[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]






                          ANWR: JOBS, ENERGY
                         AND DEFICIT REDUCTION
                             PARTS 1 AND 2

=======================================================================

                           OVERSIGHT HEARINGS

                               before the

                     COMMITTEE ON NATURAL RESOURCES
                     U.S. HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                 Wednesday, September 21, 2011 (Part 1)

                   Friday, November 18, 2011 (Part 2)

                               __________

                           Serial No. 112-62

                               __________

       Printed for the use of the Committee on Natural Resources









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          Committee address: http://naturalresources.house.gov






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                     COMMITTEE ON NATURAL RESOURCES

                       DOC HASTINGS, WA, Chairman
             EDWARD J. MARKEY, MA, Ranking Democrat Member

Don Young, AK                        Dale E. Kildee, MI
John J. Duncan, Jr., TN              Peter A. DeFazio, OR
Louie Gohmert, TX                    Eni F.H. Faleomavaega, AS
Rob Bishop, UT                       Frank Pallone, Jr., NJ
Doug Lamborn, CO                     Grace F. Napolitano, CA
Robert J. Wittman, VA                Rush D. Holt, NJ
Paul C. Broun, GA                    Raul M. Grijalva, AZ
John Fleming, LA                     Madeleine Z. Bordallo, GU
Mike Coffman, CO                     Jim Costa, CA
Tom McClintock, CA                   Dan Boren, OK
Glenn Thompson, PA                   Gregorio Kilili Camacho Sablan, 
Jeff Denham, CA                          CNMI
Dan Benishek, MI                     Martin Heinrich, NM
David Rivera, FL                     Ben Ray Lujan, NM
Jeff Duncan, SC                      John P. Sarbanes, MD
Scott R. Tipton, CO                  Betty Sutton, OH
Paul A. Gosar, AZ                    Niki Tsongas, MA
Raul R. Labrador, ID                 Pedro R. Pierluisi, PR
Kristi L. Noem, SD                   John Garamendi, CA
Steve Southerland II, FL             Colleen W. Hanabusa, HI
Bill Flores, TX                      Vacancy
Andy Harris, MD
Jeffrey M. Landry, LA
Charles J. ``Chuck'' Fleischmann, 
    TN
Jon Runyan, NJ
Bill Johnson, OH

                       Todd Young, Chief of Staff
                      Lisa Pittman, Chief Counsel
                Jeffrey Duncan, Democrat Staff Director
                 David Watkins, Democrat Chief Counsel
                                 ------                                









                                CONTENTS

                              ----------                              
                                                                   Page

Hearing held on Wednesday, September 21, 2011....................     1

Statement of Members:
    Hastings, Hon. Doc, a Representative in Congress from the 
      State of Washington........................................     1
        Prepared statement of....................................     3
    Markey, Hon. Edward J., a Representative in Congress from the 
      Commonwealth of Massachusetts..............................    53
        Prepared statement of....................................    55
    Tsongas, Hon. Niki, a Representative in Congress from the 
      Commonwealth of Massachusetts, Statement submitted for the 
      record.....................................................    71
    Young, Hon. Don, the Representative in Congress for the State 
      of Alaska..................................................    13
        Testimony of.............................................    14

Statement of Witnesses:
    Begich, Hon. Mark, a U.S. Senator from the State of Alaska...     8
        Prepared statement of....................................    10
    Hall, Carey, Commercial Ice Road Truck Driver, Carlile 
      Transportation Systems.....................................    23
        Prepared statement of....................................    25
        Response to questions submitted for the record...........    26
    Jenkins, David E., Vice President for Government and 
      Political Affairs, Republicans for Environmental Protection    26
        Prepared statement of....................................    28
    Karpinski, Gene, President, League of Conservation Voters....    31
        Prepared statement of....................................    33
    Murkowski, Hon. Lisa, a U.S. Senator from the State of 
      Alaska, Oral statement of..................................    11
    Parnell, Hon. Sean, Governor, State of Alaska................     4
        Prepared statement of....................................     6
    Rexford, Fenton, City Council Member, City of Kaktovik, 
      Alaska.....................................................    16
        Prepared statement of....................................    17
        Response to questions submitted for the record...........    19
    Sharp, Tim, Business Manager/Secretary Treasurer, Alaska 
      District Council of Laborers, Local 942....................    20
        Prepared statement of....................................    21
        Response to questions submitted for the record...........    22

Additional materials supplied:
    Gwich'in Steering Committee, Statement submitted for the 
      record.....................................................    66
    Millett, Hon. Charisse, Alaska State Representative, Letter 
      submitted for the record...................................    67
    Poupore, Raymond J., Executive Vice President, National 
      Construction Alliance II, Letter submitted for the record..    70
      

                                CONTENTS

                              ----------                              
                                                                   Page

Hearing held on Friday, November 18, 2011........................    73

Statement of Witnesses:
    Brinkley, Douglas, Professor of History, Rice University.....    73
        Prepared statement of....................................    75
    James, Sarah Agnus, Chairperson, Gwich'in Steering Committee.    76
        Prepared statement of....................................    77
    Pagel, Lauren, Policy Director, Earthworks...................    84
        Prepared statement of....................................    86
    Pica, Erich, President, Friends of the Earth.................    79
        Prepared statement of....................................    81

                                     


 
OVERSIGHT HEARING ON ``ANWR: JOBS, ENERGY AND DEFICIT REDUCTION.'' PART 
                                   1

                              ----------                              


                     Wednesday, September 21, 2011

                     U.S. House of Representatives

                     Committee on Natural Resources

                            Washington, D.C.

                              ----------                              

    The Committee met, pursuant to call, at 10:06 a.m. in Room 
1324, Longworth House Office Building, Hon. Doc Hastings 
[Chairman of the Committee] presiding.
    Present: Representatives Hastings, Young, Duncan of 
Tennessee, Bishop, Lamborn, Fleming, McClintock, Rivera, Duncan 
of South Carolina, Tipton, Labrador, Southerland, Flores, 
Harris, Landry, Fleischmann, Runyan, Johnson, Markey, 
Faleomavaega, Holt, Costa, Sarbanes, Garamendi and Hanabusa.
    The Chairman. The Committee will come to order. The 
Chairman notes the presence of a quorum, which under Committee 
Rule 3(e) is two Members.
    The Committee on Natural Resources is meeting today to hear 
testimony on an oversight hearing on ANWR: Jobs, Energy and 
Deficit Reduction. Under Committee Rule 4(f), opening 
statements are limited to the Chairman and Ranking Member, and 
the Ranking Member has a previous engagement. When he comes, we 
will allow him to make his opening statement.
    But I will ask unanimous consent that any other Members who 
want to have an opening statement, that will be in the record 
as long as they submit it by the close of business today. 
Without objection, so ordered.
    At this time, I will make my opening statement, and then we 
will go to our distinguished panelists that are here and by 
remote Governor Parnell. Governor Parnell, good seeing you. 
Thank you for taking the time.

 STATEMENT OF HON. DOC HASTINGS, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF WASHINGTON

    The Chairman. At a time when our nation desperately needs 
to create new jobs and cut the staggering national debt, this 
Committee is uniquely positioned to advance solutions that 
accomplish both these priorities.
    Responsibly harnessing America's onshore and offshore 
energy resources will create millions of new jobs and generate 
billions of dollars in new revenue. And without a doubt, ANWR 
is the single greatest opportunity for new energy production on 
Federal land. No single energy project in America can produce 
more jobs and do more to reduce the debt.
    As I stated two weeks ago, I believe that the Joint Select 
Committee working to find $1.5 trillion in budget savings 
should embrace opening ANWR. The Joint Committee should act on 
ANWR and increase production of the taxpayers' energy resources 
across the board. There is bipartisan support for this in 
Congress, and now is the time to take full advantage of this 
job creating, deficit reduction resource.
    Section 1002 of ANWR was deliberately and intentionally 
reserved for the purpose of energy production in 1980 by the 
Congress and by President Jimmy Carter. It is now wilderness, 
and it contains 10.4 billion barrels of oil according to some 
conservative estimates.
    While ANWR is 19 million acres total, a plan developing 
less than 500,000 acres would provide access to the majority of 
ANWR's energy resources. This means that we can harness the 
potential of ANWR by using less than 3 percent of its total 
acreage. Producing this much oil would generate substantial 
revenue for the Federal Government through leasing and 
royalties. According to the Congressional Research Service, it 
could generate over the life of the project between $150 
billion to nearly $300 billion.
    I want to emphasize that this revenue is just from leasing 
and royalties. It doesn't include the cumulative economic 
impacts from harnessing ANWR's energy resources. For example, a 
new energy project means new business spending and new jobs in 
the construction, transportation and manufacturing sectors.
    New jobs mean there are more people contributing to our 
economy and paying taxes. It improves the health of economies 
and government budgets at the local, state and Federal levels. 
Allowing energy production in ANWR is an investment in the U.S. 
economy worth several hundred billions of dollars.
    So we are here today to take an honest and fair look at 
ANWR's resources and what potential they hold for our country 
in terms of jobs, revenue and economic growth. We are searching 
for real solutions to our nation's problems. Unfortunately, 
there are those who will automatically say no--no to new job 
creation and deficit reduction--no matter what the advances in 
technology, and I think that is an important part when we look 
at ANWR or how small the footprint of operations at ANWR would 
be.
    The witnesses called to testify before the Committee I 
think exemplify this point. The Majority has invited real 
people who live and work in Alaska. We have a truck driver who 
will testify, a tribal leader who will testify, a labor union 
representative who will testify, and of course we have the 
bipartisan Alaska congressional delegation, and we have by 
remote the Governor of Alaska.
    On the other side, unfortunately, the Minority has chosen 
two witnesses that both live in Washington, D.C. Now, I just 
have to ask the rhetorical question. Which do you think more 
represents the wants and needs of those that are here because 
of this hearing?
    Given the nation's high jobless rate and the growing debt 
and deficits, it is time to move forward and create thousands 
of jobs and generate billions of dollars in new Federal revenue 
by harnessing the energy potential of ANWR.
    And with that, as I said earlier, the Ranking Member, the 
distinguished Ranking Member, has another engagement that he 
just couldn't be here, and when he comes, we will allow him to 
make his statement.
    So with that, I want to introduce the first panel of 
witnesses. We have two-thirds of it. We have the junior senator 
from Alaska, Senator Begich. Thank you for being here. And, of 
course, our colleague on the Committee, Senator Don Young----
    [Laughter.]
    The Chairman. Yes. Yes. That is right. Boy, that is really 
a mistake to elevate him. I apologize for that, Senator Begich, 
and I apologize to Governor Parnell for giving you--well, maybe 
three senators would be a pretty good deal.
    Mr. Young. No. That is a downgrade. I can tell you right 
now.
    The Chairman. I will be sure to tell Senator Murkowski that 
when she comes in.
    So with that, thank you all for being here, and with that, 
Governor Parnell, let me introduce you and allow you to make 
your opening statement. Thank you very much for taking the time 
this early in the morning in Alaska. So, Governor Parnell, you 
are recognized.
    [The prepared statement of Mr. Hastings follows:]

          Statement of The Honorable Doc Hastings, Chairman, 
                     Committee on Natural Resources

    At a time when our Nation is in desperate need of new job creation 
and cutting the staggering national debt, this Committee is uniquely 
positioned to advance solutions that accomplish both these priorities. 
Responsibly harnessing America's onshore and offshore energy resources 
will create millions of new jobs and generate billions in new revenue.
    And without a doubt, ANWR is the single greatest opportunity for 
new energy production on federal land. No single energy project in 
America can produce more jobs and do more to reduce the debt.
    As I stated two weeks ago, I believe that the Joint Select 
Committee working to find $1.5 trillion in budget savings should 
embrace opening ANWR. The Joint Committee should act on ANWR and 
increased production of the taxpayers' energy resources across the 
board. There is bipartisan support for this in Congress, and now is the 
time to take full advantage of this job-creating, deficit-reducing 
resource.
    Section 1002 of ANWR was deliberately and intentionally reserved 
for the purpose of energy production in 1980 by President Jimmy Carter. 
It is not Wilderness and it contains 10.4 billion barrels of oil 
according to conservative estimates.
    While ANWR is 19 million acres total, a plan developing less than 
500,000 acres would provide access to the majority of ANWR's energy 
resources. This means that we can harness the potential of ANWR by 
using less than 3 percent of its acreage.
    Producing this much oil would generate substantial revenue for the 
federal government through leasing and royalties. According to the 
Congressional Research Service, it could generate $150-$296 billion in 
new federal revenue over the life of production.
    I want to emphasize that this revenue is just from leasing and 
royalties. It doesn't include the cumulative economic impacts from 
harnessing ANWR's energy resources. For example, a new energy project 
means new business spending and new jobs in the construction, 
transportation and manufacturing sectors. New jobs mean there are more 
people contributing to our economy and paying taxes. It improves the 
health of economies and government budgets at the local, state and 
federal levels. Allowing energy production in ANWR is an investment in 
the U.S. economy worth several hundred billions of dollars.
    We are here today to take an honest and fair look at ANWR's 
resources and what potential they hold for our country in terms of 
jobs, revenue and economic growth. We are searching for real solution 
to our Nation's problems.
    Unfortunately, there are those who will automatically say no--no to 
job creation and deficit reduction no matter the advancements in 
technology or how small the footprint of operations at ANWR would be.
    The witnesses called to testify today before the Committee 
exemplify this point.
    The Minority has chosen to invite two witnesses that lead 
Washington, D.C.-based advocacy organizations, which is their rightful 
choice.
    In contrast, the Majority has invited real people who live and work 
in Alaska. A truck driver, a tribal leader, and a labor union 
representative are joined by the bipartisan Congressional delegation. 
They will tell us firsthand what ANWR production will mean to them, 
their neighbors and their communities--the jobs it will create and the 
economic boost it will provide their state and our entire country.
    Given the Nation's high jobless rate and growing debt and deficits, 
it's time to move forward to create thousands of jobs and generate 
billions in new federal revenue by harnessing the energy potential of 
ANWR.
                                 ______
                                 

                STATEMENT OF HON. SEAN PARNELL, 
                       GOVERNOR OF ALASKA

    Governor Parnell. Thank you, Chairman Hastings and 
Honorable Committee Members. I appreciate the opportunity. To 
our Alaska congressional delegation, I welcome this opportunity 
as well. For the record, my name is Sean Parnell. I am Governor 
of the State of Alaska. Thank you for allowing me just a few 
moments to make the case for American energy production and why 
ANWR is a good investment for our country, one that we can no 
longer afford to ignore.
    I would first like to recognize Chairman Hastings. Thank 
you for your efforts to remove unnecessary regulations and 
roadblocks to economic growth. Thank you, too, for the time 
that you invested in coming to our state. In Alaska, we set a 
goal to increase the throughput of the Trans-Alaska Pipeline 
System to one million barrels a day from current levels of 
about 550,000 barrels per day. I have asked other Governors to 
set increasing production goals as well. This will help grow 
our nation's economy, make us more energy secure and more 
energy independent.
    Reaching this goal of a million barrels per day through 
TAPS will take work between the Federal Government and the 
State of Alaska. The task before us allows us to create jobs. 
It is to grow our economy. And to boil it down to one simple 
truth, more American oil and gas production means jobs, and 
jobs translate into stable communities and a strong nation.
    Now, beyond the Beltway, Americans believe that our nation 
faces an almost insurmountable debt burden, leading some to ask 
if it is even possible to pay it down. Many thoughtful 
Americans are alarmed at nearly $15 trillion in Federal debt, 
and we are deeply concerned about the future of our great 
nation, and yet we can regain our economic footing through 
producing more American energy. America's workforce wins, 
families win, job creators win and the Federal Government wins 
more revenue.
    Look at the states doing relatively well in this economic 
downturn. They are America's major energy producers. Alaska is 
one of those states, yet we are held back from contributing 
more affordable energy to other Americans by Federal regulators 
who want to keep Federal lands off limits to oil and gas 
exploration.
    America is blessed with natural resources, both renewable 
and nonrenewable. We need them all right now. This transition 
to renewables cannot take place all at once. That is like going 
from first gear to fifth gear. You risk stalling the engine of 
our economy by starving it of power. And some of our nation's 
richest oil reserves, they exist along the Coastal Plain within 
ANWR. It is accessible, it is extractable, and oil production 
and wildlife in ANWR are compatible.
    Now, oil from ANWR would help meet U.S. demand for the next 
25 years or longer. Responsible development of ANWR would 
create hundreds of thousands of jobs across our nation in 
virtually every state because a secure supply of petroleum will 
create demand for goods and services and lower the cost of 
doing business.
    As you know, the U.S. imports over 65 percent of our 
nation's annual petroleum needs. These imports cost more than 
$150 billion a year to our economy. That figure does not 
include the military cost and the human cost of imported oil, 
which are truly incalculable.
    So what is this resource we call ANWR? The U.S. Geological 
Survey estimates that the amount of technically recoverable oil 
beneath ANWR's Coastal Plain ranges between 5.7 billion and 
nearly 16 billion barrels. Studies suggest the Coastal Plain 
could produce a 10 year sustained rate of one million barrels 
per day.
    ANWR? It is a 19 million acre national wildlife refuge. 
This national refuge is approximately the size of the State of 
South Carolina. However, exploration and production can come 
from only a small part of ANWR known as the Coastal Plain. The 
Coastal Plain was designated by Congress, as the Chairman said, 
in 1980 as requiring a special study to determine its oil and 
gas potential and the effects of development on the 
environment.
    In 1987, the Department of the Interior recommended 
development. Today's technology ensures that the footprint for 
development in ANWR could be less than 2,000 acres, 
approximately half the size of Andrews Air Force Base. So think 
about that. Half the size of Andrews Air Force Base in a land 
mass the size of South Carolina.
    Additionally, technology now allows for almost zero impact 
exploration through the use of ice roads, ice pads and the 
like. Protecting the environment is as important to Alaskans 
and perhaps more important to Alaskans than to all Americans. 
This great land is our home. We have to be good stewards of 
air, land and sea to live here.
    For most of the year the Coastal Plain is frozen. It has 
low biological activity. Experience shows that seasonal 
restrictions and other environmental stipulations can be used 
to protect caribou during their six week calving season each 
season. Appropriate restrictions can also protect migratory 
birds and fish.
    Our experience with other North Slope fields shows it can 
be done. Prudhoe Bay, for example, located 60 miles west of 
ANWR, has been operating for over 30 years and has produced 
more than 16 billion barrels of oil so far. Amidst that, the 
Central Arctic caribou herd at Prudhoe Bay has grown from 5,000 
animals in 1975 to over 67,000 animals in 2008.
    The Trans-Alaska Pipeline System is a world class oil 
transportation system and one of this nation's most significant 
and valuable assets. Every day Alaska oil moves through TAPS to 
refineries in Washington state and California. But declining 
production from Alaska's fields is taking its toll on TAPS. The 
Trans-Alaska Pipeline System is not designed to flow at low 
rates. Below 550,000 barrels per day, the risk of clogs and 
corrosion increase. The very real possibility of a midwinter 
shutdown is an urgent concern.
    Bringing new production from ANWR and other Alaska fields 
is critical to preserve this valuable piece of our nation's 
infrastructure. Without increased production, the Trans-Alaska 
Pipeline is at risk, our economy is at greater risk, as is our 
national security.
    With the oil from ANWR in the Trans-Alaska Pipeline, it is 
also going to be feasible to develop other marginal fields that 
otherwise might not be economic. It is all about growing jobs 
in our economy and about keeping America safe. The Coastal 
Plain of ANWR is America's best bet for the discovery of 
significant oil and gas reserves in North America. Many 
economic benefits would result, not the least of which are the 
Federal revenues that would be in the billions of dollars.
    But a reserve of Alaska oil locked in the ground makes no 
sense. Americans need jobs and our economy needs a jump start 
that an impotent Federal Government cannot provide. If the 
Federal Government persists in blocking oil development in 
Alaska, it could mean the dismantling of the Alaska Pipeline 
and the stranding of every last bit of oil that exists in our 
Arctic.
    For millions of Americans out of work and struggling to 
make ends meet, Federal policy blocking oil development only 
deepens the wounds. In Alaska, the Federal Administration has 
blocked exploration in ANWR, blocked exploration in the NPRA 
and has delayed exploration in the Arctic offshore.
    When it comes to ANWR, we have heard people say that it 
will not impact the price of fuel now because it will take too 
long to bring on-line. Well, they have been saying that for 20 
years, and that is a disingenuous argument. It is time to 
reduce dependence on oil from unstable, unfree and unfriendly 
regions of the world.
    Let us bring ANWR oil to America and decrease the trade 
deficit, bring ANWR oil to America and increase American jobs, 
bring ANWR oil to America and reduce the Federal debt with 
revenues and taxes from a more vibrant economy.
    I thank you, Mr. Chairman.
    [The prepared statement of Governor Parnell follows:]

