Department of Defense Appropriations Act, 2006--Conference Report--Resumed

DEPARTMENT OF DEFENSE APPROPRIATIONS ACT, 2006--CONFERENCE REPORT--Resumed

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Ms. MURKOWSKI. Mr. President, thank you.

It is December 21. This is the shortest day of the year. On Alaska's North Slope today, it is pretty dark. The Sun went down, I was told, November 18 at 1:40 p.m. It is not going to rise again until January 23 at 1:01 p.m. Today's weather forecast on the North Slope is for it to be about 30 degrees below zero. Most of us would be hunkering down and hiding out from the cold and the dark. But right now Alaska's North Slope and the oil activities are humming because this is the time of year we do our work up there. And why do we do it? Do we do it because we like the cold, we like to be in the cold and in the dark? No. We do it because this is how we provide for the protections for the area. We explore and we work when the tundra is frozen. This is when we build the ice bridges. This is when we do the exploration. We do it because we care for the environment up there.

It hurts to hear some of the discussion and some of the argument and some of the misinformation about how we in Alaska derive our resources, how we pull the oil from the ground up North. We have been providing about 20 percent of this Nation's domestic oil from Prudhoe Bay for the past 30 years, and we have been doing a good job of it. We have been providing not only for the environment, we have been providing the jobs, and we have been providing the revenues. We have been helping this country in an effort to keep our balance of payments from booming even more than they already are. We are doing what this country needs when it comes to domestic production. We need the authorization of the Congress to do more, to open this small area up on the Coastal Plain to oil exploration and development.

There has been some discussion that in this bill, in the Defense bill, we are opening up in excess of the 2,000 acres we have agreed upon. The language is very clear. It says: 2,000 acres. It does not allow for the Natives to add additional acreage on top of the 2,000. It is a 2,000-acre limitation.

There has also been some challenge or some suggestion by the minority leader that somehow with this legislation the judicial review has been changed or altered in some way that would lesson the judicial review. That is absolutely not correct. There have been technical corrections in this legislation that differ from the earlier legislation that was introduced, but the judicial review remains in place.

There has been some suggestion that the State of Alaska will sue for a 90-percent share of the revenues rather than the 50-50 share.

Mr. President, I ask unanimous consent to have printed in the RECORD a letter signed by the Attorney General of the State of Alaska that clearly provides that the issue has been settled in terms of the 50-50 split because the issue has been appealed all the way to the U.S. Supreme Court. The State considers the decision by the U.S. Court of Federal Claims to be settled law. So those arguments people will make that we should not move forward with opening ANWR at this point in time are simply not true.

There being no objection, the material was ordered to be printed in the RECORD, as follows:

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Ms. MURKOWSKI. Mr. President, what ANWR represents to this country is energy security, national security, from the perspective of reducing our vulnerability on foreign sources of oil. When we talk about vulnerability in this country, and recognizing the vulnerability and the exposure of our men and women who are serving us over in Iraq, over in Afghanistan, we have to do everything we possibly can in this country to provide for their protection. Eighty percent of the Government's oil consumption is by our military. We need to keep this in mind. If we can do anything more to help with our domestic production so that we can decrease this reliance, we need to do so.

What ANWR offers to us is energy security, domestic security in the sense of jobs, and truly environmental security. I need to stress that. We have been doing a responsible job up North for the past 30 years. We want to continue that, to fill the pipeline that is now about half capacity.

Let me amplify a bit on why ANWR is so important for this Nation.

Since we debated ANWR during the budget resolution process this spring, we have finished a 14-year-effort to craft a new comprehensive energy bill. In that bill we have provided incentives and tax breaks to increase renewable energy: wind, solar, biomass, geothermal, ocean energy supplies. We promoted, by tax breaks, the purchase of hybrid and alternate clean cars to cut fuel consumption. We also mandated a doubling of the production of ethanol to help displace foreign oil.

We hiked the efficiency standards for a host of appliances to reduce electricity demand--hopefully by 40 percent, saving enough electricity to equal the output of 170 new 300-megawatt power plants. We promoted new technology, proposing to spend $3 billion to develop new hydrogen-fueled cars and to perfect the next generation of nuclear power.

We also made it easier to import more natural gas to ease our pending supply shortage. We approved $5.6 billion in tax breaks to promote energy efficiency and the growth of alternative fuels--more than twice what we spent to promote oil and gas production.

But outside of some minor changes that may speed oil leasing in the National Petroleum Reserve in Alaska--the Nation's last designated place for petroleum production--and a few very minor regulatory changes, we did little to directly increase domestic oil and gas production.

