Legislature(2005 - 2006)CAPITOL 124
03/21/2005 01:00 PM House RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| HB197 | |
| HJR15 | |
| HB197 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 197 | TELECONFERENCED | |
| + | HJR 15 | TELECONFERENCED | |
| *+ | HJR 5 | TELECONFERENCED | |
HB 197-OIL SPILL EXEMPTIONS FOR GAS WELLS CO-CHAIR SAMUELS announced that the first order of business would be HOUSE BILL NO. 197 "An Act exempting certain natural gas exploration and production facilities from oil discharge prevention and contingency plans and proof of financial responsibility, and amending the powers and duties of the Alaska Oil and Gas Conservation Commission with respect to those plans; and providing for an effective date." REPRESENTATIVE VIC KOHRING, Alaska State Legislature, said HB 197 is designed to correct an unintended consequence of House Bill 531 in 2004. While trying to place restrictions on the coal bed methane industry, the legislature inadvertently required gas drilling companies to create oil spill contingency plans, he said. This bill will provide an exemption where there is negligible risk for oil spills. There are no fiscal consequences, and there is support from the industry, the Alaska Oil and Gas Conservation Commission (AOGCC), and the Department of Environmental Conservation (DEC), he concluded. 1:55:16 PM REPRESENTATIVE SEATON questioned language in Section 2 where it said the exemption does not apply to gas drilling where oil could be encountered. REPRESENTATIVE KOHRING said the exemption doesn't apply to gas drilling where oil could be encountered. There are areas in gas formations that are capable of flowing oil, so only if it is determined by the AOGCC that there is no potential for oil to seep out, then there would be an exemption. REPRESENTATIVE GATTO said it can't be known before drilling. REPRESENTATIVE SEATON asked about line 13 on page 3 where "crude oil does not include natural gas or refined petroleum products." He wanted to make clear that pipelines with refined petroleum products will be required to have oil spill contingency plans. 1:58:42 PM LARRY DIETRICK, Director, Division of Spill Prevention and Response, Department of Environmental Conservation, said AOGCC is responsible for determining the likelihood of oil being present. He said he is not aware of AOGCC ever making the wrong determination. If there is oil present, the requirement will be imposed. If a contingency plan was not in place and there was a spill, the permittee will still need to respond appropriately as directed by other statutes. 2:00:17 PM MR. DIETRICK thinks the reference to crude oil tries to make it clear that the bill applies to the gas-only situation. REPRESENTATIVE SEATON said that was his concern. "Crude oil does not include natural gas--I don't have a problem with that-- but then we have 'or refined petroleum products,' and if we're exempting pipelines that are carrying refined oil products from having an oil spill contingency plan, I would have a problem with that, but I am not sure if that's the effect of the bill." MR. DIETRICK said, "There are no other categories of the regulated facilities that would be exempted by this, other than the gas exploration activities, so the scenario of a refined petroleum product pipeline, say, or oil storage tank that's currently regulated would still continue to be regulated." REPRESENTATIVE SEATON asked if the language should include refined petroleum products "if we're just trying to distinguish between crude oil and natural gas." 2:02:07 PM MR. DIETRICK said he thinks there is a technical reason for clarifying the definition, and he'll ask the Department of Law. REPRESENTATIVE GATTO noted that on page 3, line 13, the definition of crude oil does not include natural gas, and he asked if natural gas is always part of crude oil. MR. DIETRICK said natural gas is separately defined in statute, and the intent is to distinguish them. Natural gas has a stand- alone definition. It is a component of crude, but for the purposes of applying the exemption, the two are considered separately. REPRESENTATIVE SEATON noted that on page 3, line 25, there is the language that oil does not include natural gas, and then there is a different definition on page 4, line 7. 2:05:06 PM REPRESENTATIVE SEATON asked if it was just non-conventional gas that is being considered. MR. DIETRICK answered that the bill concerns non-conventional gas because that is what was inadvertently changed last year. REPRESENTATIVE SEATON asked if HB 197 conforms to the current procedures for conventional gas. MR. DIETRICK said that is correct, and the definitions are technical changes to make it consistent. REPRESENTATIVE GATTO asked about the deletion on page 2, line 8. MR. DIETRICK replied, "The change made by [house bill 531], narrowed that definition of 'non-conventional' to the gas wells, and that was the problem area, so that's why they deleted it, and it's replaced with the language, which is all new in Section 1. So they deleted the reference to non-conventional, which was changed by 531 to have a different--it narrowed it from its originally broad thing, which would have continued to allow gas wells to be exempt. So when it narrowed it down, it implied then that contingency plans would be required for the non- conventional or the coal bed wells, and that's what they're trying to fix." Section 1 substitutes for the deleted language in Section 2, he added. If AOGCC makes the determination that oil is not present, then no contingency plan would be required. 2:08:13 PM REPRESENTATIVE KOHRING said it is not his intention to include refined petroleum products, and he would support clarifying that language. He also noted a technical correction that he would like fixed on page 4, line 1, where he would like to insert the word "to" after the word "oil". REPRESENTATIVE ELKINS asked who is responsible if there is an oil spill when no contingency plan was required. MR. DIETRICK said the operator is, and that is part of the application process. If an oil contingency response plan was not required, the operators are still required to immediately respond to a spill. 2:10:53 PM MR. DIETRICK said that the idea of requiring a plan is for specific situations where the risk is high enough to have a high level of preparedness in place. 2:11:54 PM CO-CHAIR SAMUELS set the bill aside until teleconferencing problems could be fixed. HB 197-OIL SPILL EXEMPTIONS FOR GAS WELLS CO-CHAIR SAMUELS announced that the next order of business would be revisiting HOUSE BILL NO. 197, "An Act exempting certain natural gas exploration and production facilities from oil discharge prevention and contingency plans and proof of financial responsibility, and amending the powers and duties of the Alaska Oil and Gas Conservation Commission with respect to those plans; and providing for an effective date." REPRESENTATIVE SEATON offered Amendment 1 as follows: Page 4, line 1, after "oil" Insert "to" 2:42:52 PM There being no objection, Amendment 1 carried. The committee took an at-ease from 2:43 p.m. to 2:44 p.m. 2:44:03 PM REPRESENTATIVE SEATON said he wants the committee to consider offering an amendment to delete "or refined petroleum products" from page 3, lines 13-14 and from page 4, lines 7-8. He will wait until the sponsor can explain why it is in the bill. 2:45:23 PM [HB 197 was held over]
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