   Statement of The Honorable Sean Parnell, Governor, State of Alaska

    Chairman Hastings and Honorable Committee Members:
    For the record: My name is Sean Parnell. I am Governor of the State 
of Alaska.
    Thank you for allowing me a few moments to make the case for 
American energy production, and why ANWR is a good investment for our 
nation, one we can no longer afford to ignore.
    I would first like to recognize Chairman Hasting's efforts to 
remove unnecessary regulations and policies adversely affecting oil and 
gas development.
    I appreciate that he has taken the time to become a nationally 
recognized subject expert in this area.
    In Alaska, we set a goal to increase the throughput of the Trans 
Alaska Pipeline System (TAPS) to one million barrels a day from current 
levels of about 550,000 barrels per day. I have asked other governors 
to set increasing production goals, as well.
    This will help grow our nation's economy, make us more energy 
secure, and more energy dependent.
    Reaching this goal of a million barrels per day through TAPS will 
take work between the federal government and the State of Alaska, where 
each owns substantial oil and gas resources.
    The task before us all is to create jobs, to grow our economy.
    To boil it down to one simple truth: More American oil and gas 
production means jobs. And jobs translate into stable communities, and 
a strong nation.
    Beyond the Beltway, Americans believe that our nation faces an 
almost insurmountable debt burden, leading some to ask if it is even 
possible to pay it down, given our current GDP.
    Many thoughtful Americans are alarmed at the nearly $15 trillion 
federal debt, and they worry about the future of our great nation.
    And yet, we can regain our economic footing through producing more 
American energy.
    America's workforce wins, families win, job creators win, and the 
federal government wins--more revenue.
    Look at the states doing relatively well in this economic downturn: 
They are America's major energy-producers. Alaska is one of those 
states. Yet, we are held back from contributing more affordable energy 
to other Americans by federal regulators who want to keep federal lands 
off limits to oil and gas exploration.
    America is blessed with natural resources, both renewable and non-
renewable. We need them all right now.
    This transition to renewables cannot take place all at once. That's 
like going from first gear to fifth gear--you risk stalling the engine 
of our economy by starving it of power.
    And some of our nation's richest oil reserves exist along the 
coastal plain known as ANWR.
    It's accessible. It's extractable. And oil production and wildlife 
in ANWR are compatible.
    Oil from ANWR could help meet U.S. demand for the next 25 years--or 
longer.
    Responsible development of ANWR would create hundreds of thousands 
of jobs across our nation, in virtually every state, because a secure 
supply of petroleum will create demand for goods and services, and 
lower the cost of doing business.
    As you know, the United States imports over 65 percent of our 
nation's annual petroleum needs. These imports cost more than $150 
billion a year. That figure does not include the military costs--and 
the human cost--of imported oil, which is truly incalculable.
    What is the resource we call ANWR? And in such a remote location on 
Alaska's northern edge, how did we first learn that oil was even 
present?
    The U.S. Geological Survey estimates that the amount of technically 
recoverable oil beneath the coastal plain ranges between 5.7 billion 
and nearly 16 billion barrels \1\. Studies suggest the coastal plain 
could produce a 10-year sustained rate of one million barrels per day.
---------------------------------------------------------------------------
    \1\ http://pubs.usgs.gov/fs/fs-0028-01/fs-0028-01.htm
---------------------------------------------------------------------------
    ANWR is a 19-million-acre national wildlife refuge. This national 
refuge is approximately the size of South Carolina. However, 
exploration and production can come from only a small part of ANWR 
known as the Coastal Plain of ANWR.
    The Coastal Plain was designated by Congress in 1980 as requiring 
special study to determine its oil and gas potential and the effects of 
development on the environment. In 1987, the Department of the Interior 
recommended development.
    Today's technology ensures that the footprint for development in 
ANWR would be less than 2,000 acres--approximately half the size of 
Andrews Air Force Base (4,320 acres) in a land mass the size of South 
Carolina. Additionally, technology now allows for almost ``zero impact 
exploration'' through the use of ice roads, ice pads, and the like.
    Protecting the environment is as important to Alaskans as it is to 
all Americans. This Great Land is our home, and we have to be good 
stewards of air, land, and sea to live here.
    For most of the year, the Coastal Plain is frozen. It has low 
biological activity. Experience shows that seasonal restrictions and 
other environmental stipulations can be used to protect caribou during 
their six-week calving season each summer.
    Appropriate restrictions can also protect migratory birds and fish. 
Our experience with other North Slope fields shows it can be done.
    Prudhoe Bay, for example, located 60 miles west of ANWR, has been 
operating for over 30 years and has produced more than 16 billion \2\ 
barrels of oil so far. Amidst that, the Central Arctic caribou herd at 
Prudhoe Bay has grown from 5,000 in 1975 to over 67,000 in 2008. \3\
---------------------------------------------------------------------------
    \2\ http://www.alyeska-pipe.com/Pipelinefacts/Throughput.html
    \3\ http://www.anwr.org/images/pdf/Cariboufinal_6-09.pdf
---------------------------------------------------------------------------
    The Trans Alaska Pipeline System is a world class oil 
transportation system and one of this nation's most significant and 
valuable assets. Every day, Alaska oil moves through TAPS to refineries 
in Washington State and in California.
    But declining production from Alaska's fields is taking its toll on 
TAPS.
    The Trans Alaska Pipeline is not designed to flow at low rates. 
Below 550,000 barrels per day, the risk of clogs and corrosion 
increase. The very real possibility of a mid-winter shut down is an 
urgent concern.
    Bringing new production from ANWR and other Alaska fields is 
critical to preserve this valuable piece of our nation's 
infrastructure. Without increased production, our economy is at greater 
risk as is our national security.
    With oil from ANWR in the Trans Alaska Pipeline, it will be 
feasible to develop other marginal fields that otherwise might not be 
economic. It's all about growing jobs and our economy, and about 
keeping America safe.
    The Coastal Plain of ANWR is America's best bet for the discovery 
of another giant ``Prudhoe Bay-sized'' oil and gas field in North 
America. Many economic benefits would result, not the least of which 
are the federal revenues that would be in the billions of dollars.
    But a reserve of Alaska oil locked in the ground makes no sense 
when Americans need jobs and our economy needs a jump start that 
government is impotent to provide.
    If the federal government persists in blocking oil development in 
Alaska, it could mean the dismantling of the Alaska pipeline, and the 
stranding of every last bit of oil that exists in our Arctic.
    For millions of Americans out of work and struggling to make ends 
meet, federal regulatory policy blocking oil development only deepens 
the wounds. In Alaska, the federal administration has blocked 
exploration in ANWR, has blocked exploration in NPR-A, and has blocked 
exploration in the Arctic offshore.
    When it comes to ANWR, we've heard people say that it will not 
impact the price of fuel now, because it will take too long to bring 
online. They've been saying that for 20 years. That's a disingenuous 
argument.
    It's time to reduce dependence on oil from unstable, unfree, and 
unfriendly regions of the world.
    Bring ANWR oil to America, and decrease the trade deficit.
    Bring ANWR oil to America, and increase American jobs.
    Bring ANWR oil to America, and reduce the federal debt with 
revenues and taxes from a more vibrant economy.
    Thank you, and I am available to answer any questions.
                                 ______
                                 
    The Chairman. Thank you very much, Governor. I note that it 
is 6:00 in Alaska and 10:00 here, and I thank you very much for 
being up this early. Thank you very much for your testimony.
    On a personal note, I very much enjoyed the trip that I 
made to the North Slope along with you and Congressman Young. 
It certainly reaffirmed what I thought was up there, and it 
showed me--it re-emphasized to me--what you said about the 
environmental concerns that everybody has taken on the North 
Slope. Thank you very much for your testimony.
    Governor Parnell. You are welcome. Thank you.
    The Chairman. Now we will go to our distinguished panel, 
the congressional delegation from Alaska, and we will start 
with the junior senator since the senior senator isn't here. 
So, Senator Begich, you are recognized.

STATEMENT OF HON. MARK BEGICH, A UNITED STATES SENATOR FROM THE 
                        STATE OF ALASKA

    Senator Begich. Thank you very much. Thank you, Chairman 
Hastings, for the opportunity to testify in front of your 
Committee on an issue that you will find strong support from 
all the delegation in regards to the opening of ANWR and most 
Alaskans. I was born and raised in Alaska, and this is an issue 
that I think has been around all my life, and the fact is I am 
very honored and proud to be here with my colleagues to talk 
about this issue.
    Today's hearing is focused on a timely topic. With gasoline 
prices averaging $3.65 in the Lower 48 and unemployment around 
9 percent, Alaska is here to help. We can offer relief to 
consumers at the pump, provide well paying jobs in Alaska and 
the Lower 48 and help our $15 trillion deficit.
    The oil and gas resources of the Coastal Plain of the 
Arctic National Wildlife Refuge are enormous and conveniently 
located just 65 miles east of the Prudhoe Bay reserves and 
infrastructure. The latest estimates from USGS are for about 10 
billion barrels of technically recoverable oil. Of course, any 
natural gas found only will help the economics of the proposed 
Alaska natural gas pipeline, which could also be a huge job 
creator for our nation. Over the years there have been 
competing estimates of how many jobs in Alaska and the Lower 48 
supply chain that the development would create. Needless to 
say, all of them are at least in the tens of thousands of jobs 
across this nation.
    I am proud to co-sponsor Senator Murkowski's bills that 
would allow responsible oil and gas development in the Arctic 
refuge. Today, extended reach drilling technology has shrunk 
drilling pad platforms and prints dramatically. Well pads on 
the North Slope from the 1970s that covered 65 acres now take 
less than 10 acres. Drilling cuttings and muds are now disposed 
of by injection wells.
    While development always will have impacts, we can do a 
good job today of responsibly producing more domestic oil which 
promotes both our economic and national security. I know 
today's hearing is about ANWR, but I always want to make sure 
we don't lose sight of the tremendous potential elsewhere in 
Alaska. That is a potential I believe we are close to 
realizing.
    The USGS estimates 26 billion barrels of oil and more than 
100 TCF of natural gas technically recoverable in the Chukchi 
and Beaufort. All of this means we are looking at a lot of 
jobs. The University of Alaska Institute for Social and 
Economical Research estimates 54,000 jobs can be created from 
Alaskans working in the Beaufort and Chukchi, including all the 
support and manufacturing jobs stretching from Alaska to the 
Lower 48.
    Over the 50 year lifespan of these fields, this means $154 
billion--now, let me say that again, $154 billion--in payroll 
and $200 billion plus to the Federal treasury. Their science 
crews this summer alone employed over 400 folks in the region.
    We finally have sustained momentum on exploring these 
resources, and I have hope that Shell, the first of the 
leaseholders in exploration process in the Beaufort and 
Chukchi, will be drilling exploratory wells off Alaska's arctic 
coast for the first time in nearly 20 years. ConocoPhillips and 
Statoil are just on the heels with plans of a 2013 and 2014 
season.
    Shell received approval of the Beaufort exploration plan a 
few weeks ago. Just yesterday Shell received an air permit, a 
subject I know this Committee has worked on, for one of their 
main drill ships and support fleet. Hopefully Chukchi plan will 
be approved when the Court accepts the supplemental EIS later 
in the month of October.
    Finally, the National Petroleum Reserve-Alaska, NPRA, can 
also play an important role in keeping enough oil in the Trans-
Alaska Pipeline to operate economically while development on 
these other resources proceeds. We have been pushing the 
Administration to solve procedural issues with the 
ConocoPhillips CD5 in the NPRA. We are hopeful for a 
breakthrough in the next 30 days with hundreds of direct 
construction jobs for several years to follow.
    Mr. Chairman, simply put, Alaska has enormous resources--
ANWR, NPRA, Chukchi, Beaufort--to offer a nation hungry for 
affordable energy and good paying jobs. Thank you for the 
opportunity to detail out many opportunities that are in front 
of Alaska and this country. Thank you.
    [The prepared statement of Senator Begich follows:]

 Statement of The Honorable Mark Begich, U.S. Senator, State of Alaska

    Thank you, Chairman Hastings, and Ranking Member Markey for the 
opportunity to speak to you today.
    When it comes to energy, the Alaska delegation and most Alaskans 
stand united. I am proud to appear with my colleagues, Senator 
Murkowski and Congressman Young.
    Today's hearing is focused on a timely topic.
    With gasoline prices averaging $3.65 in the lower 48 states and 
unemployment around 9 percent, Alaska is here to help. We can offer 
relief to consumers at the pump, provide well-paying jobs in Alaska and 
the Lower 48 and help reduce our $14 trillion deficit.
    The oil and gas resources of the coastal plain of the Arctic 
National Wildlife Refuge are enormous and conveniently located just 65 
miles east of the prolific Prudhoe Bay reservoirs and infrastructure.
    The latest estimates from the USGS are for up to 10 billion barrels 
of technically recoverable oil.
    Of course, any natural gas found will only help the economics of 
the proposed Alaska Natural Gas Pipeline, which could also be a huge 
job creator for our nation.
    Over the years, there have been competing estimates of how many 
jobs in Alaska and in the Lower 48 supply chain that development would 
create. Needless to say, all of them are at least in the tens of 
thousands across our nation.
    I am proud to co-sponsor Sen. Murkowski's bills that would allow 
responsible oil and gas development in the Arctic Refuge.
    Today's extended reach drilling technology has shrunk drilling pad 
foot prints dramatically. Well pads on the North Slope from the 1970s 
that covered 65 acres now take up less than 10. Drilling cuttings and 
muds are now disposed of by injection wells.
    While development always will have impacts, we can do a good job 
today of responsibly producing more domestic oil, which promotes both 
our economic and national security.
    I know today's hearing is about ANWR, but I also want to make sure 
we don't lose sight of the tremendous potential elsewhere in Alaska. 
That is a potential I believe we're close to realizing.
    The USGS estimates 26 billion barrels of oil and more than 100 TCF 
of natural gas technically recoverable in the Chukchi and Beaufort 
Seas.
    All this means we're looking at a lot of jobs, too.
    The University of Alaska's Institute for Social and Economic 
Research estimates 54,000 jobs created from Alaskans working in the 
Beaufort and Chukchi Seas, including all the support and manufacturing 
jobs stretching from Alaska to the Lower 48.
    Over the 50-year life of the fields, that means about $154 
billion--billion with a B--in payroll, and $200 billion to the federal 
treasury.
    Their science crews this summer alone amounted to 400 jobs.
    We finally have sustained momentum on exploring these resources. I 
have every hope that Shell, the first of the leaseholders in the 
exploration process, will be drilling exploration wells off Alaska's 
Arctic coast for the first time in nearly 20 years.
    ConocoPhillips and Statoil are just on their heels with plans for 
2013 and 2014.
    Shell received approval of their Beaufort Exploration plan a few 
weeks ago. Just yesterday, Shell received an air permit--a subject I 
know this committee has worked on--for one of their main drill ships 
and its support fleet.
    Hopefully the Chukchi plan will be approved when the court accepts 
the Supplemental EIS in October.
    Finally, the National Petroleum Reserve--Alaska (NPR-A)--can also 
play an important role in keeping enough oil in the Trans-Alaska 
Pipeline to operate economically while development on these other 
resources proceed.
    We've been pushing the administration to solve procedural issues 
with ConocoPhillips' CD-5 development in the NPRA. We're hopeful we'll 
see a breakthrough in the next 30 days, with hundreds of direct 
construction jobs for several years to follow.
    Mr. Chairman: Alaska has enormous resources to offer a nation 
hungry for affordable energy and good-paying jobs. Thank you for this 
opportunity to detail some of those opportunities.
                                 ______
                                 
    The Chairman. Thank you very much, Senator Begich, for your 
testimony. As I mentioned when I was up there, certainly what 
you said was reaffirmed when I went up there and made that 
trip.
    And now I am pleased to recognize the senior senator from 
Alaska, Senator Murkowski. I should tell you that I 
inadvertently elevated Congressman Young to a senator, and he 
immediately disavowed that.
    Senator Murkowski, you are recognized.

STATEMENT OF HON. LISA MURKOWSKI, A UNITED STATES SENATOR FROM 
                      THE STATE OF ALASKA

    Senator Murkowski. Thank you, Mr. Chairman, and to my 
colleagues and to the Members of the Committee, I offer my 
apologies for being tardy. I was off campus giving a speech. It 
did allow me the opportunity, though, to hear Governor 
Parnell's comments on the radio and to hear yours, Senator 
Begich.
    I appreciate the level of detail that has been laid before 
the Committee this morning in terms of Alaska's great 
potential; not only the resources, the revenues, and the jobs 
that are created. We know the story well and so the opportunity 
to be able to share that story with our colleagues is important 
so, Chairman, I appreciate you scheduling this hearing this 
morning. I appreciate your efforts to come north, see for 
yourself and help us advance this very important cause.
    And as much as I am happy to be here to give my thoughts, I 
will suggest to you that it is unfortunate that we are still 
having this discussion about whether to develop the 1002 area 
in Alaska. I think it should be more appropriate that we 
discuss when and how to develop this incredible national 
resource.
    I want to say a few words about the Fish and Wildlife 
Service's so-called Comprehensive Conservation Plan or the CCP. 
As a threshold issue, I find it both misguided and, as an 
Alaskan, somewhat insulting when the Federal agencies continue 
to look for ways to lock up additional wilderness in Alaska 
when Alaska doesn't want it and when the law plainly says no 
more.
    It couldn't be more clear. Three separate provisions in the 
Alaska National Interest Lands Conservation Act, ANILCA, made 
Congress' intent on this matter very clear, and yet our Federal 
agencies can't help but keep going down this same path toward 
more wilderness review. And for what? The draft CCP cites a 
``symbolic'' value----
    The Chairman. Senator, could you put the microphone a 
little bit closer?
    Senator Murkowski. Yes.
    The Chairman. Thank you.
    Senator Murkowski. How is that? The draft CCP cites a 
symbolic value of the refuge and states that ``millions who 
will never set foot in the refuge find satisfaction, 
inspiration and even hope in just knowing it exists.''
    Well, Mr. Chairman, I would suggest to this Committee that 
millions more would do well to find jobs. I am not sure who is 
in charge of quantifying the value of satisfaction inspired by 
knowing that something exists somewhere, especially set against 
the hundreds of billions of dollars in Federal revenues that we 
are consciously foregoing by this exercise.
    The draft CCP seems very much at odds with itself beyond 
just that. After going through the legal gymnastics to try to 
skirt the no more clause so that considering the Coastal Plain 
for wilderness review is back on the table, it acknowledges, 
although begrudgingly, that the 1002 area contains almost 
40,000 acres of lands that are not even suitable for wilderness 
designation, even if such a designation were legal.
    So compare that number. You got 40,000 acres within the 
1002 area which the Administration concedes is not even 
eligible for wilderness protection, with the mere 2,000 acres 
which Congress Young's legislation and my Senate bill would 
authorize for development within that same area.
    Keep in mind that the 1002 has also been subject to 
exploratory drilling and all of the motorized equipment that 
attends to that activity in the past, and yet somehow or other 
we are being asked to believe the irreconcilable argument that 
drilling now would cause the area to lose its character, even 
as technology has improved in ways that Congress could not have 
even contemplated when writing the law.
    This year we had unrefuted testimony in the Senate Energy 
Committee which spoke to the truly amazing technology 
advancements in seismic acquisition data, the directional 
drilling, enhanced oil recovery with specific application to 
the 1002 area, all of which would lend substantial reassurances 
of a minimally intrusive development program with no lasting 
impacts if we were only allowed to access.
    Members of this Committee, here we are with the Federal 
Government essentially broke fighting all day, every day, over 
every scrap of spending cuts and revenue ever conceived when 
the simple delivery on a decades old promise could render 
literally hundreds of billions in Federal revenue without so 
much as raising a tax or cutting a single program. But instead 
of looking for a responsible path forward toward accessing this 
resource, the Fish and Wildlife Service looks for ways to lock 
it up.
    So I would suggest to this Committee that we are witnessing 
a gross misappropriation of resources. When an agency's 
response to our nation's current debt and jobs crisis is to 
seek more ways to twist the law just to keep money buried in 
the ground, our priorities, Mr. Chairman, seem to have spun out 
of the realm of reality.
    As my colleagues have documented in terms of the jobs, the 
resources and the revenues, Alaska has so much to offer. We 
just need the ability to be able to contribute. I thank you for 
the opportunity to be before the Committee and want to pledge 
my support toward this effort in working with you, Congressman 
Young and Senator Begich.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator Murkowski, for 
your testimony.
    And last, but certainly not least, we will got to our 
colleague on the Committee and colleague in the House, the 
gentleman from Alaska, Mr. Young. You are recognized.

