Legislature(2025 - 2026)BARNES 124
05/15/2025 01:00 PM House RESOURCES
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| Audio | Topic |
|---|---|
| Start | |
| HJR26 | |
| HB119 | |
| HB206 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HJR 26 | TELECONFERENCED | |
| += | SJR 19 | TELECONFERENCED | |
| + | HB 119 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 206 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
HOUSE RESOURCES STANDING COMMITTEE
May 15, 2025
1:03 p.m.
MEMBERS PRESENT
Representative Robyn Niayuq Burke, Co-Chair
Representative Maxine Dibert, Co-Chair
Representative Carolyn Hall
Representative Donna Mears (via teleconference)
Representative Zack Fields
Representative Dan Saddler
Representative George Rauscher
Representative Julie Coulombe
Representative Bill Elam
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE JOINT RESOLUTION NO. 26
Requesting that the United States Congress appropriate
authorized federal workforce development funds to train state
residents for the development, construction, and operation of
the Alaska liquefied natural gas project; and encouraging the
hiring of residents and the use of state-based small businesses
in the development, construction, and operation of the Alaska
liquefied natural gas project.
- MOVED CSHJR 26(RES) OUT OF COMMITTEE
HOUSE BILL NO. 119
"An Act relating to an in-state natural gas pipeline developed
by the Alaska Gasline Development Corporation; and providing for
an effective date."
- HEARD & HELD
HOUSE BILL NO. 206
"An Act relating to disclosure of oil and gas production tax
information."
- HEARD & HELD
COMMITTEE SUBSTITUTE FOR SENATE JOINT RESOLUTION NO. 19(RES)
Urging the United States Congress to honor the terms of the
Mineral Leasing Act and the Alaska Statehood Act and provide the
state with a 90 percent share of all bonuses, royalties, and
rentals received by the federal government from the Arctic
National Wildlife Refuge and the National Petroleum Reserve in
Alaska.
- BILL HEARING CANCELED
PREVIOUS COMMITTEE ACTION
BILL: HJR 26
SHORT TITLE: AK LNG PROJECT WORKFORCE DEVELOPMENT
SPONSOR(s): REPRESENTATIVE(s) ELAM
05/07/25 (H) READ THE FIRST TIME - REFERRALS
05/07/25 (H) RES
05/12/25 (H) RES AT 1:00 PM BARNES 124
05/12/25 (H) -- MEETING CANCELED --
05/15/25 (H) RES AT 1:00 PM BARNES 124
BILL: HB 119
SHORT TITLE: GAS PIPELINE FAIRBANKS SPUR
SPONSOR(s): REPRESENTATIVE(s) STAPP
02/26/25 (H) READ THE FIRST TIME - REFERRALS
02/26/25 (H) STA, RES
03/06/25 (H) STA AT 3:15 PM GRUENBERG 120
03/06/25 (H) Heard & Held
03/06/25 (H) MINUTE(STA)
03/11/25 (H) STA AT 3:15 PM GRUENBERG 120
03/11/25 (H) Heard & Held
03/11/25 (H) MINUTE(STA)
05/06/25 (H) STA AT 3:15 PM GRUENBERG 120
05/06/25 (H) Moved CSHB 119(STA) Out of Committee
05/06/25 (H) MINUTE(STA)
05/07/25 (H) STA RPT CS(STA) NEW TITLE 2DP 5AM
05/07/25 (H) DP: HOLLAND, CARRICK
05/07/25 (H) AM: VANCE, MCCABE, MOORE, HIMSCHOOT,
STORY
05/12/25 (H) RES AT 1:00 PM BARNES 124
05/12/25 (H) -- MEETING CANCELED --
05/15/25 (H) RES AT 1:00 PM BARNES 124
BILL: HB 206
SHORT TITLE: OIL AND GAS DATA
SPONSOR(s): REPRESENTATIVE(s) MEARS
04/22/25 (H) READ THE FIRST TIME - REFERRALS
04/22/25 (H) RES, FIN
05/14/25 (H) RES AT 1:00 PM BARNES 124
05/14/25 (H) Heard & Held
05/14/25 (H) MINUTE(RES)
05/15/25 (H) RES AT 1:00 PM BARNES 124
WITNESS REGISTER
REPRESENTATIVE BILL ELAM
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, introduced HJR 26.
