Legislature(2009 - 2010)CAPITOL 120

04/14/2010 09:00 AM RULES


Download Mp3. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
* HR 16 MINING/PROCESSING OF RARE EARTH ELEMENTS
Moved Out of Committee
* HR 17 EXPORT LICENSE EXT. FOR KENAI LNG PLANT
Moved CSHR 17(RLS) Out of Committee
SB 301 POWER PROJECT FUND
Moved HCS SB 301(RLS) Out of Committee
Bills Previously Heard/Scheduled
                    ALASKA STATE LEGISLATURE                                                                                  
                 HOUSE RULES STANDING COMMITTEE                                                                               
                         April 14, 2010                                                                                         
                           9:05 a.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Nancy Dahlstrom, Chair                                                                                           
Representative Charisse Millett                                                                                                 
Representative Mark Neuman                                                                                                      
Representative Kurt Olson                                                                                                       
Representative Berta Gardner                                                                                                    
Representative Beth Kerttula                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Bob Herron, Vice Chair                                                                                           
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE RESOLUTION NO. 16                                                                                                         
Relating to the  mining and processing of rare  earth elements in                                                               
Alaska and to the stockpiling  of rare earth elements; and urging                                                               
the United States Congress to pass H.R. 4866.                                                                                   
                                                                                                                                
     - MOVED HR 16 OUT OF COMMITTEE                                                                                             
                                                                                                                                
HOUSE RESOLUTION NO. 17                                                                                                         
Urging the  United States Department  of Energy  to expeditiously                                                               
approve a two-year extension of  the export license for the Kenai                                                               
liquid natural gas plant.                                                                                                       
                                                                                                                                
     - MOVED CSHR 17(RLS) OUT OF COMMITTEE                                                                                      
                                                                                                                                
SENATE BILL NO. 301                                                                                                             
"An  Act relating  to  the power  project  fund; authorizing  the                                                               
Alaska Energy  Authority to charge  and collect fees  relating to                                                               
the power  project fund; authorizing the  Alaska Energy Authority                                                               
to  sell and  authorizing the  Alaska Industrial  Development and                                                               
Export Authority  to purchase  loans of  the power  project fund;                                                               
providing  legislative  approval for  the  sale  and purchase  of                                                               
loans  of  the  power  project   fund  under  the  memorandum  of                                                               
understanding  dated  February 17,  2010;  and  providing for  an                                                               
effective date."                                                                                                                
                                                                                                                                
     - MOVED HCS SB 301(RLS) OUT OF COMMITTEE                                                                                   
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HR  16                                                                                                                  
SHORT TITLE: MINING/PROCESSING OF RARE EARTH ELEMENTS                                                                           
SPONSOR(s): RESOURCES                                                                                                           
                                                                                                                                
04/09/10       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/09/10       (H)       RLS                                                                                                    
04/14/10       (H)       RLS AT 9:00 AM CAPITOL 120                                                                             
                                                                                                                                
BILL: HR  17                                                                                                                  
SHORT TITLE: EXPORT LICENSE EXT. FOR KENAI LNG PLANT                                                                            
SPONSOR(s): RULES BY REQUEST                                                                                                    
                                                                                                                                
04/10/10       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/10/10       (H)       RLS                                                                                                    
04/14/10       (H)       RLS AT 9:00 AM CAPITOL 120                                                                             
                                                                                                                                
BILL: SB 301                                                                                                                  
SHORT TITLE: POWER PROJECT FUND                                                                                                 
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
                                                                                                                                