STATEMENT OF HON. DON YOUNG, A REPRESENTATIVE IN CONGRESS FROM 
                      THE STATE OF ALASKA

    Mr. Young. Thank you, Mr. Chairman. I want to thank my 
colleagues. Good testimony. Governor, excellent testimony. 
Everything they have said is in my statement. I will submit it 
for the record.
    But I would like to just emphasize two things. This is long 
overdue. This Committee has passed this bill 11 times, and it 
has died in the Senate. We have two Senators going to help us 
get it passed. Whether the President will sign it I do not 
know, but it has been said about jobs and dependency.
    This oil is 60 miles away from an existing pipeline. We 
could probably deliver it if we had an emergency and in fact do 
it, and this Congress has said so, in about three years, much 
better than any place else, in an area which we have done 
before. We know what the challenges are. We know the results.
    And the idea now, just think about this. We last year spent 
$333 billion sending dollars overseas. That is dollars from the 
working class man. Over the years, we have actually spent $3.4 
trillion sending dollars overseas, $3.4 trillion from the 
working man. This is unjust and uncalled for.
    ANWR itself is just a large--I have been there. I actually 
have trampled a lot of the areas, but the area which 1002 is in 
is basically, and you will hear from witnesses today that live 
there. You will hear from people that work there. You will hear 
from people that know how important it is as far as jobs go. 
But this is not the pristine area people talk about. This is an 
area that has been explored before by other people.
    And I think if I can say one thing, the most resentful 
thing I can think about is it is just not a loss for America. 
It is a loss for the people at Kaktovik. We gave Kaktovik 
approximately 93,000 acres of land for their social and 
economic well-being, which is right in the middle of ANWR or 
actually on the edge of ANWR, and yet they can't develop it. 
They can't have a way to develop their oil on their land 
because they can't get out. They are landlocked. And that is 
sort of the twisted tongue approach, and that is wrong.
    For the environmental community, you have won in a lot of 
ways. You have delayed this for many, many years, but you also 
in this delay have created a better way of drilling. The 
footprint is very small from where it was when we first had 
Prudhoe Bay. By the way, Prudhoe Bay was discovered and we 
developed it in 1973. Actually in 1973 you passed the bill, and 
we produced the first barrel of oil. We did that because we had 
an emergency. People were in line. They were shooting one 
another. By the way, gas was 39 cents a gallon, but there was 
no gas. Now it is very nearly $4 a gallon.
    If you want to boost this economy, ladies and gentlemen, 
Members of the Committee and the listening audience, just think 
about if we had our oil we could control the price--there would 
be no spikes--and probably drop the price of oil. If we drop 
the price of oil $1, that would be a $3,000 per family ability 
to spend that money on something other than gasoline.
    Now, I know some of the environmentalists say we have to 
transfer ourselves into another form of energy. That is well 
and good, and I support all forms of energy. Yes, we have had 
some great finds in the Americas. Now, there is a chance the 
Americas could be, I would say, self-sufficient. I am talking 
about Brazil, Venezuela, Mexico, Colombia. But their countries 
too are under question.
    And so to have us have this oil available with an 
infrastructure in place is dead wrong. I am asking this 
Committee and the President to pass not only this bill, but let 
us get our country on the move again. Let us put our people to 
work. Let us not be dependent on those people that are not 
friendly to us.
    It is time that this Congress acts, solves our problem and 
gets the show on the road. Thank you, Mr. Chairman.
    [The prepared statement of Mr. Young follows:]

  Statement of The Honorable Don Young, a Representative in Congress 
                        from the State of Alaska

    Chairman Hastings and Ranking Member Markey, thank you for having a 
hearing on this topic, which is not only important to Alaska, but the 
energy and economic security and well being of the nation as a whole.
    At a time of high unemployment, high energy prices, and an urgent 
need to address our national debt, there is no question that this 
Nation needs the oil and gas that can be produced from ANWR.
    Just look at the price of gasoline today. Though, it has fallen 
from the highs of 2008, the American consumer is seeing a large chunk 
of their budget left at the gas station. Home heating oil prices have 
soared similarly, and unless something is done home owners will 
continue to suffer again this fall when the weather turns cold.
    So why are prices soaring? Is it a conspiracy? No, it is just 
supply and demand. As our economy grows, demand for energy increases. 
But domestic supply has not kept pace. And as everyone in their high 
school economics class knows, when demand increases and supply doesn't, 
prices go up.
    Since 1973, the year of the Arab oil embargo that created economic 
havoc and put drivers into long lines at the gas pump, U.S. crude oil 
production has declined by nearly half. Today, we are producing here in 
the U.S. about the same amount of oil as when Harry Truman was 
President--even though our economy is fifty times larger than it was 
seven decades ago.
    So it should come as no surprise that two-thirds of our oil now 
comes from foreign sources. Nor should it come as any surprise that 
last year we spent over $333 billion to import oil from insecure 
sources of the world, including the Persian Gulf.
    Those who argue against exploration in ANWR are arguing in favor of 
increasing our reliance on foreign suppliers.
    Let's be honest and say that there will be some consequences to 
exploring and producing in ANWR. But let's also be honest and say that 
if we import the oil it will arrive in the U.S. in foreign ships that 
sometimes are not up to our standards. And our environmental safeguards 
for oil production are much more stringent than theirs are. So if you 
are really concerned about the environment you should prefer oil to be 
produced here rather than somewhere else in the world. Just a few short 
weeks ago news broke of a deal that will partner Exxon and Russia to 
drill in the Arctic. Do we really trust that Russia can protect the 
Arctic better than we can?
    Although the ANWR region of Alaska encompasses 19 million acres, 
less than 2000 acres would actually be necessary to tap the region's 
vast resources though ultra-modern, environmentally sensitive drilling 
technology, including slant-drilling. To give some perspective on size, 
if the State of Alaska were a 1,000 page phone book, the 2000 acre 
drilling area would be equal to one-half of a square inch on one page 
of the 1,000 page phone book.
    ANWR is believed to hold between 6 and 16 billion barrels of oil. 
The best estimate is that about 10 billion barrels of the oil are 
recoverable. But it could be much larger, which we will only know 
through actual drilling. For example, in 1968 the Prudhoe Bay region of 
Alaska, which is to the West of ANWR, was believed to hold 9 billion 
barrels of recoverable oil. But that proved to be a gross under-
estimate. So far, Prudhoe Bay has produced 16 billion barrels, and it 
will continue to produce for many years to come.
    If President Clinton, in 1995, had not vetoed legislation that 
would have allowed exploration and production in ANWR, oil would be 
flowing today. As a result, we'd be enjoying the economic benefits of 
the hundreds of thousands of jobs created, increased revenue into the 
federal coffers, and a more certain energy supply.
    The time is past due to open ANWR, and I implore this Committee to 
proceed with a bill that will accomplish this.
    Thank you again for the opportunity to testify.
                                 ______
                                 
    The Chairman. Thank you, Mr. Young. I very much appreciate 
your testimony and I might add your passion, and I think I can 
say that for all of you from Alaska. I know the history of what 
you have gone through.
    Senator Murkowski, I think you put an exclamation point on 
that. We shouldn't be arguing about this anymore. We should be 
figuring out a way to get it done. Senator Begich, thank you 
very much for your testimony.
    And coming from Alaska, thank you very much, Governor 
Parnell, for participating in this. I know from my perspective 
I really believe that there is a national security aspect to 
energy production in this country, and when we have the 
potential resources in one of the 50 states it is in many 
respects criminal that we don't utilize that.
    So I thank you very much for your testimony, and I 
certainly am committed to making our country less dependent on 
foreign energy resources. Thank you very much for being here, 
and I will dismiss the panel. Governor, thank you very much for 
being here.
    Governor Parnell. Thank you.
    The Chairman. We will call the next panel as soon as this 
one vacates the table.
    [Pause.]
    The Chairman. I want to thank the second panel. We have 
with us Mr. Fenton Rexford, who is a council member from the 
Cit of Kaktovik, of which I had the pleasure to participate in 
a town hall gathering last June when I was up there. I 
appreciated that.
    Mr. Tim Sharp, the Secretary Treasurer of Laborers Local 
492 out of Fairbanks; Mr. Carey Hall, the ice road trucker for 
Carlile Transportation Systems out of Anchorage, Alaska.
    And we have Mr. David Jenkins, Vice President for 
Government and Political Affairs for Republicans for 
Environmental Protection out of Washington, D.C. and Mr. Gene 
Karpinski, president of League of Conservation Voters, out of 
Washington, D.C.
    Mr. Rexford, let me go over all of this with you. I didn't 
say this with our distinguished representatives from Alaska 
because of the timeframe, but when the green light comes on 
that means you have five minutes, when the yellow light come on 
that means you have one minute, and when the red light comes on 
it means that five minutes have expired.
    Now, your full statement will appear in the record. I would 
like you to try to confine your remarks to that five minutes so 
that we can have time for questions and answers. I know with 
the interest shown by this Committee on this subject, I think 
we will probably have a lot of that.
    So, Mr. Rexford, you are recognized for five minutes, and 
thank you for being here.

       STATEMENT OF FENTON REXFORD, CITY COUNCIL MEMBER, 
                    CITY OF KAKTOVIK, ALASKA

    Mr. Rexford. Thank you very much, Honorable Chairman 
Hastings and Members of the Committee. For the record, my name 
is Fenton Okomailak Rexford. I am currently the Tribal 
Administrator for the Native village of Kaktovik and also a 
member of the City of Kaktovik Council, both of which I am 
representing today.
    I also served previously as the president of the Kaktovik 
Inupiat Corporation, the surface landowner to 92,000 acres of 
privately owned lands which Congressman Young talked about 
briefly about being a refuge within the National Arctic 
Wildlife Refuge.
    I was born and raised in the Village of Kaktovik. I intend 
to grow old there. By the way, Kaktovik is the only community 
that is within the boundaries of the Arctic National Wildlife 
Refuge, and I can compare what life was in Kaktovik prior to 
all the development and discovery of oil and gas in 1968 and 
our quality of life we have today because of my personal 
experiences.
    I have spent many days and years listening to the people of 
Kaktovik and to the residents across the North Slope and also 
the vast majority of us who support responsible development on 
the Coastal Plain of ANWR, also known as 1002. I am very happy 
that this Committee is proposing to open the Coastal Plain of 
ANWR for oil and gas exploration and development and limit the 
activity to only 2,000 acres, which is less than .01 percent of 
the size of ANWR.
    We all know that the Coastal Plain and the entire national 
wildlife Arctic National Wildlife Refuge remains extremely 
important not only to the people of Kaktovik and to the North 
Slope Borough, but also to the state and also the United States 
of America. We would not favor development on the Coastal Plain 
unless we were confident that development can occur without 
jeopardizing our way of life.
    The Inupiat people of Kaktovik used the lands for many 
years, for many thousands of years, hundreds of years, and 
consider it being a wilderness is an insult to our people there 
because we have footprints. We have cabins. We have ice 
cellars. We have drying cache, places that we store or hunt. 
They are all over, every 25 miles, before the education was 
mandated to go to the villages or to the hub of the areas. We 
had every 25 miles there were people. There were cabins. That 
is how long it took for dogsleds to travel.
    So with that, we would not trade with the development of 
the Coastal Plain, so that would jeopardize our way of life 
because we live there and we want to live that way. The Inupiat 
people of Kaktovik use the lands in and around ANWR to support 
our traditional lifestyle, which I just stated. The tundra and 
the Beaufort Sea are our gardens, and we respect and live off 
of them. As such, we could not support again the development of 
the Coastal Plain. It really would adversely affect our Inupiat 
tradition and way of life.
    Responsible development of ANWR's Coastal Plain is a matter 
of self-determination of our people, and we would like for the 
Congress to open up ANWR so that we are private landowners. We 
should have the opportunity, like any private landowner, to 
make development and use the land for benefit. That will 
benefit us, and it will enable our region continued access to 
essential services taken for granted by many people of the 
Lower 48.
    Over the nearly 40 years we have watched the oil 
development in Prudhoe Bay. Because of this, my people know 
that industry and wildlife can co-exist. Based on our 
experience, we have strong confidence of the North Slope 
Borough's ability to protect our natural wildlife environment 
through the Wildlife Department and resources from adverse 
impact of permitting agencies, the Planning Department that 
takes care of planning and zoning, particularly if decisions 
are made after considering local input regarding resources such 
as the caribou and polar bear.
    Responsible ANWR development means my people will continue 
to have access to running water and flush toilets, which just 
happened 11 years ago in the year 2000 we were able in the 
Village of Kaktovik, able to have running water and be able to 
flush the toilet, so that is a real benefit for our people for 
their health.
    Responsible development also means access to local schools, 
health care facilities and professional fire stations, the 
police department. And for many of my generation our only 
option for school beyond eighth grade was to attend Indian 
school in the Lower 48 in Chilocco.
    I know I don't have much time, but we really support the 
development, and I thank you, Mr. Chairman, for allowing me the 
opportunity, Chairman Hastings, and I thank you very much to 
listen to the points of view. You can find the rest of the 
testimony that is written before you.
    [The prepared statement of Mr. Rexford follows:]

      Statement of Fenton Okomailak Rexford, City Council Member, 
                        City of Kaktovik, Alaska

    Honorable Chairman Hastings and members of the Committee, thank you 
for inviting me to testify before you today. My name is Fenton 
Okomailak Rexford. I am the Tribal Administrator for the Native Village 
of Kaktovik and a member of the Kaktovik City Council, both of which I 
am representing today. I am also the President of the North Slope 
Borough School District Board of Education, and I am currently running 
for the office of Mayor of the North Slope Borough. I previously served 
as the President of Kaktovik Inupiaq Corporation, the surface land 
titleholder to 92,000 acres of privately owned land within the Coastal 
Plain of the Arctic National Wildlife Refuge.
    I am a life-long resident of Kaktovik and I intend to grow old 
there. I can compare what life in Kaktovik was like prior to oil 
development on the North Slope to the quality of life we have today 
because of my personal experience. I have spent time listening to the 
people of Kaktovik and to the residents across the North Slope and the 
vast majority of us support responsible development of the Coastal 
Plain of ANWR. I have had the opportunity to talk to many members of 
Congress and staff on this issue, with a considerable amount of my time 
spent in Washington, D.C. I am very familiar with this issue and have 
been fighting the misrepresentations of the opposition for over 15 
years. Therefore, I speak with the institutional knowledge my people, 
the Inupiat people of the North Slope, the people who live in the 
Coastal Plain, have about ANWR.
    The Coastal Plain of ANWR consists of 1.5 million acres of land and 
is known as the 1002 area. ANWR itself covers more than 19 million 
acres of land. The Coastal Plain is a very small portion of this land 
and, in the pending legislation, Congress proposes to limit development 
in this area to no more than 2,000 acres--an even smaller portion, less 
than 0.01% of all of ANWR. We are, therefore, talking about a tiny 
amount of land within a vast area, most of which is designated as 
wilderness or refuge. All of this land remains extremely important to 
the people of Kaktovik and the North Slope Borough. We would not favor 
development of the Coastal Plain unless we were confident that 
development can occur without jeopardizing our way of life.
    The Inupiat people of Kaktovik use the lands in and around ANWR to 
support our traditional subsistence lifestyle. The land and sea are our 
gardens and we respect them. We subsist off of the land and sea. As 
such, we could not support development of the Coastal Plain if it would 
adversely affect our Inupiaq traditional subsistence way of life. 
Responsible development of ANWR's Coastal Plain is a matter of self-
determination for my people. It will enable the entire North Slope 
region continued access to essential services taken for granted by 
people from the Lower 48.
    Over nearly 40 years, we have watched oil development at Prudhoe 
Bay. Because of this, my people know that industry and wildlife can 
coexist. The Central Arctic Caribou herd, which calls the Prudhoe Bay 
region home, numbered around 3,000 in the 1960's. Today the population 
is thriving at more than 65,000. The Porcupine Caribou Herd in ANWR now 
numbers about 169,000. We expect this herd to continue to thrive and do 
not believe that development of such a small area of land within such a 
massive region will negatively affect these animals. Based on our past 
experience, we have strong confidence in the North Slope Borough's 
ability to protect our natural wildlife environment and resources from 
adverse impact, particularly if decisions are made after considering 
local input regarding subsistence resources such as caribou.
    Responsible ANWR development means my people will continue to have 
access to running water and flush toilets throughout the region. The 
luxury of a flush toilet and running water--things we did not have just 
a few years ago--decreases our risk of exposure to health hazards such 
as hepatitis. Responsible development also means access to local health 
care facilities and professionals. Our region is vast and covers 
roughly 89,000 square miles, yet we have only eight tiny villages. Our 
only access to a hospital is 360 air miles from Kaktovik to Barrow, 
with a flight time of 90 minutes, weather permitting. This trip is 
expensive, particularly for people in an area with little local 
economy. Responsible development also will continue to support our 
local health clinics, which are vital to the continued good health of 
my people.
    Further, development of the North Slope enables our community to 
sustain a local school. For many of my generation, our only option for 
school beyond eighth grade was to attend an Indian school in the Lower 
48. We are now able to provide our children with a high school 
education on the North Slope.
    Finally, responsible development will continue to provide search 
and rescue, police and fire protection for our North Slope communities. 
The weather conditions within the North Slope are harsh and at times 
life threatening. As we continue to practice our traditional 
subsistence lifestyle, we take comfort in knowing that if we are 
misguided in our journeys, our region has the capability of conducting 
search and rescue missions.
    Responsible development of ANWR will not just have important 
benefits for those lucky enough to live on the North Slope. Development 
of ANWR also will have important benefits for all Americans. In the 
past few months, many have called for the federal government to reduce 
its spending deficit, while creating new jobs and stimulating the 
American economy. Development in ANWR could help to address all three 
of these concerns.
    Opening ANWR to oil and natural gas development would create more 
than $110 billion in federal revenues and royalties over the next 30 
years. North Slope oil development at Prudhoe Bay has already 
contributed more than $50 billion in federal revenues since 1977. 
Responsible development on the Coastal Plain would triple that amount. 
In addition, development of ANWR would result in thousands of new 
contracts, all across the U.S., for materials and services. The three 
companies currently producing oil on the North Slope spend money in 
every one of the 50 states. The additional expenditures related to 
development of ANWR would in turn create tens of thousands of jobs, 
many of which could put unemployed Americans back to work in 
manufacturing facilities, the construction business, and other 
industries.
    Also in recent months, Americans have focused on issues of national 
security, including imported oil and high gasoline prices. Development 
in ANWR can help resolve these issues, too. Today, we import more than 
60% of our oil, much of it from troubled areas in the Middle East. The 
U.S. Geological Survey has repeatedly said that the Coastal Plain 
represents the best chance for a major oil discovery in the United 
States. In 1998, the USGS predicted that the Coastal Plain contained 
5.7 to 16 billion barrels of recoverable oil. The mean estimate is 
about 10.4 billions--twice the known oil reserves in Texas or about 30 
years of imported oil from Saudi Arabia. The USGS revised its estimate 
in 2005, predicting that new technologies could significantly increase 
that amount, while also reducing the footprint of the drilling site and 
any environmental impacts of drilling. At peak production, ANWR could 
produce between 650,000 barrels per day and 800,000 barrels per day. 
This could both reduce our dependence on foreign oil and help reduce 
gasoline prices. And the more we can reduce the amount of oil produced 
under troubled, unstable governments, the more our national security 
would be improved. Development of the Coastal Plain of ANWR is a win-
win situation for the American people, particularly for those of use 
who call this area home.
    Chairman Hastings, and Members of the Committee, I thank you for 
the opportunity to present to you the views of the people of the 
Village of Kaktovik and the North Slope Borough.
                                 ______
                                 

    Response to questions submitted for the record by Fenton Rexford

        1.  As a resident of Kaktovik, hunter, whaler, incorporator of 
        our home-rule government the North Slope Borough, a Tribal 
        administrator for the Native Village of Kaktovik and a member 
        of the Kaktovik City Council, I believe that the oil and gas 
        industry and wildlife can co-exist. The animal species of the 
        North Slope are not harmed by the presence of development. Our 
        rivers are still full of fish and the caribou population has 
        actually increased in number near the present-day development. 
        There needs to be a balance and local stakeholder engagement, 
        but in my experience, the development of oil and gas resources 
        on the North Slope has not had an adverse impact on our 
        wildlife.
        2.  The majority of Kaktovik residents and the majority of the 
        North Slope residents believe that ANWR can be developed 
        responsibly without adversely impacting our lands and wildlife. 
        We have lived with oil and gas exploration and development for 
        over 30 years, and because of local stakeholder engagement-we 
        have protected our lands and wildlife for the benefit of our 
        people.
        3.  We have come to realize that the survival of our 
        communities depends upon future resource development in our 
        region. Development has empowered our communities to improve 
        the quality of life and standard of living for our Inupiat 
        people. I grew up during an era where children were shipped 
        from their communities to attend school hundreds of miles away. 
        This experience had a negative impact on our society because of 
        the cultural disconnect. With the discovery of oil in Prudhoe 
        Bay our communities were able to build the infrastructure 
        necessary to educate our children locally and provide healthy 
        living conditions for our people; while at the same time, our 
        people and culture depend on food resources of the land and 
        sea. We recognize the necessary balance, and wish others would 
        recognize it as well.
        4.  There are several. First, an increase in the already 
        exponential cost of living. My community pays $4.65 for a 
        gallon of gas; we have to travel over 300 miles to the nearest 
        hospital at a cost of nearly $400 for a one-way airplane ticket 
        because air travel is the only accessible mode available to our 
        community; we don't even get fresh produce because by the time 
        it reaches our community it is rotten. Second, our home-rule 
        government, the North Slope Borough, receives its revenue 
        through taxation of infrastructure on the North Slope. A 
        depressed economy and lack of exploration and development of 
        resources we know are in the ground will have a significant 
        negative impact on the revenues generated by the North Slope 
        Borough to provide public services to our residents. Decreasing 
        the volumes of oil through the Trans-Alaska Pipeline (TAPS) 
        risks a shutdown of the entire pipeline. This would condemn our 
        region and take away our ability to improve our communities and 
        provide jobs for our residents. We will be at high risk of a 
        population out-migration from our communities as talents leave 
        our villages in search of employment opportunities outside of 
        the region. Finally, without development we will not have the 
        revenues to sustain the infrastructure in our communities, 
        including the running water and flush toilets that the people 
        in the lower 48 take for granted.
                                 ______
                                 
    The Chairman. Thank you, Mr. Rexford. Like I said, your 
full statement will appear in the record, and I very much 
appreciate your oral testimony.
    Mr. Tim Sharp, Secretary Treasurer of Laborers Local 942, 
you are recognized for five minutes.