AMY SCHUMACHER, Executive Director
Fairbanks Pipeline Training Center
Fairbanks, Alaska
POSITION STATEMENT: Testified in support of HJR 26.
KENDRA BROUSSARD, Staff
Representative Bill Elam
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: On behalf of Representative Elam, prime
sponsor, answered questions regarding HJR 26.
GREG CASHEN, Lobbyist
Fairbanks Pipeline Training Center
Juneau, Alaska
POSITION STATEMENT: Answered questions regarding the Fairbanks
Pipeline Training Center.
WARREN CHRISTIAN, Secretary
Fairbanks Pipeline Training Center;
President
North Slope Contractors Association
Fairbanks, Alaska
POSITION STATEMENT: Answered questions regarding the FPTC.
BERNARD AOTO, Staff
Representative Will Stapp
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: On behalf of Representative Stapp, prime
sponsor, answered questions regarding the CS for HB 119.
REPRESENTATIVE WILL STAPP
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, introduced the CS for HB
119.
FRANK RICHARDS, President
Alaska Gas Line Development Corp
Anchorage, Alaska
POSITION STATEMENT: Answered questions regarding the proposed
gas line.
COREY ALT, Staff
Representative Donna Mears
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: On behalf of Representative Mears, prime
sponsor, presented a PowerPoint on HB 206.
DALE YANCEY, Director
Tax Division
Department of Revenue
Juneau, Alaska
POSITION STATEMENT: Answered questions regarding HB 206.
ACTION NARRATIVE
1:03:34 PM
CO-CHAIR ROBYN NIAYUQ BURKE called the House Resources Standing
Committee meeting to order at 1:03 p.m. Representatives Fields,
Coulombe, Elam, Rauscher, Dibert, Hall, Saddler, Mears (via
teleconference), and Burke were present at the call to order.
HJR 26-AK LNG PROJECT WORKFORCE DEVELOPMENT
1:04:32 PM
CO-CHAIR BURKE announced that the first order of business would
be HOUSE JOINT RESOLUTION NO. 26, Requesting that the United
States Congress appropriate authorized federal workforce
development funds to train state residents for the development,
construction, and operation of the Alaska liquefied natural gas
project; and encouraging the hiring of residents and the use of
state-based small businesses in the development, construction,
and operation of the Alaska liquefied natural gas project.
1:04:44 PM
REPRESENTATIVE BILL ELAM, Alaska State Legislature, as prime
sponsor, introduced HJR 26. He explained that the resolution
urged Congress to appropriate the $20 million in workforce
development funds authorized for the Alaska liquefied natural
gas (AKLNG) project. Congress had authorized this funding
specifically to support the workforce training for Alaska
Natives, rural residents, and dislocated workers for
participation in the AKLNG infrastructure. Despite the
authorization, the funds had not been appropriated. The
resolution further encouraged AKLNG project sponsors and
contractors to prioritize hiring trained Alaskans and working
with small in-state businesses. He explained how the resolution
aligned with existing statute. He pointed out that the training
infrastructure already existed across Alaska through regional
training centers and apprenticeship programs, but additional
funding would be needed to meet the labor needs of the LNG
project. He pointed to the long-term benefits of training
Alaska workers rather than relying on an out-of-state work
force. The resolution reinforced the state's support for in-
state labor and economic development tied to natural resource
projects.
1:07:55 PM
CO-CHAIR BURKE announced that the committee would hear invited
testimony.
1:08:08 PM
AMY SCHUMACHER, Executive Director, Fairbanks Pipeline Training
Center, spoke in support of HJR 26. She explained the
importance of gathering sufficient resources in preparation for
the proposed AKLNG project. She pointed out that the Fairbanks
Pipeline Training Center (FPTC) is the hub for everything that
goes to the slope, and the center is ready to train Alaskans.
1:09:15 PM
MS. SCHUMACHER responded to several questions by Representative
Saddler regarding funding, explaining that FPTC is a multi-craft
training trust. The funding includes contractor contributions,
some state grants, and support from the construction academy.
The FPTC would like to use the federal funds to expand and scale
up the annual pipeline training and for outreach classes to
introduce people to the pipeline trades. Regarding the question
of how the money would be spent, she explained that mainly it
would be training, capital improvements, equipment and
technology upgrades, and rural outreach.
