Legislature(2017 - 2018)BARNES 124
02/21/2018 01:00 PM House RESOURCES
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| Audio | Topic |
|---|---|
| Start | |
| Presentation(s): Proposed Pebble Mine | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE RESOURCES STANDING COMMITTEE
February 21, 2018
1:15 p.m.
MEMBERS PRESENT
Representative Andy Josephson, Co-Chair
Representative Geran Tarr, Co-Chair
Representative John Lincoln, Vice Chair
Representative Harriet Drummond
Representative Justin Parish
Representative Chris Birch
Representative DeLena Johnson
Representative David Talerico
MEMBERS ABSENT
Representative George Rauscher
Representative Mike Chenault (alternate)
Representative Chris Tuck (alternate)
COMMITTEE CALENDAR
PRESENTATION(S): PROPOSED PEBBLE MINE
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
ANDY MACK, Commissioner
Department of Natural Resources (DNR)
Anchorage, Alaska
POSITION STATEMENT: Provided a PowerPoint presentation
entitled, "Permitting Processes for the Pebble Project," dated
2/21/18.
LARRY HARTIG, Commissioner
Department of Environmental Conservation (DEC)
Juneau, Alaska
POSITION STATEMENT: Provided an overview of the major permits
that may be required from DEC for the proposed Pebble Mine.
SAM COTTEN, Commissioner
Alaska Department of Fish & Game (ADF&G)
Juneau, Alaska
POSITION STATEMENT: Provided a PowerPoint presentation
entitled, "House Resources Committee Pebble Project Update,"
dated 2/21/18.
RON BENKERT, Regional Supervisor
Anchorage Area Office
Division of Habitat
Alaska Department of Fish & Game (ADF&G)
Anchorage, Alaska
POSITION STATEMENT: Answered questions during the ADF&G
presentation on the proposed Pebble Mine.
ACTION NARRATIVE
1:15:12 PM
CO-CHAIR ANDY JOSEPHSON called the House Resources Standing
Committee meeting to order at 1:15 p.m. Representatives
Josephson and Talerico were present at the call to order.
Representatives Johnson, Lincoln, Drummond, Parish, Tarr, and
Birch arrived as the meeting was in progress.
^PRESENTATION(S): PROPOSED PEBBLE MINE
PRESENTATION(S): PROPOSED PEBBLE MINE
1:15:42 PM
CO-CHAIR JOSEPHSON announced the only order of business would be
presentations by the commissioners of the Department of Natural
Resources (DNR), the Department of Environmental Conservation
(DEC), and the Alaska Department of Fish & Game (ADF&G) on the
proposed Pebble Mine.
1:16:34 PM
ANDY MACK, Commissioner, Department of Natural Resources (DNR),
provided a PowerPoint presentation entitled, "Permitting
Processes for the Pebble Project," dated 2/21/18. He explained
the presentation would cover a broad context on mining in
Alaska, the present permitting status of the proposed Pebble
Mine project, and DNR's expectations going forward. He noted
the three photographs on slide 1 are of operations at the Pebble
Mine and were taken 9/17/17 during one of two DNR site
inspections. Turning to slide 2 he said the map illustrates
mining activities in the state, including producing mines, and
pointed out that DNR works on lots of mine prospects,
opportunities, and operating mines located throughout Alaska.
COMMISSIONER MACK stated DNR aggressively seeks to ensure the
state is in control of its future on issues related to oil and
gas resources as well as to the growing mining industry. He
acknowledged there is tension between federal and state agencies
and expressed his belief Alaska is developing its resources and
caring for its environment. For example, the state is engaged
in the national discussion on definitions of the [Waters of the
United States (WOTUS), pursuant to the Clean Water Act], and in
review of the U. S. Environmental Protection Agency's (EPA's)
requirements of the Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA), Section 108(b), which
is the financial responsibility requirements for mining
operations.
COMMISSIONER MACK related that Alaska state government has long
been confident in its bonding requirements system for an
operational mine in Alaska and is encouraging federal agencies
to stand down so that [the state] can take a greater role. He
said DNR is advancing the state's interest in the Eastern
Interior Resource Management Plan (RMP) issued by the Bureau of
Land Management (BLM), which is another example of DNR's efforts
to take control of the state's future.
1:21:18 PM
COMMISSIONER MACK displayed slide 3 and reviewed the proposed
project's status. He said the Pebble Project is a large deposit
in the advanced exploration stage of development; it is located
in the Bristol Bay region 17 miles northwest of Iliamna; and
consists of two contiguous deposits - Pebble West on which the
application is now and Pebble East [with combined estimated
mineral resources of 80.6 billion pounds of copper, 5.6 billion
pounds of molybdenum, and 107.4 million ounces of gold].
COMMISSIONER MACK moved to slide 4 and explained DNR has issued
a miscellaneous land use permit (MLUP), number 6118, for Pebble
which - with two small exceptions - is the interface between the
state, as landowner, and the project. On December 31, 2017, the
multiyear MLUP permit [issued to Pebble Limited Partnership
(PLP)] was due to expire. The application on the multiyear
application was for the continued care, maintenance, and
reclamation of existing boreholes and facilities. The last
borehole at the site was drilled in 2013, and since then Pebble
has been responsible for care and maintenance. An extension was
granted so DNR could take public comment from 11/1/17-11/30/17,
during which time 1,500 comments were received. He
characterized many of the comments as substantive, detailed, and
sometimes critical, in contrast to the thousands of MLUPs issued
by DNR for which there are typically zero comments.