 STATEMENT OF TIM SHARP, BUSINESS MANAGER/SECRETARY TREASURER, 
              ALASKA DISTRICT COUNCIL OF LABORERS

    Mr. Sharp. Thank you, Chairman Hastings, and good morning 
to the Committee. Thank you for both inviting and allowing me 
to testify on a subject that is important and timely not only 
to people that I represent and to the people of Alaska, but 
most, if not all, Americans as well. My oral testimony will be 
the same as my written remarks.
    My name is Tim Sharp. I am the Business Manager of the 
Alaska District Council of Laborers. I represent approximately 
5,000 Alaskan union members who are involved in the 
construction of roads, bridges, buildings, pipelines, 
processing facilities, pump stations, gathering centers, as 
well as workers in the public sector, tourism, manufacturing, 
maintenance and other miscellaneous industry.
    I began working on the North Slope in 1975 at the age of 20 
developing the Trans-Alaska Pipeline, Prudhoe Bay, Kuparuk and 
other satellite fields. I stayed active on the issues that 
surround development and the infrastructure expansion for both 
the industry and the workers that I represent in the field 
today.
    I come here today not to be used as a political foil 
against our President and wish to avoid the appearance of any 
type of political posturing that seems to be prevalent during 
an election year in both Houses. I am also not a supporter of 
the Drill Baby Drill mentality or similarly empty platitudes as 
all oil and gas development in Alaska should be measured, 
planned and well thought out with projects that pencil out, are 
sustainable and aggressively engineered environmentally using 
the cutting edge science and technology. We live there. It is 
our home.
    That being said, I firmly believe that the development of 
the Arctic National Wildlife Refuge can meet these criteria. I 
don't want to engage or argue on the weight or lack of weight 
of the merit of voluminous mountains of fluff and rhetoric on 
both sides of this charged issue. Whether you choose to believe 
it to be the Serengeti plain of America or a cold, desolate, 
God forsaken, mosquito invested wasteland, there is no all-
encompassing absolute that can describe ANWR. The truth is it 
is neither of the two, and it falls somewhere in the middle.
    The picture of the ANWR debate has not really changed in 20 
years. However, the frame surrounding the picture has. We are 
at a time in America where our economy needs an employment jump 
start. Energy costs only continue to escalate, and foreign 
dependence on oil seems to make our economy and our businesses 
vulnerable in a way that I am personally uncomfortable with.
    We seem to be caught up in contemplating our navel on 
process, permitting and politics at a time when it is obvious 
to most that we have oil in Alaska, development will generate 
thousands of needed jobs and the leverage and impact the 
foreign producers could have on us would lessen. Instead, 
inaction trumps common sense and legitimate need.
    Balance those considerations against the possible 
environmental impact development could have on ANWR. I have 
personally witnessed herds of caribou gathering around 
pipelines and modules in Prudhoe Bay to enjoy the only shade in 
hundreds of miles, or just to rub up against the pipe just to 
shake the mosquitos and flies surrounding them. However, let 
there be no doubt. Even with improved directional drilling and 
using all tools available to them, there would be some small 
impact.
    The minimal acreage needed for development in ANWR would be 
a great opportunity for the environmental community and the oil 
industry to work closely together to show what American 
technology and ingenuity could do. Where better than ANWR to 
create an environmental gold standard for oil and gas 
development?
    I also know the varied opinions of some of the Gwich'in and 
Eskimo people and respect those opinions of some of their 
leaders. But some of their members are my members as well, and 
many of them don't believe the responsible development of ANWR 
will be detrimental in any way to the culture or the lifestyle 
that they enjoy.
    There have been numerous geologic studies done over the 
years in regards to the amount of oil and gas that ANWR holds. 
They speak for themselves. But using the most conservative 
estimates on the amount of the reserves, the amount of energy 
it would produce for our country, the tens of thousands of good 
paying jobs that it would generate in Alaska, Washington, 
Oregon and many other states, it is time to take another look 
at both the environmental risk versus the economic reward.
    I am a strong proponent of alternative energy, but also 
realistic in terms of the timelines associated with developing 
it to the point of adequately offsetting the energy needed by 
most of our petrochemical based industries. I am addressing 
today the need for political action to offset our dwindling 
energy reserves in the next five to 10 years, but, equally 
important, the need for jobs today.
    Another study will simply not equate to the leadership we 
need to see on this issue. Please act, and thank you for your 
time.
    [The prepared statement of Mr. Sharp follows:]

     Statement of Tim Sharp, Business Manager/Secretary Treasurer, 
                  Alaska District Council of Laborers

    Good Morning Chairman Hastings and Committee Members,
    Thank you for both inviting and allowing me to testify on a subject 
so important and timely; not only to the people I represent, and the 
people of Alaska, but most, if not all, Americans as well. My oral 
testimony will be the same as my written remarks.
    My name is Tim Sharp and I am the Business Manager of the Alaska 
District Council of Laborers. I represent approximately five thousand 
Alaskan Union members who are involved with the construction of roads, 
bridges, buildings, pipelines, processing facilities, pump stations, 
gathering centers, as well as, workers in the public sector, tourism, 
manufacturing, maintenance and other miscellaneous industry sectors.
    I began working on the North Slope of Alaska in 1975 at the age of 
twenty developing the Trans Alaska Pipeline, Prudhoe Bay, Kuparuk and 
other satellite fields. I have stayed active on the issues that 
surround development, and infrastructure expansion for both the 
industry and the workers I represent in the field today.
    I come here today not to be used as a political foil against our 
President and wish to avoid the appearance of any type of the political 
posturing that seems to be prevalent during an election year in both 
Houses.
    I am not supportive of the ``Drill Baby Drill'' mentality or 
similarly empty platitudes, as all oil and gas development in Alaska 
should be measured, planned, and well thought out with projects that 
pencil out, are sustainable, and aggressively engineered 
environmentally, using cutting edge science and technology. We live 
there, it is our home. That being said, I firmly believe that the 
development of the Arctic National Wildlife Refuge can meet these 
criteria.
    I don't want to engage or argue the weight, or lack of weight, of 
the merit of the voluminous mountains of fluff and rhetoric on both 
sides of this charged issue. Whether you choose to believe it to be the 
``Serengeti Plain of America'' or a cold, desolate, God forsaken, 
mosquito infested wasteland, there is no all encompassing absolute that 
can describe ANWR. The truth is it is neither of the two. It falls 
somewhere in the middle.
    The picture of the ANWR debate has not really changed in twenty 
years however, the frame surrounding the picture has. We are at a time 
in America where our economy needs an employment jumpstart, energy 
costs only continue to escalate and foreign dependence on oil seems to 
make our economy and our businesses vulnerable in a way I am personally 
uncomfortable with.
    We seem to be caught up in contemplating our navel on process, 
permitting and politics at a time when it is obvious to most that we 
have oil in Alaska, development would generate thousands of needed 
jobs, and the leverage and impact the foreign producers could have on 
us would lessen. Instead, inaction trumps common sense and legitimate 
need.
    Balance those considerations against the possible environmental 
impact development could have on ANWR. I have personally witnessed 
herds of caribou gathering around pipelines and modules in Prudhoe Bay 
to enjoy the only shade in hundreds of miles or to rub up against them 
to shake the mosquitoes and flies surrounding them. However, let there 
be no doubt even with improved directional drilling and using all tools 
available to them, there would be some small impact.
    The minimal acreage needed for development in ANWR would be a great 
opportunity for the environmental community and the oil industry to 
work closely together and show what American technology and ingenuity 
could do. Where better than ANWR to create an ``environmental gold 
standard'' for oil and gas development?
    I also know of the varied opinions of both some of the Gwi'chin and 
Eskimo people and respect the varied opinions of some of their leaders. 
But some of their members are my members as well and many of them don't 
believe that responsible development of ANWR will be detrimental to 
their culture or lifestyle.
    There have been numerous geologic studies done over the years in 
regards to the amount of oil and gas that ANWR holds. They speak for 
themselves. But using the most conservative estimates on the amount of 
the reserves, the amount of energy it would produce for our country and 
the tens of thousands of good paying jobs it would generate in Alaska, 
Washington, Oregon and many other states, it is time to take another 
look at both the environmental risk and economic reward.
    I am a strong proponent of alternative energy, but also a realist 
in terms of the timelines associated with developing it to the point of 
it adequately offsetting the energy needed by most of our petrochemical 
based industries. I am addressing today the need for political action 
to offset our dwindling energy reserves in the next five to ten years 
but equally important the need for jobs today. Another study will 
simply not equate to the leadership we need to see on this issue. 
Please act.
    Thank you for your time.
                                 ______
                                 

           Response to questions submitted for the record by 
                     Tim Sharp, Laborers' Local 942

October 18, 2011

Tim Charters, Staff Director
Subcommittee on energy and Mineral Resources
1324 Longworth House Office Building
Washington, D.C. 20515

Dear Mr. Charters:

    This letter is in response to Congressman Hastings' questions to me 
in a letter dated October 5, 2011.
(1.)  Mr. Sharp, can you tell us how your job and the construction jobs 
        of those you represent differ in terms of salary and benefits 
        as opposed to those working in Alaska in non-energy fields such 
        as the food service industry?
    The salaries and benefits generated by those construction jobs from 
the energy field (oil and gas in particular) are far superior to those 
in the food service industry. Our basic package per hour rate in 
Prudhoe Bay is forty one dollars and thirty nine cents ($41.39) wage 
and benefits included. The rates from food and beverage jobs top out at 
half of that rate and often provide few or meager fringe benefits.
(2.)  Mr. Sharp, you represent approximately 5,000 members that are 
        responsible for the construction of all aspects of 
        transportation, tourism and manufacturing. Undoubtedly the 
        highest priority for your members is the creations of good-
        paying, reliable jobs for themselves and their children. Can 
        you tell us what changes you have seen in job creation and the 
        communities of Alaska as the energy industry in Alaska has 
        evolved?
    As you may well know, the large majority of our state's operating 
budget is financed by taxes on the oil industry's infrastructure, as 
well as, the gas and oil produced from our oilfields. As a result of 
the production that has taken place since at least the nineteen 
seventies (1970's), we have seen huge upgrades in our rural villages, 
in terms of schools, sanitation, airports, and roads. We have also 
witnessed similar infrastructure projects throughout the rest of Alaska 
in highways, public facilities, expansion of our university campuses, 
bridges, utilities, airports, etc. and the ability to maintain them.
    Along with those infrastructure projects has come the awareness 
that if the wages and benefits are to circulate here in the Alaskan 
economy for maximum effect, Alaskan workers need to be adequately 
trained to perform them.
    There have been efforts too numerous to mention to accommodate this 
philosophy, however, between apprenticeship programs, vocational 
schools, colleges and universities and rural skills training programs, 
we now have the ability to meet almost any energy industry workforce 
needs with skilled Alaskans. This has helped build capacity in our 
state and reversed the need to import workers from the lower forty 
eight states and Canada.
    I hope these short responses answer the questions to your 
satisfaction. Both questions could be answered in greater detail, with 
voluminous amounts of documentation for back-up. I trust you will not 
hesitate to contact me if you wish for more information regarding 
either question or any others that might arise in the future concerning 
my testimony.
    Thank you again for allowing me to testify on this most important 
and timely issue.

Sincerely,

Tim Sharp
Business Manager/Secretary-Treasurer
Laborers' Local 942
2740 Davis Road
Fairbanks, AK 99709
                                 ______
                                 
    The Chairman. Thank you very much, Mr. Sharp, for your 
testimony.
    Now I am pleased to introduce Mr. Carey Hall, who is an ice 
road trucker. We will just leave it at that. Mr. Hall, you are 
recognized for five minutes.

STATEMENT OF CAREY HALL, ICE ROAD TRUCKER--COMMERCIAL, CARLILE 
                     TRANSPORTATION SYSTEM

    Mr. Hall. Thank you. My name is Carey Hall. I live and work 
in Alaska. I am a truck driver by occupation. I work on the ice 
roads hauling freight to and from the North Slope of Alaska. I 
am an employee of Carlile Transportation. It is an Alaskan 
owned and based trucking company. We have more than 600 
employees, and we have been in business for 30 years.
    We move freight all over the United States and specialize 
in movements and goods and equipment specifically for the oil 
and gas industry. I am not a gas expert. I am a truck driver. 
Truck drivers literally and figuratively drive our nation's 
economy. I see the flow of goods and demand for products, 
services and workers that the industry creates.
    I have been asked to be here to give you my view on the 
impact of opening ANWR. I would like to explain why I further 
believe oil and gas development in Alaska is so crucial to my 
well being, to my family and to our nation.
    The oil and gas industry represents the cornerstone of our 
business. It is not only important to contractors and vendors 
such as trucking companies, but to all our citizens in the 
State of Alaska and as a nation. It produces jobs, lots of 
jobs, and we need jobs.
    Prudhoe Bay has operated above and beyond what initial 
predictions indicated. More recoverable oil and longer duration 
periods are recovering it due to technology, and efficiency has 
continued to keep these fields productive. It has been a huge 
gold mine for jobs, tech relief and economic development in 
Alaska and nearly every other state in our nation as well.
    The need for contracts and supplies and services purchased 
by the Alaskan oil industry has without a doubt touched every 
single corner of our nation. Every state in the Nation has been 
drawn on to provide goods and services for production in Alaska 
for over 40 years. This has been a benefit economically to 
every state. I know because I work it.
    Incredible lessons of environmental stewardship and safety 
has also been realized. The ice roads are built, heavily 
utilized and then they disappear. One would never know that 
they were ever there. The creation of this infrastructure has 
allowed new fields to be developed and ultimately supply our 
nation with oil substantially above and beyond the initial 
predictions in the early 1970s.
    However, we are seeing less and less oil in the pipeline. 
These finds are thinning out. We don't have the freight loads 
we once had, and what we are hauling to the oil patches now is 
just for repair and maintenance of what is already there. New 
development must be brought on line elsewhere.
    ANWR is crucial to keeping oil in our pipeline. The 
pipeline needs to run at a certain output to even operate. 
Finds such as ANWR must be brought on line. This one spot in 
Alaska has more oil potential than any other spot in North 
America.
    Imported oil to the United States is the single largest 
contributor to our national debt. Opening ANWR is the right 
step in responsible management of our national debt. No money 
comes from the Federal Government to develop ANWR, yet the 
rewards will be plentiful. Our nation needs our energy, and we 
have the ability to make that happen.
    The History Channel has done Alaska a huge favor. The show 
is not about me. It is not about the company I work for. It is 
about a remote, rigorous and regulated industry supplying our 
nation with a much needed commodity. Oil companies pay for the 
ice roads, and those roads are the basis for my job; good long-
term, high paying jobs.
    America needs more of these, and we can have them, but ANWR 
is not a band-aid for our debt solution. ANWR is about careful 
planning and environmental stewardship and looking to the 
future. Alaskans, knowing this will be done right, are 
overwhelming to support this cause.
    Thank you for inviting me to speak. I am willing to answer 
any questions that you may have.
    [The prepared statement of Mr. Hall follows:]

       Statement of Carey Hall, Carlile Transportation Systems, 
          Ice Road Truck Driver-Commercial, Anchorage, Alaska

    My name is Carey Hall and I live and work in Alaska. I am a truck 
driver by occupation and work on the Ice Roads of Alaska hauling 
freight to and from the North Slope of Alaska. I am an employee of 
Carlile Transportation; an Alaskan owned and based trucking company. We 
have more than 600 employees and have been in business for 30 years. We 
move freight all over the United States and specialize in movement of 
goods and equipment specifically for the oil and gas industry. I am not 
an oil and gas expert and won't act like I am. I am a truck driver. 
Truck drivers literally and figuratively ``drive'' our nation's 
economy. I see the flow of goods and the demand for products, services 
and workers that this industry creates.
    I have been asked to be here to give you a glimpse of what an Ice 
Road Trucker working in the oil patch industry sees and experiences. I 
would like to explain why I believe further Oil and Gas development in 
Alaska is so crucial to my well-being, to my family and to our nation.
    The oil and gas industry represents the cornerstone of our 
business. It is not only important to contractors and vendors such as a 
trucking company but to all our citizens in the State of Alaska and as 
a nation. It produces jobs, lots of jobs, we need jobs!
    Prudhoe Bay has operated above and beyond what initial predictions 
indicated. More recoverable oil and a longer duration period of 
recovering it, due to technology and efficiency has continued to keep 
these fields productive. It has been a huge ``gold mine'' for jobs, tax 
relief, and economic development in Alaska and nearly every other state 
in our nation as well. The need for contracts of supplies and services 
purchased by the Alaskan oil industry has without a doubt touched every 
single corner of our nation. Every state in the nation has been drawn 
on to provide goods and services for production in Alaska for over 40 
years. There has been a benefit economically to every state. I know, 
because I work it.
    Incredible lessons of environmental stewardship and safety have 
also been realized. The ice-roads are built, heavily utilized and then 
disappear. One would never even know they were ever there. The creation 
of this infrastructure has allowed new fields to be developed and 
ultimately supplying our nation with oil sustaining above and beyond 
initial predictions in the early 70's.
    However, the end is in sight, we are seeing less and less oil in 
the pipeline. The finds are thinning out. We don't have the freight 
loads we once had and what we are hauling to the oil patch is for 
repair and maintenance. New development must be brought on-line 
elsewhere.
    ANWR is crucial to keeping oil in our pipeline. Without ANWR we 
have the threat of our nation's pipelines--The Trans Alaska Pipeline 
shutting down. The pipeline needs to run at a certain output in order 
for it to even operate. Finds such as ANWR must be brought to fruition. 
This one spot in Alaska has more oil potential than any other spot in 
North America. Importing oil to the United States is the single largest 
contributor to our national debt. Opening ANWR is the right step in 
responsible management off our national debt. No money will come from 
the Federal Government, yet the rewards will be plentiful. Our nation 
needs our energy and we have the ability to make that happen.
    The History Channel has done Alaska a huge favor. The show is not 
about me, it is not about the company I work for. It is about a remote 
and rigorous and regulated industry, supplying our nation with a needed 
commodity--OIL! That is who developed the Ice Roads--that is who pays 
to have them built and that is who uses them. The result of this is my 
job and other just like it. Good--long term--high paying jobs. America 
needs more of these and we can have them.
    I am not a brain surgeon or a rocket scientist, but I can tell you 
one thing I do know--It is with vigilance and dedication and that oil 
companies keep working to produce safe practices, regulating the way 
they work with the natural resources and the environment. It's about 
jobs--our economy needs them! It's about becoming less dependent on 
foreign oil and using our own interests to survive. Our nation needs 
American energy and we have it. Federal land is available in Alaska and 
environmental safeguards are in place more now than ever before. 
Beginning with the permitting process and going thru to the final 
design of a well rig footprint. Which by the way--that old rocker style 
drill we sometimes see pictured--that is not Alaska. That is old school 
and new age drilling has a much smaller footprint and very technically 
advanced leading to cutting edge innovation, efficiency and safety.
    I am confident in saying that Alaskan Legislators, the Alaskan 
Congressional delegation, and every single Alaskan Governor has 
supported opening ANWR every single year since the debate began. People 
care about their own backyard more then they care about their 
neighbors--that is why Alaskans support ANWR opening--it is our 
backyard. We know that ANWR will produce tens of thousands of long term 
jobs; we know that infrastructure will be built; we know that tanker 
ships will be needed, pipe will be manufactured, and services will be 
contracted. It happened in Alaska before and has benefited our entire 
nation for decades. ANWR is not a bandaid for our debt and economy; it 
is a long term sustainable solution. ANWR is about careful planning, 
environmental stewardship, and looking to the future. Alaskans know 
this will be done right and overwhelmingly support this cause.
    Thank you for inviting me to speak.
                                 ______
                                 

   Response to questions submitted for the record by Carey T. Hall, 
  Ice Road Trucker, Carlile Transportation Systems, Anchorage, Alaska

October 19, 2011

Tim Charters, Staff Director
Subcommittee on Energy and Mineral Resources
1324 Longworth House Office Building
Washington, DC 20515

Via email:[email protected]

Dear Mr. Charters,

    Please extend my gratitude and thanks to the entire Committee on 
Natural Resources, for their invitation and hospitality during my first 
official visit and testimony on ``ANWR Jobs, Energy and Deficit 
Reduction'' on September 21, 2011. I also, appreciated the opportunity 
to review distributed ANWR research materials and hear the other 
testimonies. As I stated during my testimony, Alaska's oil production 
industry is very important to me and the sustenance of my family.
    In your letter dated October 5, 2011, there was a two part question 
for the record requested by Doc Hastings. The question was ``Can you 
tell us what you have seen in your business as a result of lagging 
domestic energy production, and what you believe would happen to your 
business if ANWR were to be open to energy development?'' In response 
to the question, my family and I moved back to Alaska in 2005 because 
my employer Carlile Transportation Systems, Inc. was under contract to 
haul a huge amount of freight to and from Prudhoe Bay and the North 
Slope Oil Fields. However, in the past few years the amount of freight, 
oil production and the number of trips that I have made to the North 
Slope all have decreased. I am positive that opening ANWR for energy 
development would stimulate the transportation industry in Alaska, as 
well as the entire United States economy.
    Thank you again for this great platform to share my thoughts and 
concerns about ANWR. I am eagerly looking forward to hauling in the 
first load across the ice road in preparation of drilling in ANWR.

Sincerely,

Carey T. Hall
Ice Road Trucker
Carlile Transportation Systems
1800 E. 1st Avenue
Anchorage, Alaska 99501
                                 ______
                                 
    The Chairman. Thank you very much, Mr. Hall, for your 
testimony.
    And now I am pleased to recognize Mr. David Jenkins, Vice 
President for Government and Political Affairs for the 
Republicans for Environmental Protection. Mr. Jenkins, you are 
recognized for five minutes.

 STATEMENT OF DAVID E. JENKINS, VICE PRESIDENT FOR GOVERNMENT 
AND POLITICAL AFFAIRS, REPUBLICANS FOR ENVIRONMENTAL PROTECTION

    Mr. Jenkins. Good morning. As you said, I am David Jenkins, 
Vice President----
    The Chairman. Turn on the microphone if you would. Thank 
you.
    Mr. Jenkins. Good morning. As you said, I am David Jenkins, 
Vice President of Government and Political Affairs for 
Republicans for Environmental Protection. I appreciate the 
opportunity to testify today. REP is a national grassroots 
organization that is based on the idea that conservation is 
conservative.
    Our members recognize that natural resource stewardship 
requires a balanced approach. They see oil drilling in Prudhoe 
Bay and other parts of Alaska's North Slope, and they come to 
the same conclusion the Eisenhower Administration came to 50 
years ago; that protecting the Arctic refuge represents 
balance. With 95 percent of the North Slope's Coastal Plain 
available for development, it is hard to argue that stripping 
away protections for that last remaining 5 percent constitutes 
a balanced approach.
    The great conservative political theorist, Russell Kirk, 
challenged the conservatives to hoard what remains of natural 
wealth against the fierce appetites of modern life. Now, the 
purpose of this hearing today is to explore claims that opening 
up the Arctic refuge to oil and gas development would create 
tens of thousands of jobs and generate hundreds of billions in 
new Federal revenue. One source of these rosy projections is a 
recent study commissioned by the American Petroleum Institute 
and conducted by Wood Mackenzie.
    Projecting jobs and revenue from developing unproven oil 
and gas reserves is highly suspect due to the speculative 
nature of such reserves. For example, the U.S. Geological 
Survey recently revised its estimates for the NPRA downward by 
over 90 percent. Beyond the amount of oil, there are many other 
unknowable factors such as the future price of oil and the 
availability of oil fields that are less costly to develop.
    Even under Wood Mackenzie's assumptions, the job 
protections seem outside the bounds of reality. The projections 
suggest that in Alaska alone there would be an additional 
60,000 jobs within five years, nearly four times the number of 
oil and gas jobs that exist statewide today. Are we to believe 
that drilling this last 5 percent of the Coastal Plain will 
produce magnitudes, more oil and gas workers than the industry 
is employing in all the rest of the state combined?
    Equally problematic are the Federal revenue projections 
being tossed around. The revenue projection range cited on this 
Committee's website of $150 billion to $296 billion assumes the 
discovery of oil in amounts that are at the lower end of 
probability. It is not fiscally responsible to promote such 
speculative revenue as an answer to our deficit problem.
    The projections appear based on a 2008 CRS report that 
assumes a corporate tax rate of 33 percent. I hope this doesn't 
mean that Members of this Committee are committed to such a 
high corporate tax rate. The CRS and Wood Mackenzie reports 
also assume oil prices will be around $125 a barrel. That is 
$40 more than today, but without any resulting impact on 
demand.
    The odds of all this playing out to meet the job and 
revenue projections are probably about the same as me winning 
the lottery. There is, however, a kernel of truth in that high 
oil price estimate. Even assuming the highest resource 
estimates, Arctic refuge production would not significantly 
impact oil prices. The Administrator of EIA made that point 
before this Committee in March.
    It is also worth noting that increases in Alaskan oil 
production do not have to come at the expense of the Arctic 
refuge. There are more than five billion barrels of proven oil 
reserves on the North Slope available for production, 30 
billion barrels of heavy oil at Prudhoe Bay, millions of acres 
of lease lands not yet developed and significant shale oil 
formations.
    These facts undermine any claim that the future of the 
Trans-Alaska Pipeline will be in jeopardy without refuge 
drilling. Ultimately, however, this is really a discussion that 
should be more about values than numbers. There are places 
across our nation that possess unique ecological, spiritual and 
societal values. If coal were found tomorrow beneath El Capitan 
in Yosemite National Park would we blast it to smithereens or 
would we pass it along to future generations unimpaired?
    The Arctic refuge is no less of an iconic natural resource. 
The refuge lands were protected by the Eisenhower 
Administration as an impact landscape that stretches from the 
Brooks Range to the Beaufort Sea. The refuge's Coastal Plain is 
its biological heart, and it is disingenuous to claim that oil 
exploration can be done there with minimal impact.
    As I conclude, I would ask you to keep in mind 
traditionally conservative values such as prudence, humility, 
reverence and stewardship. Kirk, who President Reagan described 
as the prophet of American conservatism, warned: The modern 
spectacle of vanished forests and eroded lands, wasted 
petroleum and ruthless mining is evidence of what an age 
without veneration does to itself and its successors.
    We already have enough reminders that we live in an age 
without veneration. We should not let exploitation of the 
Arctic refuge become just another one. Thank you.
    [The prepared statement of Mr. Jenkins follows:]

