Legislature(2005 - 2006)CAPITOL 124
05/02/2005 01:00 PM House RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| HB254 | |
| HB280 | |
| HJR17 | |
| HCR13 | |
| SJR16 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HCR 13 | TELECONFERENCED | |
| *+ | HJR 17 | TELECONFERENCED | |
| *+ | HB 280 | TELECONFERENCED | |
| + | SJR 16 | TELECONFERENCED | |
| + | HB 254 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 254-NAT. GAS SPUR LINE AND DISTRIBUTION GRID REPRESENTATIVE NORMAN ROKEBERG, Alaska State Legislature, Juneau, said HB 254 is a grubstake bill, and it expands the scope of work for the Alaska Natural Gas Development Authority (ANGDA). There is a companion bill to provide an additional $8 million to ANGDA to study spur line projects, he said, and it provides for the review of a bullet line from the North Slope to Cook Inlet. He added that it looks at two other routings. The governor vetoed $2.5 million for funds for the right-of-way acquisition from Glennallen to Matanuska-Susitna, he said. He stated that the Cook Inlet tribal council, in concert with North Star LLC, has a $3 million federal grant to review the Parks Highway area. "The authority shall agree to cooperate with the federal grantees, so any other monies that have been appropriated by the federal government to study spur lines, this bill specifically indicates they would cooperate," he stated. "The funding that's in the companion appropriation bill comes from the $28 million railbelt energy fund--$8 million of which goes to ANGDA for the study and $20 million for the current existing southern intertie repair and maintenance," he added. 1:53:23 PM REPRESENTATIVE ROKEBERG said grubstake is an old Alaska concept, and this issue is so important, the Department of Energy has indicated that by 2012 the Cook Inlet area will not be able to provide consumer natural gas no matter what the price. REPRESENTATIVE SEATON suggested putting cost recovery in the title. REPRESENTATIVE ROKEBERG said titles are for senators and minority members to play with. It is not necessary, he added. 1:55:22 PM CO-CHAIR SAMUELS said the sponsor statement clarifies HB 254. 1:55:55 PM REPRESENTATIVE GATTO referred to a news article that stated two companies buy two thirds of Cook Inlet's gas, and if they stop buying gas, the price will go through the roof. He said if they keep buying gas, it will run out and the price will go up as well. He suggested it was a no-win situation. REPRESENTATIVE ROKEBERG said gas shortages will still be felt in 2012 unless new gas is found. "Even if we shut the plants down, we're going to still come up short," he said. REPRESENTATIVE GATTO asked how that can be if those two plants are two thirds of the consumption. REPRESENTATIVE ROKEBERG answered: The export license for Conoco Phillips plant goes through 2009, so if we have a finite amount of gas-- we've had new discoveries on the Kenai. The Kachemak pipe line that goes down near the Ninilchik area, going toward Homer. And there are some additional fields down there. But I'm not sure, I can't recall the exact quantities of the discovery ... They are adding to our stocks, and there are certainly other potential gas in the Cook Inlet basin area. This legislature, for the last decade, has gone out of its way to try to incent development, particularly the Cook Inlet area. We've had some success ... this committee in the last legislature passed a tax credit bill for gas pipe lines, which has been, I think, was instrumental with the Kachemak pipe line development, which was quite expensive. REPRESENTATIVE ROKEBERG continued that despite the known demands, the area could ultimately have a shortage of gas, and questioned how others can be encouraged to explore for gas. "That's why it is important to look at the use of the gas, the size of the spur line, and ultimately how we are to use that." He said there is no question in his mind that "we have to absolutely stay completely focused on natural gas. Any diversion of alternate/other types of energies will diminish the ability to afford and put in a gas pipe line." He added wind or coal generation "should absolutely be a policy that should be discouraged by the legislature." 2:00:25 PM REPRESENTATIVE ROKEBERG said the legislature should stay on target and stay on natural gas. To justify the capacity of a gas line, "we're going to have other green field developments, from Dow Chemical to petro-chemical type utilization. And we need to make those industrial sites available at tidewater." He noted that one of the issues is the price. He said natural gas prices have doubled in the past two years. 2:01:34 PM REPRESENTATIVE GATTO asked if the bill is separate from moving North Slope gas to Chicago. REPRESENTATIVE ROKEBERG said it is a further addition to the scope of work and routing for a spur line off the Chicago or Valdez route, because it adds the Parks Highway Y-off from Fairbanks. It also calls for a bullet line from the North Slope to Cook Inlet, he added. 2:03:04 PM CO-CHAIR RAMRAS said he is a big supporter of alternative energy and wants to recognize that conventional hydro-carbon energy can co-exist with innovative forms of energy without adding to the costs. He said he is of the opinion that the port authority's program is not viable, and he saw a news article today that undermines one of the partners in Sempra. He noted the sponsor statement suggests the state will allocate some of the $8 million to a route that he doesn't think is viable, and he asked Representative Rokeberg if he would accept an amendment to delete lines 22-29 on page 3 of the bill. 2:04:54 PM REPRESENTATIVE ROKEBERG said that would gut the bill. "I share your concern about the Port Authority," he noted. The trouble with deleting the Glennallen to Cook Inlet route would be counter productive, "because even if we had a highway route, you could go two different ways. I mean in terms of routing analysis, you can come from, even the highway route, you can come down the Richardson highway to the Glen highway and go that route. Or come down the Parks highway, so that debate needs to take place." CO-CHAIR RAMRAS said he meant just line 25 to delete "to tidewater at a point on Prince William Sound". REPRESENTATIVE ROKEBERG said he is very reluctant. The bill came from an initiative from the people of Alaska in the formation of ANGDA itself, he said. The original charge was an all-Alaska pipeline from the North Slope to Valdez, he added, and if the highway route falls apart, "we close the door on ANGDA's charge to compete with the Port Authority project." 