1:25:41 PM
COMMISSIONER MACK stressed that an MLUP is issued by DNR if
there are impacts to less than five acres on a continuous basis.
Because Pebble is using helicopter support for most of its
activities, the project's impact footprint is less than five
acres, thus the MLUP is a legitimate permit. He referred to the
[Nunamta Aulukestai, et al., vs. State of Alaska and Pebble
Limited Partnership] litigation which DNR interpreted to mean
that DNR must follow a thorough public comment and public notice
process. He expressed his belief DNR is also responsible for
evaluating comments and considering them prior to issuing a
future MLUP. He described DNR's thorough review of the comments
and its decision to incorporate some of the comments into the
current MLUP; for example, the length of the permit was limited
to one year because new activities at the mine site were
anticipated. Commissioner Mack opined that limiting the MLUP to
one year was a wise decision, given that the previous permit was
a care and maintenance permit; there were no wells planned.
Now, there are applications to the U.S. Army Corps of Engineers
(USACE) and plans are being developed, and there is time to
review plans to consider them in developing terms for the next
permit. Therefore, in 2018, Pebble has submitted a new
application and terms can be reconsidered by DNR.
1:29:50 PM
COMMISSIONER MACK said another effect of the litigation is that
DNR strives to ensure all information about the project that can
be released is published online in a timely manner. Also
addressed by comments on the project was that within the MLUP
there should be financial assurance provided to the state thus
the permit requires a $2 million performance guarantee to allow
the state to perform cleanup if necessary. Other elements of
the MLUP include a requirement for coordination between the
Alaska Department of Fish & Game (ADF&G) and DNR on wildlife
issues, and a well closure plan for existing boreholes. During
the exploration phase of a mine, boreholes may be left open to
monitor water; however, in the permit DNR clarified that of 612
open boreholes, 600 would be inspected, 300 in each of two
years, and 138 boreholes would be closed as part of the
reclamation project in 2017. He stressed DNR's intent to ensure
the integrity of this unique area and to make sure the burden
and obligation are on the operator.
1:35:44 PM
COMMISSIONER MACK addressed slide 5 and noted DNR conducted
aerial and field inspections in 2017 which covered 278 sites in
detail. Since 2003 there have been 58 state agency inspections,
he said, and DNR's intent is to continue active inspections in
the future. He moved to slide 6 and said Pebble's MLUP renewal
application is different from last year and proposes various
activities for 2018, including 61 geotechnical boreholes, 19
diamond drill core boreholes, minor repairs to Borehole 3127,
and routine inspections. He pointed out DNR held a public
comment period from 1/19/18-2/20/18, and 1,800 comments were
received; he restated the value of public comments.
COMMISSIONER MACK displayed slide 7 and provided a history of
the project. He said Northern Dynasty acquired a purchase
option in 2001 and consolidated its ownership interest in 2007,
which was the year the Pebble Limited Partnership was formed.
Exploration since then has been mostly helicopter-supported
exploration. The first borehole was drilled in 1988 and the
last in 2013, with a total of 1,355 boreholes, of which
approximately 600 remain active. The 2017 MLUP document stated
that field inspections revealed Pebble complied with DNR, and
closed the boreholes as requested, albeit some have "lingering
issues." The site has 2,402 claims over 416 square miles. He
acknowledged this is a significant area of land but said many of
the 1,355 boreholes are consolidated in a more central location.
1:41:06 PM
COMMISSIONER MACK moved to slide 8 and continued to outline the
history of the Pebble Project. He stated that baseline studies
were conducted from 2004 to 2008, and aquatic biomonitoring was
conducted by ADF&G in 2010, all of which are available to the
public. He explained slide 9 depicts a general description of a
timeline for mining projects in Alaska and is not specific to
the Pebble Project. Although the timeline for the Pebble
Project is unknown, DNR estimates the project has entered the
advanced exploration, environmental studies, and prefeasibility
study phases.
COMMISSIONER MACK turned to slide 10 to discuss the federal
review process. He pointed out that the Pebble Project's
Section 404 Clean Water Act application is a major federal
action that triggered the National Environmental Policy Act
(NEPA), and the U.S. Army Corps of Engineers (USACE) is the lead
agency for the project. He explained that USACE, the U.S. Fish
and Wildlife Service (USFWS), the Department of the Interior
(DOI), and EPA have understandings based on the Clean Water Act
(CWA) and work together to an extent but are also competing
agencies in some cases as they develop CWA permits, under which
the Pebble Project falls. He noted that Pebble requires a CWA
permit, and that typically this process goes smoothly, although
there are some exceptions. He recalled a failed permit by
ConocoPhillips around a decade ago. He stressed that every
permit is unique. Regarding federal review, he noted public
scoping will start in March 2018, and the next step will be the
environmental impact statement (EIS) process, a process with
which DNR is familiar.