We delayed that action until now, when we hopefully will permit oil development from a tiny portion of the Arctic coastal plain in my home State of Alaska.

ANWR oil will certainly help stabilize our energy prices while generating more than $36 billion in Federal revenues within 20 years--$2.5 billion according to this reconciliation bill--money that is vital given our $319 billion deficit for fiscal year 2005 and the recent CBO forecast that we will still face a $314 billion deficit this year, not counting spending to counter the effects of Hurricanes Katrina, Rita and Wilma. While both numbers are down, we clearly need more revenues.

ANWR will reduce our balance of payments deficit because we won't be buying as much oil overseas. Last year we paid $166 billion to buy oil overseas--a quarter of our ballooning trade deficit. We are paying even more this year. Keeping those billions a year in America that ANWR oil production will equal at current prices is important.

It will produce hundreds of thousands of American jobs in most every State, with estimates ranging from a high of over 1 million total jobs to a low of 735,000.

These are jobs mostly in the lower 48 States; 12,000 jobs in Washington State; 80,000 jobs in California; 48,000 jobs in New York; 34,200 in Pennsylvania; 34,000 jobs in Florida, 5,500 jobs in Arkansas, even 2,700 jobs in Hawaii, our fellow non-contiguous sister State to the south, according to forecasts by Wharton Econometrics Forecasting Associates.

It is because of these jobs and the other economic benefits, that so many groups support ANWR development, from many in organized labor to farmers, and from truckers to manufacturers, all of whom know that ANWR oil will help stabilize everything from the cost of spring planting and fall harvesting to the thousands of products made from oil: from antihistamines to compact discs and from heart replacement valves to shampoo.

That is why groups from the U.S. Chamber of Commerce to the Americans for Tax Reform, from the Alaska Gas Association to the Alliance for Energy and Economic Growth, and unions such as the International Union of Operating Engineers, the Seafarers International Union, the Teamsters, the United Association of Plumbers and Pipefitters, the Laborers' International Union, the United Brotherhood of Carpenters and Joiners, and the Building and Construction Trades Department all are supporting ANWR's opening.

According to USGS estimates, ANWR's Coastal Plain has an even chance containing the second largest oil field in North America. During this debate opponents may well again repeat that there isn't enough oil there to be worth developing, that it only represents a tiny supply or only will decrease our dependence on foreign oil by a few percent.

Those arguments are utter nonsense. It is like saying we should never have produced the East Texas oil fields since the area only contained 5.3 billion barrels--a half to a third of ANWR's likely production. East Texas has produced oil, created jobs and protected our national security the past 75 years of through WWII, and Korea, Vietnam, and the Persian Gulf.

ANWR production is likely to provide all the oil that South Dakota will need for 499 years. It is likely to provide all the oil that Minnesota will need for 84 years, for New York for 34 years, for California for 16 years. That is a lot of oil.

When you consider that the American Farm Bureau Federation reports that American farmers in the 2003-2004 planting season lost $6.2 billion in income because of higher fuel and fertilizer costs--farmers facing an even bleaker price picture this fall given high prices and drought--then it's clear that all the oil and gas ANWR may produce will be precious to help hold down or reduce those costs in the future.

Remember that ANWR's oil would have offset the oil that we lost in the Gulf of Mexico because of hurricane damage--oil that could well have prevented prices from skyrocketing at the pump this summer and fall.

Discounting ANWR's likely oil is also like saying we as a nation should never have opened the neighboring Prudhoe Bay oil field in Alaska because Prudhoe Bay would only supply us with a 3-year supply of oil. Prudhoe Bay has provided America with up to a quarter of our domestic oil supply for the past 28 years. It has already saved us from spending more than $200 billion to buy imported oil and new technology has consistently raised the amount of oil the field will produce.

Initially Prudhoe was expected to produce only 35 percent of its oil. Now it's likely to produce more than 16.5 billion barrels--65 percent of its oil in place. The same increase in production might occur at ANWR and could raise production totals to between 10 and 27 billion barrels--the mean being nearly 18 billion barrels, if it happens.

We know industry has spent about $40 billion on the trans-Alaska oil pipeline and the wells and production facilities at Prudhoe Bay in the past three decades--78 percent of that spending going to states in the lower 48.

From just 1980 to 1994 California businesses received $3.2 billion in work because of Alaska oil development, Washington State firms $1.7 billion, New York $680 million, Minnesota businesses $100 million.

There is no question that ANWR oil development will be good for the country's economy and its national security. But it also will be good for the global environment and it won't harm Alaska's environment, wildlife or beautiful landscape.