2:07:09 PM HAROLD HEINZE, Chief Executive Officer, Alaska Natural Gas Development Authority, said the bill provides a number of options. He emphasized that ANGDA has done screening studies of different routes for getting North Slope gas to Cook Inlet, and "frankly it is clear that at a screening level, economics are not going to dictate some of the choices that need to be made if they are made at all." If there is a line going from the North Slope to Valdez, it is logical to look at bringing gas to Cook Inlet from Glennallen, he stated. If it goes down the highway to Chicago, then from Delta to Cook Inlet via Glennallen and or direct to Cook Inlet are both possible, he said. When looking at all the elements, it is very unclear which is the best route, he stated, and the bill expands what ANGDA can examine. 2:10:29 PM MR. HEINZE said ANGDA has looked at the bill and its accompanying appropriation as a way to provide an additional funding source to look at other opportunities if necessary. He said it is not necessary now, but it could be in the next few months as negotiations with the producers end up being successful or not. "If we were to use this funding, it is our position that we would do it in the context of intending to repay, at some point, the railbelt energy fund," he said, and ANGDA will not pursue it if it will not be successful. 2:11:41 PM WARREN KEOGH, Chickaloon, Alaska, said he is concerned about ANGDA receiving money because they spent "about $500,000 in the past six months for contracted services and ANGDA's recent action, which is a submission of a right-of-way application to the Alaska Department of Natural Resources for a 300-foot pipe line right-of-way from Glennallen to Palmer." He questioned additional state funds because ANGDA has not provided adequate public notice in public meetings, and its public outreach has been inadequate. He said landowners had no idea the pipeline was routed through their private property. The spur line engineering report alerts ANGDA to fault lines crossing the route, which require extensive field investigations for proper design of the pipe line, and Mr. Keogh said that those field evaluations should be done prior to final route selection. "My question is why has a route been selected and the right-of-way application been submitted prior to these recommended field studies?" He also noted a similar problem with fish streams and wetlands. He said his community will be traversed by 20 miles of the pipe line, and it was not advised before the route was selected. Furthermore, ANGDA reported it did public outreach to the community, which merely consisted of talking to one Chickaloon resident who happens to manage a natural gas development firm. The community council passed a resolution to ask ANGDA to suspend its right-of-way and permit acquisition process, he said. 2:15:53 PM MR. KEOGH said ANGDA has moved too hastily and made some mistakes. He understands the urgency and he supported the ANGDA initiative, but said it would be better to slow down and do things right before spending $8 million of railbelt funds. 2:16:38 PM REPRESENTATIVE GATTO said, "You did mention that there was no notification of a pipe line routed down Trunk Road, and ... I haven't been home for four months but I'm certainly not aware of any notification to that degree." MR. KEOGH said on the joint pipe line office website where the application is posted, the right-of-way application route is shown on 20 maps including the routes that cross private lands. He said the right-of-way application is only for state lands but it also shows where the route crosses private lands. 2:17:52 PM REPRESENTATIVE GATTO said there are recent issues with power line construction from MEA who received agreements with property owners, but this line is scheduled to go through without landowner approval. MR. KEOGH said landowners on the route did not know the pipe line was intended to go through their property. 2:18:56 PM REPRESENTATIVE ROKEBERG said he is mystified why Mr. Keogh is not supporting this legislation, because it would provide an alternative to the right-of-way through Chickaloon. "I guess I am a little bit baffled," he said. MR. KEOGH said when a state entity plans a pipeline route he would expect meaningful input from the impacted communities. No matter where it is, "folks along the way need to be well- apprised and have significant input." He said the people of ANGDA might not be aware that Chickaloon has a land plan. "In the scramble to find the best way to get natural gas out of the state and along whatever route, [it's important] that you pay close and careful consideration to the interests and needs and the priorities of the citizens of the local communities," he explained. 2:20:49 PM REPRESENTATIVE ROKEBERG said he can't really disagree, "but for him to oppose legislation that doesn't speak to those issues is disappointing." 2:21:11 PM REPRESENTATIVE SEATON moved to report HB 254, version F, out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HB 254 was passed out of committee. 2:21:40 PM
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