1:45:39 PM
COMMISSIONER MACK displayed slide 11 and advised that the
anticipated state permits include various permits [from DNR,
Department of Environmental Conservation (DEC), Alaska
Department of Fish & Game (ADF&G), and the Department of
Transportation & Public Facilities (DOT&PF). Currently, he
said, DNR has [issued] a temporary water use authorization for
water used for exploration at the mine site, and an MLUP. At
the time of the plan of operations, public comment is taken, and
decisions will be made. He briefly described the purposes and
circumstances of several other permits.
1:48:21 PM
COMMISSIONER MACK moved to slide 12 and discussed the role of
state permit coordination facilitated by DNR through the Office
of Project Management and Permitting (OPMP). He said OPMP
coordinates permits - but has no permitting authority - and
ensures questions are answered, particularly on a "critical path
item," such as major projects on the North Slope or mining
expansions. The expenses of OPMP are paid by industry.
Displaying slide 13 he said DNR expects applications for state
authorizations will be submitted during the NEPA process. He
characterized the USACE preliminary schedule of a scoping phase
in March 2018 and possibly a Record of Decision (ROD) by
September 2020 [a correction to slide 13] as a "very quick
schedule." He stressed the state will participate fully in the
federal process, regulate exploration activities, coordinate
with DEC and ADF&G, and engage with USACE and other federal
agencies, tribes, industry, and stakeholders.
1:52:46 PM
REPRESENTATIVE JOHNSON inquired about the status of the casings
that have been left above ground.
COMMISSIONER MACK replied that last year DNR was notified of
serious physical hazards on public land. He advised that, in
the MLUP last year, DNR asked Pebble to cut the metal casings
down to grade level so the metal casings would no longer stick
up above ground. He offered his belief that Pebble had complied
to a great extent.
REPRESENTATIVE JOHNSON directed attention to slide 9, General
Project Timeline, and asked how long the entire process might
take from beginning to end.
COMMISSIONER MACK clarified that slide 9 is for a typical large
mine process without an actual number of years involved. He
noted Pebble's first well was drilled in 1988 and one of the
concerns from stakeholders is that the state wasn't provided a
project plan until after 10 years of activity. However, he
continued, the process is underway, and the state now has an
application for review.
REPRESENTATIVE JOHNSON asked for a timeline for state and
federal permitting.
COMMISSIONER MACK directed attention to the list of permits on
slide 11 and said there is not a typical timeline involved in
developing a plan of operation or for the leases that are
necessary. Speaking from his experience, he said he really
doesn't know.
1:59:02 PM
CO-CHAIR JOSEPHSON drew attention to slide 4 and inquired
whether the $2 million performance guarantee is a cash bond.
COMMISSIONER MACK said yes, Pebble provided a $2 million
performance guarantee from the bonding market.
CO-CHAIR JOSEPHSON inquired as to DNR's total bonding
requirements for the entire project.
COMMISSIONER MACK responded that the performance guarantee is to
do the work in the exploration phase. He explained that after
the plan of operation proposal, DNR uses a computerized formula
to determine the amount of the bond for the next phase, which
can be very significant. For example, the bond required for the
Red Dog Mine is approximately $500 million.
CO-CHAIR JOSEPHSON surmised the [newly proposed transportation]
corridor to the west of Cook Inlet has not been approved by the
state. He asked whether USACE could evaluate the application
prior to the state's decision.
COMMISSIONER MACK confirmed a [transportation] corridor has not
been approved and opined that USACE does not have the ability to
evaluate this issue without the state's participation.
2:02:12 PM
REPRESENTATIVE PARISH, regarding the 1,500 comments for the MLUP
application and the 1,800 comments for the renewal application,
inquired as to the number of individuals submitting comments as
opposed to one person sending multiple comments. He further
inquired as to the percentages of favorable and opposed comments
that were received from individual senders for the renewal.
COMMISSIONER MACK answered that 1,500 was the number of
individuals, and that a significant majority expressed concerns
or opposed the renewal.
2:04:40 PM
REPRESENTATIVE DRUMMOND questioned how an MLUP, limited to an
area less than five-acre impact area, could apply to a project
that is exploring 2,402 claims spread over 416 square miles.
COMMISSIONER MACK replied:
I've been given a phrase, which is the very technical
phrase, which is "five acres of un-reclaimed
disturbance," okay? I view it as a more practical
matter, as the five acres, or less than five-acre
standard or threshold, is really represent[ing] what
you would place on the tundra on a day-to-day basis
and what has been out in the field for a number of
years.
COMMISSIONER MACK directed attention to the photos on slide 1
and pointed out that a camp would count as part of the five
acres. However, he continued, disturbance from a helicopter-
supported operation can be distinctly less, as seen by the photo
of a wellbore which is the extent of the disturbance.
REPRESENTATIVE DRUMMOND asked whether a camp is established at
every borehole.
COMMISSIONER MACK responded no, there is only one central main
supply camp within the area of the deposit.
2:07:12 PM
CO-CHAIR TARR offered her understanding that information
provided to DNR in the MLUP application differs from that of the
USACE Clean Water Act application, and that of the new smaller
mine plan. She asked whether the state will request additional
information.
COMMISSIONER MACK confirmed the state would request more
information from the federal agency.
CO-CHAIR TARR asked whether the MLUP would be [renewed or a new
MLUP issued] prior to receipt of any additional information; for
example, additional information on the economics of the project.