Let me shock those on the other side of this issue. As a life-long Alaskan, a mother with two sons with a family that loves the outdoors, let me say again I would be the first to oppose ANWR's opening if I had any concerns about what oil development will do to our landscape, our air, our water and our wildlife. But I don't.

I have been to Prudhoe Bay, have seen the impacts of oil there and know that Prudhoe's development has not damaged Alaska's environment.

And I know that by using 21st century technology and advanced engineering that has been perfected since the field's construction 30 years ago, that ANWR can be developed safely and the environment even better protected.

First let's look again at Prudhoe's experience. There was much concern that development there would harm the environment and damage the Central Arctic Caribou herd that lives in the field. Neither happened.

The Central Arctic herd continues to calve and nurse their young in the area's oil fields. The herd has grown from 3,000 animals in 1974 to nearly 32,000 today. This 10-fold increase shows that caribou and oil production can co-exist quite nicely, thank you.

Wildlife studies have shown that several bird species have grown since the field was built--specifically brant, snow geese and spectacled eiders, although as the National Academy of Sciences reported last year some nesting distributions may have changed and brant and eiders in general are having problems, perhaps because of reach warmer climate conditions.

I'm sure someone will mention polar bears. I am quite prepared to talk about the very healthy condition of Alaska polar bear stocks. For the moment let me say that only two bears over the past 38 years have been harmed in Alaska because of oil development and with new infrared detection equipment, we can make sure that no bears will be disturbed during denning by ANWR's development.

Americans can be assured that opening the coastal plain will have even less impact on Alaska's environment. That is because new technology has reduced the impact on the environment and the footprint of development.

3-D and 4-D seismic that I mentioned earlier now allow us to locate oil without surface disruption.

Underground directional drilling allow us to recover oil 4 miles away and hopefully up to 8 miles away within a few years, meaning that only a tiny portion of surface habitat will be disturbed between drill sites.

The size of so-called well pads has decreased 70 percent to 88 percent since Prudhoe Bay. The proof can be seen in that the Tarn field was opened in 1998 disturbing just 6.7 acres. Not the 65 acres for a well-pad at Prudhoe Bay. The Alpine field that we in the Senate visited in March, today produces 120,000 barrels a day from a central well pad that is just 43 acres in size--67 if you count the attached air strip.

Ice roads today are used for winter drilling--roads that melt without any disturbance to the tundra in summer when the animals arrive on the coastal plain. New composite mats also can be used to reduce gravel fill and dust. And pipelines technically can be placed underground to prevent any surface disturbance to animals or birdlife, although there are no problems with above ground pipelines. There won't be a ``spider web'' of development as some have claimed.

Drilling restrictions will prevent noise in summer that might scare a mother caribou, and as insurance, development can be barred by the Secretary of the Interior to guarantee habitat for a core caribou caving area or for bird nesting areas.

Opponents often say that development will destroy ``America's Serengeti.'' We are proposing to limit the ``footprint'' of development to just 2,000 acres of Federal land. That is no more land than a moderately-sized American farm--the average farm in North Dakota is 1,400 acres--while an area larger than all of South Carolina will remain wild and protected. With the new technology it will be possible to leave nearly 100 square miles of undisturbed habitat between well sites. The animals of the African veld in Tanzania should be so lucky.

Opponents of opening ANWR always address two more issues: that oil spills on the North Slope of Alaska has shown that development should not be allowed, and that air quality from energy production should also prevent development. Let me briefly respond to both concerns.

Concerning oil spills opponents list numbers claiming a high number of spills, but fail to mention that companies have to report spills of most any substance more than a gallon in size, whether of water, or oil or chemicals.

According to the Alaska Department Environmental Conservation, there have been an average of 263 spills on the North Slope yearly during the past decade, but the average oil spill was just 89 gallons--2 barrels of oil--and that 94 percent of that oil was totally cleaned up. By comparison the rest of the state had seven times more spills per year than the Prudhoe Bay oil field.

According to the National Academy of Science's 2003 study, if you look at all oil spills from 1977 through 1999, 84 percent of all spills were less than 2 barrels in size and only 454 barrels of oil per year may have been released to the environment, compared to 378,000 barrels of oil that enter North American waters as a result of just urban runoff--those drips at filling stations and other spills. That may be less oil than enters the Alaska environment naturally because of oil seeps on the North Slope.

Concerning air quality, we have heard mention that Prudhoe Bay has destroyed the air quality. There is no truth to those claims.

