Legislature(2011 - 2012)BUTROVICH 205
03/19/2012 03:30 PM Senate RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| SB159 | |
| SB215 | |
| HJR29 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 159 | TELECONFERENCED | |
| *+ | SB 215 | TELECONFERENCED | |
| + | HJR 29 | TELECONFERENCED | |
HJR 29-BLM LEGACY OIL WELL CLEAN UP
4:05:07 PM
CO-CHAIR WAGONER announced consideration of HJR 29.
CO-CHAIR PASKVAN moved to bring HJR 29 before the committee for
discussion.
CO-CHAIR WAGONER objected for discussion purposes.
4:05:45 PM
REPRESENTATIVE CHARISSE MILLETT, Alaska State Legislature,
sponsor of HJR 29, explained that this issue was brought forward
to her by someone who interned with the Alaska Oil and Gas
Conservation Commission (AOGCC) and inventoried legacy wells
that were drilled between 1944 and 1981 by the US Navy and the
US Geological Survey (USGS). These wells were drilled when there
wasn't any way to plug and abandon a well and there weren't any
regulations. There are 136 wells spread all over the National
Petroleum Reserve (NPR-A) and they are all in various stages of
decay. Some of them are unplugged, some are full of diesel and
some have shacks with barrels of diesel in them. The Bureau of
Land Management (BLM) has plugged seven wells; 42 wells are
still in violation of AOGCC rules.
The state has asked the BLM to come up and clean the wells, but
their plan is about one well a year. These wells pose a risk not
only to the pristine environment of the Arctic, but just as a
risk to the ecosystem. The last survey of the wells was done in
2007.
REPRESENTATIVE MILLETT said three wells have been lost due to
coast line erosion; they're just missing. Three others can't be
found due to the terrain of the North Slope, its permafrost and
snow flow; some wells are wide open up there in lakes with no
casing. One is called the "whistling well;" the reason is
because natural gas is escaping from it and has been escaping
for the last 50 years.
As the state fights to open ANWR, these wells are being used on
environmentalist websites saying they are oil company wells.
They aren't! They have been told that 17 of the wells are being
used to monitor climate change, but they don't know how they are
cased, if diesel is still present or if they really are
monitoring climate change. It's a disgrace to Alaskans to allow
the federal government to treat our land this way.
REPRESENTATIVE MILLETT said she met with the BLM in Anchorage
twice and with the BLM and Department of Interior (DOI) twice in
Washington, D.C. (DC) and was told both times thanks for coming,
but we don't have any money.
4:10:52 PM
She related further that a land conveyance was done between the
Arctic Slope Regional Corporation and the North Slope Borough
and the federal government that transferred 33 wells. The
federal government has now said in that conveyance that
responsibility for abandoning and plugging those wells lies with
the new land owner, which was not part of the agreement. And,
ironically, the federal government has leased land in NPR-A, and
the OCS for a total of $9 billion. If a private company was
doing this, the fines would be over $40 billion.
REPRESENTATIVE MILLETT said that Senator Murkowski brought the
issue to Secretary Salazar's attention and he said they could
plug three wells this year. With enough pressure and public
exposure she thought the rest of those wells could be abandoned
and plugged appropriately.
4:13:37 PM
CARL PORTMAN, Deputy Director, Resource Development Council
(RDC), Anchorage, AK, supported HJR 29. Every member of the
House supported this resolution and joined in as co-sponsors.
The DOI and other federal agencies require private companies to
explore for and produce domestic energy and mineral resources in
an environmentally responsible manner. And through laws,
regulations and permitting, federal agencies have set a high bar
to mitigate impacts to the environment. As a result, industry
has been held to the highest standards. When violations or
permitting requirements occur, companies are held responsible,
often facing steep fines. However, in the case of lands in the
federal Arctic, the government has not held itself to the same
high standard.
Of the 130 legacy wells that were drilled, Mr. Portman said,
only a handful of were properly plugged and reclaimed. The
remaining wells are out of compliance with regulations adopted
by the AOGCC. The federal government has been reminded
repeatedly of its obligation to plug the legacy wells and
reclaim sites, but the state cannot impose fines on the federal
government. If it could, they would exceed $8 billion and much
more of the statute of limitations could be disregarded.