    Statement of David E. Jenkins, Vice President for Government & 
      Political Affairs, Republicans for Environmental Protection

    Good Morning, I am David Jenkins, vice president of government and 
political affairs at Republicans for Environmental Protection. I 
appreciate the opportunity to testify today.
    Republicans for Environmental Protection is a national grassroots 
organization dedicated to resurrecting the Republican Party's great 
conservation tradition and strengthening its commitment to the 
responsible stewardship of our environment and natural resources.
    REP is based on the idea that conservation is conservative and we 
work to advance the original conservative philosophy that compels us to 
be good stewards of our great American heritage.
    REP is involved in many important issues, but none have generated 
the level of member engagement that our work related to the Arctic 
Refuge has.
    While our members are dedicated conservationists, they also 
recognize that natural resource stewardship requires a balanced 
approach. I think that sense of balance is one of the reasons REP 
members are so dedicated to keeping the entire Arctic Refuge protected 
from development.
    They see the oil drilling in Prudhoe Bay and in other parts of 
Alaska's North Slope, they know that vast expanses of Alaska's Arctic 
have also been made available for development--and they come to the 
same conclusion the Eisenhower Administration came to 50 years ago--
that protecting the Arctic Refuge represents balance.
    With 95 percent of the North Slope's coastal plain available for 
oil and gas development, it is hard to argue that stripping away the 
protections for that last remaining 5 percent represents a conservative 
or balanced approach to natural resource stewardship.
    The great conservative author and political theorist Russell Kirk 
once pointed out that ``Nothing is more conservative than 
conservation.'' In his seminal book The Conservative Mind he wrote:
    ``The resources of nature, like those of spirit, are running out, 
and all that a conscientious man can aspire to be is a literal 
conservative, hoarding what remains of culture and of natural wealth 
against the fierce appetites of modern life.''
    The purpose of this hearing today is to explore claims that opening 
up the Arctic Refuge to oil and gas development would help our economy 
by creating tens of thousands of jobs and new federal revenue in the 
hundreds of billions.
    One source of these rosy projections, not surprisingly, is a recent 
study commissioned by the American Petroleum Institute and conducted by 
Wood Mackenzie energy consulting.
    Before even looking at the specifics of their claims, it is worth 
noting that any exercise that purports to project jobs and revenue from 
developing ``unproven'' oil or gas reserves should be taken with a 
grain of salt.
    Estimates of ``unproven'' reserves, oil that geologists estimate 
might be in the ground and recoverable using existing or reasonably 
foreseeable technology, are highly speculative.
    For example, the United States Geological Survey (USGS) recently 
revised its estimates for the National Petroleum Reserve-Alaska (NPRA) 
downward from 10.6 billion barrels to 896 million barrels--roughly 10 
percent of its 2002 estimate.
    Beyond the amount of oil that may or may not be in the ground, 
there are many other unknowable factors, such as the price of oil and 
the availability of oil fields that are less remote and costly to 
produce.
    Even under the Wood Mackenzie assumptions, the job projections seem 
far outside the bounds of reality. The projections suggest that in 
Alaska alone there will be an additional 60,000 jobs within 5 years. 
That would be pretty incredible since in all of Alaska, with 95% of the 
North Slope already open to development, a recent assessment by the 
Alaska Department of Labor showed only 16,468 oil and gas extraction 
jobs--and that number includes oil service/support jobs. Even after 
accounting for their multiplier effect, are we to believe that drilling 
this last 5% of the coastal plain will produce magnitudes more oil and 
gas workers than the entire industry is employing in all the rest of 
the state combined?
    It is also worth noting that increased oil production does not 
always translate into more jobs. Since 2006, the top 5 largest oil 
companies have actually cut their work forces by 11,200 employees. That 
is despite the fact that this country is producing more oil and gas 
than at any other time in our history and oil companies have been 
reporting record profits.
    Equally problematic are the revenue projections to the U.S. 
Treasury being tossed around. To say that these projections rely on 
many questionable assumptions is an understatement.
    First of all the revenue projection range cited on this committee's 
website of $150 billion to $296 billion assumes the discovery of oil in 
amounts that USGS estimates have a lower probability of being found 
(0.5 and 0.05). How on earth is it fiscally responsible to promote such 
highly speculative revenue as an answer to our deficit problem?
    The revenue projections are based on a 2008 Congressional Research 
Service (CRS) report that assumes a corporate tax rate of 33 percent. I 
hope that this doesn't mean that the Republicans on this committee are 
committed to maintaining such a high corporate tax rate for the next 30 
years.
    Even with a tax rate assumption of 33 percent, the numbers do not 
hold up to scrutiny. Recent studies have found that oil companies pay 
closer to 18% in taxes on profits.
    The CRS and Wood Mackenzie reports also assume a 50/50 split in 
royalty revenue even though the state of Alaska under current law gets 
90 percent of such revenue, and that the price of a barrel of oil, 
which today sits around $86 per barrel, will be around $125 per barrel.
    These studies also appear to use a static model to estimate the 
impacts to a dynamic economy. While they project oil prices that are 
significantly higher than today, nowhere do they assume any 
corresponding impact on consumer demand.
    The odds of all of this playing out to meet the job and revenue 
projections touted on the committee website are probably about the same 
as me winning the lottery.
    There is, however, a kernel of truth in the high oil price 
estimate.
    The amount of oil estimated to exist underneath the Arctic Refuge, 
even if you assume the highest possible estimates, is not enough to 
significantly impact the price of oil or improve our nation's energy 
security.
    The Administrator of the Energy Information Administration (EIA) 
testified before the committee on this point back in March, saying:
    ``Long term, we do not project additional volumes of oil that could 
flow from greater access to oil resources on Federal lands to have a 
large impact on prices given the globally integrated nature of the 
world oil market and the more significant long-term compared to short-
term responsiveness of oil demand and supply to price movements. Given 
the increasing importance of OPEC supply in the global oil supply-
demand balance, another key issue is how OPEC production would respond 
to any increase in non-OPEC supply, potentially offsetting any direct 
price effect.''
    Given the daily fluctuation in oil and gasoline prices based on a 
wide range of factors, any price impacts from Arctic Refuge oil would 
not rise above the statistical noise level.
    The most recent EIA report (2008) analyzing the potential of Arctic 
Refuge oil production to impact crude oil imports found that the 
maximum range of possible reduction would be between 2 and 6 percent 
during the five years of peak production from 2025-2030.
    Ultimately, however, this is really a discussion that should be 
more about values than numbers.
    There are certain places across our nation that possess unique 
values--values that I believe are far more significant than the finite 
mineral or energy resources that may or may not lie beneath. I am 
speaking of ecological, spiritual and societal values.
    If a large coal deposit were found tomorrow beneath El Capitan in 
Yosemite National Park, would we blast it to smithereens or would we 
pass it along to future generations unimpaired?
    The coastal plain of the Arctic Refuge is certainly no less of a 
unique and iconic natural treasure than El Capitan. The Refuge lands 
were protected by the Eisenhower Administration as an intact landscape 
that stretches from the Brooks Range to the Beaufort Sea.
    The refuge is one of the few remaining lands where the original 
American wilderness can be experienced on an epic scale--mountains, 
rivers, plains, seacoast and abundant wildlife. Containing a rare 
convergence of six distinct ecosystems, the Arctic Refuge is the 
``crown jewel'' of the National Wildlife Refuge System.
    With nearly 200 species of birds from all 50 states, including 
tundra swans, snow geese, golden eagles and peregrine falcons, using 
the refuge to rest, feed, and/or raise young, is there any doubt that 
the Republican bird lover who founded our wildlife refuge system, 
Theodore Roosevelt, would consider the Arctic Refuge inviolable?
    The Refuge's coastal plain is its biological heart.
    It is disingenuous to claim that oil exploration can be done on the 
coastal plain with a small footprint and minimal impact. According the 
USGS, any oil beneath the coastal plain is scattered in small pockets 
across its entire expanse. Oil development would necessitate a massive 
spider web of pipelines throughout the area.
    As we know from the track record of existing North Slope 
operations, such pipelines are highly prone to corrosion and leaking. 
Having them stretch across such a remote and difficult-to-access area 
would be a disaster waiting to happen.
    Even considering the latest drilling technologies, oil development 
in the Arctic Refuge would dramatically alter its character and destroy 
the values it was protected to preserve.
    It is also worth noting that increases in Alaskan oil production do 
not have to come at the expense of the Arctic Refuge.
    In addition to more than 5 billion barrels of proven oil reserves 
on Alaska's North Slope that are already available for drilling, there 
are over 30 billion barrels of heavy oil remaining to be produced from 
Prudhoe Bay, millions of acres of leased state and federal lands that 
have not been developed, and significant oil shale formations that have 
been discovered beneath state lands near the pipeline.
    To claim that the future of the Trans-Alaska Pipeline (TAPS) will 
be in jeopardy without oil drilling in the Refuge one has to somehow 
overlook a lot of other oil on the North Slope and a judge's 
determination that the pipeline can function with a throughput of as 
little as 200,000 barrels per day.
    In a floor speech earlier this year, Alaska state senator Gary 
Stevens--a Republican--cautioned against trying to scare people with 
shaky predictions about the future of TAPS. He said:
    ``Today, DNR is predicting over 600,000 barrels a day will be 
shipped through TAPS. So the court found that TAPS can operate at least 
down to 200,000. The physical life of TAPS is virtually unlimited if 
properly maintained.''
    As I conclude, I would like to ask that you consider some other 
values that we too often lose track of. I am referring to the 
traditional conservative values that were the very foundation of 
conservative thinking, such as prudence, humility, reverence, and 
stewardship.
    Conserving our remaining wild, unique and ecologically vital 
natural environments represents a practical application of these 
conservative values. Russell Kirk, who President Reagan described as 
``the prophet of American conservatism'' warned:
    ``The modern spectacle of vanished forests and eroded lands, wasted 
petroleum and ruthless mining, national debts recklessly increased 
until they are repudiated, and continual revision of positive law, is 
evidence of what an age without veneration does to itself and its 
successors.''
    We already have enough reminders that we live in an age without 
veneration; we should not let the exploitation of the Arctic National 
Wildlife Refuge become another one.
    Thank you.
                                 ______
                                 
    The Chairman. Thank you very much for your testimony, Mr. 
Jenkins.
    And last we will recognize Mr. Gene Karpinski, President of 
League of Conservation Voters. Mr. Karpinski?

            STATEMENT OF GENE KARPINSKI, PRESIDENT, 
                 LEAGUE OF CONSERVATION VOTERS

    Mr. Karpinski. Thank you, Mr. Chairman. Thank you for your 
time today. I appreciate the opportunity to testify before this 
panel. I am the President of the League of Conservation Voters. 
I am proud to say, by the way, that that organization is an 
organization that has a number of prominent Republicans on its 
board, including our Vice Chairman, Mr. Gerry Bowling, who is 
serving this great body, our honorable Chairman, Teddy 
Roosevelt, IV, who used to be the chair of our board, and 
people like Larry Rockefeller as well.
    All of those folks on our board and many others in our 
organization have for years and years and years opposed 
drilling in the Arctic National Wildlife Refuge. I would agree 
with something that Senator Murkowski said earlier. It is too 
bad we are having this conversation yet again today.
    And, Mr. Chairman, I agree with something you said, which 
was ``reducing our debt will require creative thinking and new 
approaches.'' This is neither. This is not creative. It is not 
new. It is the same old, same old. I have been working on these 
issues for more than 30 years. To correct the record, I live in 
Virginia, not D.C., but I have been working in this town for 30 
years, more than 30 years.
    One of my main goals has been to make sure, quite frankly, 
that we do not drill in the Arctic National Wildlife Refuge. It 
is a special place with special beauty. Some places make no 
sense to drill. I have been there. It is an incredible place. 
We shouldn't touch it. We should keep our hands off. So, yes, I 
agree we need creative thinking and new approaches. This is not 
that.
    My testimony puts some detail on some of these points. I 
want to make a few points though. There are number of reports 
being thrown around, many which are government reports, some of 
which are just baseless, unsubstantiated reports. There is a 
lot of comment today about a new report by Wood Mackenzie. One 
of their footnotes, Mr. Chairman, says, and I quote, ``We do 
not guarantee the fairness, completeness or accuracy of the 
opinions in this report.'' That is their footnote to their 
report.
    Then we learn that it is funded by the oil industry. Funded 
by the oil industry with oil industry facts that even they in 
their footnote say we don't guarantee the accuracy. That is not 
the way to make decisions on policy, so, sadly, it is baseless, 
unsubstantiated by their own data.
    A couple of the specifics. All kinds of claims about let us 
be clear. We need more jobs in this country. We need more money 
to reduce the deficit. But there is a better way. They make all 
kinds of claims about how much money will be raised, but they 
are based on false assumptions about how much oil, double the 
conservative estimates. The price per barrel is not in square 
with the facts. The tax rate they assume for oil companies 
doesn't square with the facts, and they assume there will be a 
50/50 split with the feds and the state, which is not the way 
it is today.
    So a number of facts that they say just don't square with 
the reality. They also claim a huge number of jobs will be 
created. There is no doubt some jobs will be created by 
destroying this beautiful place. We are against that. But if 
you look at the number of jobs they claim, according to the 
Department of Labor just under 17,000 jobs have been created 
for the entire 95 percent of the North Slope that is already 
being developed, so the additional jobs they suggest again make 
no sense.
    Finally, Mr, Chairman, there is a better way. We need more 
jobs. We need to cut the deficit. There are a lot of good 
proposals out there we hope you will support. Mr. Markey has 
led an effort to increase royalties for drilling offshore. That 
would bring in tens of billions of dollars, $53 billion, over 
the next 25 years.
    There are many proposals on the table to cut oil subsidies, 
which will bring over $40 billion over the next 10 years. If 
you want to raise revenue, that is real revenue at a time when 
the oil companies are making record breaking profits, nearly $1 
trillion in the last 10 years from five big oil companies. That 
is where the money is. That is who we should take it from. If 
you are serious about the deficit reduction, let us tax the oil 
companies much more than they are today and take away those 
subsidies that they don't really need.
    Finally, we do need to create new jobs. There are many 
opportunities in a new energy economy to move forward with the 
wind, solar. Not every solar plant works. We now know that very 
well. But wind and solar and efficiency. These are the jobs of 
the future, 2.7 million jobs in that industry. The solar 
industry has doubled its jobs in the last couple years. Those 
are the growing industries. That is the future. We should be 
there.
    Finally, you can argue maybe if you thought there might be 
oil, as David said, in Yosemite or in Rocky Mountain National 
Park or in Zion or a whole set of places, but we hope you and 
we would say no, that makes no sense to drill in those kinds of 
places. Some places are too special, too serious. We should not 
drill there.
    We have opposed drilling in the Arctic National Wildlife 
Refuge for all the time we have been around. We will continue 
to oppose that, and we think and we hope with bipartisan 
support on our side we will continue to win that battle.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Karpinski follows:]

 Statement of Gene Karpinski, President, League of Conservation Voters

    Thank you for the opportunity to submit testimony to the U.S. House 
of Representatives Natural Resources Committee on the topic of drilling 
for oil in America's Arctic National Wildlife Refuge. My name is Gene 
Karpinski, and I am the president of the League of Conservation Voters, 
a national non-profit organization that works to turn environmental 
values into national priorities. I am glad to be here to talk about a 
place that, even nearly ten years after standing on the vast expanse of 
rolling tundra that makes up the Arctic Refuge's Coastal Plain, still 
remains clear and alive in my mind. I have spent much of my career 
fighting to protect this sacred place and I will not stop fighting 
until it is permanently protected.
    Although this hearing is billed as one that aims to address some of 
the most pressing issues of our time--``jobs, energy and deficit 
reduction''--I am disappointed to say that today we are engaged in 
nothing more than political theater. Drilling in the Arctic Refuge is 
and always will be a political hot potato that has been voted on 20 
times in the past 30 years, in the House of Representatives alone. Over 
and over again, pro-drilling members of Congress have trotted out our 
nation's last great wilderness place as a panacea for everything from 
the budget deficit and high unemployment to providing heat for the 
poor, relief to hurricane ravaged states, support for our troops and 
health benefits to coal workers.
    Through it all, every attempt to drill the Arctic Refuge has 
ultimately failed because of the continued strong support of the 
American people who see this never-ending political spectacle for what 
it is--a kowtow to the wealthiest corporations in the world, the only 
ones who will actually benefit from opening the Arctic Refuge to 
drilling.
    Today's theater might well be a comedy if it weren't for the fact 
that our country is facing real problems that deserve real solutions. 
Drilling in the Arctic Refuge is not a real solution for jobs, energy 
or deficit reduction. Instead the projections highlighted by Chairman 
Hastings and American Petroleum Institute's recent Wood MacKenzie 
report are wildly speculative and borderline baseless. Numbers like 
$150 to $300 billion make good sound bites until they collapse under 
the microscope. In fact, Wood MacKenzie included this disclaimer in the 
footnotes of its study based on these numbers: ``We do not guarantee 
[the] fairness, completeness or accuracy of the opinions in this 
report.''
    To begin with, no one actually knows how much oil might be found in 
the Arctic Refuge but the federal government's Energy Information 
Administration has estimated that there is a 95 percent probability 
that 5.7 billion barrels of oil are technically recoverable from small 
pools spread out throughout the 1.5 million acre Coastal Plain--to peak 
at a level of 510,000 barrels per day in 2028. That's far from the 1.45 
million barrels a day that Chairman Hastings and others have trumpeted. 
What's more, factor in variables such as economic viability with 
production costs on land that has absolutely no existing infrastructure 
and sits above the Arctic Circle and those numbers continue to fall.
    From there, revenue estimates are based on assumptions such as $125 
per barrel oil prices throughout the entire life of the oil field, a 
50/50 state/federal revenue split even though the 1959 Alaska Statehood 
Act explicitly locked in a 90/10 state/federal revenue split, and a 33 
percent tax rate that in reality is closer to 18 percent.
    Jobs are the first word on everyone's lips these days in 
Washington, and not surprisingly, drilling in the Arctic Refuge has 
been held up as the answer to this problem as well. Yet the number of 
jobs attributed to drilling in the Arctic Refuge by that same Wood 
MacKenzie report are just as overblown and exaggerated as their revenue 
estimates.
    The fact is that across the country, the top five largest oil 
companies have been cutting thousands of jobs while raking in record 
profits. And the big five oil companies have reported profits--not 
revenues, profits--of $952 billion dollars over the past decade. 
They're reaping in these profits while receiving billions of dollars in 
taxpayer subsidies every year. That's ludicrous. So instead of 
contemplating yet another giveaway to Big Oil as we're doing in this 
hearing, what we should be talking about is cutting these special tax 
breaks and subsidies that go to the world's most profitable companies. 
Ending Big Oil's unfair tax breaks would cut the deficit by more than 
$36 billion over the next decade. And repealing the provision that 
allows Big Oil to drill offshore without paying any royalties would 
save taxpayers $53 billion over the next 25 years. That's real money.
    It also makes no sense to open up a pristine area like the Arctic 
National Wildlife Refuge when the oil companies are choosing not to 
drill on millions of acres they're already leasing. In fact, they're 
not exploring for or producing oil on 22 million acres out of the 38 
million acres of federal land they're currently leasing. That means 
that nearly 60 percent of land the oil companies control is just 
sitting idle. So instead of opening up and irreversibly damaging the 
Arctic Refuge, we should encourage oil companies either to drill on the 
leases they already hold or return that land to the American people--
and we can encourage them to do that by assessing a fee on non-
producing leases, as President Obama has proposed.
    We should be focusing on solutions that provide long-term 
sustainability for our nation. Now is the time to transition our 
nation's energy policy away from capital-intensive, risky, and often 
highly polluting energy sources. Moving toward a clean energy future 
will bring new jobs across a diverse group of industries that will make 
our nation more competitive and our economy more secure and 
sustainable. The clean energy economy offers more opportunities and 
better pay for low- and middle-skilled workers than the national 
economy as a whole. And, unlike oil drilling, these jobs do not 
undermine other successful industries, such as the active outdoor 
recreation economy, which alone generates $730 billion in total 
economic activity, $88 billion in annual state and federal tax revenue, 
and supports 6.5 million U.S. jobs.
    There are real solutions out there if Congress has the guts to put 
aside this partisan charade and get down to the business of creating 
jobs, building a smart energy future and finding ways to cut spending 
and raise revenues that make sense for real Americans not corporations. 
When the Joint Select Committee on Deficit Reduction was first 
announced in August, I had high hopes that this was the beginning of a 
new era of coming together to work toward real solutions. As you, 
Chairman Hastings, wrote in a September 6th op-ed in Fox Nation: 
``Reducing our debt will require creative thinking and new approaches 
that include both spending cuts and raising new revenue.'' Mr. 
Chairman, opening the Arctic Refuge to drilling is neither new nor 
creative--nor an actual solution.
    I am pleased to be sitting here today alongside David Jenkins of 
Republicans for Environmental Protection. I will never forget one of 
the most essential and historic votes we have seen in defense of the 
Arctic Refuge. It wasn't that long ago--six years in fact--and more 
than 20 Republicans members of Congress stood up together with their 
Democratic colleagues to say that Arctic Refuge drilling had no place 
in the federal budget. This is not a Democratic issue or a Republican 
issue--it is an issue of legacy and common sense.
    I believe that this bipartisan agreement still stands true today. 
We can all agree that no matter how bad our problems may seem to be, 
there are some places that define what it means to be American and the 
Arctic Refuge is one of those places. Fifty years ago, the Arctic 
Refuge was set aside for ``its unique wildlife, wilderness, and 
recreational values,'' to be passed onto future generations as it has 
been for generations before.
    As U.S. Supreme Court Justice William O. Douglas wrote: ``The 
Arctic has a call that is compelling. The distant mountains make one 
want to go on and on over the next ridge and over the one beyond. The 
call is that of a wilderness known only to a few. This is not a place 
to possess like the plateaus of Wyoming or the valleys of Arizona; it 
is one to behold with wonderment. It is a domain for any restless soul 
who yearns to discover the startling beauties of creation in a place of 
quiet and solitude where life exists without molestation by man.''
    The Gwich'in people, who call the Arctic Refuge's Coastal Plain the 
``sacred place where life begins,'' rely on this place for their 
culture and their livelihood. As Americans, we must all look toward the 
northeast corner of Alaska and remember that if we are to teach our 
children and our grandchildren what it means to be American--we must 
first teach ourselves how to preserve those parts of us that define who 
we are. The Arctic National Wildlife Refuge stands as a symbol of the 
soul of a nation that refuses to give up on itself.
                                 ______
                                 