It is true that the nation's largest oil field does add emissions into the air, mostly nitrogen dioxide and larger particulate matter. But field meets the stringent air quality standards in place for Class II attainment areas--areas where Congress has set higher standards to prevent any Significant Deterioration (PSD) of air quality.

Looking at nitrogen dioxide, in its worse year, 2000, such emissions were only a quarter of the public health standard for the area. For sulfur dioxide, in its worse year 1997, the Prudhoe Bay field emitted 16 times less sulfur dioxide than the public health standard and only a quarter of the tough standards for a Class II area.

For carbon monoxide, during its worse period, one eight-hour period in 1991 near Kuparuk, the field was 35 times lower than the public health standard. I could continue with particulate matter but the story is the same.

The truth is that the Prudhoe Bay area--the nation's largest oil field--releases eight times less nitrogen dioxide into the air than the metropolitan Washington area does per year, according to the Metropolitan Washington Council of Governments.

More important the releases have no impacts on the environment. There is no evidence that the releases are affecting the Arctic environment or the environment downwind. The air quality complaints are groundless.

To environmentalists who say we are harming Alaska, please remember that an area of more than 192 million acres, the size of all the states that stretch from Maine to Orlando, Fla.--almost the entire East Coast--are already protected in parks, refuges and forests in Alaska. We aren't proposing to touch any of those areas.

Now let me explain why I suggested that ANWR development is actually good for the global environment.

Right now America is using about 20 million barrels of oil a day and importing more than 11 million barrels of that oil. That oil is increasingly coming from countries with less stringent environmental standards than America. America has the toughest environmental standards in the world. We should be doing all we can to satisfy our oil needs at home, not exporting environmental issues overseas to Russia or Colombia or Venezuela.

Secondly, even with greater efforts at conservation--efforts that I strongly supported in the just-passed comprehensive energy bill--we are still going to need oil.

We could park every car and truck in America tomorrow and we still will need ANWR's oil to meet our needs for plastics, road construction materials, roofing materials, and those petrochemical feed stocks that are the stuff of everything from soft contact lenses to aspirin and from house paint to toothpaste.

And in case anyone tries to argue that opening ANWR will somehow increase carbon dioxide and maybe, perhaps, increase global warming, let me say that if we don't open ANWR we will need to import ever more oil to America in foreign tankers. Those tankers will need to travel tens of thousands of miles farther to reach American shores. They run on diesel fuel and will produce far more carbon dioxide than transporting Alaskan oil to lower 48 ports will.

Thirdly, if we don't open ANWR we will need to import ever more oil. When we reach 68 percent dependency we will need the equivalent of 30 giant super tankers, each loaded with 500,000 barrels of crude oil a day, to dock at U.S. ports. That will be more than 10,000 shiploads of oil a year, most likely foreign-flagged and foreign-crewed tankers passing our rocky coastlines and entering our crowded harbors. Those ships create many more times the environmental risk to America's coasts than developing our own energy, using American technology, American doubled-hulled ships, whose performance is governed by American law.

For years the mantra of environmentalists has been ``Think globally, act locally.'' The best action we can take locally is to produce more of the oil we consume every day.

Let me briefly touch on whether Alaska Natives continue to support oil development on the coastal plain. Earlier this spring some questioned that support because of a petition that was signed by some in Kaktovik--the only village directly in the ANWR area, an area where 78 percent of residents, 2 years ago supported oil development, according to a community poll. While I have letters signed by a number of those who signed the anti-development petition--letters saying they were misled by the petition sponsor and that they do still support ANWR's on-shore oil development--let me just reassure my colleagues that Alaska Natives clearly support oil development in my State.

I have a letter from all members of the Kaktovik City Council and from its Mayor sporting oil development.

The latest statewide public opinion poll in Alaska by Dittman Research finds that only 23 percent of Alaskans oppose ANWR development. In this day and age, getting more than 70 percent of any body anywhere in support of anything is a major achievement.

The Alaska Federation of Natives--that is the umbrella for all Native groups in the State--is clearly on record supporting ANWR development.

I visited Kaktovik during August to see for myself the current level of support or concern with development in the coastal plain. I can say clearly that while villagers would like us to solve their Native land allotment concerns by next year--the 100th anniversary of when the land allotments were authorized and want us in Congress to protect subsistence whaling--and while they clearly want to be consulted on development and aided to avoid any impacts--that they generally support environmentally sensitive development onshore on the coastal plain.

Natives on the North Slope of Alaska have seen for themselves the impacts of oil development and have seen the benefits that oil can bring: good jobs, better schools, improved health care, modern water and sewer systems, adequate housing and better opportunities for their children and their grandchildren.