02/26/10       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/26/10       (S)       RES, FIN                                                                                               
03/15/10       (S)       RES AT 3:30 PM BUTROVICH 205                                                                           
03/15/10       (S)       Heard & Held                                                                                           
03/15/10       (S)       MINUTE(RES)                                                                                            
03/17/10       (S)       RES AT 3:30 PM BUTROVICH 205                                                                           
03/17/10       (S)       Moved SB 301 Out of Committee                                                                          
03/17/10       (S)       MINUTE(RES)                                                                                            
03/22/10       (S)       RES RPT  2DP 5NR                                                                                       
03/22/10       (S)       DP: MCGUIRE, WIELECHOWSKI                                                                              
03/22/10       (S)       NR: HUGGINS, STEVENS, STEDMAN, WAGONER,                                                                
                         FRENCH                                                                                                 
04/05/10       (S)       FIN AT 10:00 AM SENATE FINANCE 532                                                                     
04/05/10       (S)       Heard & Held                                                                                           
04/05/10       (S)       MINUTE(FIN)                                                                                            
04/07/10       (S)       FIN RPT  3DP 3NR                                                                                       
04/07/10       (S)       DP: HOFFMAN, HUGGINS, THOMAS                                                                           
04/07/10       (S)       NR: STEDMAN, OLSON, ELLIS                                                                              
04/07/10       (S)       FIN AT 9:00 AM SENATE FINANCE 532                                                                      
04/07/10       (S)       Moved SB 301 Out of Committee                                                                          
04/07/10       (S)       MINUTE(FIN)                                                                                            
04/08/10       (S)       TRANSMITTED TO (H)                                                                                     
04/08/10       (S)       VERSION: SB 301                                                                                        
04/09/10       (H)       READ THE FIRST TIME - REFERRALS                                                                        
04/09/10       (H)       RES, FIN                                                                                               
04/10/10       (H)       RES AT 10:00 AM BARNES 124                                                                             
04/10/10       (H)       Scheduled But Not Heard                                                                                
04/11/10       (H)       RES AT 12:00 AM BARNES 124                                                                             
04/11/10       (H)       Scheduled But Not Heard                                                                                
04/12/10       (H)       RES RPT 5DP 3NR                                                                                        
04/12/10       (H)       DP: EDGMON, P.WILSON, SEATON, NEUMAN,                                                                  
                         JOHNSON                                                                                                
04/12/10       (H)       NR: OLSON, GUTTENBERG, KAWASAKI                                                                        
04/12/10       (H)       FIN AT 8:00 AM HOUSE FINANCE 519                                                                       
04/12/10       (H)       Scheduled But Not Heard                                                                                
04/12/10       (H)       RES AT 1:00 PM BARNES 124                                                                              
04/12/10       (H)       Moved Out of Committee                                                                                 
04/12/10       (H)       MINUTE(RES)                                                                                            
04/13/10       (H)       FIN RPT HCS(FIN) NT 6DP 4NR                                                                            
04/13/10       (H)       DP:   THOMAS,   KELLY,   GARA,   SALMON,                                                               
                        STOLTZE, HAWKER                                                                                         
04/13/10       (H)       NR:    N.FOSTER,   DOOGAN,    AUSTERMAN,                                                               
                         FAIRCLOUGH                                                                                             
04/13/10       (H)       FIN AT 8:00 AM HOUSE FINANCE 519                                                                       
04/13/10       (H)       Moved HCS SB 301(FIN) Out of Committee                                                                 
04/13/10       (H)       MINUTE(FIN)                                                                                            
04/14/10       (H)       RLS AT 9:00 AM CAPITOL 120                                                                             
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
REPRESENTATIVE CRAIG JOHNSON                                                                                                    
Alaska State Legislature                                                                                                        
POSITION STATEMENT:  Spoke as the sponsor of HR 16.                                                                           
                                                                                                                                
TOM WRIGHT, Staff                                                                                                               
Representative Mike Chenault                                                                                                    
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Presented HR 17 on behalf of the sponsor,                                                                
Representative Chenault.                                                                                                        
                                                                                                                                
PORTIA BABCOCK, Director                                                                                                        
State Government Affairs                                                                                                        
ConocoPhillips                                                                                                                  
POSITION STATEMENT:  During hearing of HR 17, answered                                                                        
questions.                                                                                                                      
                                                                                                                                
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
9:05:43 AM                                                                                                                    
                                                                                                                                
CHAIR NANCY  DAHLSTROM called the House  Rules Standing Committee                                                             
meeting  to  order  at  9:05  a.m.    Representatives  Dahlstrom,                                                               
Millett,  Neuman, Olson,  Kerttula, and  Gardner were  present at                                                               
the call to order.                                                                                                              
                                                                                                                                
9:06:04 AM                                                                                                                    
                                                                                                                                
        HR  16-MINING/PROCESSING OF RARE EARTH ELEMENTS                                                                     
                                                                                                                                
9:06:13 AM                                                                                                                    
                                                                                                                                
CHAIR DAHLSTROM announced that the  first order of business would                                                               
be  HOUSE  RESOLUTION   NO.  16,  Relating  to   the  mining  and                                                               
processing  of  rare   earth  elements  in  Alaska   and  to  the                                                               
stockpiling of rare earth elements;  and urging the United States                                                               
Congress to pass H.R. 4866.                                                                                                     
                                                                                                                                
9:06:32 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CRAIG JOHNSON,  Alaska State Legislature, speaking                                                               
as the  sponsor of HR 16,  explained that HR 16  requests support                                                               
for the  U.S. Congress  to pass H.R.  4866, which  encourages the                                                               
U.S. to  become independent  of foreign powers  in terms  of rare                                                               
earth  elements.   He noted  that these  rare earth  elements are                                                               
essential and  are used in  defense and light bulbs.   Currently,                                                               
about 97 percent of rare  earth minerals are imported from China.                                                               
He noted that  Alaska is blessed with these  rare earth minerals.                                                               
In fact, a mine is being  constructed in Bokan Mountain, which is                                                               
located  in southern  Alaska.   He  encouraged  the committee  to                                                               
forward  HR 16  in order  to forward  Alaska's message  that it's                                                               
prepared to stand on its own and develop its own resources.                                                                     
                                                                                                                                