COMMISSIONER MACK anticipated that in the federal permitting
process, information would be provided in various stages of the
process. He stressed DNR seeks to ensure that, regarding care
and maintenance, an MLUP is in place. He said DNR cannot delay
with the approach of a field season; however, in some cases DNR
has become a cooperating agency with a federal agency, with the
big picture in mind.
CO-CHAIR TARR inquired whether an MLUP related to care and
maintenance would be issued for one year. She further inquired
whether, as a cooperating agency, DNR would have influence over
the approval of the [Section 404, Clean Water Act] permit.
COMMISSIONER MACK answered that the term would be evaluated
during the processing of the MLUP application. Although DNR can
cooperate with federal agencies in many ways, he said, it does
not have authority over USACE or vice versa.
2:12:12 PM
CO-CHAIR JOSEPHSON recalled testimony and photographic evidence
were provided about a year ago by Dr. Chambers and members of
United Tribes [of Bristol Bay] regarding petroleum and acid
pollution at some of the [1,355] borehole sites, and that they
were not handled properly. Co-Chair Josephson noted that none
of the drill sites have been tested since 2013. He further
recalled that [in testimony on 2/19/18] Dr. Chambers said in
essence that the state was largely satisfied with the
abandonment of those sites, and General Hamilton said DNR's
requirement of a $2 million cash bond was a typical course of
events. He asked Commissioner Mack to comment on the United
Tribes' perspective that the wellbore sites were not handled
properly and whether that was the event that caused DNR to
require a cash bond. He further asked the commissioner to
address whether the department is relatively satisfied at this
point.
COMMISSIONER MACK responded that once mine operation is reached
there is a significant bond in play, but the Pebble Project is
currently in the exploration phase. The performance guarantee
and the bond that is part of that is dedicated to the
proposition that it will cover the cost of going into the field
and removing the equipment that is out there and ensuring that
the worksites are in reasonably good shape when they are left,
should the operator fail to do so. He said DNR received
recommendations in letter form from consultants and groups in
the region about what a performance guarantee would look like.
Two numbers were presented - $1.7 million and $2 million - and
DNR chose the higher of the two. To its credit, [PLP] agreed to
place a performance guarantee with the state. Regarding the
difference of opinion between Dr. Chambers and General Hamilton,
Commissioner Mack stated DNR will continue to look at this area
to ensure that whatever is going on is done very well. From the
two inspections of sites conducted last year, he continued, the
department feels comfortable, otherwise there would have been
notices of violation. The same standards are being applied here
as would be applied to an oil project on state lands. Nothing
is swept under the rug, everything is public. The inspection
reports, which are online, are solid and thorough documents.
2:18:14 PM
CO-CHAIR JOSEPHSON referred to slide 7 and offered his
understanding that unless there is a mining closure or land
designation such as a refuge, mining is presumptively open on
all state land for a claim. Regarding the 2,402 claims on slide
7, he said he wonders whether the state, industry, and people of
the state could spend a thousand years looking at whether there
will be mining in an area. He asked whether Commissioner Mack
thinks there should be a policy in place that talks more
globally about places where mining is less contentious and
places where it is inarguably very contentious. He asked
whether the Pebble mine, which has been an issue since at least
2006, could span the century.
COMMISSIONER MACK replied he does not know the answer, but that
as an agency DNR is paying close attention and working hard and
following the law, and part of that is listening to people who
live in Alaska.
CO-CHAIR JOSEPHSON, relative to the timeline of the USACE
application, recalled testimony from the prior week that things
are moving on a typical timeline but that there is program
called the "fast program." He offered his understanding that
while two other mines did not ask for that expedited approach,
Pebble has.
COMMISSIONER MACK answered he has been told that is the case but
has not actually read that request himself.
CO-CHAIR JOSEPHSON asked whether DNR has an opinion about that.
COMMISSIONER MACK replied it is up to the applicant given one of
their options is to decide when to apply and how fast to push.
He opined that DNR has done a very thorough job on the permit
that it has now and will continue to do so. What it will do on
its application is a question for Pebble.
CO-CHAIR JOSEPHSON, regarding the 61 additional boreholes that
are being requested, inquired whether such a request is usual
after having made a Section 404 permit application to the USACE.
COMMISSIONER MACK responded it is not unusual and added that
understanding what is in the different applications is a focal
point of DNR.
2:22:58 PM
LARRY HARTIG, Commissioner, Department of Environmental
Conservation (DEC), provided an overview of the major permits
the Pebble Project may require from his department. He said DEC
has not received any permit applications from Pebble at this
point and therefore his overview is speculative and based on
similar projects in Alaska. He stated the three major permits
would include: The Clean Water Act (CWA) Section 402 wastewater
discharge permit for processed and storm water collected at the
mine site; a group of authorizations requested by DEC's Division
of Oil Spill Prevention and Response (SPAR) relating to oil
spill prevention and response, such as for liquid fuels used by
the project; and air quality permits for emissions from a power
plant at the mine site, for fugitive dust, and for an unknown
power plant at the port site. He advised that many other
permits would also be necessary, and DEC would have a major role
in the NEPA process along with DNR and ADF&G. He further noted
that DEC serves as the responsible state agency that would
ultimately certify or not certify the Section 404 permit under
Section 401 of the CWA.
