPONSOR(S): SENATOR(S) PEARCE
Jrn-Date Jrn-Page Action
1/13/98 2181 (S) READ THE FIRST TIME - REFERRAL(S)
1/13/98 2181 (S) RESOURCES
2/04/98 (S) RES AT 3:30 PM BUTROVICH ROOM 205
2/06/98 (S) RES AT 3:30 PM BUTROVICH ROOM 205
2/06/98 (S) MINUTE(RES)
2/09/98 2450 (S) RES RPT 4DP
2/09/98 2450 (S) DP: GREEN, TAYLOR, TORGERSON, SHARP
2/09/98 2450 (S) ZERO FISCAL NOTE (S.RES)
2/10/98 (S) RLS AT FAHRENKAMP RM 203
2/10/98 (S) MINUTE(RLS)
2/12/98 2497 (S) RULES TO CALENDAR 2/12/98
2/12/98 2504 (S) READ THE SECOND TIME
2/12/98 2504 (S) PASSED Y17 N- E2 A1
2/12/98 2506 (S) TRANSMITTED TO (H)
2/16/98 2324 (H) READ THE FIRST TIME - REFERRAL(S)
2/16/98 2325 (H) OIL & GAS
3/31/98 (H) O&G AT 10:00 AM CAPITOL 124
WITNESS REGISTER
KRISTY TIBBLES, Researcher
to Senator Drue Pearce
Alaska State Legislature
Capitol Building, Room 518
Juneau, Alaska 99801
Telephone: (907) 465-4747
POSITION STATEMENT: Testified on SCR 20.
JOHN SHIVELY, Commissioner
Department of Natural Resources
400 Willoughby Avenue, 5th Floor
Juneau, Alaska 99801
Telephone: (907) 4532400
POSITION STATEMENT: Testified on SCR 20.
ACTION NARRATIVE
TAPE 98-29, SIDE A
Number 0001
CHAIRMAN MARK HODGINS called the House Special Committee on Oil and
Gas meeting to order at 10:04 a.m. Members present at the call to
order were Representatives Hodgins, Rokeberg, Ryan and Brice.
Representatives Ogan and Kemplen arrived at 10:05 a.m.
SCR 20 - STATE AREAWIDE LEASING PROGRAM
Number 0012
CHAIRMAN HODGINS announced the committee would hear SCR 20,
"Relating to support of the State of Alaska's areawide leasing
program."
KRISTY TIBBLES, Researcher to Senator Drue Pearce, stated that
Senator Pearce sponsored SCR 30 at the request of the support
industry, The Alliance. She stated that in 1996 the legislature
created the state's areawide leasing program with unanimous support
by all 60 legislators and the governor. The current program has
been implemented successfully by the Department of Natural
Resources and has provided a cost and labor savings approach to
offering lease sales in areas of Alaska, already subjected to
extensive leasing. She stated that the oil and gas industry
operates in a very contentious environment in Alaska and by passing
this the legislature would lend its unwavering support for this
practical approach to leasing the state's oil and gas land. She
stated that this resolution further emphasizes the benefits of this
program for all Alaskans.
Number 0047
REPRESENTATIVE JOE RYAN stated that according to the letter from
The Alliance, the opposition claimed they did not have sufficient
time to express their opinions on the legislation. He asked who
the opposition is.
MS. TIBBLES replied that she did not know and stated that a member
from The Alliance was supposed to be here to also testify.
Number 0065
JOHN SHIVELY, Commissioner, Department of Natural Resources, stated
that the administration supports the resolution and is in the
process of implementing the law and will have the first areawide
sale on June 24th. He asserted that the preliminary best interest
finding for the Cook Inlet areawide sale will be out shortly, the
sale is scheduled for April 1999. He stated that there are two
other areawide sales scheduled for the future. He stated that this
is a better way to lease as it allows the public to understand
where they are leasing, for the government to do one best interest
finding for ten years, and the industry to understand which land is
going to be available for the leasing and when.
Number 0101
REPRESENTATIVE NORMAN ROKEBERG asked what was the plan in Cook
Inlet after the follow up of the initial plan.
Number 0111
COMMISSIONER SHIVELY responded that the first sale is scheduled for
April of 1999 and then each April for the next ten years "Cook
Inlet areawide will take place. He stated that there would be a
comment period prior to the sale where the best interest finding
could be amended if so needed.
Number 0123
REPRESENTATIVE ROKEBERG asked what the name of the sale is.
COMMISSIONER SHIVELY stated that they changed the name to Cook
Inlet Areawide Lease Sale as it is not as important now to have
numbered sales.
REPRESENTATIVE ROKEBERG asked if he was starting with new baseline
findings for each of the four sales described or are there findings
in place because the 10 year renewal.
Number 0150
COMMISSIONER SHIVELY stated that they are building on the existing
findings and making the appropriate findings as information comes
available but they do not start from scratch.
Number 0161
REPRESENTATIVE ROKEBERG stated that he inserted into the bill the
10 year window and asked how he was determining the ten year
window.
Number 0164
COMMISSIONER SHIVELY stated that he misunderstood his previous
question. He stated that what happens is that they will do a full
blown best interest finding and that final finding will stand for
the 10 years. However, each year they will ask for significant new
information that might cause an amendment of the best interest
finding. He stated that the best interest finding would stand for
the ten years but it is possible to have some amendments to it.
Number 0180
REPRESENTATIVE ROKEBERG asked how much money the department is
going to be saving in developing investments and findings for the
next ten years.
Number 0200
COMMISSIONER SHIVELY responded that he could not answer that,
although there will be some savings as there will be fewer sales to
deal with. He stated that there is no question that there will be
a definite work load savings for the department.
Number 0215
REPRESENTATIVE ROKEBERG asked what an estimate would be to put
together a full blown best interest finding. Would it be in the
$300,000 to $400,000 range.
COMMISSIONER SHIVELY replied that he did not want to guess.
Number 0227
REPRESENTATIVE ROKEBERG asked him to guess or make some
assumptions. He stated that it would be supportive of the
resolution and it would stroke his ego a little bit.
CHAIRMAN HODGINS stated that the chair recognizes the job that
other legislatures have done on this and Representative Rokeberg is
noted.
Number 0252
REPRESENTATIVE KEMPLEN asked what have been the major concerns
raised with the areawide leasing program and how has the department
met those concerns.
Number 0255
COMMISSIONER SHIVELY responded that the major concern is that there
is too much acreage offered at one time and that people think a
best interest finding cannot be done in a place like Cook Inlet to
cover 5 million acres but of which we will be leasing 2.8 million
acres. He stated they have leases all but 6 percent of this land
in the previous lease sales, so it is not like this is new area.
He stated that the previous lease sale program with multiple leases
for sale at the same time causes a huge amount of confusion for the
public. He stated that his answer to people that feel they are too
much is that this program makes more sense.
Number 0278
REPRESENTATIVE TOM BRICE stated that in the analysis section of the
fiscal note resolution is mis-spelled. He offered an amendment to
correct the mis-spelling.
CHAIRMAN HODGINS asked if there was an objection. Hearing none, it
was so ordered.
Number 0300
REPRESENTATIVE OGAN made a motion to move SCR 20 with the corrected
zero fiscal note attached.
CHAIRMAN HODGINS asked if there was an objection. Hearing none,
SCR 20 was a moved out of the House Special Oil and Gas Committee.
ADJOURNMENT
CHAIRMAN HODGINS adjourned the House Special Committee on Oil and
Gas meeting at 10:20 a.m.
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