1:12:58 PM
REPRESENTATIVE FIELDS described union activities and spoke of
the necessity of scaling up the training, emphasizing the
importance of apprenticeship.
1:14:09 PM
MS. SCHUMACHER addressed several of Representative Coulombe's
questions. She explained that most of the FPTC apprenticeship
programs require state residency. People from out of state who
seek training are encouraged to become residents. Individuals
from out of state would receive safety training, so they would
have the safety certification when they go to work. She said
the types of trades in the pipeline program include operating
engineers, plumbers and pipefitters, laborers, and teamsters.
The building trades are represented by the electricians. She
explained that FPTC trains on every capacity to build a pipeline
such as bringing the pipe in, stringing the pipe out, and
welding the pipe together. Each type of worker is familiar with
what the other workers are doing.
1:17:29 PM
MS. SCHUMACHER, in response to a question from Representative
Saddler, explained that if they wait and train during the build,
then they are too late. If the gas line does not go through,
there are still supporting projects that could benefit from
training Alaskans, including all the work on the North Slope.
1:19:34 PM
MS. SCHUMACHER responded to a question from Representative
Rauscher by first extending an invitation to the committee
members to visit FPTC in late October. She explained that each
craft learns their own trade. She described the training
experienced by the laborers, the pipefitters, the equipment
operators, the mechanics, and the teamsters. Each individual
craft would be learning their own task, but all would be doing
it in coordination with the other crafts, so they understood
what it would be like on the job, knowing where to stand and
where to be.
1:22:10 PM
REPRESENTATIVE FIELDS spoke about the unique environment of the
FPTC and explained that unlike schools where skills would be
learned individually, students at the FPTC learn to lay long
lengths of pipe with all the trades present prior to being on
the slope. The training would be coordinated, multi-craft work
that no individual training school could do on their own. He
pointed out that even if the AKLNG project did not materialize,
workers are needed for the Pikka and Willow projects.
1:23:18 PM
REPRESENTATIVE ELAM, in response to a question from
Representative Hall, explained that he didn't know why the money
had not yet been appropriated. He pointed out that the
resolution would help keep attention on the issue.
1:24:25 PM
KENDRA BROUSSARD, Staff, Representative Bill Elam, Alaska State
Legislature, on behalf of Representative Elam, prime sponsor,
answered questions regarding HJR 26. In response to a question
from Representative Hall, she explained that the Alaska Natural
Gas Pipeline Act was passed in 2014.
1:25:24 PM
MS. SCHUMACHER responded to a question from Representative Hall,
explaining that the Act was first written in 2004 and amended in
2014. She clarified that 15 percent of the funding was for a
pipeline training facility in Fairbanks.
1:25:55 PM
GREG CASHEN, Lobbyist, Fairbanks Pipeline Training Center,
addressed several questions from Representative Hall regarding
why the money for the FPTC had not been appropriated at that
time. He described the appropriation process, explaining that
the language includes a reasonable expectation that the natural
pipeline construction would commence by a date two years after
the date of certification. He pointed out that the project had
not made it that far, so the money had not been appropriated by
Congress. He said there was progress and there was a reasonable
likelihood of the appropriations going through. The funding
would go through the Department of Labor & Workforce Development
(DLWD). He described the pipeline training which simulated
actual Arctic pipeline conditions including staying in a camp
like the North Slope.
1:32:04 PM
REPRESENTATIVE SADDLER opined that the political climate at the
federal level should support the proposed LNG construction and
the thriving oil and gas industry, so the resolution is timely
and appropriate.
1:33:02 PM
MS. SCHUMACHER, in response to a question from Co-Chair Dibert,
explained that FPTC was engaged in training for each of the
North Slope trades. She discussed the North Slope pipeline
certification required for employment on the slope.
1:35:11 PM
WARREN CHRISTIAN, Secretary, Fairbanks Pipeline Training Center;
President, North Slope Contractors Association, explained the
role of the North Slope Contractors Association regarding
pipeline construction in Alaska and the role of the organization
in the FPTC. He described his meeting with the Alaska
congressional delegation in Washington, D.C. to address the
funding questions. He discussed the recruitment, the training,
and the apprenticeship programs sponsored by the unions, and
pointed out the value of training rural Alaskans. He explained
that the FPTC focuses on bringing in entry level personnel who
might be trained in one trade at the FPTC but then might enroll
in one of the union apprenticeship programs. The union
apprenticeship program at the FPTC then would help bring an
individual up to the skill level needed on the North Slope. He
pointed out at that time there was work at the Willow, the
Santos, and the Coyote projects in pipeline and ice road
construction.