2:26:32 PM
COMMISSIONER HARTIG, regarding the permits from DEC, pointed out
that air quality permits require the longest lead time on any
major project because it involves collecting lots of information
to evaluate the impact of the location and concentrations of
emissions. Air quality information includes weather, physical
obstructions, topography, the location of monitoring sites,
seasonal variations, and other meteorological information which
can take years to collect for a project to apply for permits.
He noted that Pebble began collecting information in 2006 for
its larger project, but while the quality of the data is good
the collection locations may not be relevant to the new project.
COMMISSIONER HARTIG advised that DEC's Division of Air Quality
hasn't had discussions with Pebble since 2013 and thus has no
recent information on the project except what was provided to
USACE, which proposes a power plant at the mine site fueled by
natural gas. Due to the power plant's proposed large size of
230 megawatts, it may be subject to Prevention of Significant
Deterioration (PSD) requirements, which are requirements under
the federal Clean Air Act (CAA). This means higher standards
must be met for the priority air pollutants that are discharged
and these cannot exceed what is called an "increment." He
explained that the reason emissions are measured in increments
is because if one big facility moved into an area and discharged
right up to the limit of ambient air quality standards, then no
room would be left for another facility to move in as the air
quality standards would then be exceeded.
2:29:35 PM
COMMISSIONER HARTIG noted that a key consideration when DEC
looks at this facility is whether it will or will not be a PSD
facility and whether it will be triggering federal [CAA]
requirements or will be strictly under state standards. He
stated that given the size of the plant, DEC thinks it will
likely be under the federal standards. Because DEC has been
delegated the CAA permitting program in Alaska, it would be
following those federal rules and would issue the permit with
EPA oversight. Permitting a PSD facility includes review of the
emissions sources and that equipment would have to meet what is
called "best available control technology." At the mine site,
DEC would also be looking at fugitive dust caused by the large
surface mine with disturbance, pit laydown areas, low-grade ore
stockpiles, wind, erosion, and dust in the air, as well as
exhaust and dust from the trucks. Furthermore, DEC presumes
that both the mine and the port will need a backup power system
which would likely be diesel-run generators that would also
require review of the emissions. Further, DEC will need to look
at where the public will be accessing areas at the active mine
site and the port and examine whether the air emissions in those
areas will meet ambient air quality standards. These standards
are set by the state but follow national EPA requirements to
protect human and environmental health within the facility
boundary. Facility boundaries are further complicated by access
to subsistence lands and public use, and this would be another
aspect of DEC's permitting activity. Although DEC is unsure of
the source of power generation at the port, power generation
requires state air permits.
2:33:47 PM
COMMISSIONER HARTIG discussed what the Division of Oil Spill
Prevention and Response (SPAR) may be called upon to do. He
said [PLP] has talked about a natural gas line across [Cook]
Inlet. He pointed out that a year ago a gas line that delivers
commercial gas for energy to the platforms in Cook Inlet was
leaking. The leak was complicated by ice cover, so boats and
divers couldn't safely be brought to the area to repair the
subsea line. Additionally, the icecap prevented dispersal of
the methane gas that was coming up, causing concern that the
methane would displace the oxygen in the water column and make
it hypoxic to fish and marine mammals. Therefore, DEC would
need to look at where the proposed gas line would be located and
whether there could be ice conditions.
COMMISSIONER HARTIG related that over the past year DEC has been
having discussions with the Pipeline Hazardous Materials Safety
Administration (PHMSA), a federal agency that is part of the
federal Department of Transportation that has the primary
oversight of gas lines. He advised that PHMSA would be the
agency primarily responsible for looking at how this subsea line
would be built, maintained, and tested, but that SPAR would get
interested if a release occurred from this subsea line. He said
DEC and PHMSA are presently discussing entering a memorandum of
understanding (MOU) that would help define what DEC's roles
would be on Cook Inlet lines.
COMMISSIONER HARTIG noted that natural gas would presumably not
be the project's only fuel, and that diesel fuel would also be
coming into port by tank vessel or barge. That vessel, he
continued, would likely require a contingency plan (c-plan). A
c-plan is a pollution prevention and counter measures plan that
talks in broad terms about how spills would be prevented. The
department then has guidelines and [the project] must show how
it could respond within a defined period of time if a spill were
to occur of the magnitude that might be anticipated from an
operation like this. [The project] would also have to show DEC
that it has the resources to do that.
2:37:07 PM
COMMISSIONER HARTIG said he assumes Pebble would have storage
tanks at the delivery port. How storage tanks are regulated
depends on the volume, so DEC could require a c-plan or
something less for the tanks. He offered his understanding that
the project's proposal is to move the fuel up the road in
trucks. This would fall under PHMSA's jurisdiction, he
continued, and DEC would coordinate with PHMSA if there was a
spill. At the lake the trucks would be rolled onto the ferry
and be taken north across the lake about 16 miles. He said he
recently talked with the U.S. Coast Guard (USCG) about whether
it would oversee this because, as he understands it, there would
be ice breaking part of the year on the lake, which isn't
something DEC is familiar with. If the USCG determines it's a
navigable water, he continued, then the USCG would be involved
and would be looking at the capability and design of the vessel
and the competency of the crew. In this case, USCG and DEC
would work together on what plans should be in place in the case
of a spill. He further noted that there would also be a tank
farm up at the [mine] site which, depending on its size, may
need a c-plan. Or, if it is smaller, there would be other
requirements that come into play from SPAR.
