Legislature(1999 - 2000)
04/03/2000 01:45 PM House RES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SJR 39 - ENCOURAGING CONGRESS TO OPEN ANWR CO-CHAIR HUDSON announced that the next order of business was CS for Senate Joint Resolution No. 39(RES), encouraging the United States Congress to pass S. 2214, a bill opening the coastal plain of the Arctic National Wildlife Refuge to responsible exploration, development, and production of its oil and gas resources. PAT CARTER, Legislative Aide for Senator Drue Pearce, Alaska State Legislature, stated that since 1954, United States oil production has dropped 17 percent, while consumption has risen approximately 14 percent. America's energy industry has also been damaged during this same time frame. Jobs in the energy sector have declined from 405,000 in 1990 to 293,000 - a 28 percent drop over the last 10 years. A further sign of decline is that exploration rigs searching for oil have fallen from 657 in 1990 to 153 in February of 2000 - a 77 percent decline over the last 10 years. As of last February, America is importing approximately 56 percent of the daily oil consumption; 44 percent of that comes from countries that are participants and members of the Organization of Petroleum Exporting Countries (OPEC). The dramatic decline in domestic oil production and resulting dependence on foreign oil is directly attributable to America's failure to develop a long-term energy plan. To be successful, this policy needs not only to address the promotion of alternative technologies and fuels but also to recognize that for the foreseeable future Americans are going to be dependent on petroleum and natural gas to power the nation's industry, transportation systems and economy. MR. CARTER further stated that industry and government experts recognize that the Coastal plain of the Arctic National Wildlife Refuge (ANWR) is the single most promising unexplored region in the United States for a major oil and gas discovery. Therefore, SJR 39 supports the congressional efforts for developing a long- term energy policy for America, which includes opening access to promising areas like ANWR in an effort to increase the domestic oil and gas production. Only then will America be loosened from the grip of foreign oil producing nations. Number 0864 REPRESENTATIVE BARNES said that recently, in listening to a newscast where the President was encouraging the United States Congress to pass his "energy bill," she noticed that one of things he was proposing, in addition to alternative fuels, was to give tax incentives and tax breaks to oil producers. She asked, "Are you aware of anywhere in the United States -- or have you ever heard any discussion to where you could take as small an area that we're discussing here in SJR 39 and get the amount of oil out of it that you possibly could, as it relates to the United States as a whole?" MR. CARTER responded that technology has made a lot of advancements since the early 1980s. In the early 1980s, the estimated impact to the Coastal plain for full-blown oil development of ANWR was about 12,500 acres. Today, the entire development is estimated at about 2,000 acres, which amounts to roughly three square miles. He noted that absolutely no place in America looks as promising in terms of the vast quantities that they think are in ANWR and also for the relatively low impact as far as square mileage. REPRESENTATIVE BARNES commented that it seems a bit disingenuous that the President, who is "always for protecting the environment," would propose to leave ANWR untouched, while he would have to develop offshore and many other places around the United States that would require much larger areas. MR. CARTER agreed and said what is even more disturbing is that the environmental community, which proposes to look at the environment on a worldwide basis, would want to further restrict oil and gas development in a country that has by far the most restrictive oil and gas development conservation measures and environmental protection policies in place. JIM SYKES, Oil Watch Alaska, testified via teleconference from Anchorage. He said that Oil Watch Alaska keeps tabs on the oil industry in the state. He indicated that he is in opposition to CSSJR 39(RES). He referred to the "WHEREAS" on page 2, line 13, where it states, "replacing sport utility vehicles with cars that use alternative fuels or are more energy-efficient is a goal to be applauded and encouraged, but will happen only in the future." He pointed out that the only way such vehicles will be replaced is if the price of oil remains high. It happened following the 1973 oil crisis and it happened again in 1978. It was not the government's intervention; it was indeed consumers who wanted fuel efficient cars. MR. SYKES referred to the "WHEREAS" on page 2, line 18, which speaks to reducing dependence on foreign oil and looking towards domestic resources. He thinks that it is one of the greatest oversights in the resolution, he informed members, because approximately 3 percent of the world's oil is located within the borders of the United States. Alaska contributes between one- quarter and one-fifth of that 3 percent. If one considers that the United States uses about one-third of the world's oil and only has approximately 3 percent of it, it does not take much to realize that the United States cannot produce its way to oil self-sufficiency. In fact, the reverse is true: the sooner the United States depletes its oil resources, [the sooner] its defense will be at risk and oil will have to be imported at a much higher price, because other Middle East producers will have a chokehold on the supply. MR. SYKES further