1:38:34 PM
MS. SCHUMACHER, in response to a question from Co-Chair Dibert,
explained that there were five apprenticeships. There were 60
to 80 students during the last two years, and everyone who went
through the training went directly to work.
1:40:09 PM
REPRESENTATIVE ELAM agreed with Representative Coulombe's
suggestion that the governor should be added to the list of
recipients of the resolution.
1:42:15 PM
The committee took an at-ease from 1:42 p.m. to 1:43 p.m.
1:43:27 PM
REPRESENTATIVE FIELDS explained that he had to leave for another
meeting but that he supported the resolution.
1:43:45 PM
CO-CHAIR DIBERT moved to adopt Conceptual Amendment [1] to HJR
26, to add "the Honorable Michael J. Dunleavy, Governor of the
State of Alaska," to the recipient's list, following "Congress"
on line 24. There being no objection, Conceptual Amendment 1
was adopted.
1:44:22 PM
The committee took a brief at-ease at 1:44 p.m.
1:45:30 PM
CO-CHAIR BURKE opened public testimony on HJR 26, as amended.
After ascertaining there was no one who wished to testify, she
closed public testimony on HJR 26.
1:45:55 PM
CO-CHAIR DIBERT moved to report HJR 26, as amended, out of
committee with individual recommendations and the attached zero
fiscal note. There being no objection, CSHJR 26(RES) was
reported out of the House Resources Standing Committee.
1:46:28 PM
The committee took an at-ease from 1:46 p.m. to 1:49 p.m.
HB 119-GAS PIPELINE FAIRBANKS SPUR
1:49:23 PM
CO-CHAIR BURKE announced that the next order of business would
be HOUSE BILL NO. 119, "An Act relating to an in-state natural
gas pipeline developed by the Alaska Gasline Development
Corporation; and providing for an effective date." [Before the
committee was CSHB 119(STA).]
1:46:34 PM
CO-CHAIR DIBERT moved to adopt the proposed committee substitute
for House Bill 119, Version 34-LS0613\G, Nauman, 5/13/25, as a
working document.
CO-CHAIR BURKE objected for the purpose of discussion.
1:50:03 PM
BERNARD AOTO, Staff, Representative Will Stapp, Alaska State
Legislature, on behalf of Representative Stapp, prime sponsor of
HB 119, explained that the committee substitute removed the spur
line language under subsection 5 of the Alaska Gasline
Development Corporation (AGDC) charter. He pointed out that the
proposed CS, Version G, was drafted to clarify the language of
CSHB 119(STA) and remedy a miscommunication.
1:51:36 PM
CO-CHAIR BURKE removed her objection. She announced that the
committee substitute for HB 119 was before the committee.
1:51:54 PM
REPRESENTATIVE WILL STAPP, Alaska State Legislature, as prime
sponsor, explained that HB 119 seeks to eliminate a long-
standing problem for residents in the Interior. The
conversation had moved forward regarding the development of a
gas line project as proposed with AGDC and majority owner
Glenfarne. The current proposed route of the pipeline would
bypass Fairbanks, the second largest town in Alaska. The bill
sought a mechanism to remedy that disservice. He referenced the
sale of 75 percent ownership in the line by AGDC which created
difficulties in terms of the bill. Part of a fiscal note
received from Mr. Richards stated, in part, that Glenfarne
acquired the majority of interest in 8 Star, LLC, Alaska, which
was the privately held subsidiary of AGDC. That made Glenfarne
the majority owner. The fiscal note stated, "AGDC does not have
the right to change the scope of the Alaska LNG project." He
also noted that Mr. Richards referenced the agreement with
Glenfarne, but he was not aware that any member had the
opportunity to read what was actually in that agreement. It
seemed that no member had the opportunity to read what was in
the agreement prior to it being finalized.
REPRESENTATIVE STAPP then explained that two sections of the
proposed legislation were relatively simple, adding language
that would codify in statute that an all-Alaska line, if
advanced, must include a direct spur to the City of Fairbanks
and the Fairbanks North Star Borough. The second section that
was added specified that proceeds of the sales of the gas line
would be for the purpose of bringing gas to all Alaskans. He
explained that the concept was to create a fund to ensure that
Alaskans share the proceeds of monetizing the North Slope gas
1:55:12 PM
MR. AOTO explained that Representative Stapp covered everything
in the sectional analysis except Section 3, which created an
immediate effective date.