COMMISSIONER HARTIG added that he thinks the concentrate and
reagents that would be moved up to the [mine] site would be
under federal jurisdiction. But, he said, DEC would be
coordinating with the federal agencies so that DEC would be
prepared in the event of a spill.
2:39:45 PM
REPRESENTATIVE PARISH offered his understanding that
Commissioner Hartig said it is unclear whether Lake Iliamna is a
navigable waterway.
COMMISSIONER HARTIG replied it isn't to him but that the USCG
thinks it might be and it needs to be assessed by the USCG's
legal team.
REPRESENTATIVE PARISH asked what the biological importance is of
Lake Iliamna.
COMMISSIONER HARTIG responded he understands it is the biggest
producer of red salmon in the world.
2:41:08 PM
COMMISSIONER HARTIG resumed his overview and related that no
permit applications have been received by DEC's Division of
Water, although baseline work has been done looking at water
quality and mapping streams and background conditions in the
area. He said DEC is assuming the project is going to need a
Clean Water Act 402 permit, which is a wastewater discharge
permit, at the mine because it is going to be generating
processed water and putting tailings into an impoundment that
could be potentially acid generating. The tailings would be
covered with water to try to minimize oxidation. There will be
other water needing treatment at the site, he stated, and to be
discharged it will have to meet water quality standards. Under
the Clean Water Act a permit will be needed from DEC to do that.
COMMISSIONER HARTIG explained DEC, as well as EPA, would also be
looking at stormwater because in a big site like this there are
EPA requirements to minimize the contact of the natural water
with the disturbed areas where it might pick up metals and other
contaminants, thereby minimizing the amount of water needing
treatment. A wastewater treatment plant will be needed to
collect and treat this water, and a permit will be needed so the
discharge meets water quality standards. In issuing the permit,
DEC would be looking at protecting the receiving water. He
offered his understanding that the discharge would be into the
northern part of the Koktuli River drainage, so the water
quality in that stream would have to meet state water quality
standards. He noted there is nothing in the project's
application to the USACE that indicates it is going to be asking
for any kind of variations from the state water quality
standard, such as a mixing zone which would be an initial area
of dilution that would allow some mixing in the Koktuli River
before it would have to meet water quality standards.
Therefore, he continued, his presumption at this point is that
there wouldn't be a mixing zone. He further noted there is
nothing to indicate that the project would be looking at trying
to find some variance to state water quality standards, such as
site-specific criterium. So, under that scenario the water
quality standards would have to be met.
COMMISSIONER HARTIG said water quality standards start getting
into Tier 3 and these standards include the state's anti-
degradation policy. Initially all waters of the state were
designated for all uses, with these uses including protection of
the growth and propagation of freshwater aquatic life, drinking
water, contact recreation including eating the fish that a
person would catch, non-contact recreation, and agriculture use.
He explained that DEC sets criteria for different types of
pollutants, such as copper, zinc, lead, so that the amounts of
those pollutants in the water would not exceed a threshold that
would impair that designated use. When looking at a project
like this that would introduce into the stream a new pollutant
or more of a pollutant that may already be there, DEC must
figure out how much of that pollutant is going to end up in that
water, what the designated uses are, and whether it would exceed
the criteria that provide that threshold for how much could be
in that water to protect that use.
2:46:31 PM
CO-CHAIR JOSEPHSON noted that an application has been made by
members of the Bristol Bay community to classify the Koktuli
River as a Tier 3.
COMMISSIONER HARTIG confirmed such an application has been made.
CO-CHAIR JOSEPHSON asked whether Alaska has a Tier 3 criteria
that has been codified and adopted, and if not, how it would be
known whether the Pebble Project can meet the standards.
COMMISSIONER HARTIG answered that under the federal Clean Water
Act (CWA), each state is required to have water quality
standards for antidegradation. It describes the [framework and
methodology] that will be used before a decision is made to
allow any pollution to go into a water, he explained. This is
done by first classifying the water into Tier 1, 2, or 3, the
three that are generally presumed to be required under the CWA.
A Tier 1 stream doesn't currently meet all water quality
standards; a Tier 2 stream meets all the water quality standards
for the designated uses, so it would be protective of aquatic
life, drinking water, and so forth; a Tier 3 stream is the
highest level of protection and is described as outstanding
natural resource waters. The state has the option of choosing
whether to designate any of them; for example, Washington state
and Alaska have not designated any Tier 3 waters. If a state
does designate a Tier 3 water, then CWA and EPA regulations
provide that the water quality existing at the time of the
designation must be maintained. It has been interpreted to mean
that, other than very temporary things such as siltation from
nearby construction activity, no additional pollution can be
allowed in that water, regardless of whether that additional
pollution would exceed a criterium protective of designated
uses. For example, he explained further, if a facility is
already discharging into a Tier 3 water, it could continue to
discharge as it has been, but would be prohibited from
undertaking any activities that would discharge additional
amounts of an existing pollutant or a new pollutant. A Tier 3
water isn't necessarily a pristine water, it can also be a water
that is very important for recreational use or ecological
significance, so a Tier 3 water could be something like a hot
spring that people want to bathe in.