stated that the tenth "WHEREAS" on page 2, line 23, speaks about the best possibility for discovery of another oil and gas discovery the size of that at Prudhoe Bay. He noted that the latest United States Geological Survey (USGS) report talks about ten small possible opportunities, not one large oil field. MR. SYKES next expressed concern with the "WHEREAS" on page 2, line 25, where it states, "in 1998, a three-year study by the United States Geological Survey estimated the recoverable oil potential of the coastal plain to be as high as 16,000,000,000 barrels of oil, which could replace Saudi oil imports to the United States for 30 years." He noted that there is only a 5 percent chance of finding 16,000,000,000 barrels of oil. He said the "WHEREAS" on page 3, line 3, regarding coastal plain development, providing hundreds of thousands of jobs and creating billions of dollars is another pie-in-the-sky number like the 16,000,000,000 barrels. In terms of taking care of the Porcupine Caribou herd, he suggested that members please consult any of the Gwich'in people, because they do not think that it can be taken care of. The development that might occur will occur across the entire 1002 area, and it requires a network of pipelines and roads; therefore, even though the footprints themselves are individually small, the network is required. Mr. Sykes concluded: I kind of think of this as a lemonade stand. If the state's lemonade stand is between the Colville and Canning Rivers, we get maybe a 25 cent profit out of that. If we refer our customers to the west to NPR-A [National Petroleum Reserve-Alaska], which is the next logical area for development, they might give us a cut because of the referral and give us 10 cents on a dollar for a glass of lemonade, and the same thing on the east. So, the main question is, Why should we, as the State of Alaska, refer the oil developers to the areas where we don't make much money and where we really might need that oil at a later date as a savings account, which we shouldn't be taking out of right now? ... I cannot in good conscience support it under these circumstances. Thank you, Mr. Chairman. I think this is not a good deal and some of these numbers really do need to be changed if you want this resolution to carry any weight, wherever you choose to send it. Number 1604 REPRESENTATIVE JOULE wondered why Mr. Sykes pointed out that the Gwich'in people are in opposition but failed to mention the people who live right in the refuge that support it. MR. SYKES responded that the oil industry has been very successful in dividing Alaskans so that they can gain access to oil land. In places where there is concern with onshore development, the Gwich'in oppose it, because they feel that their dependence on the caribou is going to be harmed. At the same time, there is a lot of opposition with Northstar, which is an offshore development, because the Inupiat people are more concerned with sea mammal subsistence resources. He does not see it as necessarily a conflict, although there may be people within the refuge that are Inupiat that support it. It has to be seen in the larger context of what the oil industry is trying to do; if they get their feet offshore, they will move onshore, and if they get their feet onshore, they will try to move offshore. The division of the peoples is a very artificial one, because they would ordinarily be together on the issue and work it out among themselves. Number 1735 REPRESENTATIVE JOULE agreed that there is a lot of concern with the offshore development and the sea mammals. In addition, there is concern with the conditions of the ice and, especially, with what they have seen in more recent years with the Exxon Valdez. He pointed out that one of the major reasons why the people of the North Slope are in support of opening ANWR is because it is onshore development. If anything goes wrong onshore, it can be curtailed. He thinks that they have had many years of experience in Prudhoe Bay and other parts of the North Slope, and they can take that experience and the technology and leave a very small footprint. In one law in 1971, the people of that community and that area were granted, under the Alaska Native Claims Settlement Act, the opportunity to choose and development land so they could become a little more self-sufficient in the ways of the world through their corporations. Yet another law prohibits them from doing anything. He thinks it is very ironic. Number 1867 REPRESENTATIVE BARNES said: I find it ironic that we live in the greatest country on the face of the earth, with the most protected environment. ... We're constantly developing technology to clean up and protect the environment. And all of the studies clearly show that at Prudhoe Bay the size of the footprint, as said by Representative Joule, is now down to a very, very small area, and that certainly there is nobody on that North Slope that is going to allow the environment to be degraded there. I find it extremely interesting that he pointed to the caribou, and if Mr. Sykes has ever been to Prudhoe Bay, as I have, in the summertime you see all these caribou under the oil line rubbing their backs, getting the mosquitos and bugs off of them. They like that line. They're not running away from it, and they're not being afraid of it. They're having ... babies, and they feel very protected. In addition to that, when the permitting of Northstar was taking place and all the lawsuits were being thrown out of the court, there was some concern by people from Barrow - I believe, the whalers - that there would be some effect on the whales. And they did work with BP [British Petroleum] to make sure that