1:55:56 PM
FRANK RICHARDS, President, Alaska Gas Line Development Corp,
responded to a question from Representative Coulombe regarding
the permitting for a Fairbanks spur line. He referenced
language imbedded in paragraph 4 regarding the Alaska stand-
alone pipeline project, which was the in-state line for North
Slope gas to be used in Alaska. That was the outcome of a
feasibility study in 2012 when the legislature appropriated
funds for the design of the in-state project which was a 36-inch
diameter main line with a spur into Fairbanks that was a 12-inch
line. That project went through engineering and design, and it
went through the permitting process, but not all the permits
were obtained. The right of way was provided to AGDC for that
pipeline project, and AGDC still retains those designs leading
into Fairbanks. He explained that the difference between the
two projects is that one of them did not include the spur line.
1:58:33 PM
REPRESENTATIVE STAPP addressed a series of questions from
Representative Coulombe regarding the spur line. He explained
that the diameter of the pipeline probably doesn't matter that
much and quoted the saying, "It doesn't matter if the cat is
black or white so long as it catches the mice." He said people
needed to know that if the export project were to go into final
investment decision, they would break ground on a main line but
would skip the second largest town in Alaska. He referenced Mr.
Richards' statement that not all permits had been obtained. He
described several factors influencing the permitting of projects
as well as time frames regarding the main line and an off-take
line for the purpose of developing a spur line.
2:00:16 PM
REPRESENTATIVE STAPP responded to a question from Representative
Saddler regarding the proposed CS by explaining two problems.
First, because of the agreement with Glenfarne, AGDC no longer
had the right to make changes to the scope of the development
project. Second, there would be potential risk to the project
because they are permitted under two different sections of
permitting, i.e. Federal Energy Regulatory Commission (FERC) and
the Army Corps of Engineers.
2:01:28 PM
MR. RICHARDS responded to Representative Saddler's request for
clarification regarding why language had been changed between
the previous version and the current version. He explained that
a fiscal note had been created based on the previous version
included in the AKLNG project. He said Representative Stapp was
correct in saying that AGDC's agreement with Glenfarne regarding
the Alaska LNG project as permitted through the FERC process did
not include a lateral into Fairbanks. From the perspective of
AGDC, opening up the spur line permitting would add significant
potential environmental and regulatory risk to the project
proceeding forward, so they waived that issue due to timing,
costs, and permitting. In addition, it had been decided to move
the mainline off-take line because the new proposal included
uplands which were less environmentally sensitive.
2:04:21 PM
REPRESENTATIVE STAPP responded to a question from Representative
Saddler regarding the system of natural gas line plumbing in the
City of Fairbanks as well as the North Star borough. He
explained that technically both pass through the North Star
borough and described who in the area would be getting direct
gas.
2:05:59 PM
REPRESENTATIVE STAPP, in response to a question from
Representative Elam, described some of the history, referencing
the former project's design which would have passed 30 miles
from Fairbanks. Since that time, Fairbanks developed what was
called the Interior Gas Utility for the purpose of trucking
liquified gas from the North Slope liquification plant. Trucks
would transport LNG from the slope to Fairbanks. He explained
that the issues include costs, tariff rates, and the mechanics
of de-liquifying the gas and compared that to the costs of
tariffs and amortizing of the gas line. He pointed out the
potential irony of being halfway from the source of gas compared
to Anchorage but possibly paying double the costs for gas.
2:09:50 PM
FRANK RICHARDS addressed a request from Representative Mears to
verify that the tariffs for Fairbanks would be in addition to
tariffs for the entire pipeline and how that tariff is
structured so that Fairbanks is not in addition to but is rather
a part of the tariff structure. He reminded the committee that
AGDC has a signed memorandum of understanding (MOU) with an
Alaska pipeline company that wants to take on the ownership,
permitting, design, and construction of the spur line into
Fairbanks. The cost analysis for the buildout was based on
numbers from 2014, and since that time, the demand in Fairbanks
has gotten smaller, so the construction costs need to be
considered as well as an optimal design. He said that the full
responsibility for determining tariff rates will go through the
Regulatory Commission of Alaska (RCA), which is looking out for
the well-being of Alaska. He compared the Fairbanks situation
to South Central when Enstar brings on new lines.