2:50:17 PM
COMMISSIONER HARTIG continued his answer and reiterated that
there are no Tier 3 waters in Alaska and said most of the waters
in the state are Tier 2 waters. It would take a legislative act
to get a Tier 3 water designation in the state, he advised. If
the legislature did that, then federal law and DEC's regulations
would kick in and the water would be protected. The Tier 3
protection process is there, it's just there is not a process
outside of the legislative process for designating a Tier 3.
For the past 10 years, he noted, DEC has been working to put
together implementation guidance that talks about how to
implement the state's antidegradation policy, which has been
around since about 1996. He said he will probably be signing
another set of regulations on that in the next day or two that
further clarify how [DEC] treats a Tier 3 water in a permitting
scenario. [The department] has tried for some time to
establish a public process where members of the public could
nominate a water for Tier 3 - there is no requirement in the CWA
to have such a process - but the governor feels strongly that
there should be one in Alaska. The main sticking point, he
related, has been the question of who would make this decision
on a nomination. There is division in the public comment - some
people believe it should be a legislative decision because of
the long-term implications of a Tier 3 designation and what
impact it might have on future development, and some people
believe it should be an administrative action that should be
based on objective criteria and leave the politics out of it.
Therefore, if a process is wanted for the public to nominate
then these things need to be filled in.
CO-CHAIR JOSEPHSON recalled that the administration did have
legislation on that and said more discussion is needed on it.
2:54:26 PM
SAM COTTEN, Commissioner, Alaska Department of Fish & Game
(ADF&G), said he will discuss ADF&G's role in habitat permitting
generally as well as specifically for the Pebble Mine. He
introduced the department's staff who are doing this work: Ron
Benkert, Kate Harper, and John Brenkin.
COMMISSIONER COTTEN related that in addition to its permitting
responsibilities, ADF&G is involved with at least five habitat
partnerships around the state, as well as partnerships with
communities, tribal groups, local governments, U.S. government,
oil companies, and sport and commercial fishing groups, to
contribute to healthy salmon habitat projects. The department
has lots of hands-on experience with standards that are used to
design structures, such as culverts and bridges that help fish
passage and help improve salmon habitat. He noted that these
are the same kind of standards that ADF&G applies to the people
coming in for permits.
COMMISSIONER COTTEN began his PowerPoint presentation entitled,
"House Resources Committee Pebble Project Update," dated
2/21/18. He displayed slide 2 and reviewed ADF&G's four
statutory authorities: the Fishway Act, Alaska Statute (AS)
16.05.841 regarding fish passage; the Anadromous Fish Act (AS
16.05.871), which is the department's primary permitting
authority for anadromous fish streams and bodies of water;
[Special Area Permitting (5 AAC 95.700)], the general provisions
in the department's regulations that deal with how permits are
applied for and handled; and a fish resource permit [from the
Divisions of Sport Fish and the Division of Commercial
Fisheries], which is in Title 16 for the purposes of handling
and transporting live fish.
COMMISSIONER COTTEN turned to slide 3 and explained that ADF&G's
general role in mining project evaluation is to work with the
applicant through the department's various divisions as well as
other state agencies. The department is part of the Large Mine
Permitting Team (LMPT), so in addition to receiving a permit
ADF&G works with the people who are applying the permit and help
them understand what is going to be required in terms of study,
design, data collection, and so forth.
COMMISSIONER COTTEN moved to slide 4 and noted ADF&G evaluates
mine projects. In addition to the site development, he said,
ADF&G is also involved in the infrastructure that supports site
development, such as roads and pipelines. No large development
is the same as another one, so ADF&G must evaluate the unique
characteristics of each large project and internally and
otherwise determine which specific permits are going to be
required for which projects.
COMMISSIONER COTTEN displayed slide 5 which listed activities
that would typically require fish habitat permits. [The listed
activities were: construction of fish barriers; flow reduction;
bridges, culverts, buried pipelines; water withdrawal and intake
structures; stream re-alignment and diversion channels; and
instream mitigation projects.]
COMMISSIONER COTTEN turned to slide 6 and explained that once a
permit is issued ADF&G remains involved with site inspections,
ongoing monitoring to ensure compliance with the permits, and
amending habitat permits if necessary.
3:01:03 PM
COMMISSIONER COTTEN moved to slide 7 and pointed out that ADF&G
is currently reviewing the Pebble Project's Section 404 permit
application with the U.S. Army Corps of Engineers (USACE), and
that ADF&G will be participating in the USACE Notice of Intent
(NOI) and the scoping opportunities. He noted that a change in
the project is a transportation corridor and said ADF&G will be
involved in evaluating what permits are going to be needed in
that area. The transportation corridor and gas line would get
close to the McNeil River bear viewing area, he continued, and
people have expressed interest in considering that.
COMMISSIONER COTTEN reviewed slide 8 and noted the project
activities for which fish habitat permits will likely be
required from ADF&G. He said ADF&G will likely receive permit
applications for such things as culverts, pipelines, and barge
landings. He displayed an aerial view (slide 9) of the overall
project area, which extends from the mine site to where a new
port would have to be developed. He also displayed a map
depicting the sites where ADF&G has already done work regarding
subsistence uses in the project area (slide 10).
3:02:24 PM
REPRESENTATIVE LINCOLN, regarding the permit requirement for
crossings over fish bearing water, recalled that a presentation
last week talked about how the area is covered with gravel and
there is a lot of exchange of water across the area. He asked
whether a stream that has no fish, but which is connected to
streams that do, would have any relevance to whether it needs to
be permitted.