the pipes that were sunk into the water were sunk in such a way that they were comfortable ... that it would not cause environmental degradation. And when he talks about the oil industry is trying to do thus- and-so, I believe that that is not a correct way to put it, because 70 plus percent of Alaskans, it has been shown, support the development of ANWR - I believe it is 77 percent. They have supported development at Prudhoe Bay. You would think that people would know that, in fact, if this many Alaskans supported that, you wouldn't just refer to the oil companies as wanting this, because the very last blood of this state depends on oil and gas development and other resource extraction, and that's one of the problems that we're going to face in the very near future with our economy. And I know Mr. Sykes. I wish him well in his endeavors. I just happen to disagree with him. Number 2062 CARLY ALLEN, Alaska Youth for Environmental Action (AYEA), said: We are vehemently opposed to this resolution. First of all, people keep talking about how this is for Alaska's future, and this is for the real Alaskans, and the Alaskans support it. I have lived here my entire life, and I plan to raise my kids here. And I do not want to see Alaska turned into another Lower 48. I don't want it stripped of its natural resources. The other issues involved are the talk about the Native people of the area. The people who live in the actual refuge, their main subsistence is offshore. People worry about their own; they take care of their own thing, and that is why these people support onshore drilling, ... because it doesn't directly affect them, in their minds, at least. In answer to the Gwich'in people, their entire subsistence is based onshore. They have a huge interest in keeping this area from development. To ... disrupt this area will profoundly affect the environment. I don't think we can in good conscience go and do all this stuff without knowing exactly what we're doing. I think it needs further study, at least. I think part of the reason this is coming forward again now is because of the high oil prices. By the time - if it passes - by the time it develops, if it's developed, and oil starts coming out of there, it will be five to ten years from now. It's people right now having stuff affect them and [wanting] a quick fix. And there is only about six months' worth of oil in there. That's one of the figures that has come up. There is only enough to run the United States for six months. That's not worth it. We're disrupting a whole ecosystem without really knowing what exactly the effects will be. In answer to Alaskans wanting this, only 50.3 percent of Alaskans polled in the latest poll want this; 41 percent of those polled said, "No way." And this is only a small study, 500 randomly selected Alaskans. So, I think at least this needs further discussion and further study, and we don't think it should happen at all. Number 2554 REPRESENTATIVE BARNES pointed out that the latest poll that she had seen was a huge sample, and 77 percent of Alaskans were in support of opening ANWR. She asked Ms. Allen if she has ever been to Prudhoe Bay. MS. ALLEN responded that she has never been to Prudhoe Bay, and one reason that she is opposed to SJR 39 is because she wants to see it before it is opened to oil drilling. REPRESENTATIVE BARNES reiterated that this is a very small area in Prudhoe Bay. She pointed out that she has been there on several occasions, and it supplies a great deal of America's oil. She has seen the caribou, the fox and the birds nesting, and it does not look as if they are too disturbed. She added, "I think it is very unfortunate that people tell you things that you have to rely upon, because you are not able to see for yourself." MS. ALLEN replied that there have been huge die-offs in one of the main caribou herds. CO-CHAIR HUDSON asked Ms. Allen if she could get a copy of where that is referenced. MS. ALLEN replied, "I believe I could." Number 2397 SARAH CALLAGHAN, Staff for the Sierra Club, Anchorage, indicated that the Sierra Club is in opposition to any drilling on the ANWR Coastal plain. She explained that ANWR consists of about 1.5 million acres of land and only represents 5 percent of Alaska's entire coastal area in the Arctic. She said that 95 percent of Alaska's Arctic, both onshore and offshore, is either available for oil and gas drilling today or available for leasing and exploration in the future. Thus ANWR is currently the only 5 percent that is off-limits to oil drilling. MS. CALLAGHAN indicated the Sierra Club is looking forward, in the future, to a balance between oil drilling and wilderness in Alaska's Arctic. They really do feel that ANWR represents a unique area. It is known as the biological heart of a much larger ecosystem. Millions of migratory birds travel to the Coastal plain in the summertime. Of course, the 130,000-member Porcupine Caribou herd calves on the Coastal plain each year. This is an area that is very important, not only to people that use the area for hunting and guided hiking trips but also for the wildlife. MS. CALLAGHAN further stated that polling has shown a consistent split [in opinion]: whether it was 50/50 or 40/60, Alaskans are really divided over the question of whether to drill for oil in Alaska's only Arctic refuge. Recent polling shows that the majority of Alaskan women and rural residents support protecting ANWR. Even in Fairbanks, a recent poll showed that 51 percent of the citizens of Fairbanks wanted to protect ANWR. It is not cut- and-dried; many Alaskans feel that this is a really important area. MS. CALLAGHAN stressed that no amount of careful planning is going to