9:08:55 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER  said that  she finds this  very exciting.                                                               
She then  inquired as to whether  H.R. 4866 is necessary  to move                                                               
forward with the mine located at  Bokan Mountain.  With regard to                                                               
the  processing,   refining,  and   purification  part   of  this                                                               
industry,  Representative  Gardner  asked  if  the  minerals  are                                                               
extracted  in   small  enough  quantities  to   have  value-added                                                               
activities in Alaska, without increasing the shipping cost.                                                                     
                                                                                                                                
REPRESENTATIVE  JOHNSON  responded that  now  there  is only  one                                                               
processing facility  in the U.S.,  located in California,  and it                                                               
can't handle the  minerals that would be mined.   This resolution                                                               
would  call  for Alaska  to  develop  [this technology  for  rare                                                               
elements].     The  minerals  are  very   low  radioactive  level                                                               
minerals.   He  explained that  the  mines for  these rare  earth                                                               
minerals are narrow  shaft mines because the  minerals, which are                                                               
in small quantities,  are located in very narrow  veins with high                                                               
concentrates.   Therefore, it's practical to  have the processing                                                               
plants  in Alaska,  although  it's more  practical  to adapt  the                                                               
California  facility immediately.   Representative  Johnson noted                                                               
that  he has  asked the  Department of  Natural Resources  (DNR),                                                               
when  performing  its  aerial  mapping   of  Alaska,  to  include                                                               
equipment that would seek [and identify] these minerals.                                                                        
                                                                                                                                
9:11:38 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER expressed  hope that one would  find a way                                                               
to have a  situation in which the rare ore  is [processed] within                                                               
the state.                                                                                                                      
                                                                                                                                
REPRESENTATIVE  JOHNSON  agreed  with  trying  to  add  value  by                                                               
processing these rare elements in the state.                                                                                    
                                                                                                                                
9:12:10 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN  pointed out  that processing  any minerals                                                               
will take energy, which will require  a gas pipeline.  He related                                                               
his excitement  with regard to  the value-added aspect  of mining                                                               
and processing these rare earth elements in Alaska.                                                                             
                                                                                                                                
REPRESENTATIVE JOHNSON  added that these minerals  are present in                                                               
water found  in oil  fields and  in geothermal  waters throughout                                                               
the world.   Therefore, he  has requested that the  waters across                                                               
the inlet from  Anchorage be tested for rare earth  elements.  He                                                               
then noted that the largest rare  earth mine is in Australia.  In                                                               
closing, Representative  Johnson pointed  out that Alaska  can be                                                               
on  the  cutting edge  with  rare  earth elements  because  these                                                               
minerals aren't sold on the market.                                                                                             
                                                                                                                                
9:15:47 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KERTTULA  thanked the sponsor and  Chair Dahlstrom                                                               
with regard to how they handled this resolution.                                                                                
                                                                                                                                
9:16:04 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE OLSON moved to report  HR 16 out of committee with                                                               
individual  recommendations and  the  accompanying fiscal  notes.                                                               
There being no objection, it was so ordered.                                                                                    
                                                                                                                                
9:16:30 AM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
         HR  17-EXPORT LICENSE EXT. FOR KENAI LNG PLANT                                                                     
                                                                                                                                
9:17:53 AM                                                                                                                    
                                                                                                                                
CHAIR DAHLSTROM announced  that the next order  of business would                                                               
be HOUSE RESOLUTION  NO. 17, Urging the  United States Department                                                               
of Energy  to expeditiously approve  a two-year extension  of the                                                               
export license for the Kenai liquid natural gas plant.                                                                          
                                                                                                                                
CHAIR DAHLSTROM then announced that  before the committee is CSHR
17, Version 26-LS1670\R, Wayne, 4/13/10.                                                                                        
                                                                                                                                
