SJR 18-SUPPORT SHELL PORT OF SEATTLE LEASE  3:41:37 PM CHAIR GIESSEL announced consideration of SJR 18. KARI NORE, staff to Senator Giessel, Alaska State Legislature, Juneau, Alaska, explained SJR 18 for the sponsor. She said this resolution supports the Royal Dutch Shell Port of Seattle leases. It also urges the State of Washington to stop interfering with Alaska's economic development, especially when it comes to developing the oil and gas deposits in the Beaufort and Chuckchi Seas and the Alaska Arctic. She said this resolution also offers Seward and/or Dutch Harbor as possible ports for Royal Dutch Shell in the event that Seattle and the State of Washington move forward with the termination of their current leases. SENATOR STEDMAN said Shell had been looking at several ports and that Dutch Harbor and Seward are far from the supply chain. He was wondering why those were picked from the whole gamut of choices they have in Alaska. CHAIR GIESSEL replied that Dutch Harbor is an actual location where Shell has harbored their vessels before and they have some facilities set up for them there; Seward is in the process of developing a harbor. Ketchikan is an option and she wasn't sure that Whittier could accommodate the drilling vessels. SENATOR STEDMAN said Sitka has a dock facility that is capable of accommodating Panamax-sized ships. It appears that no one port will have the capacity to facilitate offshore and that Alaska will end up with multiple ports. Seattle is being extremely rude and Alaska would like to get Shell's business. SENATOR STOLTZE said Seward has a rich history in the development of Alaska and asked if they had received support from the City of Seward for economic development because of the National Park issue and politics involved in Seward. He asked if they had received any support from the City of Seward for economic development and bringing something as evil as fossil fuels into its port. CHAIR GIESSEL responded, as the immediate past senator for Seward, that Seward was the home port for at least one of Shell's vessels and is quite open to development. An industrial harbor is being developed across the bay from the city. 3:46:40 PM SENATOR STEDMAN moved conceptual Amendment 1 to add "has available potential home ports at Dutch Harbor, Seward, Ketchikan, Sitka, and anywhere in Prince William Sound" on page 3, line 13, to leave the all the options open for companies. There were no objections and conceptual Amendment 1 was adopted. 3:47:42 PM CHAIR GIESSEL opened public testimony on SJR 18. REED CHRISTENSEN, Board Member, Alaska Support Industry Alliance, Anchorage, Alaska, strongly supported SJR 18. He is also the President of Dowland-Bach Corporation. He said the Alaska business climate is like the weather: if you like it or not, just wait five minutes because it will change. This rugged environment and remoteness is part of the natural challenges of doing business in Alaska, but most people don't realize it or our resiliency and capacity to rise to them. However, the recent stance by neighbors in Washington State and others are much worse than the flooding of the Dalton Highway. The Alliance strongly supports this resolution and echoes remarks made by Mayor Brower of the North Slope in her open letter to Lieutenant Governor Hensley that says statements from current leadership in Washington State and Seattle "reflect a lack of basic knowledge about our region and are offensive to people who live in America's Arctic." 3:51:23 PM SARAH ERKMANN, Manager, External Affairs, Alaska Oil and Gas Association (AOGA), Anchorage, Alaska, supported SJR 18. She said the Arctic Outer Continental Shelf (OCS) holds enormous oil and gas resources, approximately 27 billion barrels of oil and 132 tcf of natural gas. In comparison, the Trans Alaska Pipeline System (TAPS) has carried just more than 17 billion barrels in over 30 years. At one point, it carried more than 2 million barrels of oil a day, but now it transports an average of 550,000 barrels a day. TAPS has played a critical link in the nation's energy security and OCS development in the Beaufort and Chukchi Seas could feed into TAPs and maintain its viability for years to come. Additionally, oil and gas development in the Arctic OCS means jobs for Alaskans. Development of the Chuckchi and Beaufort Seas is predicted to produce an annual average of 35,000 direct and indirect jobs over the next half century for Alaska, alone. Those jobs represent a total payroll of more than $70 billion. When it comes to the Pacific Northwest, Shell's decision to stage its Arctic operation in Seattle in 2012 poured hundreds of millions of dollars into the Seattle economy and employed more than 400 people. Seattle stands to benefit from similar economic benefits in 2015. On a broader scale, the State of Washington and City of Seattle benefit from the development of Alaska's resources via 113,000 jobs for Washington residents and annual business sales to the state of $5 billion. 3:54:11 PM CHAIR GIESSEL finding no further comments on SJR 18, closed public testimony. SENATOR STEDMAN commented that Washington State might do a refined products tax on exports next year, and maybe Alaska might have a difference of opinion on that. So, it goes beyond just what they are doing with Shell. 3:55:04 PM SENATOR MICCICHE said he appreciated SJR 18 very much. The point is not lost of the hypocrisy of some communities; it seems like the more btus they use per capita the more they are against oil and gas development. He suggested encouraging developers of waters off of Alaska to start a little earlier on to keep their investments in the state. The more that occurs, the more our infrastructure will be capable of servicing those vessels and assets. SENATOR COGHILL remarked that one of the things that gets lost by many people who live in Seattle is that Alaska is trying to build an infrastructure for power here. They have lived for almost a century with hydro projects put together by the federal government and run by the Army Corps of Engineers that has given them 4-cent power that they lean on, and they are quite often accusing Alaskans of leaning on the federal government. Boeing would not have moved to Seattle if it hadn't been for low cost power that was created a century ago. SENATOR STEDMAN added that it goes beyond the western side of the State of Washington; "it goes into the eastern side when you look at damming of rivers for hydro-generation and the farm belt that sprang up once they had the ability to water the desert." In the event legislators ever go down that road and mention it formally to their legislature, he would like to use a broader brush and remind them of development on both sides of the mountains. SENATOR COSTELLO moved to report SJR 18, as amended, from committee with individual recommendations and attached fiscal note(s). There were no objections and CSSJR 18(RES) was reported from the Senate Resources Standing Committee.