completely eliminate oil spills or risks to the environment when drilling for oil. Today analysis shows that in Prudhoe Bay there is about 1,000 square miles of roads, pipelines, drilling pads and airports. This is concentrated in a small area and what you get is a "web of development," and it does affect caribou migration and other wildlife populations. She reported that a recent analysis shows 5,000 separate oil spills since the Exxon Valdez oil spill 11 years ago. These are self-reported incidents that the industry has told them about. Also, Alaska's own biologists from the University of Alaska have determined that the Central Arctic herd in Prudhoe Bay is experiencing a recent decline in population, lower birth rates, increased stress, and a decline in overall productivity. Essentially, the Arctic herd is split into two groups - one to the east of the pipeline and one to the west. The area west of the pipeline, where most of the development is taking place, is where they are seeing some major declines and reduction of productivity for those caribou herds. Number 2650 REPRESENTATIVE JOULE asked whether the caribou decline is for a certainty attributable to what is happening on the North Slope. He further asked whether it is because the population is doing so well that the herd [size] is "exploding" and therefore creating competition and stress in the herd's range. MS. CALLAGHAN replied that oil was first discovered in the late 1960s in Prudhoe Bay, and all of the caribou herds were experiencing a natural increase in size. The Central Arctic herd actually tripled in size and is up to about 30,000 animals today. Biologists believe that the reason the herd grew so much over that 15-year period is that there were mild winters. Since oil has been discovered, biologists have been doing a lot of studies throughout the years, and it is only recently that they have been able to make the connection between oil drilling and the slow decline in productivity in the caribou herds. It has only been in the last few years that they have actually drawn a clear line between oil drilling and negative effects on caribou herds on the North Slope. Number 2752 REPRESENTATIVE KAPSNER stated that she visited the North Slope project, and what impressed her was how environmentally sensitive BP and ARCO are being. When they stop a car just for a few minutes, they put plastic underneath so that no exhaust drips on the ground. If exhaust does drip on the ground, it is classified as an oil spill, which is why there have been as many as 5,000 oil spills self-reported. She noted that there was a Greenpeace tent there, too, and the oil drillers were wondering what [Greenpeace] was doing with its waste. She said she found it ironic. REPRESENTATIVE COWDERY asked Ms. Callaghan about the 95 percent that she had referred to in her testimony and wondered if it has the potential for oil production. MS. CALLAGHAN replied that the other 95 percent is only covering the North Slope, which includes the Arctic Refuge Coastal plain, the state lands, NPR-A and the offshore areas. She replied, "Yes, we do expect that there is oil to be had in that 95 percent." REPRESENTATIVE COWDERY wondered if Ms. Callaghan had scientific proof of that. MS. CALLAGHAN replied that they would have to talk with BP and ARCO about that, but since ARCO is currently drilling in the NPR- A, it is likely that there is oil out there. She indicated that there is quite a bit of oil still to be had in the state lands, and by focusing the infrastructure where they already have the roads, they can contain that development and still make quite a bit of money. REPRESENTATIVE COWDERY wondered if Ms. Callaghan would be opposed to oil development in the other 95 percent. MS. CALLAGHAN replied that each area is special in its own way. The Sierra Club does not support a blanket endorsement of developing. There needs to be careful consideration. For instance, they don't support areawide lease sales that the state does. TAPE 00-29, SIDE B POLLY CAW said she is opposing SJR 39 because ANWR is a national refuge that should be preserved for all Americans. She said, "In effect, with SJR 39 we're destroying the very meaning of the word 'refuge.'" A refuge by definition is a haven, which to her means a haven for the diversity of wildlife that exists there. She related how one of her students, after looking up the definition of refuge, asked how [ANWR] could be considered a refuge when it is exploited with development. Ms. Caw said she believes this is a dangerous lesson being taught to the next generation. REPRESENTATIVE WHITAKER asked if Ms. Caw is aware that the coastal plain was specifically set aside by Congress for future oil exploration. MS. CAW answered, "But I am also aware that the word 'refuge' and designating an area for the wildlife and for the people seems to contradict terms to me." REPRESENTATIVE WHITAKER said he wouldn't question the contradiction, because that is part of what is trying to be dealt with, in that there is a "clash of cultures." He related his belief that development is integral to the State of Alaska. He recognized that [others believe] development of this type is a thing of the past and perhaps, not the future. "We" are wrestling with those two concepts, he concluded. Number 2854 MEKAELA MAHONEY, a Kodiak high school student, said that she opposed SJR 39. She expressed concern that by opening up this last 5 percent of the Arctic coastal plain and (indisc.) to oil drilling, there will be no chance to change our minds and put the oil back in the land. She hopes that much consideration would be given before a final decision is reached. Ms. Mahoney pointed out that