2:12:11 PM
REPRESENTATIVE STAPP agreed with Representative Mears that the
spur needs to be included in an overall tariff, but said this
bill is probably not the place for that discussion.
2:12:58 PM
FRANK RICHARDS responded to a series of questions from
Representative Stapp. He explained that the MOU he referred to
was with AGDC and was part of the Alaska stand-alone pipeline
project, but was not part of the agreement transfer to
Glenfarne. Regarding whether there was an MOU under the
existing mainline project, he explained that there was an
interconnection or an offtake point near the Chatanika River.
That would be the point where a spur line would start for
delivery of gas to Fairbanks. In response to further questions
requesting clarification about what that interconnection would
actually be, he described it as a valve and a depressurization
unit. This would enable off-taking gas to another entity who
would then have the construction, operation, and maintenance
responsibilities for a spur line into Fairbanks.
2:15:08 PM
REPRESENTATIVE STAPP agreed with Representative Coulombe's
observation that that South Central would be charged tariffs by
Enstar, which would represent the costs of carrying gas from A
to B, and that there would be a tariff for gas to Fairbanks. He
acknowledged the potential for the capital costs plus the tariff
to operate the pipeline, both landing on Fairbanks, which would
lead to higher tariffs for Fairbanks. He pointed out that the
state had invested heavily in a gas export line that would not
benefit a vast majority of people despite running within 30
miles of a large population center. If the costs were to be
amortized, the cost to the Fairbanks residents would be
substantially higher.
2:18:14 PM
REPRESENTATIVE STAPP addressed several questions from
Representative Rauscher, explaining that the Interior Alaska Gas
Utility (IGU) had been building gas infrastructure in Fairbanks
with the expectation of a gas line to the town. Regarding the
comment that the amortization would be "extravagant," he
suggested it would be less so than "the billions of dollars
dumped into Cook Inlet to subsidize producers for production."
He commented that adding customers would result in lower rates
because of economy of scale wherein a cheaper source of fuel
would attract more customers. Ideally a gas line would enable
customers to spend less money on heat.
2:21:02 PM
MR. AOTO responded to Representative Rauscher's question
regarding a study on this issue. He explained that the Wood
Mackenzie study [November 2024] assumed Fairbanks would consume
11 billion cubic feet (Bcf) if the gas pipeline were built
compared to the UGI consumption rate estimate of 1.5 Bcf. That
study assumes an overhaul to enable usage by the larger
customers such as the University of Alaska Fairbanks, Fort
Wainwright, and the Eielson Air Force Base. He explained that
the study did not necessarily account for the time and expense
of putting in the power plants that would be able to receive
that natural gas.
2:21:56 PM
REPRESENTATIVE STAPP responded to Representative Saddler's
question regarding the fiscal note for HB 119, explaining that
the numbers were based on ADGC operating the pipeline, and the
numbers would change under a different scenario.
2:24:13 PM
MR. AOTO clarified the result of the proposed committee
substitute regarding gas line connections throughout the state
of Alaska.
2:24:45 PM
FRANK RICHARDS responded to a question from Co-Chair Burke
concerning which permits had not been received. Mr. Richards
said AGDC had strategically focused on acquiring major permits
that de-risk the project, but that there was an Army Corps of
Engineers' wetlands permit the project had not fully received.
2:26:08 PM
FRANK RICHARDS responded to a question from Co-Chair Burke
concerning which permits had not been received. [Due to poor
sound quality, portions of the audio are indiscernible.]
2:28:27 PM
There being no further discussion HB 119 was held over.
2:28:47 PM
The committee took an at-ease from 2:28 p.m. to 2:30 p.m.
HB 206-OIL AND GAS DATA
2:30:28 PM
CO-CHAIR BURKE announced that the final order of business would
be HOUSE BILL NO. 206, "An Act relating to disclosure of oil and
gas production tax information."