9:17:58 AM                                                                                                                    
                                                                                                                                
TOM  WRIGHT, Staff,  Representative Mike  Chenault, Alaska  State                                                               
Legislature,  speaking  on  behalf  of  the  sponsor  of  HR  17,                                                               
Representative  Chenault,  explained  that  HR  17  supports  the                                                               
extension of  the export license  of the Kenai  liquefied natural                                                               
gas (LNG) facility.  The facility  has been operating for over 40                                                               
years.     Currently,  the  Kenai   LNG  facility  is   the  only                                                               
significant  industrial  user  of  natural  gas  in  Southcentral                                                               
Alaska.    The facility  received  a  two-year extension  to  its                                                               
export license in  March 2009 and thus will expire  in 2011.  The                                                               
facility, he related, is owned  by the Kenai LNG Corporation with                                                               
ConocoPhillips owning 70 percent  and Marathon owning 30 percent.                                                               
Both  parties have  agreed to  seek  an extension  of the  export                                                               
license.   The application would extend  the export authorization                                                               
through March 2013.  He noted  that the extension request will be                                                               
for existing  volumes of  natural gas and  no increase  in volume                                                               
for export will be requested  for the 99 trillion British thermal                                                               
units  (Btus)  that was  authorized  by  the U.S.  Department  of                                                               
Energy  in 2009.    Mr.  Wright highlighted  that  the Kenai  LNG                                                               
facility  contributes heavily,  $130 million  per year,  to state                                                               
and local economies  and supports 60 direct jobs  and 50 indirect                                                               
jobs, which account for $17  million annually in personal income.                                                               
Furthermore, production of gas for  feedstock to the facility and                                                               
the sale of  LNG generate approximately $60  million in royalties                                                               
and taxes  for the  state and  the Kenai  Peninsula Borough.   In                                                               
conclusion, Mr.  Wright pointed  out that  this resolution  is of                                                               
importance to the sponsor's district as well as the state.                                                                      
                                                                                                                                
9:20:01 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER  noted her strong support  of the proposed                                                               
extension as  it serves  an important  function for  the Railbelt                                                               
energy.   She then recalled  that the  Kenai LNG facility  has an                                                               
agreement  that  it  would  reduce   its  gas  consumption  in  a                                                               
circumstance  in which  the  Anchorage area  utilities  are in  a                                                               
crisis situation.                                                                                                               
                                                                                                                                
MR. WRIGHT deferred to the representative from ConocoPhillips.                                                                  
                                                                                                                                
9:20:46 AM                                                                                                                    
                                                                                                                                
PORTIA    BABCOCK,    Director,   State    Government    Affairs,                                                               
ConocoPhillips,  confirmed  that  the  Kenai  LNG  facility  does                                                               
divert  gas from  the Kenai  LNG  facility to  the local  markets                                                               
during  emergencies and  when there  are critical  deliverability                                                               
events, as  they arise.   She said  that the  aforementioned will                                                               
continue to be  the case.  In further  response to Representative                                                               
Gardner,  Ms.  Babcock  clarified   that  there  isn't  a  formal                                                               
agreement to that effect; rather it's just an understanding.                                                                    
                                                                                                                                
9:21:33 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  OLSON  moved  to  report  CSHR  17,  Version  26-                                                               
LS1670\R,  Wayne,  4/13/10,  out  of  committee  with  individual                                                               
recommendations and  the accompanying fiscal notes.   There being                                                               
no  objection, CSHR  17(RLS) was  reported from  the House  Rules                                                               
Standing Committee.                                                                                                             
                                                                                                                                
9:21:46 AM                                                                                                                    
                                                                                                                                
The committee took an at-ease from 9:21 a.m. to 9:24 a.m.                                                                       
                                                                                                                                
                   SB 301-POWER PROJECT FUND                                                                                
                                                                                                                                
9:24:24 AM                                                                                                                    
                                                                                                                                
CHAIR DAHLSTROM announced that the  final order of business would                                                               
be SENATE  BILL NO. 301,  "An Act  relating to the  power project                                                               
fund;  authorizing  the Alaska  Energy  Authority  to charge  and                                                               
collect fees relating to the  power project fund; authorizing the                                                               
Alaska  Energy  Authority  to sell  and  authorizing  the  Alaska                                                               
Industrial Development and Export  Authority to purchase loans of                                                               
the power  project fund; providing  legislative approval  for the                                                               
sale and  purchase of loans of  the power project fund  under the                                                               
memorandum  of   understanding  dated  February  17,   2010;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
[Before the committee is HCS SB 301(FIN).]                                                                                      
                                                                                                                                
CHAIR DAHLSTROM related her understanding  that the Alaska Energy                                                               
Authority (AEA) views Amendment 1  as acceptable.  She noted that                                                               
Sara Fisher-Goade, AEA, nodded to confirm that is the case.                                                                     
                                                                                                                                
9:25:17 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  OLSON moved  to  adopt Amendment  1, labeled  26-                                                               
GS2974\R, Kane, 4/13/10, which read:                                                                                            
                                                                                                                                
     Page 2, line 1, following "loans":                                                                                     
          Insert "appropriated by the legislature"                                                                          
                                                                                                                                
There being no objection, Amendment 1 was adopted.                                                                              
                                                                                                                                
9:25:32 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  OLSON  moved  to   report  HCS  SB  301(FIN),  as                                                               
amended,  out of  committee with  individual recommendations  and                                                               
the accompanying fiscal notes.   There being no objection, HCS SB
301(RLS) was reported from the House Rules Standing Committee.                                                                  
                                                                                                                                
9:25:49 AM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Rules Standing Committee meeting was adjourned at 9:25 a.m.                                                                     

Document Name Date/Time Subjects