the Arctic is a vision of Alaska; Alaska evokes images of the wilderness, open space and the wonderful animals. Without the aforementioned qualities, many people would not live in Alaska or visit the state. Furthermore, SJR 39 does not necessarily solve our high oil prices or dependence on foreign oil. She noted that it could take up to 10 years to prepare the land for oil drilling. Number 2769 SAMANTHA MARLAR, a Kodiak high school student, said that she strongly opposes SJR 39. If SJR 39 passes, it will have detrimental effects on Alaska's environment as well as Alaska's image as the Last Frontier. This image is important to the tourism industry and economy as well as to Alaska's residents. She said, "Besides destroying the birthing grounds of the 129,000 Porcupine Caribou herd, this resolution would also destroy the U.S.'s last threshold of pristine wilderness." People come to Alaska with the expectation that Alaska is a great frontier that is free from the unfavorable characteristics of the other states, she said. She informed the committee that her parents are a good example: they drove the so-called Alcan on their honeymoon, in search of a better life than that found in the noisy and polluted place of their birth, the San Francisco Bay area. In conclusion, Ms. Marlar restated that opening up this last 5 percent of the North Slope would forever shatter Alaska's image as the Last Great Frontier. Number 2681 LARRY PAQUIN acknowledged that "we" all agree that the current high price of gasoline is causing a hardship on consumers. However, rushing to open ANWR is a quick fix to a temporary problem. He agreed with Mr. Sykes that opening ANWR to drilling will merely prolong the time [until] "we" develop a comprehensive national energy policy. Mr. Paquin suggested that building fuel- efficient cars and properly inflating tires could save as much oil as would come from ANWR. He believes very little has been done, except in times of high gasoline prices, to conserve energy. MR. PAQUIN recalled the statement that the vast majority of people favor opening ANWR to drilling. In the Fairbanks area, he said, only 51 percent favor opening ANWR to drilling, which is hardly a vast majority. He echoed earlier comments regarding the notion that the people who depend on the offshore areas for resources, the people around Kaktovik, are not as concerned about the land. However, the Gwichi'in people are because their resources depend on the land itself. He asked, "Must we repeat the buffalo-slaughter mentality that was already developed ... and apply this to the last 5 percent of land available on the Arctic national coastal plain to exploitation?" He said that this is not really an energy crisis, and, if it were, there would be better arguments regarding opening ANWR. Mr. Paquin expressed the need for long-term vision versus a short-term fix. REPRESENTATIVE HARRIS mentioned that he did not know where people were receiving the information that 51 percent of those in Fairbanks favor opening ANWR to drilling. He surmised that the percentage would increase rapidly if those in Fairbanks were asked, "Would you rather see the development of ANWR either go ahead or not go ahead, or the University of Alaska's funding be decreased because of the lack of revenue that the state has as the decline in oil revenue continues?" As stated earlier, Representative Harris believes that much of Alaska's economy is dependent upon its resource development. If the state continues to decline in resource development, then he predicts state spending will decline as well. MR. PAQUIN pointed out that there are also bills "in the works" that would transfer close to 130,000 acres to the university; therefore, part of that problem would be solved. He informed the committee that he believes [the 51 percent] is from an Ivan Moore (ph) poll in Fairbanks. REPRESENTATIVE HARRIS said that does not answer his question. If the state does not develop its resources and the university loses its revenue, he asked if Mr. Paquin believes that number [the 51 percent] would change. MR. PAQUIN said he believes that there are other sources of funding besides oil. He pointed out that the polls depend upon how [the question] is framed. REPRESENTATIVE JOULE commented that the people from the coast are not as concerned with the land as they are with the sea. He himself lives on the coast and has been to the community, and he knows that much of their food comes from the ocean. However, much of their food source also comes from the land and the rivers in the area. Therefore, he believes it is inaccurate to say that these people are not as concerned with what happens to the land. Number 2429 PHIL WILDFANG told members that he wanted to attest to Ms. Callaghan's statement that some Fairbanks citizens are interested in preserving ANWR. As a 57-year-old, he said that he is not proud of the track record his generation has in regard to preserving wilderness areas, conserving natural resources and so forth. Although ANWR only constitutes 5 percent of the North Slope, this area is a national treasure. Therefore, it is time to turn the thermostats down, pump up our tires and put technology to work in order to develop some alternative energy resources. He suggested diversifying Alaska's economy in order to look toward something other than extraction technology to support the economy. Mr. Wildfang respectfully urged the committee to reject SJR 39 and to send the nation the message that "we" want to preserve this national treasure. Number 2326 DAVE LACEY informed the committee that he has worked in rural development for almost 20 years with a village on the Yukon Flats. He has been told by