Legislature(2005 - 2006)CAPITOL 124
02/15/2006 01:00 PM House RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| HB300 | |
| HJR14 | |
| HB324 | |
| HCR29 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 300 | TELECONFERENCED | |
| *+ | HB 324 | TELECONFERENCED | |
| + | HJR 14 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| = | HCR 29 | ||
HB 300-OIL & GAS CONSERVATION COMMISSION MEMBER CO-CHAIR RAMRAS announced that the first order of business would be HOUSE BILL NO. 300, "An Act relating to the qualifications of the member of the Alaska Oil and Gas Conservation Commission who need not be certified, trained, or experienced in either the field of petroleum engineering or the field of petroleum geology." 1:07:25 PM REPRESENTATIVE VIC KOHRING, Alaska State Legislature, sponsor of HB 300, said that because of the complexity and expansion of the oil and gas industry, the public seat on the Alaska Oil and Gas Conservation Commission (AOGCC) ought to have at least some understanding of the industry. He noted that there are three seats on the AOGCC and two require expertise in the field. Currently the third seat doesn't require any kind of petroleum background. He said it shouldn't be a wide-open spot and an on- the-job training opportunity. REPRESENTATIVE LEDOUX asked what it will do with the current public member. REPRESENTATIVE KOHRING said that member is doing a good job and it will have no impact on his position. REPRESENTATIVE LEDOUX asked if there have been past problems that Representative Kohring is trying to fix. REPRESENTATIVE KOHRING said no, but he is looking toward the future. He said the increased technology requires increased knowledge, and there is a growing volume of work because of the growing industry. REPRESENTATIVE SEATON noted that the bill requires familiarity with the oil and gas industry in the State of Alaska, which is not a requirement for the other two members. REPRESENTATIVE KOHRING said he does not know why that stipulation is in the bill. REPRESENTATIVE SEATON suggested taking out that requirement. REPRESENTATIVE KOHRING said he could take that out because someone qualified may come from the Colorado School of Mines. CO-CHAIR SAMUELS said geology is geology, but in Alaska things are different because most land is not privately owned, and he suggested that the knowledge of Alaska's tax system, for example, is important. He said the public member should be able to bring something to the table. 1:14:56 PM REPRESENTATIVE GATTO suggested the third member should be a manager or "businessman" because the other two members are required to have technical knowledge. He asked if current members have exposure to business matters. REPRESENTATIVE KOHRING said he did not know, but one is an attorney. 1:16:16 PM REPRESENTATIVE GATTO said that the term "fundamental understanding" is general. 1:16:50 PM REPRESENTATIVE CRAWFORD asked for an explanation of why a public member is not desired. He spoke of a previous member who did a fine job of looking out for the public. He pointed out the original intent of having a public member. "It was a good idea at the time, and why should we change that?" he asked. REPRESENTATIVE KOHRING said he just thinks that person should have the expertise because of the technical nature and the volume of work. He said the person could have some knowledge of the industry and still advocate for the public. 1:18:44 PM REPRESENTATIVE CRAWFORD said he had to learn about a lot of issues, but he is a representative of the people and it was up to him to get up to speed on things that he had no background in. He said the oil and gas industry develops mindsets and culture within the industry, and that is why the state wanted to have the public member. 1:20:04 PM REPRESENTATIVE KOHRING said that the person is not required to work for the industry. REPRESENTATIVE LEDOUX asked about other public commissions where the members are not required to have a fundamental understanding of the issues. REPRESENTATIVE KOHRING said he was appointed to the Alaska Housing Board without much knowledge, and it was a tough challenge to get up to speed before he could be productive. 1:21:49 PM REPRESENTATIVE GATTO asked about the job description of the commission itself. 1:22:24 PM REPRESENTATIVE KOHRING requested that a commissioner answer that question. 1:22:58 PM JOHN NORMAN, Chair, Alaska Oil and Gas Conservation Commission (AOGCC), said the AOGCC is one of the oldest commissions in the state. The creation of the AOGCC represented a tremendous amount of foresight, he noted. He said the makeup of the commission has evolved over the years, and he has known every commissioner since statehood and "virtually all" would fit the requirements of HB 300. He then said that a few were not up to the level of having minimal understanding of the industry. He said the bill is a step in the right direction, and it allows flexibility while still requiring knowledge of the industry. He said he has had considerable experience in the industry. 