2:30:52 PM
COREY ALT, Staff, Representative Donna Mears, Alaska State
Legislature, on behalf of Representative Mears, prime sponsor of
HB 206, continued his PowerPoint from the House Resources
Standing Committee on May 14, 2025, regarding HB 206 [hard
copies in the committee file]. He explained that he would begin
with slide 7, titled "Alaska's Unique Structure," which showed a
graph comparing gross and net tax comparisons between $70 oil
and $65 oil. The description read as follows [original
punctuation provided]:
Under a net tax, the public has a greater interest in
transparency because of the higher revenue volatility
inherent in the system.
MR. ALT explained why, under a net tax system such as in Alaska,
the public has more interest in the producer tax information
than they have in some other jurisdictions. He called the
committee's attention to the difference in the taxable volume
column which compared the values of a net tax versus a gross tax
system. He posited that economists describe a net tax as more
efficient over the long term, leading to greater investment in
oil and gas. He pointed to the bottom of the chart which shows
a change in the taxable value of $70 oil and $65 oil and
explained that the assumption of a net tax system by the state
of Alaska increases a degree of risk sharing between the oil
producers and the state in a way that is not seen in producing
jurisdictions such as Oklahoma and Texas.
2:33:33 PM
MR. ALT responded to a question from Representative Coulombe by
explaining that the chart on slide 7 is a hypothetical example
that he produced. He explained that the numbers are close to
those used by the State of Alaska, pointing out that gross taxes
in states across America are usually in the 4- to 7-percent
range.
2:34:20 PM
MR. ALT addressed several concerns posed by Representative
Rauscher regarding risks to the oil companies and the state,
explaining that HB 206 itself makes no changes to oil and gas
tax law, the collection of taxes, or the structure of the tax
system, and there would be no impact on revenue. The bill is
meant to give insight into the question of whether the tax
system is performing up to the goals we set for it. He assured
the committee there was no intention to create a situation
causing competitive damage. Also, the intention of the bill was
not to force disclosure that was not already provided. For
example, the production tax value that would be required by this
bill is already disclosed by some oil companies in other
jurisdictions around the world that use net tax systems,
including some that operated in Alaska.
2:39:21 PM
REPRESENTATIVE MEARS, as prime sponsor, addressed several
questions from Representative Rauscher, explaining that one of
the reasons the bill was crafted late in the session was to
enable conversations with the industry prior to releasing the
bill. In addition, she wanted it to sit over the interim, so
those conversations could continue. She agreed that data can be
commercially sensitive and she would not want sensitive
information to be exposed.
2:40:21 PM
MR. ALT responded to a question from Representative Rauscher by
clarifying that some data would come from information disclosed
by companies depending on their status in the marketplace as
well as disclosures from the American stock exchange and the
SEC. Continuing adjustments would be made to the bill's
language to ensure it doesn't include competitively damaging
information.
2:42:06 PM
MR. ALT, in response to a search for clarification made by
Representative Saddler, explained that the intention of the
legislation was not to force disclosure of information that is
not disclosed already by companies.
2:44:46 PM
CO-CHAIR BURKE responded to Representative Saddler's demand for
an answer by asking Representative Mears to respond.
REPRESENTATIVE MEARS maintained that Mr. Alt had provided the
relevant information Representative Saddler asked for and that
there was information disclosed in other districts that was not
disclosed in Alaska. She said Mr. Alt had provided a good
background about that level of detail, but they could follow up
with additional specifics.
2:45:46 PM
CO-CHAIR BURKE addressed Representative Saddler on the record to
say he had the right to ask questions but not to badger staff.
2:46:17 PM
MR. ALT resumed the PowerPoint presentation of HB 206 by moving
to slide 8, titled "Alaska's Unique Structure," which showed
several graphs regarding tax disclosure requirements, and which
read as follows [original punctuation provided]:
• Some oil-producing states have stronger disclosure
requirements.
• In Texas and North Dakota, producers' tax returns
are public
MR. ALT explained that there is a disparity in the disclosure
requirements between other gas and oil producing states and
Alaska. The bottom-left graph was put out by Alaska's
Department of Revenue (DOR) regarding the level of investment on
the North Slope. He pointed out that details are not provided
about every unit. He discussed the graph on the right which
showed an example of a tax history document from the Texas
comptroller which had been provided after requesting tax
information about a specific oil producer. The example showed
the first page of a 4,000-page volume from one month in 2024
concerning Hilcorp Energy company. This is an example of the
level of detail other jurisdictions provide. He noted that,
unlike Alaska, tax officials from other states would compile
this information into usable data sets for policy makers and the
public.