Gwich'in elders that future generations [are important] and the caribou [should be] comfortable in the calving grounds. Mr. Lacey said, "It's not necessarily the size of the footprint, but it's the disruption that we have to deal with." He related his belief that it is good to follow what the elders say due to their view of the larger picture. He recognized that the oil revenues fund the university, but what will happen to the university funding when the oil runs out? This problem should be [grappled] with now, instead of pushing it off into the future. Mr. Lacey indicated that the way to go is conservation, which makes sense when keeping future generations in mind. Number 2185 RANDY VIRGIN said he was speaking on his own behalf today. He stated, "The U.S. will never drill its way into energy independence." He said 3 percent of the world's reserves are within the United States, which consumes one-third of the world's oil. Therefore, opening ANWR is not going to end [the country's dependence] on foreign oil. He informed the committee that the USGS estimates the mean average to be 3.2 billion barrels of oil under the coastal plain, which could run the country for six months. Even with the highest estimate, it would be 16 billion barrels of oil, which could run this country for two-and-a-half years. MR. VIRGIN said that he could not look his friend [who lives in this area] in the eye and tell her that a six months' supply of oil is more important than her culture's need for that land to remain such that they can subsist off the caribou herd. He pointed out that the Gwich'in nation opposes opening up ANWR and has stated that in resolutions. He further pointed out that when this refuge was created, the coastal plain was not set aside for oil development. Rather, the language actually refers to a "special study area". Furthermore, this refuge is currently barred by Congress from development, and that is the reason there is a bill that would open the refuge pending at the federal level. REPRESENTATIVE WHITAKER commented that he is aware of the language in the congressional Act, and it [the refuge] was set aside for possible exploration. In regard to the probability of providing oil for the U.S., it is one manner in which this issue may be viewed. However, there is another way of looking at this: the probable 1.5 billion to 3 billion barrels of oil from ANWR, which would provide a minimum of 10 years of operation of the Alaska pipeline, which is very meaningful to the state. Furthermore, if there is a 5 percent possibility that there are 16 billion barrels of oil in ANWR, that would provide 48 years of operation for the Alaska pipeline. He stressed the need to look at this from both contexts; however, he said, Alaskan legislators have to consider the Alaskan perspective the most important. MR. VIRGIN said that he appreciated the Alaskan perspective, which is his first concern. In the interest of a local perspective, Mr. Virgin told members he prefers to defer to the Gwich'in people. He does not believe that this [opening ANWR] could be done without sacrificing the environment. He concluded, "Ten years ago, I'm sure that we were convinced that the technology was so advanced that we couldn't possibly mess up and yet the Exxon Valdez oil spill proved us wrong. ... Eleven years now, and we still don't have a full fleet of double-hulled tankers." CO-CHAIRMAN HUDSON commented that things are moving in that direction. He recalled his 20 years at sea, in which he watched oil being transported in the most terrible shipping situations. However, he said Alaska can take some sense of pride since almost every new ship coming online is double-hulled, with a redundant control system and improvements. Number 1792 NANCY MICHAELSON testified in opposition to SJR 39, saying she does not agree with entering the Arctic coastal plain and drilling for oil and gas. She does not agree with the interruption it would cause to the wildlife and the Gwich'in. Most of all, she does not believe that this is something that all Alaskans agree on. Ms. Michaelson referred to page 2, line 13, which read: "WHEREAS replacing sport utility vehicles with cars that use alternative fuels or are more energy-efficient is a goal to be applauded and encouraged, but will happen only in the future ...." She suggested perhaps deleting that section because voters had voted for legislators to "do good now." Furthermore, she doesn't believe that opening ANWR would happen for many years, and the state should be moving towards these things now. SUE SCHRADER, Alaska Conservation Voters (ACV), noted that the bill packet should include a copy of her testimony. She also offered to supply the committee with a copy of the results of the aforementioned Ivan Moore poll that ACV did January 10-20, 2000. Number 1577 PAM LaBOLLE, President, Alaska Chamber of Commerce, announced that the Alaska Chamber of Commerce strongly supports SJR 39 because it means jobs for Alaskans, economic well-being for the state, revenue for schools, support for social services and revenue for Alaska's cities and towns. Furthermore, this would mean oil for America and reducing dependence on foreign oil. Ms. LaBolle said that she has been to Prudhoe Bay and ANWR, and she has seen how environmentally sensitive the oil field production is at these locations. It is clean, she said. She noted that she has seen the wildlife, which are not affected or bothered to any visible degree on the North Slope. The amount of land being discussed here is approximately the same amount as that involved in the Anchorage International Airport. She commented, "It is not that significant, and it will be environmentally