MR. PORTMAN said that HJR 29 points out the double standard and
hypocrisy that exits in the federal government's permitting and
regulation of resource development activities in Alaska. The
resolution rightly urges the federal government to comply with
the same laws and requirements it expects industry to follow.
The federal government should lead by example and set an even
higher standard for itself.
4:16:52 PM
CATHY FOERSTER, Chairman, Alaska Oil and Gas Conservation
Commission (AOGCC), Anchorage, AK, strongly supported HJR 29.
She thanked the legislature and all others who have rallied
around this issue in DC for our state. It is a subject that is
near and dear to her heart. She presented a power point
explaining that the federal government drilled the wells from
1944 to 1981 in northern Alaska called legacy wells. They are
all on the western North Slope with geography and biology just
like ANWR, but all are in an area called the National Petroleum
Reserve instead of a national wildlife refuge.
4:17:38 PM
She said the BLM within the DOI is the agency that operates
these wells that have has been out of compliance with Alaska
regulation at one time or another and most of them still are
today. Given the condition of most of these wells, review of the
applicable regulations would likely reveal that they are not
even in compliance with the DOI's own regulations.
MS. FOERSTER said she didn't have enough time to go through all
the wells, but she showed them pictures of the most troubling.
One was of hundreds of rusting drums that had chemicals in them
at one time. DOI doesn't have enough budget to clean up the
mess; they can't pick up drums, but they have enough money to
rent a helicopter, fly a bunch of people out there and to take
pictures of it.
4:20:29 PM
SENATOR WIELECHOWSKI said her testimony was compelling and asked
why not sue them.
MS. FOERSTER replied that the state can't trump the federal
government and can't sue it either. She's been told the only
thing she could do is embarrass them in the court of public
opinion. "So, here we go."
She said the state BLM would like to clean this mess up, too,
but their hands are tied by the meager budget the federal
government gives them. It's against the rules to even ask for
more money for this stuff. The feds have all that money from
lease sales and she mentioned the renovation of the Mall and re-
sodding. For the same money they could plug and abandon (P&A)
all those wells.
MS. FOERSTER explained that in Alaska proper plugging and
abandonment of wells is governed by Article 2 of AOGCC
regulations. The purpose of properly plugging and abandonment
includes: public safety, protection of the environment and
protection of sources of drinking water; it includes sufficient
down hole cement and plugs to insure that underground fluids
cannot migrate. With very few exceptions, the 137 legacy wells
do not comply with this requirement. She said several wells were
left open to the surface and some were filled with diesel when
the federal government left them.
4:23:20 PM
Proper P&A of wells require that all underground pipe be cut off
five feet below ground level so that it cannot create an
excavation hazard or become a problem during normal earth
movement and with few exceptions, again, most of the wells don't
comply. The oil industry gets blamed for situations in the
picture. Proper P&A requires sufficient surface remediation so
that the site blends in with the natural vegetation again within
a few seasons. Many of the legacy well sites are permanent
eyesores littered with rotting wood, rusting metal and other
debris. The few wells that have been re-vegetated have
potentially more serious down-hole mechanical issues, because
they are not secure.
MS. FOERSTER said delaying P&A has caused several wells to be
lost and the BLM has taken them off their concern list since
they can no longer find them, but out of sight and out of mind
doesn't mean out of trouble. Postponing the abandonment of the
remaining wells puts them at risk of being lost, as well.
4:26:39 PM
MS. FOERSTER said the state shouldn't have to force the federal
government into compliance; they should provide adequate funding
to bring these wells into compliance with both state and federal
regulations, maybe from federal lease sale money.
CO-CHAIR PASKVAN thanked her for the "awesome presentation" and
asked a rough estimate of what it would cost to make 130 wells
safe.
4:28:27 PM
MS. FOERSTER replied $500 million-or less, but there are
probably ways to do it cheaper. For example, oil companies have
said if they get to lease the land they would plug and abandon
them for free. Also, the BLM cleans up one or two wells a year
and leaves, but a large part of the cost is mobilization and
demobilization of the equipment. If they were to move that
equipment up there and do more than one well at a time there
would be enormous economies of scale.
SENATOR WIELECHOWSKI said he found it hard to believe that this
is not a violation of some federal law. Have the state's
attorneys looked at this?