    The Chairman. Thank you, Mr. Karpinski, and thank you all 
very much for your testimony. We will now begin the round of 
questioning, and I recognize myself for five minutes.
    I want to make an observation because we sometimes can't 
see the forest because of the trees when we talk about American 
energy. I am very much, and I think probably most people at 
least on my side of the aisle, in favor of an all-of-the-above 
energy approach. I think the more diversified our portfolio is 
of energy production is best for the consumers, recognizing 
always at the end of the day that the market is going to 
determine what the consumer is going to buy.
    Now, having said that, in my district, by the way, my 
district is a big hydropower producer. It is one of the largest 
wind producers in the country. It has a nuclear power plant. So 
I am familiar with alternative sources of energy. But to ignore 
the vast potential resources that we have of oil, natural gas 
and coal doesn't make sense from a standpoint of what is 
affordable energy.
    And that is really where the debate ought to be because 
Alaska is sitting on the potential resources of huge resources 
that we ought to take advantage. I alluded to this at the end 
of my opening statement about a national security issue. The 
world, if we haven't noticed, is not getting what I would say 
more and more peaceful, but yet most of the energy is 
controlled by those that are antagonist to us.
    So at some point, and I painfully remember the 1970s when 
OPEC turned off the spigot. I don't think we want to get 
ourselves in that situation again. By the way, we were only 
importing about one-third of our crude in the 1970s. Now we are 
importing close to 60 to 65 percent. It is just the opposite.
    So when we talk about studies and who is right and who is 
wrong, Mr. Karpinski, you alluded to the fact that the study 
that you alluded to was by the oil industry. If you are talking 
about hyperbole, you made a statement in your opening statement 
that we are about to destroy this place. Now, nobody is talking 
about destroying ANWR in any stretch of the imagination. In 
fact, Mr. Rexford I think said that he lives up there, for 
goodness sakes. If anybody should know, he would be the one.
    So with that, Mr. Rexford, you had to I guess shorten your 
oral statements. Let me give you an opportunity, a minute or so 
if you wouldn't mind, to say what you think would be the 
benefits to your community up there in Kaktovik.
    Mr. Rexford. I really appreciate the opportunity again, Mr. 
Chairman. The benefits that I want to elaborate more about is 
that we all know that the infrastructure in Prudhoe Bay is 
depreciating. The oil that is going to the pipeline is getting 
less and less.
    When the North Slope Borough was formed in 1972, our 
founding father, Eben Hopson, was very creative. When he was in 
the State Legislature he wrote the laws for making a home rule 
government, and we were able to tax. These tax dollars were 
able to provide us schools. Many of us had to go to Chilocco, 
Oklahoma, near Norman. Many of us had to go to Oregon, Chemawa, 
Oregon, five miles north of Salem. So going many thousands of 
miles and being away from home when you are the age of 16, 15 
years old.
    In 1982, our first graduate from high school in 1982 in 
Kaktovik, so we were able to build schools, able to build 
clinics, roads, streets, lights. And these are just fairly 
recent. I mean, many of our villages still need new 
infrastructural services, providing services, picking up 
garbage, paving the streets or making runways. Those kind of 
things are taken for granted in the Lower 48.
    The best benefit to have for the North Slope Borough would 
be protecting the wildlife with the Wildlife Department.
    The Chairman. Mr. Rexford, I only have 25 seconds, and I 
want to ask the other two witnesses a very quick question. 
Thank you.
    Mr. Rexford. OK.
    The Chairman. Mr. Sharp and Mr. Hall, I just want to ask 
you one question. You do not work for the oil companies. Is 
that correct?
    Mr. Hall. No, I don't.
    The Chairman. Mr. Sharp?
    Mr. Sharp. No, sir, I don't.
    The Chairman. No. And I think that is the important point 
here because the oil industry is a robust industry, but it has 
to have, in order to thrive, a robust support industry, which 
you represent with your testimony is that support industry, 
that is not factored in many times with the job creation. I 
just want to emphasize that point and thank you for being here.
    Next I will recognize the gentleman from New Jersey, Mr. 
Holt, for five minutes. Mr. Faleomavaega for five minutes.
    Mr. Faleomavaega. Thank you, Mr. Chairman. I do want to 
thank you for calling this hearing, very important and timely, 
and to suggest that this has been almost a broken record for 
the last 20 years that we have been dealing with this issue, a 
very important issue at that.
    I am very happy that we have Mr. Rexford here testifying. I 
just wanted to know what is the sentiments of our Alaska Native 
tribes toward the idea of drilling ANWR?
    Mr. Rexford. Could you repeat that?
    Mr. Faleomavaega. This may be unfair because you are only 
representing your tribe. What is the sentiments of the other 
tribes in Alaska concerning the issue of ANWR?
    Mr. Rexford. Yes. We have heard a lot from the Gwich'in, 
the ones that are over the Continental Divide, and we respect 
their opinion. We have lived and worked. I mean, we are 
neighbors. I wish they would do the same and respect our 
opinion and have the opportunity to again in private lands, the 
2,000 acres. We are locked in. We cannot develop or even touch 
our land without Congress' approval or the Senate.
    So the vast majority of us on the North Slope support 
opening ANWR. Seventy percent of Alaskans also support the 
opening of ANWR and development.
    Mr. Faleomavaega. Thank you. I will consult further with 
Chairman Young concerning this issue. Do you know what 
percentage of oil that the American consumer gets from Alaska 
each year? Of the total amount of oil that we get, how much 
comes from Alaska?
    Mr. Young. Twenty percent. It was up as high as 35 percent 
at one time, but the pipeline is way down now. That is our 
biggest problem, and that is also the way our people are being 
taxed because they are paying $4 a gallon for gas now instead 
of $2 a gallon.
    Mr. Faleomavaega. It is my understanding we currently 
import well over $700 billion worth of imported oil from 
foreign countries. I understand also we recently held a hearing 
that from Venezuela alone we purchase over $42 billion a year 
of oil coming from Venezuela alone. Very interesting in terms 
of that.
    The Alaska Pipeline was built in the 1970s. What is the 
status of the technology from that time until now? Has it been 
proven that the technology was very unsafe for the 
transportation and the extraction of oil from that time from 
Prudhoe Bay to this time, or has it been proven that the 
technology has served very well in bringing that oil from 
Alaska? Does anybody care to comment on that? Maybe I am asking 
the wrong panel.
    Voice. Go ahead.
    Mr. Jenkins. I can try. One thing that strikes me is all 
the problems that have been there on the North Slope with 
respect to the pipelines. You know, the USGS, when it talks 
about oil potential in the Arctic refuge, says that those oil 
pockets are being scattered throughout the whole entire Coastal 
Plain, so in order to access that you would have to have quite 
a spider web of pipelines running across there.
    And back in 2006 we had the big spill up there with the 
corrosion in the pipeline, and there have been a lot of 
corrosion problems in the pipelines since. At the time of that 
2006 spill, Senator Murkowski was exasperated at a Senate 
hearing, and she said for years we have been saying that oil 
production in Alaska is the gold standard, but our faith has 
been shattered. She said shattered.
    And so here we are a few years later, and everybody is 
claiming that somehow we are going to be able to develop the 
Arctic National Wildlife Refuge somehow with absolutely no 
impacts, and I just don't think the facts bear that out.
    Mr. Faleomavaega. In fairness to Senator Murkowski, she is 
not here to comment on this, but I just wanted to as a matter 
of has the technology improved from 30 years ago when we 
started extracting and transporting the oil coming from Alaska? 
That is my question.
    Mr. Sharp. Mr. Chair? You bet I would like to answer that 
if I could.
    Mr. Faleomavaega. Please.
    Mr. Sharp. Yes. First of all, I would like to also add a 
little comment. It would be a great thing for all of you to 
come up and see what this gentleman just referred to as the big 
spill, OK, because you would look up and say this is all there 
is?
    We represent the people that cleaned up the big spill. 
There were a number of weeks of work. The corrosion that is 
talked about on the pipeline has more to do with deferred 
maintenance than engineering, which is a whole separate issue.
    Mr. Faleomavaega. Sir, I have 13 seconds left. I just want 
to add another comment.
    Mr. Sharp. The directional drilling for ANWR----
    Mr. Faleomavaega. Yes.
    Mr. Sharp.--has made the impact very small.
    Mr. Faleomavaega. The biggest import of oil that we get 
also comes from Canada, and the way they extract the oil, the 
way they provide the oil to supply us, I really wonder if the 
technology is the same in terms of how we are applying the 
standards in our country.
    Mr. Chairman, my time is up. I thank you.
    Mr. Young [presiding]. I thank you. And may I compliment 
the panel. Fenton, thank you for coming down. You live there, 
and you say 92,000 acres. I thought it was 96,000.
    Mr. Rexford. Yes. It is over 92,000 acres.
    Mr. Young. Under the Settlement Act, you were allowed to 
develop that under your social and economic well being, but you 
can't do it unless you have an ability to move the oil. Is that 
correct?
    Mr. Rexford. Well, it has to be an act of Congress, both 
the House and Senate.
    Mr. Young. I don't think it has to be an act of Congress on 
you. It has to have the right to move the oil. We will talk 
about that later, Fenton. I will go back through that law.
    Mr. Hall, how much do you weigh?
    Mr. Hall. I weigh 280 pounds.
    Mr. Young. Two hundred and eighty pounds. The reason I ask 
that, I want to stress this again. If Mr. Hall was to pluck one 
hair--I don't think he has that much on his head, but if he did 
have it on his head, one hair--that is the size of the 1002 
area. That is the size of the 1002 area. That is how much land 
we are talking about.
    Mr. Jenkins, have you been to ANWR?
    Mr. Jenkins. Several people on our staff and our members 
have. I have not.
    Mr. Young. No, no. Have you been there?
    Mr. Jenkins. I have not been afforded the opportunity, but 
I----
    Mr. Young. OK. Second, how can you say it is a sacred area 
when Mr. Rexford lives there? That is his area. Why is it 
sacred to you, and he wants to drill?
    Mr. Jenkins. It is an intact ecosystem that stretches from 
the----
    Mr. Young. Wait a minute. It is not an intact ecosystem. 
The DEW line was there. It was developed. Do you realize that? 
There has actually been wells drilled there.
    Mr. Jenkins. Yes. There have been a couple.
    Mr. Young. You are aware of that?
    Mr. Jenkins. There have been a couple.
    Mr. Young. But it is sacred?
    Mr. Jenkins. There were a couple wells drilled, and there 
are tracts that still remain today from the seismic activity.
    Mr. Young. OK. Now, how do you sit there and say this is a 
sacred area for you? Do you believe in the first Americans?
    Mr. Jenkins. I believe that----
    Mr. Young. Do you believe in the first Americans?
    Mr. Jenkins. In the first Americans? Well, I know they 
exist, yes.
    Mr. Young. You know they exist. Do you believe they have a 
right?
    Mr. Jenkins. Yes, they have a right, and all Americans have 
a right.
    Mr. Young. Then why don't you let him develop his field?
    Mr. Jenkins. The Congress set those boundaries the way they 
set them.
    Mr. Young. And they left 1002 out under Jimmy Carter on the 
Alaska National Lands Act to be developed.
    Mr. Jenkins. Actually they forbid Congress from developing 
it.
    Mr. Young. No, they did not. They said that Congress had a 
right to develop it.
    Mr. Jenkins. I mean until an act of Congress.
    Mr. Young. An act of Congress.
    Mr. Jenkins. Right.
    Mr. Young. Now, read your laws a little carefully because 
that is the way it was set out. We gave these people the land.
    You know, I would be very happy if we could just allow the 
Kaktovik people to develop their own lands in the 1002 area. 
Would you support that?
    Mr. Jenkins. Well, you would have to look and see what the 
impacts would be to the area surrounding that.
    Mr. Young. No, no, no, no, no. Would you support their 
right?
    Mr. Jenkins. The right per se, yes, but----
    Mr. Young. You would.
    Mr. Jenkins.--look, these lands, the public lands, the 
public lands that are part of ANWR----
    Mr. Young. They are their lands.
    Mr. Jenkins. They are their lands.
    Mr. Young. Yes.
    Mr. Jenkins. But it is surrounded by public lands that 
belong to the American people.
    Mr. Young. Oh, so the public takes priority over private 
lands? The government takes priority over private lands? Is 
that your belief?
    Mr. Jenkins. No, but the reason----
    Mr. Young. Well, then let them develop their lands.
    Mr. Jenkins. Look, the whole property rights ethic that is 
a conservative ethic is borne out of a notion of stewardship, 
the belief that people who own their own property will take 
better care of it. Now, when we are talking about a public 
estate----
    Mr. Young. Wait a minute. Stop. Stop. Stop. I am not going 
to debate you on that. You think the government takes better 
care of the land by locking it up?
    Mr. Jenkins. Public lands are not locked up. There are 
certain areas----
    Mr. Young. They are locked up. You show me where else. 
Everybody says 95 percent of the land in the State of Alaska on 
the Coastal Plain is open for drilling. Do you know where the 
oil is?
    I have said this many times. I have been arguing this over 
the years. You don't hunt rabbits on a pool table just because 
it is green. And that is what you are saying.
    Mr. Jenkins. What about all the other leases that are on 
the North Slope that are not developed?
    Mr. Young. The other leases. Where are the other leases? We 
want to see what is happening. We can't get anything done 
because the Administration won't issue the permits correctly. 
And we are talking about ANWR. We are talking about 1002, 2,000 
acres of land. The footprint will be that size period.
    It will put Mr. Sharp's people to work. It will allow 
Kaktovik to do their job. It will give Mr. Hall an opportunity 
to have his son, who is in the military right now, to finish 
his education and his kids go to school and provide a living 
for his family.
    And you are sitting in Washington, D.C., you and your 
friend, who has made a fortune out of this job----
    Mr. Jenkins. A fortune?
    Mr. Young. A fortune. He has made a fortune. Yes, I happen 
to know where you are. Washington, D.C. You are sitting around 
here not letting those people do as they should.
    Now, I think you ought to be ashamed of yourself. I think 
you really should be ashamed.
    Mr. Karpinski. Mr. Chairman?
    Mr. Young. I am not answering you. I am not asking you a 
question.
    Mr. Karpinski. You talked about me.
    Mr. Young. Just keep quiet. So I am just suggesting one 
thing right up here. Mr. Hall needs that job. Mr. Sharp has to 
put his people to work. And, after all, Mr. Mr. Rexford 
optimally should have the right to develop the lands we gave 
him. With that my time is up.
    Mr. Holt. I thank the Chair. Much has been said this 
morning about the composition of the panel, and the Chair of 
the Committee made a point that there were various 
representatives from Alaska, elected and otherwise, here. He 
said that some other witnesses come from outside of Alaska.
    I just wanted to remind the Members that the title of 
today's hearing is ANWR: Jobs, Energy and Deficit Reduction. 
There is talk about the national economy, the national energy 
picture, and the title is about the Alaska National Wildlife 
Refuge. So I think it is indeed appropriate.
    Another point was made of the fact that the Majority 
invited a witness from the TV show Ice Road Truckers, but given 
some of the claims we have seen this morning maybe the better 
show would be Myth Busters.
    Let me raise a couple of points, the most recent point. Mr. 
Jenkins and Mr. Karpinski, we have heard a lot that only 2,000 
acres would be disturbed by the drilling. There was an analogy 
made some years back in this Committee when a similar claim was 
made that this is like saying the area of the table is the area 
of its legs.
    Is it in fact the case that only 2,000 acres would be 
disturbed? Is there no impact, for example, from the ice roads? 
Mr. Jenkins? Mr. Karpinski? Does either of you have anything to 
say on that?
    Mr. Karpinski. Yes. Let me go back on one point too because 
obviously beauty is in the eye of the beholder, and different 
people can see the same place and say different things.
    I just wanted to quote from the Gwich'in people in response 
to Mr. Young earlier, the Gwich'in people who call the Arctic 
Refuge Coastal Plain ``the sacred place where life begins.'' 
That is their quote, how they describe it, and they rely on 
this space for their culture and----
    Mr. Young. If I may? If I may? Would the gentleman yield to 
me? Because that is my home.
    Mr. Holt. I would like to let----
    Mr. Young. Yes. And then I would like you to yield.
    Mr. Holt. I would like to let the witness finish, and as 
time allows I would be happy to yield to the Chair. The witness 
was in mid-statement. Please.
    Mr. Karpinski. Clearly the extent to which there is oil 
there, it is not in one central place. It is deposited in many 
places throughout the plain, and therefore you have to connect 
the roads.
    Your analogy to the table makes total sense. The impact on 
the place would be much more, clearly much more than the 2,000 
acres that are claimed. If Mr. Markey were here, he has this 
great visual of the spider web that would have to connect all 
these places if in fact we ever went there. Let us hope we 
don't.
    Mr. Holt. Before yielding to Mr. Young----
    Mr. Young. I will use my own time.
    Mr. Holt. All right. Thank you. Much has been made of how 
this will help bring down the deficit, the money that will come 
to the U.S. Treasury. If it is a 50/50 split, over the next 10 
years, which is what we are talking about in all of the deficit 
discussions here in Washington, it appears to me that it is on 
the order of $3 billion. If it is not a 50/50 split, if it is a 
90/10 split, then it is about $600 million. I think we are 
walking into an Alaskan fiscal bear trap here.
    Let us turn to, Mr. Karpinski, the other point that has 
been made this morning about how important this is for gas 
prices. Would you care to give us an estimate in the minute 
that remains what effect this might have on gas prices in the 
next say 10 years or next 20 years?
    Mr. Karpinski. You know, the data suggests that it might 
have an impact of pennies a gallon 15 years from now, so it is 
basically no impact in the short term and an incredibly nominal 
impact in the long term.
    There are ways to have an impact on gas prices by reducing 
our dependence on oil, but that would mean, for example, you 
talk about technologies. The best new technology is the 
automobile. We will have a new automobile in the next 10 to 15 
years that will reduce our dependence on oil, save us money at 
the pump and go further on a gallon of gas. Those are the kinds 
of technologies we should be investing in rather than this.
    Mr. Holt. I think it is worth pointing out that OPEC, for 
example, could completely wipe out any of those penny savings 
with a one day flooding of the market or withholding of oil. My 
time has expired. I thank the Chair.
    Mr. Young. I just want to comment on the Gwich'in. Gwich'in 
is 400 miles away from this field. The Gwich'in people are a 
very small minority group. They say they are against the wells, 
drilling. In fact, they are developing some of their own oil 
land. So when you say the Gwich'in, that is my tribe. I live 
there. You don't. Eighty percent of those people support it. 
You have one or two that don't, and that is who everybody 
listens to. That is the sad part.
    So don't give me this Gwich'in stuff and a sacred area. 
That is not their area. They are Athabascans. There is a great 
deal of difference between Athabascans and the Inuits. Now, 
they work together, but I can tell you Doyon, which is a 
Gwich'in group, they support it. So don't get into my backyard 
and start messing around with my backyard.
    Mr. Gosar?
    Mr. Fleming. Fleming.
    Mr. Young. Excuse me?
    Mr. Fleming. Fleming.
    Mr. Young. Fleming. Excuse me. I am sorry.
    Mr. Fleming. Yes, sir. Thank you. Thank you. Yes. Mr. 
Karpinski, I heard you make some statements, really 
discrediting statements to this Wood Mackenzie study here.
    Actually I think a couple of our panelists and, of course, 
it is very detailed. It has a tremendous amount of data. It 
must have taken a lot of time, a lot of people to do this. The 
title of it says or your discredit was that it couldn't 
guarantee the accuracy of its results or something. I am 
paraphrasing.
    Mr. Karpinski. I quoted their footnote. We do not guarantee 
the fairness, completeness or accuracy of the opinions in this 
report.
    Mr. Fleming. OK. The title is U.S. Supply Forecast, 2012 to 
2030. Sir, when a weatherman forecasts the weather can he be 
100 percent accurate every time with that?
    Mr. Karpinski. Of course not.
    Mr. Fleming. Did you hear me? I didn't hear you.
    Mr. Karpinski. I said, ``Of course not.''
    Mr. Fleming. Oh, OK. Of course not. OK. Thank you. So the 
truth of the matter is this is simply a forecast. The outcome, 
the fairness or whatever can never be guaranteed because it is 
a forecast. That is all it is.
    But I have been looking around on the dais here. I can't 
find your data. Where is your data, sir?
    Mr. Karpinski. Can I go back to the data from the report 
first?
    Mr. Fleming. Just answer me.
    Mr. Karpinski. Sure.
    Mr. Fleming. Just answer my question. Where is your data, 
sir?
    Mr. Karpinski. The Department of Labor was the facts on the 
North Slope.
    Mr. Fleming. Where is it? I don't see it. Where is it?
    Mr. Karpinski. It is in the Department of Labor, the U.S. 
Geological Survey data.
    Mr. Fleming. Wait. Before you come in and dispute something 
that has been presented to us, shouldn't you bring your data 
and your facts?
    Mr. Karpinski. Frankly, sir, I did not bring the copies of 
the government reports with me, but they are all Energy 
Information Administration, U.S. Geological Survey, Department 
of----
    Mr. Fleming. But that is not here for us to discuss.
    Mr. Karpinski. They are public information. I didn't 
realize I had to carry the----
    Mr. Fleming. I would submit, Mr. Chairman, that we ask the 
members of the panel to submit that information into the record 
and to underline the part that you feel is accurate and where 
it disagrees with this.
    Let me go on. Let me go on. You mentioned that the evil oil 
money----
    Mr. Karpinski. Do you want me to answer your question about 
what I dispute?
    Mr. Fleming. No, sir. I only have limited time. I am sorry.
    Mr. Karpinski. I thought you asked me that question.
    Mr. Fleming. I only have limited time. This was paid for 
you say by the evil oil money?
    Mr. Karpinski. I didn't use the word evil. I said the oil 
industry, and I said----
    Mr. Fleming. The oil industry.
    Mr. Karpinski. You said evil. I did not say that.
    Mr. Fleming. What is your point of saying that it is paid 
for by the oil industry?
    Mr. Karpinski. The oil industry has a clear interest, an 
economic interest in doing this drilling. Therefore, when they 
produce that document and they pay for that document that is 
important to be public information. But I did not use the word 
evil. That was your word.
    Mr. Fleming. That is my word.
    Mr. Karpinski. OK.
    Mr. Fleming. That is fair. That is my word.
    Mr. Karpinski. To be clear on the assumptions they made in 
terms of what the price per barrel of oil is to make the 
assumptions that they use does not square with the facts. The 
assumption they use on how much oil is available----
    Mr. Fleming. That is not my question. We will get that data 
later.
    Mr. Karpinski. But you earlier----
    Mr. Fleming. All I am saying is you weren't prepared. Next 
time bring your data. If you want to dispute something that has 
been presented to us, bring your own data.
    Mr. Karpinski. With all due respect, I cited the reports in 
my testimony.
    Mr. Fleming. Just speculating in front of us today, sir, is 
just----
    Mr. Karpinski. I don't need to have them physically with 
me, Mr.----
    Mr. Fleming.--simply not accurate.
    Now, who supplies the funding for the Land and Water 
Conservation Fund?
    Mr. Karpinski. A lot of it is from the Federal Government, 
matched by states.
    Mr. Fleming. Land and Water Conservation Fund. Where does 
that money come from?
    Mr. Karpinski. In part there is a dedicated fund, and 
sometimes it gets----
    Mr. Fleming. From where?
    Mr. Karpinski. Offshore oil and gas drilling.
    Mr. Fleming. OK. It comes from the oil and gas, the same 
evil people that supplied this document here for us. Well, I 
thank you for that.
    Let us see. How much time do I have left?
    Voice. A minute 15.
    Mr. Fleming. OK. Let me get down to some statements here 
about what we are talking about that comes from the Wood 
Mackenzie.
    In their analysis they found that U.S. policies which 
encourage the development of new and existing resources could 
by 2030 increase domestic oil and national gas production--I 
believe that should be natural; it says national. Natural gas 
production by over 10 million, support an additional 1.4 
million jobs in a time when we are stuck above 9 percent 
unemployment and the President can't seem to get it down, and 
raise over $800 billion of additional government revenue.
    Now, this takes into consideration a number of 
administrative hold-ups, including Gulf of Mexico production, 
Keystone Pipeline and additional bureaucracy on that natural 
gas. Natural gas is big in my district, which is Haynesville 
shale. We are continually fighting back against efforts to slow 
that down.
    Even if the results were 50 percent in terms of revenue and 
jobs of this, we would still be close to a million jobs, if not 
more, and $400 billion of revenue. So if this study is even 
close to being accurate we are still talking about tons of jobs 
and lots of money, sir.
    So I guess my point here today is why quibble over the 
accuracy of this report? It is obvious that development of ANWR 
would produce a tremendous amount of jobs in a time, sir, that 
we need jobs, in a time when we need the revenue. I believe my 
time is up. I yield back.
    Mr. Young. The good lady from Hawaii, Ms. Hanabusa? Who is 
next? I keep track of who came in here first, so you are up, 
lady, whether you want to be or not.
    Ms. Hanabusa. Thank you. Thank you, Mr. Chair. Mr. Rexford, 
I would like to understand the history of--bear with me. First 
of all, you are the past president of the Kaktovik--am I saying 
that right--is it Inupiat Corporation.
    Now, what I am trying to understand is before the 
Settlement Act your tribe was able to select lands. Am I also 
correct on that?
    Mr. Rexford. No.
    Ms. Hanabusa. You were not able to select lands----
    Mr. Rexford. No.
    Ms. Hanabusa.--before the Settlement Act?
    Mr. Rexford. In 1971 with the Alaska Native Claim 
Settlement Act we were provided the opportunity to----
    Ms. Hanabusa. And that is when you selected the lands?