sensitively done." MS. LaBOLLE stated that most people testifying today were not even here 25 or 30 years ago and thus do not recognize that the same argument is being used. At that time, a worst-case scenario was predicted; however, there has been an extremely good record of production, which has meant much to Alaska. Alaska has an infrastructure that for which there was no hope before the production of oil. So much has been gained from oil production, and now it is time to look at ANWR. Ms. LaBolle said, "We're all Alaskans. We all want a bright and healthy future for our children and our children's children, and we are confident that development ANWR exploration will give us that bright, healthy future." Number 1404 ANDY KELLER (ph) spoke in opposition to SJR 39, saying he would like to submit his testimony and supporting documents at a later date. Although speaking on his own behalf, he informed the committee that he is a graduate student of the University of Alaska - Fairbanks and a former employee of the U.S. Fish & Wildlife Service. Mr. Keller noted that he had conducted biologically studies on the coastal plain of ANWR in order to assess possible impacts to biological resources - should oil drilling take place - and to obtain a baseline study. From his personal experience, he believes that industrial impacts have the potential to significantly erode wildlife values and destroy the areas' wilderness character. He emphasized that claims that opening ANWR would only impact 2,000 acres of land drastically understate the impacts of hundreds of miles of roads spread across the tundra, with dozens of drilling pads, and with dust and noise from trucks and airplanes. For example, in the 1002 report it is estimated that 40 percent of the Porcupine Caribou herd would be drastically impacted by the infrastructure in Prudhoe Bay. He feels, as others have expressed, that a 10 percent protection for the coastline of Arctic Alaska is a small amount compared to the 90 percent that is currently not protected. MR. KELLER commented that he is not convinced, either way, by the polling data. In terms of Alaska, he believes that the polling numbers are closer. He informed the committee that he is conducting some preliminary surveys and launching a national poll, at the University of Alaska, that would explore this issue and tie rising gas prices to the desire to open ANWR to oil drilling. Mr. Keller stated that over 70 percent of the American public supports protecting this area, which is well documented. There is a bill, with approximately 166 co-sponsors, in Congress that would protect this area as a wilderness. Furthermore, there are U.S. Senators who will filibuster any drilling bills, should any make it to the U.S. Senate. MR. KELLER informed the committee that he is currently in the process of reviewing the legislature's expenditures on Arctic Power, the lobby effort for drilling proponents. He reported that thus far, the 1997 request he has seen is in the amount of $775,000; therefore, he suspects that it is in the millions. Mr. Keller wondered whether, with the grim prospects of passing that as a drilling bill, the money could be better spent to assist the university and to address other needs in the state. Number 1143 ROGER HERRERA (ph), an Anchorage resident testifying via teleconference from Washington, D.C., explained that he first came to Alaska in 1960 as a geologist working on the North Slope, and thus he knows that area very well. He noted that he is presently in Washington, D.C., in order to persuade Congress to open up the coastal plain to responsible development, which he believes that Alaska should support. He stressed that wildlife and oil development can exist at the same time, which has been adequately proven at Prudhoe Bay. In regard to the earlier information about the reduction of caribou in Prudhoe Bay area, it was not entirely complete. He clarified that in the three years beyond the years quoted, the number of caribou in the western part of the Central Arctic herd doubled in 1995-1997; however, the caribou that do not use the oil field decreased by half. He commented, "These things are sort of the quirks of nature and have very little to do with the oil field." He noted that he was quoting from a document titled "Journal of Wildlife Research." MR. HERRERA stated that the recent interest in looking at the coastal plain as a partial solution to [the state's problems] is really precipitated by OPEC's control of the world price of oil. Basically, OPEC has control of the price because it has control of the supply. He said, "The coastal plain represents a source of future supply. We had a price range of $10 going up to $30 because OPEC curtailed production by less than 1.5 million barrels of oil a day." If the USGS is correct in its reserve estimates, then this could be expected to come from the coastal plain. MR. HERRERA concluded, "If one looks at the careful analysis of the world oil production situation, which is now appearing with increasing frequency in the scientific press, one finds that the consensus of people that know about these things is strongly indicating that the world production of oil will peak as soon as 2006 or 2007; and thereafter it will decline." Therefore, he said, this is a bigger problem than some theoretical concerns about wildlife on the coastal plain. It will be reviewed on a national [basis]. In order to view this responsibly, one must review whether the USGS figures and subsequent production are correct. Without it, "we" will be forced into alternative energy sources when "we" are ill-prepared and cannot afford them. Number 0871 TAD OWENS, Project Coordinator, Resource