MS. FOERSTER replied "yes we have, and no we can't." She even
talked to the head of the EPA Crimes Division who assured her if
it happened more than five years ago, the statute of limitations
would apply. The EPA would love to help, but they can't figure
out what to do.
CO-CHAIR PASKVAN asked if Alaska spent the money to clean it up,
could it attach or hold on to some federal royalty dollars.
MS. FOERSTER replied that the Attorney General hadn't offered
that as a solution.
4:31:29 PM
CO-CHAIR WAGONER opened public testimony.
4:31:32 PM
DAVID THERIAULT, Alaska Conservation Alliance, Anchorage, AK,
supported HJR 29. He said they knew very little about this issue
before Representative Millett's office approached them about it.
Ms. Foerster's presentation was very persuasive. Their concern
is to protect the environment and health, but they also want to
see consistent rules consistently applied for both private and
government entities.
CO-CHAIR WAGONER said maybe his group could contact other
conservation groups to get them involved in putting some
pressure on the federal government.
MR. THERIAULT responded that the conservation community is
learning about it now and starting to talk about it with some of
the national organizations and they all want to solve this
problem one way or another.
CO-CHAIR WAGONER, finding no further comments, closed public
testimony.
CO-CHAIR WAGONER offered Amendment 1.
27-LS1208\A.1
Nauman
3/17/12
AMENDMENT 1
OFFERED IN THE SENATE BY SENATOR WAGONER
Page 1, line 3, following "region":
Insert "; and urging the Office of the Governor
to increase nationwide awareness about legacy wells
and well sites"
Page 2, line 24, following "region":
Insert "; and be it
FURTHER RESOLVED that the Alaska State
Legislature respectfully requests the Office of the
Governor to disseminate information through
appropriate national news outlets and by other
available means to increase awareness nationwide of
the dangerous conditions of the legacy wells and
legacy well sites in the state and the federal
government's failure to plug the legacy wells properly
and reclaim the legacy well sites"
CO-CHAIR WAGONER explained that at the time when the legislature
was given a doubling of their office accounts, he refused to
accept his, but he was pursuing diverting that money to this
cause. The amendment asks the governor and his office to become
involved in this resolution process and get them to buy PR in
certain newspapers, and maybe use a photo array of properly
abandoned wells in Alaska. He thought it would have a major
effect on what the feds would be able to do to answer this
problem.
CO-CHAIR PASKVAN asked the bill sponsor's thoughts on the
amendment.
REPRESENTATIVE MILLETT said she welcomed the amendment. Her
staff found that a full page black and white ad in the
Washington Post would cost $54,000 to $110,000.
CO-CHAIR WAGONER said if they can't get the money together to
use newsprint, they could use the Internet and send emails to
every conservation club in the United States.
4:37:35 PM
SENATOR FRENCH said it looks like the language is designed to
coax the governor and not use a "shall" or "must," so a fiscal
note could be avoided, and he thought that was a good idea.
CO-CHAIR WAGONER found no objections to Amendment 1 and
announced that it was adopted.
CO-CHAIR PASKVAN moved to report HJR 29 as amended from
committee with individual recommendations and no attached fiscal
note. There were no objections and SCS HJR 29(RES) moved from
committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 215 - Route Comparison.pdf |
SRES 3/19/2012 3:30:00 PM |
SB 215 |
| SB 215 - Sponsor Statement and Legislation.pdf |
SRES 3/19/2012 3:30:00 PM |
SB 215 |
| SB 215 - Energy Cost Comparison.pdf |
SRES 3/19/2012 3:30:00 PM |
SB 215 |
| SB 215 - Fairbanks Impact.pdf |
SRES 3/19/2012 3:30:00 PM |
SB 215 |
| HJR 29_BLM Legacy Wells_AOGCC.pdf |
SRES 3/19/2012 3:30:00 PM |
HJR 29 |
| HJR 29_Version A.pdf |
SRES 3/19/2012 3:30:00 PM |
HJR 29 |
| HJR29_Fiscal Note_1-2-022012-LEG-N.pdf |
SRES 3/19/2012 3:30:00 PM |
HJR 29 |
| HJR 29 Amend Wagoner.pdf |
SRES 3/19/2012 3:30:00 PM |
HJR 29 |
| Draft CS SB 159-D version.pdf |
SRES 3/19/2012 3:30:00 PM |
SB 159 |