1:27:48 PM MR. NORMAN said every other day, he is "sent back to the books" to understand the issues. He said there is a framework of legalities, vocabulary, and other things that need to be understood. He added that Alaska's regulatory structure and oversight is respected around the world. The understanding of the industry does not mean a person is in the pocket of the industry. He said he has represented Native corporations against the oil and gas industry. A person's experience need not be gained in the industry, he stated. He said that holding hearings is part of the work of the AOGCC, so he thought his law experience was helpful, "but we are best to leave it that we have an Alaskan that would represent the public...but I don't think it's too much to ask that that person have a basic understanding of the industry." He concluded that a person would not know the questions to ask if she or he was not knowledgeable, and that person might be overly suspicious of the industry. He said all producing states have professional commissions. 1:33:02 PM REPRESENTATIVE SEATON said that the words "in the state" may restrict the number of applicants to the commission. MR. NORMAN said he can support that change, because that preference will still be in Section 1. He added that Alaska is unique, so it is desirable to have someone who is from Alaska. 1:35:55 PM REPRESENTATIVE GATTO asked what the commission does. MR. NORMAN said the AOGCC was convened when the industry was unregulated, and its job is to oversee the orderly development of oil and gas. It tries to ensure that best engineering practices and best geologic science is applied. The AOGCC also convenes hearings for disputes, similar to the Superior Court. He said the commission oversees every hole in the ground to find oil or gas and continues oversight until a well is put to bed. He gave examples. 1:40:38 PM CO-CHAIR RAMRAS said the committee has an outline of what the commission does. 1:41:19 PM REPRESENTATIVE SEATON moved Amendment 1 as follows: Page 2, lines 26 and 27, after "industry" Delete: "in the state" CO-CHAIR SAMUELS objected. REPRESENTATIVE KOHRING said it takes away the specific requirement but it doesn't change the intent of the bill. REPRESENTATIVE GATTO noted that the original bill asked for the public member to be an attorney or be experienced in business management. He said the current version eliminates all of that, and it asks for the exact opposite. He asked how that happened. REPRESENTATIVE KOHRING said the original bill contained his initial thoughts without conversing with other people. He said he spoke with people in the oil and gas industry and decided to change it. 1:44:14 PM REPRESENTATIVE GATTO surmised that the bill started in the House Committee on Oil and Gas and the entire bill was changed. REPRESENTATIVE KOHRING said he wanted to make sure the bill was amenable to most interests, including the administration. 1:44:55 PM REPRESENTATIVE SEATON said the current language requires that a person's training or experience has to have been in Alaska, and he doesn't think that was the intent. A roll call vote was taken. Representatives Seaton, Gatto and LeDoux voted in favor of Amendment 1. Representatives Samuels, Elkins, Ramras and Crawford voted against it. Therefore, Amendment 1 failed by a vote of 3-4. 1:46:22 PM CO-CHAIR SAMUELS moved to report CSHB 300(O&G) out of committee with individual recommendations and the accompanying fiscal notes. REPRESENTATIVE ELKINS objected. REPRESENTATIVE ELKINS said there are a lot of people who are qualified and the bill will "keep a Bill Gates-type person from setting on the board." He said he cannot support it. 1:47:13 PM CO-CHAIR SAMUELS said at least the member should understand the terminology of the industry. He said the person should understand how the Alaska Native Claims Settlement Act or Alaska taxation works. "You have this huge staff; you get paid a whole lot of money; you should bring something to the table." He said the person does not need to be an expert. CO-CHAIR RAMRAS concurred. 1:48:03 PM REPRESENTATIVE LEDOUX said it eviscerates the idea of the public member. The state has a concept of public membership on commissions: people who are not part of the industry. She said she sees this bill as dissolving that concept. 1:48:56 PM CO-CHAIR SAMUELS said this commission, as well as the Boards of Fish and Game, don't compare with other boards. The Board of Real Estate Appraisers is not dealing with tens of billions of dollars. He said the public should have their seat, but ask that they understand the terminology. The commission maximizes hydrocarbon recovery. The public needs a member, but it is not asking for a very minimal standard of understanding. An attorney might not have that understanding, he said. The public member could be a roughneck on the slope who has no ties to the industry. He said an oil and gas tax lawyer could be a member. 1:50:46 PM REPRESENTATIVE CRAWFORD said he had reservations initially. The present bill will still leave the appointment to the governor and legislature. He said Richard Fineberg could be appointed under this language, so he will not object. He doesn't think it will change things. 1:52:02 PM CO-CHAIR RAMRAS said there are three bills to discuss today and Northern Dynasty will be making a presentation. REPRESENTATIVE GATTO said he likes the first version, but he supports the current version, because the governor can still choose a person within the oil and gas industry who has a business background. REPRESENTATIVE ELKINS removed his objection. Hearing no further objections, CSHB 300(O&G) passed out of the House Resources Standing Committee. 1:53:15 PM
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