Development Council (RDC), testified via teleconference from Anchorage, urging passage of SJR 39. He explained that RDC represents individuals and companies from all of Alaska's basic industries. Its mission is "to grow Alaska's economy through the responsible development of our natural resources." Members of RDC have long supported the opening of ANWR to responsible oil and gas exploration and development. Mr. Owens said, "We believe advances in technology allow for significant resource development with minimal environmental impact. ... The oil and gas industry on the North Slope has demonstrated that it can operate under the most extreme conditions with the highest respect and care for the land and its natural resources." Number 0808 KAREN COWERT, General Manager, Alaska Support Industry, testified via teleconference from Anchorage in support of SJR 39. As mentioned by Mr. Herrera (ph), she said, "our" commitment to the environment is not an either/or situation. She informed the committee that about two years ago, "we" brought several folks from the Washington, D.C., Environmental Protection Agency(EPA) office to Alaska. After a visit to Prudhoe Bay and several other fields, Peter Robinson, EPA Deputy Director, said Alaska knows how to do it right in regard to the pristine and well-run fields in Alaska. MS. COWERT stressed the need for America to have a strong economy. She pointed out that the U.S. would save $14 billion per year in oil imports if the U.S. used its own oil. She emphasized her desire to see that $14 billion in oil in America so that jobs can be created. Developing ANWR would probably create 250,000 to 735,000 jobs. She said, "We see federal revenues that would be enhanced by billions of dollars ... and that's not even to say what the Alaska economy would get." She pointed out that currently, Alaskans are looking at a $2,000-a- year permanent fund dividend, which all Alaskans enjoy. She emphasized that the state would also benefit from state revenues. She indicated the need to focus on the important things: jobs, America's strong economy and a strong environmental situation. Number 0500 PAUL FUHS, Lobbyist, CSX Lines, testified in support of SJR 39. He pointed out that Alaska uses a lot of fuel in its ships to bring cargo to Alaska. He said, "Between us and (indisc.), we bring 80 percent of the consumer goods into Alaska, and we need fuel for those ships." In regard to the testimony that ANWR would only provide a six months' supply, he pointed out that the same approach to Prudhoe Bay would have resulted in a two-and-a- half years' supply. He stated, "Actually, we supply 20 percent of the nation's production, but almost 60 percent of that is foreign." MR. FUHS pointed out that resources developed overseas are developed at a much lower environmental standard than "we" would, and thus he did not see how that is saving the planet. He indicated the need to take some pride in the work "we" have done, since "we" have taken control of our emissions. Mr. Fuhs said, "The fact is that the North Slope is de facto wilderness. ... One good environmental factor of oil development is that once it's done, if you have proper reclamation, it'll be gone forever; it is a temporary use of the land." Furthermore, the lease provisions put in place ensure that the land will be properly reclaimed. Therefore, he believes "we" have earned the right to do this, and he hopes that the legislature not only passes SJR 39 but also gets involved to [open ANWR]. Mr. Fuhs commented, "It's a little bit scary to me that some of the people that we saw here today that are obviously getting some of their information from our school system are not being given the whole story." Number 0203 CO-CHAIRMAN HUDSON announced that public testimony was concluded. He thanked all of the witnesses. REPRESENTATIVE JOULE corrected his earlier statement in regard to the number of animals in the Central Arctic caribou herd, saying Ms. Callaghan's number was closer. He noted that ADF&G is not sure why the herd is fluctuating; they think it may be [because of] some stress on the habitat. Representative Joule commented that the debate today was good and appropriate in a system of checks and balances. CO-CHAIRMAN HUDSON pointed out that everything that goes before the committee is part of the record to be transmitted to every member. The committee's job is to listen to all sides. TAPE 00-30, SIDE A REPRESENTATIVE BARNES read from Ms. Schrader's prepared statement contained in the bill packet: While the Native residents of Kaktovik, whose subsistence activities are centered around marine mammals rather than caribou, may support opening the refuge, the Gwich'in people of Alaska and Canada consider the coastal plain as sacred ground. For an estimated 20,000 years, their traditional subsistence lifestyle has depended heavily upon the caribou of the Porcupine herd that use the coastal plain as their birthing grounds. REPRESENTATIVE BARNES indicated that it offers up a great dichotomy, because last week the issue of wolves was before the committee, and the same people opposed the conservation efforts against the wolves that are eating moose in McGrath and taking away the subsistence lifestyle. Those same people here are using the same basic argument as it relates to the Gwich'in people that they are using against the people in McGrath, she suggested. REPRESENTATIVE BARNES made a motion to move CSSJR 39(RES) from committee with individual recommendations and accompanying fiscal note; she asked for unanimous consent. There being no objection, CSSJR 39(RES) moved from the House Resources Standing Committee.
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