3:03:06 PM
RON BENKERT, Regional Supervisor, Anchorage Area Office,
Division of Habitat, Alaska Department of Fish & Game (ADF&G),
replied that some previous hydrology studies have revealed
ground connections. Specifically, there appears to be a strong
groundwater connection between upper Talarik Creek and the south
fork of the Koktuli River, and there are probably other
instances of that. He said ADF&G has not yet evaluated the
areas along the new corridor. Some previous studies by Pebble
Project consultants looked at instream flows and exchange of
water near the mine site, but ADF&G has not had an opportunity
to initiate any studies or recommend studies for looking at that
specific kind of information on the new corridor. He advised
ADF&G anticipates that additional studies will be conducted to
clarify whether the old studies are still valid or what
additional information needs to be obtained to inform the
department's permitting decision. A lot of work still needs to
be done, he continued, as to what type of physical information
is going to be needed to evaluate the project.
COMMISSIONER COTTEN said the Section 404 permit application that
has been submitted suggests a certain number of culverts and
bridges. He stated that ADF&G will evaluate and determine
whether additional requirements are needed for culverts,
bridges, or any other crossings. So, even if something might
not be in the permit application, ADF&G would have potentially
an additional evaluation as to what else might be needed.
3:04:51 PM
CO-CHAIR JOSEPHSON inquired whether ADF&G can make those sorts
of requests of the applicant before it rules on permits.
COMMISSIONER COTTEN replied, "Absolutely yes."
COMMISSIONER COTTEN returned to his presentation and reiterated
that slide 10 displays the work ADF&G has done to identify
subsistence use. He explained that slides 11 and 12 provide a
general description of some of the studies that have previously
been conducted. He said copies of these studies can be provided
to the committee upon request. He noted ADF&G has identified
areas where additional studies are needed, such as evaluating
what permits will be required for the new transportation
corridor. Additionally, the new mine footprint will probably
need some reevaluation as to which permits ADF&G will have to be
involved with.
3:06:19 PM
REPRESENTATIVE BIRCH asked where things are at as far as federal
intervention on state land. He further asked whether [the
state] has taken a position in opposition to federal preempting
of state authority on state lands.
COMMISSIONER COTTEN responded there is a lot of case law on that
subject. He said he thinks it's clear that the United States
has an ability to require a Section 404 permit, for example, and
he doesn't think the state can tell the federal government that
it cannot do that. The state is not limited by federal
regulations or standards, he added, the state can be more
stringent than the federal government.
3:07:30 PM
CO-CHAIR JOSEPHSON noted the Pebble permit application to the
USACE proposes an 83-mile [transportation] corridor. He asked
how ADF&G would analyze the potential impacts to fish habitat
and mitigation for those impacts to those streams on the
transportation corridor.
COMMISSIONER COTTEN answered that ADF&G would do an evaluation
of each of the potential stream crossings that the department
identifies. He deferred to Mr. Benkert to answer further.
MR. BENKERT explained that once the state process is initiated,
teams called technical working groups are put together to
evaluate any kind of study plan proposals by the project
proponents and to provide suggestions to get a study plan
together that is going to get at the correct information for
ADF&G. One of those study plans would be to evaluate the stream
crossings along the road corridor, he continued. The department
would also physically visit each one of the sites and do a site
characterization to provide recommendations as to what the
design standards should be on each specific crossing. A lot of
work still needs to be done; ADF&G will get out on the ground as
well as initiate studies to look at fish, hydrology, and
geomorphology of those crossings so that the crossings can be
designed appropriately.
3:09:27 PM
CO-CHAIR JOSEPHSON inquired whether the department can charge
the applicant for those costs under the law.
MR. BENKERT replied that a project of this size goes through the
Office of Project Management & Permitting (OPMP). Typically,
the applicant enters into a Reimbursable Services Agreement with
the State of Alaska. Those funds provided by the applicant can
be utilized by ADF&G for its work specifically on this project.
3:10:04 PM
REPRESENTATIVE BIRCH asked whether the Stand for Salmon
Initiative is an impediment to project construction in Alaska.
He further asked for ADF&G's opinion on the initiative. He
opined that the state has a rigorous mechanism already in place
to protect the state's fisheries and expressed his concern that
the initiative will curtail development statewide.
COMMISSIONER COTTEN responded that litigation is ongoing on the
initiative and meanwhile ADF&G will continue to do its job and
follow the law and permitting requirements. At this point, he
said, the department cannot give an opinion on the initiative.
REPRESENTATIVE BIRCH inquired whether Commissioner Cotten could
provide an assessment to the committee as to what the initiative
would do to the state's permitting environment if passed.
COMMISSIONER COTTEN said the department is currently cooperating
with the legislature on legislation that is similar, although he
doesn't know whether it would replace the initiative. He said
ADF&G is happy to work with the legislature to evaluate impacts
of different proposals that would include changes to Title 16.
3:13:17 PM
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 3:18 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| 1 DNR-House_Resources-Pebble-2-21-18 PPT.pdf |
HRES 2/21/2018 1:00:00 PM |
|
| 2 ADFG HRES PPT re Pebble Project 2.21.18.pdf |
HRES 2/21/2018 1:00:00 PM |