Natives who have lived in the area for thousands of years simply want to be consulted and to have their wisdom reflected in the regulatory decisions made to control energy development. That is a perfectly reasonable position for local residents to take and I certainly will support them to make sure their knowledge and wisdom are listened to.

They simply want respect and we in government clearly should respect their knowledge as oil development proceeds.

I As long as we include reasonable environmental and regulatory protections, Alaska Natives support responsible oil development on the Arctic coastal plain.

And this bill provides $35 million in impact aid, money that hopefully will alleviate any impacts from ANWR development and assist Alaska Native Corporations and their members who live along the Trans-Alaska oil pipeline corridor.

This amendment is largely based on an ANWR stand-alone-bill, S. 1891, that I introduced this fall. So that there is no mistaking the clear intent of this legislation as it is considered for final passage, let me state the following:

After 18 years of debate since release of the final environmental impact statement covering Arctic oil development in 1987, more than 50 hearings, dozens of field trips, passage of ANWR legislation in the 106th Congress, and passage of ANWR-opening legislation by the House in the 108th Congress and by both the House and Senate in the reconciliation act process in the 109th Congress, it is absolutely clear that it is the intent of Congress--should this bill pass--that oil and gas development be permitted in the entire ANWR coastal plain on an expedited basis. That means that development should be permitted on the Federal lands as permitted by this legislation without delay in order to be producing revenues within 5 years.

It is clearly the intent of Congress as spelled out in the provision, that the existing LEIS is sufficient to cover new preleasing activities and that it is the intent of Congress that the LEIS is still sufficient to govern oil development with modest updating.

Concerning the 92,000 acres of native-owned lands, lands owned by the Arctic Slope Regional Corporation and the Kaktovik Inupiat Corporation, Congress by this division in the Defense appropriations bill is authorizing immediate development as allowed by the 1983 land trade that allowed Natives to select lands in the coastal plain and as allowed by the Alaska Native Claims Settlement Act and the Alaska National Interest Lands Conservation Act.

Specifically, there should be no question that it is the intent of Congress that the phrase ``prelease activity'' is intended to include all activities that normally take place prior to a lease sale, including surface geological exploration or seismic exploration. The Secretary has promulgated regulations governing surface geological and geophysical exploration programs for the refuge's coastal plain pursuant to Section 1002 of ANILCA. These regulations, set out at Part 37 of Title 50 of the Code of Federal Regulations, are consistent with the LEIS and include adequate environmental safeguards. Although the primary purpose of those regulations was to governor the exploration necessary to produce the ``1002'' report to Congress, they include provision for additional surface geological and geophysical exploration ``if necessary to correct data deficiencies or to refine or improve data or information already gathered.'' 50 CFR Section 37.11.

This authority is adequate for the Secretary to process any requests for permits for prelease surface exploration, but is not the exclusive authority for processing such requests. This amendment provides independent and sufficient authority for the Secretary, acting through the Bureau of Land Management, to issue prelease permits for surface geological exploration or seismic exploration. Permits for prelease surface exploration, whether or not pursuant to Part 37 of Title 50, that incorporate environmental safeguards similar to those in Part 37 of Title 50 are consistent with the LEIS and the requirements of this section.

Another area I would like to clarify is relating to the provision that allows the Arctic Slope Regional Corporation to begin oil production from their lands. It should be clear that the section in this bill removes the prohibition in Section 1003 of ANILCA against the production of oil and gas and leasing or other development leading to production of oil and gas for lands within the ``1002'' Coastal Plain Area, as depicted on the map prepared by the U.S. Geological Survey entitled ``Arctic National Wildlife Refuge 1002 Coastal Plain Area,'' dated September 2005, including both Federal lands private lands, primarily owned by Alaska Native corporations, and now or hereafter acquired within the 1002 Coastal Plain Area and preserves all rights of access to those lands, including for oil and gas pipelines, provided for in Sections 1110 and 1111 of ANILCA.

There is much more that I can say. For now let me just say that both Republicans and Democrats agree that American independence on foreign oil threatens our national security, and yet, we continue to import over half of our oil needs. And we haven't yet done enough to reverse that trend.

Only by passing ANWR, in conjunction with the other environmental steps we have already taken in the energy bill, can we produce more oil from American soil, with American workers; oil that will be used to heat American homes and power America's farms and industries.

In a sentence, ANWR is a part of the solution to America's dependence on foreign energy sources. Not the entire solution, but one real part of it. The one part not yet addressed by Congress this year.

ANWR is the place and the time is now.

I yield the floor.

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