2:48:08 PM
MR. ALT proceed to slide 9, titled "Alaska's Unique Structure,"
which read as follows [original punctuation provided]:
History:
• In 2006, Alaska transitioned from a gross (ELF) to a
net tax under the
Petroleum Profits Tax (PPT)
• The PPT system lacked sufficient disclosure, both to
the Department of Revenue and the public.
• ACES (2007) implemented the current disclosure
statute, AS 43.55.890, to provide for some disclosure
of producer data.
2:49:22 PM
MR. ALT moved to slide 10, titled "Alaska's Unique Structure,"
which showed a graph detailing lease expenditures and capital
expenditures over time. The slide read as follows [original
punctuation provided]:
Weakening Disclosure:
• In 2016, DOR published information on four North
Slope units. Today Prudhoe is the only one.
• Units have very different production and economic
profiles depending on geology and development
2:50:26 PM
MR. ALT explained that the quality of disclosure DOR is allowed
to provide under law has deteriorated. He proceeded to slide
11, titled "What's the Problem?" which read as follows [original
punctuation provided]:
Without insight into the profitability of oil
individual producers in particular fields, the
legislature could beunknowingly:
1. Holding back industry to the detriment of all
Alaskans through complex and onerous tax rates
2. Unfairly advantaging some producers over others
3. Incentivizing development of federal land over
state land, decreasing royalty income
4. Allowing the maximum benefit of Alaska's resources
to flow to out-of-state oil producers instead of
Alaskans themselves
MR. ALT described each of those points in more detail and then
turned to slide 12, titled "What's our solution?" which simply
stated, "Increased transparency."
2:52:25 PM
MR. ALT moved to slide 13, slide 14, and slide 15, titled
"What's our solution?" which read as follows [original
punctuation provided]:
HB 206 would require DOR to publish information about
producers at the unit level upon request:
1. The amount of oil or gas produced by each
working interest owner (WIO) in a unit
2. The gross value at the point of production
(GVPP) by WIO
3. Transportation costs attributable to the
product by WIO
4. Production tax value (PTV) by WIO
5. Tax due by WIO 6. State royalty by WIO
This data is to be released with monthly resolution.
• Most of this information is already public
• Royalty information is produced by DOR
• Production data is available from AOGCC
• Transportation costspipeline tariffs and
shipping ratesare largely public
• GVPP is roughly calculable from production data
and public price information.
• What's not?
• Production Tax Value
• Tax Paid
• Some companies publish this information voluntarily.
Others don't. This proposal would level the playing
field.
• HB 206 would provide:
• Transparency for the public and policymakers
• Consistent disclosure in substance and format
across producers
• A meaningful dataset for analysis
• Parity in disclosures between producers
MR. ALT emphasized that information disclosed by the proposed
law would not be damaging to the companies.
2:54:26 PM
MR. ALT, in response to a question from Representative Elam
regarding the level of administrative burden this would create,
deferred the question to Mr. Dale Yancy of DOR.
2:57:00 PM
DALE YANCEY, Director, Tax Division, Department of Revenue,
answered questions regarding whether HB 206 would create
additional administrative burden. He explained that DOR did not
have that level of detail available, and it would require
additional staff to aggregate the data. He described the
information oil companies provided on their tax returns and how
the aggregation of data would change with HB 206. He explained
that the monthly filings provided by the oil companies detailed
the amount of oil produced but not how much tax was being paid.
2:59:35 PM
REPRESENTATIVE MEARS pointed out that purpose of the proposed
bill is to remedy the fact that this data is available to
legislators only with a signed non-disclosure agreement, and it
is not available to the public. The data exists within the
State of Alaska, but it is not useful.
MR. ALT, in response to a comment by Representative Elam, said
that he would defer to DOR to generate a fiscal note that would
accurately account for data aggregation.
3:01:24 PM
CO-CHAIR BURKE announced that HB 206 was held over.
3:03:35 PM
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 3:03 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| draft RES CS HB 119 ver G.pdf |
HRES 5/15/2025 1:00:00 PM |
HB 119 |
| HB 206 Presentation HRES 5.14.pdf |
HRES 5/15/2025 1:00:00 PM |
HB 206 |
| HB 119 Summary of Changes N to G.pdf |
HRES 5/15/2025 1:00:00 PM |
HB 119 |