    Mr. Rexford. Yes.
    Ms. Hanabusa. But initially, according to what I 
understand, you were not given the rights to the subsurface 
initially, the subsurface mineral rights. Is that also correct?
    Mr. Rexford. All village corporations only own the surface 
lands. The regional corporation, Arctic Slope Regional 
Corporation, owns the subsurface.
    Ms. Hanabusa. OK. That is what I am confused about. But 
right now can your tribe or your corporation develop the 
subsurface mineral rights if Congress approves it, or is it the 
regional corporation that has that right?
    Mr. Rexford. The subsurface belongs to the regional 
corporation. We own the surface.
    Ms. Hanabusa. OK. Mr. Rexford, can you tell me what the 
relationship between the regional corporation is to the 
corporation that you were the president of?
    Mr. Rexford. The regional corporation is our--like all the 
seven other villages, it is our mother corporation that takes 
care of all of our shareholders. Just the shareholders, we have 
110 out of 4,000 or more or maybe 10,000 that ASRC looks after 
or helps.
    Ms. Hanabusa. Can you also tell me whether the regional 
corporation has any kind of `veto rights'' over your rights on 
the lands that you own the surface rights to?
    Mr. Rexford. Yes. I am not an expert with Arctic Slope 
Regional Corporation business. We just take care of our surface 
rights. I would defer that to ASRC on the work that they do for 
us.
    Ms. Hanabusa. And what is the name of your regional 
corporation?
    Mr. Rexford. Arctic Slope Regional Corporation.
    Ms. Hanabusa. I saw in your testimony you are running for 
mayor of some kind of North Slope. Is that related to this?
    Mr. Rexford. Yes. It is the North Slope Borough, 89,000 
square miles, a little larger than the size of Minnesota.
    Ms. Hanabusa. Oh. And you will be mayor of it?
    Mr. Rexford. Yes, I hope so.
    Ms. Hanabusa. Bear with me, because I am really very 
interested in the relationship between the regionals, as well 
as the tribe itself.
    So you said the regional corporation is the one that has a 
say as to whether the subsurface mineral rights would be 
developed and not the tribe that has the surface rights?
    Mr. Rexford. Yes. The regional corporation, from my 
understanding, would have to get permission or talk with the 
surface landowner before anything can happen. We have come to 
an agreement with the ASRC to help develop that land.
    Ms. Hanabusa. Oh, great. So that was my next question. So 
your regional corporation has said OK, the 92,000 acre surface 
corporation should develop the subsurface rights. That has been 
taken care of?
    Mr. Rexford. Yes.
    Ms. Hanabusa. OK. So the only thing now standing in your 
way of doing it is whether or not Congress is going to approve 
it? Is that correct?
    Mr. Rexford. That is correct.
    Ms. Hanabusa. Thank you. So everybody that has a say is on 
the same page, and that is what I wanted to establish. Thank 
you very much, Mr. Rexford.
    Mr. Rexford. Thank you.
    Ms. Hanabusa. Thank you, Mr. Chair.
    Mr. Young. I thank the good lady. We are going to have a 
little discussion about this later and we will check the law. 
They have worked together well.
    I still say because of the Land Claims Act itself they have 
a right of that land, because they selected it before this oil 
was ever developed, of developing the land for the social and 
economic well being, being the subsurface or surface. I don't 
think it takes an act of the Congress to let the Kaktovik drill 
their oil, but they happen to be here, and here is the rest of 
the ANWR area, the 1002 area.
    So if they had a way to get the pipeline across the rest of 
the refuge we can probably develop it without an act of 
Congress, but you can't do that because of the other status. 
The compatibility test doesn't hold up.
    Ms. Hanabusa. Thank you, Mr. Chairman.
    Mr. Young. Mr. Duncan?
    Mr. Duncan of Tennessee. Thank you very much, Mr. Chairman. 
I didn't know I was going to be called on at this time, but 
thank you.
    You know, I have mentioned here before I represent the 
Great Smokey Mountains or a big part of the Great Smokey 
Mountains National Park, and that is about not quite 500,000 
acres. ANWR is 19.8 million acres, 35 times the size of the 
Great Smokies. We get about nine to 10 million visitors a year, 
and they come there and think it is huge, and yet ANWR is 35 
times the size.
    I guess I am one of the very few Members who has been up to 
Prudhoe Bay twice. I have been to Kaktovik twice. It is 
amazing. The first time I went up to Alaska, I had a man in the 
Anchorage Airport tell me--he said if you see anything up there 
taller than two feet, it was put there yesterday by a man. 
There are many, many miles where you don't see anything at all. 
To drill on 2,000 or 3,000 acres is so minuscule. People can't 
even comprehend it.
    We were told in the mid 1990s that it would mean a million 
barrels a day coming down here. President Clinton vetoed it. 
The main argument against it at that time was it would take 
seven or eight years to get that oil to market and it 
wouldn't--I really believe we can do it much faster than that, 
but they had that argument. But just think if we had gone ahead 
and done it at that time. We would have had that oil coming in 
here right when those gas prices were hitting many places in 
the country $4 a gallon.
    Now, I know we have a Secretary of Energy who said that we 
should be paying the same price for gas that they pay in 
Europe, $8 or $9 a gallon. But if you want to talk about 
putting the final nail in the coffin of the small towns and the 
rural areas, drive these gas prices up to $8 or $9 a gallon 
because people in those small towns and rural areas have to 
drive further distances on average to get to work.
    The thing that concerns me the most, I have noticed over 
the years that almost all these environmental radicals come 
from very wealthy or very upper income families. But I will 
tell you who they end up hurting. They end up hurting the poor 
and the lower income and the working people by destroying jobs 
and driving up prices. And that is exactly what would happen if 
we let these gas prices go way up. And then to say that it 
would only mean a few pennies difference? Well, I really 
question that.
    I think we don't have to produce all of our oil. If we 
started producing a little bit more I think OPEC and some of 
these other oil producing nations would get so concerned that 
they would start bringing their prices down. And that is what 
we need to be trying to do is bring these prices down instead 
of driving them up several more dollars a gallon so that people 
won't drive as much. In addition to that, even if it only 
brought prices down just by a little bit at least if we started 
producing more oil we wouldn't see gas prices go to $5 or $7 or 
$8 a gallon, as they might if we just limit production.
    We have groups in every part of the country. These groups, 
they don't want you to cut any trees. They don't want you to 
dig for any coal. They don't want you to drill for any oil. 
They don't want you to do anything. And they always throw out 
solar and wind. Well, I wish that some of these people that 
want to limit our energy to solar and wind, I wish they would 
limit their energy production in their own congressional 
districts to solar and wind. Their whole economy would shut 
down from it in all probability.
    I am told now that the estimates are we could produce as 
much as 1.45 million barrels a day coming down to this country. 
I think it would make a significant difference, and it would 
help a lot of lower income people in this country and it would 
help our economy tremendously. I yield back the balance of my 
time.
    Mr. Young. I thank the gentleman. Mr. Costa?
    Mr. Costa. Thank you very much, Mr. Chairman. Council 
Member Rexford, what is the population of Kaktovik these days?
    Mr. Rexford. It is a little bit under 200. I mean 300. I am 
sorry.
    Mr. Costa. I see. It hasn't probably changed too much in 
the last couple decades, has it?
    Mr. Rexford. Our population is increasing. We have housing 
shortages. Families are doubling and tripling up. So our 
population is growing, yes.
    Mr. Costa. I was in your community in 1992, and I enjoyed 
having the opportunity to spend some time there. I find this 
conversation about ANWR interesting. Obviously a lot of 
politics have been discussed here today.
    But the fact of the matter is what is the distance from 
ANWR, which is the proposed site for drilling, the footprint 
that some describe as the size of Andrews Air Force Base--I 
have heard it described about the size of Los Angeles 
International Airport--from the pipeline at Prudhoe Bay in 
distance?
    Mr. Rexford. The main pipeline, from Kaktovik it is 90 
miles, but when you look at the border for the nearest oil 
field, the Badami Oil Field that Exxon owns and leases or 
leased from the state, it is only like from the border maybe 10 
miles, 15 miles from the Arctic National Wildlife Refuge.
    Mr. Costa. So the distance that you would have to drive 
from the proposed site to connect the pipeline would be within 
60 miles or less?
    Mr. Rexford. Yes. It will be a lot less than that. Yes.
    Mr. Costa. And that would be your transmission to send the 
oil down to Prudhoe and all the way down to the Valdez?
    Mr. Rexford. Yes. I think the central part of the 1002 to 
Flaxman Island or the border on Staines River of Arctic 
National Wildlife Refuge is about 40 miles.
    Mr. Costa. You know, obviously people want to make their 
point. I guess I will make mine. First of all, I think that we 
need to use all the energy tools in our energy toolbox. We have 
a bipartisan bill that would do that that I think talks about a 
robust renewable portfolio, but at the same time takes 
advantage of our oil and gas reserves that exist within the 
United States, both onshore and offshore.
    I guess there is a lot of myth busting to take place here. 
I was interested to hear Mr. is it Kalpinski----
    Mr. Karpinski. Karpinski.
    Mr. Costa. Karpinski.--and Mr. Jenkins, the analogy used 
about if coal were determined to be found under El Capitan. I 
used to represent Yosemite National Park, and I can assure you 
if there was coal found under El Capitan we wouldn't be going 
after that.
    But I think it is a real unfair comparison to talk about 
that and ANWR. ANWR is not the Brooks Range, the poster child 
that you bring out all the time, and I know it has been a good, 
successful fundraiser for several decades, the beautiful Brooks 
Range with the deer and the elk and the grizzly bears and the 
salmon. That area was set aside to be protected and should be 
protected.
    It is I think correspondingly like the other parts of 
Alaska that are protected under the wilderness law. That is not 
ANWR. It is an Arctic plain. It is an area that is an Arctic 
desert. Now, I don't need you to make the point. I was there. 
You have not been there.
    Mr. Karpinski. Excuse me, sir. I have been there. I camped 
on the Canning River.
    Mr. Costa. Yes.
    Mr. Karpinski. And so I have been there and I was on that 
plain. It is one of the most amazing experiences I have ever 
had to do that kind of thing. I have been there. Excuse me.
    Mr. Costa. Well, we can agree to disagree. If you cannot 
drill there safely, and this is where the comparative analysis 
gets lost because we are talking about drilling at 2,000 and 
6,000 feet of ocean depth where the costs are much greater and 
the risks are much higher. And that is the comparative analysis 
we ought to be using.
    If you can't drill safely in the footprint on ANWR that is 
being proposed, you can't drill safely anywhere in America. You 
just ought to stop. We just ought to forget it. I mean, there 
is a whole different agenda--I disagree with the agenda--on why 
you don't want that area disturbed.
    And let us just be frank about it. I mean, we have created 
this myth that in fact we are going into the Brooks Range. We 
are not. We have created this myth that we are going to 
irrevocably change that area any more than we have changed 
Prudhoe Bay. I mean, I represent Kern County, a large oil 
production area in California. We have 25 platforms off the 
coast of California. That gets ignored.
    You know, reasonable people without political agendas ought 
to be able to come to some conclusion. If you can't drill there 
safely, you can't drill anywhere in America safely. Thank you, 
Mr. Chairman.
    Mr. Young. I thank the gentleman. Thanks for going to 
Alaska and actually visiting Alaska.
    Mr. Duncan from South Carolina?
    Mr. Duncan of South Carolina. Thank you, Mr. Chairman, and 
thank you guys for traveling back east to be part of this. Mr. 
Hall, I am not going to ask you how much you weigh, but I want 
to say I enjoy the show. Be careful out there. You guys have 
some challenges. I appreciate you coming today to talk with us.
    Mr. Karpinski, what do you think is a fair price for 
Americans to pay for a gallon of gasoline?
    Mr. Karpinski. Excuse me. A fair price?
    Mr. Duncan of South Carolina. What do you think Americans 
should pay for a gallon of gasoline? That is a simple question.
    Mr. Karpinski. I think the current prices are--we subsidize 
some of the price. I don't know that it is a fair price, 
depending on all the technologies to get there and who pays for 
what. Frankly, we would like to see prices lower and 
technologies better so we can go farther on a gallon of gas.
    Mr. Duncan of South Carolina. A price, a number, a dollar 
figure. What do you think personally is----
    Mr. Karpinski. I don't have a particular number. I used to 
pay 33 cents a gallon.
    Mr. Duncan of South Carolina. OK.
    Mr. Karpinski. So prices will go up. It is a commodity we 
are going to have less and less of. The solution to our energy 
problem is to reduce our dependence. We can actually all agree. 
We want to reduce our dependence on----
    Mr. Duncan of South Carolina. Secretary Chu said that 
before----
    Mr. Karpinski. We need new technologies to go further on a 
gallon of gas. That is how we solve this problem, not by 
drilling in special, beautiful places. That is how we solve 
this problem.
    Mr. Duncan of South Carolina. The reason I ask you that, I 
wanted to see what you thought in relation to what Secretary 
Chu said before he was elected or appointed Secretary of the 
Department of Energy. He thought we ought to pay European 
prices, and he said $7, $8 a gallon for gasoline was fair for 
America.
    My wife sent a text message last night, Mr. Chairman, that 
said Hickory Point gas station in Clinton, South Carolina, 
where we live, gas was $3.11! She was excited. $3.11 a gallon! 
I sent her one back. I said ``OMG. Please fill up.''
    Mr. Karpinski. Sir, 20 years from now we shouldn't be using 
gas.
    Mr. Duncan of South Carolina. She said this. Hold on, sir.
    Mr. Karpinski. We shouldn't be paying anything for a gallon 
of gas.
    Mr. Duncan of South Carolina. She said this, sir. She said 
isn't it pathetic that we think that that is cheap? This is a 
real life dialogue between my wife and I about $3.11 a gallon 
gasoline in this country, and we are thinking that is cheap.
    Mr. Young. Would the gentleman yield?
    Mr. Duncan of South Carolina. Yes, sir.
    Mr. Young. I appreciate that because we are paying $8 in 
Fort Yukon, Alaska. If you think that doesn't smart, believe 
me. You can't even drive a snow machine with that price. So 
thank you.
    Mr. Duncan of South Carolina. That is amazing, Mr. 
Chairman. We are blessed in this country with the energy 
resources, and I firmly believe that energy is a segue to job 
creation and that is what this hearing is about is about jobs. 
Increased U.S. domestic energy production means jobs. There is 
no doubt about it.
    Look at the economies where there are energy-driven state 
economies--Texas, North Dakota and Alaska. Unemployment is low. 
Revenues are high. More Americans working will mean fewer 
Americans relying on the government services and a lessened 
burden on state, local communities, state government. Energy is 
definitely a segue to job creation. Alaska is doing well, as 
you guys can see.
    Mr. Karpinski, are you a member of Ducks Unlimited?
    Mr. Karpinski. Ducks Unlimited? No. National Wildlife 
Federation.
    Mr. Duncan of South Carolina. Ducks Unlimited?
    Mr. Karpinski. No.
    Mr. Duncan of South Carolina. Quail Unlimited?
    Mr. Karpinski. Quail? No.
    Mr. Duncan of South Carolina. Rocky Mountain Elk 
Federation?
    Mr. Karpinski. No.
    Mr. Duncan of South Carolina. Quality Deer Management 
Association?
    Mr. Karpinski. No.
    Mr. Duncan of South Carolina. Conservationists have given 
more money--hunters, fishermen, others have given more money--
to set aside land for conservation than a lot of other 
organizations that are out there that hold themselves up as 
conservational organizations. I want to make that point very, 
very clear.
    Mr. Karpinski. Mr. Duncan, that is why----
    Mr. Duncan of South Carolina. The ANWR area was set aside 
in 1980.
    Mr. Karpinski.--Theodore Roosevelt, IV, is on our board.
    Mr. Duncan of South Carolina. The ANWR area was set aside 
in 1980 by Jimmy Carter. President Carter then and Congress set 
aside Area 1002 for oil and natural gas development.
    Around that same time--1978, 1980--the Department of Energy 
was created to lessen our dependence on Middle Eastern oil. 
They knew that we needed to have domestic energy production to 
lesson our dependence on countries who may not be friendly to 
the United States. We have the resources here in this country. 
We recognize that area as an area that had oil and natural gas 
resources at that time.
    We heard the Governor say that there is capacity in the 
pipeline. Let us just drill the oil. Let us drill the natural 
gas. Let us reach those resources. Send them to the Lower 48 to 
be refined where the refineries are.
    I want to ask Mr. Rexford. It is interesting in your 
comments that you said the benefits that you would receive in 
your area, water and flush toilets from having the revenues 
from these areas that would benefit your community. Thank you 
for saying that.
    You all understand that the revenues are there. The oil and 
natural gas resources are there. Thank you for bringing your 
perspective to this Committee to really bring it home on what 
it means to the livelihood of the Native Alaskans. Thank you.
    Mr. Chairman, I yield back. Thank you.
    Mr. Lamborn [presiding]. I would now like to recognize the 
representative from California, Mr. Garamendi.
    Mr. Garamendi. Thank you, Mr. Chairman. This issue has been 
kicked around for near on 50 years, and during that period of 
time the American people, through their representatives, have 
recognized an extraordinary value in wilderness.
    There are indeed sacred places and there are indeed in this 
planet on which we live places that may have resource 
potential, but they also have potential of simply being what 
they are. Undeveloped. Natural. A place for wildlife and 
mosquitoes, but not a place where we would extract resources.
    ANWR is such a place. It is unique. There is no other place 
on this planet like ANWR. It doesn't exist. This is it. This is 
the last that there is. Is it worth a few days of oil supply 
for this nation to despoil it? I think not. And thus far the 
American people have said let us leave it the way it is, the 
way it came to us. Natural. Undisturbed.
    That is something very, very special that the American 
people have decided over the years not just here, but other 
places, including the Smokey Mountains, to say let us leave it 
the way it is. Let us let it be there for all of the future 
generations in its natural state, for those creatures that have 
been there for years, including the ducks. Let us leave it 
there.
    And, yes, there are people who live there, and your 
community is one of them. Oil development is taking place in 
this region. We know that Shell is exploring offshore. It will 
soon be exploring offshore, and that will have a dramatic 
effect on all that we discuss here. There may be transportation 
facilities as a result of that exploration in this region. 
There may be offshore oil development in this region. We know 
that Exxon has just cut a deal with the Russian oil company to 
explore not so far away. Many things are happening in the 
Arctic.
    And there is one place where things should not happen, and 
that is ANWR. Now, will this oil be made available for the 
American public? Maybe, but maybe not. It was 1995 that the 
original law was changed that allows oil that flows through the 
Trans-Alaska Pipeline to be exported, and in fact it is 
exported. How much is going to be exported? We don't know. Not 
too much today, but you add another 500 million barrels--
500,000 barrels--a day and you are going to see more exports. 
Available to the American public? Not if it is exported.
    The oil industry is an international market, and the price 
is determined on the international market. We pay accordingly. 
China, India, other countries are increasing their demand. So 
figure that into the equation.
    Some places are scared. Some places should not be 
developed. I understand the desire of those who live in the 
area for jobs, but in the long run there are other jobs that 
could be available, and there certainly will be just to the 
west of the ANWR is the Prudhoe Bay development, and just to 
the west of that is an area much, much larger than ANWR that 
was set aside more than a century ago or nearly a century ago 
for oil development and oil exploration, and that is underway 
today.
    So why ANWR? So that we can fight an unending battle here 
over a very special part of this planet? For what? Leave it. 
Leave it alone. Let it be what it has always been. Natural. 
Undisturbed. I yield back.
    Mr. Lamborn. The Chair would now recognize Representative 
Flores of Texas for five minutes.
    Mr. Flores. Thank you, Mr. Chairman. Gentlemen on the 
panel, I thank you for joining us today. Before I get into the 
questions, I would like to give you a little bit of my 
background because I have some understanding of what each of 
you do, I think.
    I am a former oil and gas entrepreneur and an executive. I 
am also an investor in biofuel technology, an investor in fuel 
cell technology, and I want to clarify that none of those used 
government guaranteed loans when I did that. I am the largest 
residential producer of solar power in Brazos County, so I 
think I have an understanding of both conventional energy 
resources and also alternative energy resources.
    I have driven the Dalton Highway and I have been behind 
some large trucks for miles on end trying to get around them, 
but I have been there. I have been to the North Slope. I have 
been to Prudhoe Bay. I have seen firsthand the peaceful co-
existence of wildlife with oil and gas exploration activities 
in the Prudhoe Bay area.
    I have seen an abundant wildlife population that exists in 
that area, and I have seen also firsthand the dramatic impact 
of improved technology to reduce the environmental, as well as 
real estate, footprints that have happened with oil and gas 
exploration in Prudhoe Bay, and that is one of the things that 
makes drilling in ANWR worth looking at today.
    Early on in one of our hearings here one of the speakers 
said something about parallel universes. You know, we do have 
parallel universes. I am hearing it today. On the one hand, in 
Universe 1 we have the production of safe, secure efficient 
supplies of domestic energy. We can produce good paying 
American jobs. We can help balance the Federal budget. We can 
grow a robust economy and strengthen our national security as 
part of that process.
    On the other hand, in Universe 2 we can rip off the 
taxpayers by picking winners and losers with projects like 
Solyndra. We can rip off the taxpayer by freezing their assets 
that they own under the ground at ANWR and other public lands 
and off our shores. We can also rip off future generations with 
continuing huge deficits in our Federal budget, and we can rip 
off all Americans today by not giving them the chance to have 
good, middle class jobs.
    Here is the current status in the United States of national 
wildlife reserves. There are 150 plus wildlife reserves in the 
United States that have 4,400 oil and gas wells on them, and 
there has been no significant adverse environmental impact to 
any of those. Closer to home in Texas, not an area I represent, 
but my neighbor to the southwest, we have the Aransas National 
Wildlife Reserve that is the home of over 100 plus wells and a 
growing population of an endangered species called the whooping 
cranes.
    For those of you that want to hypothecate about gasoline 
prices, let me say that you are way off base. When I exited the 
drilling business to go into this job to try to improve the 
future for my children and grandchildren, natural gas was 
selling at about $5 an MCF. Today it is about $3.80 an MCF, and 
that is because of technology and abundant drilling for this 
resource in this country. It is not just a few pennies. It is a 
significant change because supply and demand, the laws of 
economics, work.
    For those of you that think taxes are the solution to 
balance our budget, why don't we just go to Apple and say we 
are going to raise your taxes, but in return for raising your 
taxes we want you to produce more iPads and produce them at a 
lower cost. The same thing the President said on Monday. We 
want to raise the taxes on the job creators and have them 
produce more jobs, more good, middle class jobs. Folks, those 
dogs don't hunt. We know that.
    Mr. Rexford, my question is for you. You said something, 
and I am going to just take part of the quote. You said you are 
familiar with this issue, and you have been fighting the 
misrepresentation of the opposition for over 15 years. Why 
don't you walk us through real quickly those 
misrepresentations?
    Mr. Rexford. Yes. The gentleman to my left here talked 
about Canning River. Canning River is on the outskirts of ANWR. 
The border of the Arctic National Wildlife Refuge is on the 
east bank, and he is traveling on the Canning River. You know, 
the Canning River is barely in the Arctic National Wildlife 
Refuge.
    One other one that I really want to talk about or didn't 
get to is polar bears. The U.S. Fish and Wildlife Service, not 
only in the Arctic National Wildlife Refuge, and the gentleman 
talked about NPRA. He talked about the state lands that are 
ready for leasing. The U.S. Fish and Wildlife Service 
designated polar bear habitat protection, that 20 mile swath. 
It is like from the State of Washington all the way down to 
California, from the coastline to 20 miles inland. You know, 
that is going to be a big hindrance to our people.
    You know, I have been born and raised or reared by my folks 
not to put any people down and respect their opinion. You know, 
that is just the kind of person that we are in the Arctic 
Slope. I could say I was bold with Congressman Young when he 
was asking questions, but the myths are the Porcupine, the 
Porcupine caribou herd, commingles with the Central Arctic 
herd. The Teshekpuk herd went through Arctic National Wildlife 
Refuge about eight years ago. That is near Point Barrow. They 
commingled with the Porcupine caribou herd.
    So saying that the Porcupine caribou herd is going to 
reduce or decline, millions of other caribou commingle with 
each other with the Porcupine caribou herd, so the Porcupine 
caribou herd is not just in that area. The Porcupine herd also 
goes over in Central, over near Barrow. There are Teshekpuk 
near Point Barrow. That is over 300 miles away.
    Mr. Flores. Thank you. Mr. Sharp, you represent union 
personnel, right?
    Mr. Lamborn. Mr. Flores?
    Mr. Flores. Yes?
    Mr. Lamborn. I think I have to cut the questioning short.
    Mr. Flores. Oh, sorry. I yield back.
    Mr. Lamborn. Sorry about that. Now I would like to 
recognize the Ranking Member of the full Committee for his 
opening statement. Mr. Markey?

 STATEMENT OF HON. EDWARD MARKEY, A REPRESENTATIVE IN CONGRESS 
             FROM THE COMMONWEALTH OF MASSACHUSETTS

    Mr. Markey. I thank you, Mr. Chairman, very much, and I 
apologize for being late to this hearing. Senator Kennedy's 
daughter, Kara, passed away. The funeral was this morning. It 
was an absolutely beautiful service for her, and I rushed here 
as quickly as I could after the completion of that service.
    The Super Committee has been charged with reducing our 
deficit by at least $1.5 trillion over the last [sic] 10 years 
in order to begin getting our nation's budget back on track. 
This Committee has the authority and the responsibility to make 
recommendations to the Super Committee for ways to reduce the 
deficit.
    In response to this enormous challenge, the Republican 
Majority is once again looking to drill in the pristine Arctic 
National Wildlife Refuge in Alaska. Under the guise of reducing 
the deficit, they are proposing to open up the crown jewel of 
the Wildlife Refuge System to drilling. Unfortunately, drilling 
in the Arctic refuge would do very little to reduce our deficit 
in the next 10 years.
    According to the Department of Energy, oil production from 
the Arctic refuge wouldn't even begin for 10 years. As a 
result, the Congressional Budget Office has said that drilling 
in the refuge would only generate $3 billion during the first 
10 years from initial lease sales, which would be a drop in the 
bucket of the overall reductions which our country needs.
    In contrast, the Democratic proposals to ensure oil 
companies pay their fair share would generate nearly $60 
billion over that same 10 year period, 20 times as much money 
to reduce the deficit. The oil and gas industry is swimming in 
profits while our country is swimming in debt. The top five oil 
companies have made $71 billion in just the first six months of 
this year.
    But the Republican Majority has opposed repealing 
unnecessary tax breaks for the oil and gas industry that would 
generate more than $43 billion over the next 10 years. The 
Republican Majority has also opposed ending royalty-free 
drilling on public lands offshore in the Gulf of Mexico. 
Closing that loophole could raise $9.5 billion over the next 10 
years.
    Incentivizing companies to drill on the millions of acres 
of public land which they already hold would generate nearly $1 
billion. In fact, oil companies are just sitting on more oil 
than we could ever get out of the Arctic refuge according to 
the Department of the Interior. There is more oil under the 
leases that oil companies already have from the American people 
that are not being used offshore than they are ever likely to 
find in the Arctic refuge.
    Repealing the royalty giveaway to the Gulf States would 
generate an additional $1.9 billion over the next 10 years. 
Increasing inspection fees for the oil industry, as the BP 
Commission has recommended, would generate another $500 million 
over the next decade. Increasing the royalty rates oil 
companies pay to drill on public land could generate an 
additional $900 million. All told, over the next 10 years these 
Democratic ideas would reduce our deficit 20 times as much as 
opening up the Arctic refuge to drilling would produce.
    To put it in perspective, if these Democratic ideas were 
the height of the Empire State Building, the Republican plan to 
drill in the refuge would occupy the first five floors in terms 
of solving the deficit problem. We need a plan to begin 
reducing our deficit in the short term, not shortsighted 
giveaways of our most pristine areas.
    The Republican plan to open up the Arctic National Wildlife 
Refuge to drilling would not offer us any refuge from red ink. 
It amounts to little more than an opportunistic giveaway to the 
oil industry and is a detraction from the real solutions which 
this Committee should be pursuing in order to reduce the 
Federal deficit, and we await those hearings that we have in 
this Committee on that subject. I yield back the balance of my 
time.
    [The prepared statement of Mr. Markey follows:]

     Statement of The Honorable Edward J. Markey, Ranking Member, 
                     Committee on Natural Resources

    Thank you.
    The Super Committee has been charged with reducing our deficit by 
at least $1.5 trillion dollars over the next ten years in order to 
begin getting our nation's budget back on track. This Committee has the 
authority and the responsibility to make recommendations to the Super 
Committee for ways to reduce the deficit.
    In response to this enormous challenge, the Republican Majority is 
once again looking to drill in the pristine Arctic National Wildlife 
Refuge in Alaska. Under the guise of reducing the deficit, they are 
proposing to open up the crown jewel of the Wildlife Refuge System to 
drilling. Unfortunately, drilling in the Arctic Refuge would do very 
little to reduce our deficit in the next 10 years.
    According to the Department of Energy, oil production from the 
Arctic Refuge wouldn't even begin for 10 years. As a result, the 
Congressional Budget Office has said that drilling in the Refuge would 
only generate $3 billion dollars during the first 10 years from initial 
lease sales, which would be a drop in the bucket of the overall 
reductions we need.
    In contrast, Democratic proposals to ensure oil companies pay their 
fair share would generate nearly $60 billion over the next 10 years.
    The oil and gas industry is swimming profits while our country is 
swimming in debt. The top 5 oil companies have made $71 billion dollars 
just in the first six months of this year. But the Republican majority 
has opposed repealing unnecessary tax breaks for the oil and gas 
industry that would generate more than $43 billion over the next 10 
years.
    The Republican Majority has also opposed ending royalty-free 
drilling on public lands offshore in the Gulf of Mexico. Closing this 
loophole could raise $9.5 billion over the next decade.
    Incentivizing companies to drill on the millions of acres of public 
land they already hold would generate nearly $1 billion. In fact oil 
companies are just sitting on more oil than we could ever get out of 
the Arctic Refuge--according to the Department of the Interior, there 
is more oil under the leases oil companies are not using offshore than 
there likely is in the Arctic Refuge.
    Repealing the royalty giveaway to the Gulf States would generate an 
additional $1.9 billion.
    Increasing inspection fees for the oil industry, as the BP 
Commission has recommended, would generate another $500 million.
    Increasing the royalty rates oil companies pay to drill on public 
land could generate an additional $900 million.
    All told, over the next 10 years these Democratic ideas would 
reduce our deficit 20 times as much as opening up the Arctic Refuge to 
drilling.
    To put it in perspective, if these Democratic ideas were the height 
of the Empire State Building, the Republican plan to drill in the 
Refuge would occupy only the first five floors.
    We need a plan to begin reducing our deficit in the short term, not 
shortsighted giveaways of our most pristine areas.
    The Republican plan to open up the Arctic National Wildlife Refuge 
to drilling would not offer us any refuge from red ink. It amounts to 
little more than an opportunistic giveaway to the oil industry, and is 
a distraction from real solutions.
    I yield back.
                                 ______
                                 
    Mr. Lamborn. OK. Thank you, Representative Markey. I would 
now recognize Representative Landry for five minutes.
    Mr. Landry. Thank you, Mr. Chairman. You know, it is 
amazing because for the amount of money that they want to take 
away from the oil and gas industry, the oil and gas industry is 
posed to spend and to invest just in America five times that 
amount at a time when we want to create jobs.
    Mr. Hall, you can finish for a second. Can I ask you? I 
just want to know. Are you as tired as I am of turning the TV 
on and hearing how Washington really wants to create jobs? Are 
you as tired of hearing that song and dance as I am?
    Mr. Hall. Yes, I am. I would like to see it happen.
    Mr. Landry. Me too. I am tired too. In fact, during the 
President's speech on how he wanted to create jobs I held a 
little sign up that said Drilling Equals Jobs. Would you 
disagree that drilling equals jobs?
    Mr. Hall. It would equal a lot of jobs.
    Mr. Landry. So I should have held one that said ANWR Equals 
Jobs, right?
    Mr. Hall. That would be the ticket right there.
    Mr. Landry. That would be. And we are in need of a lot of 
jobs today. Is that correct?
    Mr. Hall. Desperately.
    Mr. Landry. OK. Mr. Sharp, would you agree with that as 
well?
    Mr. Sharp. We are ready to go to work. Yes, sir.
    Mr. Landry. And so if the priority of this country--not 
what we would like. I mean, there are a lot of things. There 
are differences. I know, Mr. Hall, you are from Louisiana, 
right?
    Mr. Hall. That is correct.
    Mr. Landry. So I know that your momma taught you the 
difference between wants and needs, right, and she always said 
we are going to get you what you need, and then if there is 
some left over, we will get you what you want.
    Mr. Hall. That is the way on the farm I grew up on.
    Mr. Landry. Well, I can tell you that what we need in this 
country is jobs, all right? What we want is we want a utopia 
world where everything stays just like it was when the country 
was founded, all right? And that is nice and I appreciate that, 
but I think we have come a long way in being able to balance 
the industry with the environment. I really do.
    And so I think that if our number one priority in this 
country is creating jobs then let us get the drilling. Let us 
get the reducing the cost of our energy, which brings me up to 
Mr. Gene--I can't see that.
    Mr. Karpinski. Karpinski.
    Mr. Landry. I can't see that.
    Mr. Karpinski. Karpinski.
    Mr. Landry. You mentioned that drilling is not going to 
lower the cost at the pump. That is correct? That is what you 
said?
    Mr. Karpinski. That is based on an Energy Information 
Administration study in 2008.
    Mr. Landry. And so you agree with that study?
    Mr. Karpinski. Yes.
    Mr. Landry. OK. So did you support the President tapping 
into the Strategic Petroleum Reserve?
    Mr. Karpinski. I think our organization was neutral on that 
at the time, quite frankly.
    Mr. Landry. It was neutral? If you don't want us to tap 
into a natural reserve, and using the fact that it doesn't 
reduce the cost at the pump, why would tapping into an 
artificial reserve reduce the cost? Isn't that a bit 
hypocritical?
    Mr. Karpinski. I thought I just said we didn't take a 
position on that, frankly, so I am unaware of the----
    Mr. Landry. But you take a position on this.
    Mr. Karpinski. I am stating the government facts on what 
the impact would be of the drilling.
    Mr. Landry. But you are using it to support your argument. 
Is that not correct? I mean, you are using that to----
    Mr. Karpinski. I am using a government study.
    Mr. Landry. So how can you take a neutral position on 
whether or not the President should tap into the SPR, but use 
the fact, which I dispute that fact. Let me just put that on 
the record.
    Mr. Karpinski. I am citing the government data on that.
    Mr. Landry. I understand. But then why would tapping into 
the Strategic Petroleum Reserve be any different?
    Mr. Karpinski. I didn't make that case, so you can ask 
someone who supported that. I didn't make that case.
    Mr. Landry. Well, but I am asking you why----
    Mr. Karpinski. I am making the case----
    Mr. Landry.--you wouldn't oppose it if, I mean----
    Mr. Karpinski. I am making the case the reason you don't 
drill in the Arctic--the reason proffered to drill in the 
Arctic is somehow it is going to lower the price of gasoline. 
We know that is just not true.
    Mr. Landry. Well, wait.
    Mr. Karpinski. The reason not to drill in the Arctic is 
because it is the special place that it is.
    Mr. Landry. That is what you are saying the statistics are, 
but the President went out there and said that when you 
increase supply--OK, when you increase the supply--you affect 
the market. That is basic. I am not going to dispute that.
    I just think that there is a natural reserve. It is over 
there in ANWR. It is in the Gulf of Mexico. I am with 
Congressman Markey in that there are a lot of reserves in the 
Gulf of Mexico. We just need to start permitting, OK, so that 
we can tap into that.
    Mr. Karpinski. I wish you would be with Mr. Markey on where 
we actually should find revenues because if we are serious 
about revenues, the revenues from the oil and gas companies at 
this moment are there. That is who we should be tapping. That 
makes much more sense. It does not destroy a beautiful place, 
and that is where we should go. We support that, and that is 
the solution that we believe in.
    Mr. Lamborn. OK. Thank you. I would now recognize 
Representative Markey, the Ranking Member of the full 
Committee, for five minutes for questions.
    Mr. Markey. Thank you so, so much. Mr. Karpinski, one of 
the answers could have been Mr. Landry did not support using 
the Strategic Petroleum Reserve and so perhaps he doesn't agree 
with whether or not that infusion of oil actually does lower 
prices, which would then support your argument, if you wanted 
to make that, but I guess----
    Mr. Karpinski. Thank you, Mr. Markey.
    Mr. Markey.--the real case is that all of the evidence that 
was pointing toward speculators at that one moment in time 
driving up the price artificially, whereas the Energy 
Information Agency is looking over a long period of time in 
determining that there is a very marginal impact which the 
Arctic refuge oil would play on the price of oil.
    So let me go back to you, Mr. Karpinski and Mr. Jenkins. In 
terms of this issue of over the next 10 years, which is what we 
are tasked to do to reduce the Federal deficit. Is it worth it 
to drill in the Arctic Wildlife Refuge to find $3 billion worth 
of revenues, given the pristine nature of the Arctic Wildlife 
Refuge and the infinitesimally small amount of money that would 
be raised as a result of that? Mr. Jenkins?
    Mr. Jenkins. Well, obviously we certainly think not. We 
dispute the estimates that people are throwing around in terms 
of what kind of revenue and job creation would come from 
developing the refuge.
    You know, it seems like these numbers are based on a--they 
are not based on reserves that we know are in fact there. They 
are based on speculative reserves. You know, if you are talking 
about something as serious as reducing our deficit, you need to 
hang your hat on something a little more solid than unproven 
oil reserves that may or may not be in the Arctic National 
Wildlife Refuge.
    But to your point, yes, this is a very special place. It 
was set aside by President Eisenhower, not Jimmy Carter, as an 
intact ecosystem, and implicitly in that was the Eisenhower 
Administration knew that they were going to allow more oil 
exploration in the Prudhoe Bay area and they saw putting aside 
the Arctic refuge as representing balance. That refuge included 
the 1002 area, which is the Coastal Plain, which is the 
refuge's biological heart.
    Mr. Markey. So, Mr. Karpinski, the Big Five oil companies 
made $36 billion in profits in the last three months of the 
year, April, May and June, but they spent $10 billion of their 
profits buying back shares of their own stock in order to 
artificially raise the price. They spent $7 billion issuing 
dividends to their investors.
    Over the next decade, repealing the tax breaks for the oil 
and gas industry would generate more than 10 times the revenue 
that we would get by drilling in the Arctic refuge. Do you 
think that the Super Committee should repeal the tax breaks for 
the oil industry?
    Mr. Karpinski. Absolutely. We have stated it on the record 
many times. I stated it earlier today. Because clearly we do 
need new revenues and we do want to create more jobs. Drilling 
in the Arctic National Wildlife Refuge is not a solution to 
either one of those, but in terms of raising new revenues those 
five oil companies made nearly $1 trillion in the last 10 
years.
    To remove those subsidies and tax breaks for the oil and 
gas industry makes a lot of sense. As your chart showed, 20 
times as much money from those sources at a time when they are 
making record breaking profits, gouging consumers at the pump. 
This is the time to take that kind of action, to be serious 
about deficit reduction and to create----
    The other part of the way we reduce our costs here is again 
the technology. Technology is important. The technologies in 
the long run, we need to reduce our reliance on oil. The way 
you do that is with the new technologies in the automotive 
industry.
    I stood there with President Obama three weeks ago when he 
announced a plan for the next 15 years to have cars go further 
on a gallon of gas, an effort you have trumpeted for many, many 
years, Mr. Markey. That is the vision for the future.
    We are going to run out of oil. There is no doubt about 
that. We need to get off of oil, and new technologies can help 
us do that. All 10 auto companies were there on that podium 
with the President. This is the way to create jobs for the 
future.
    Mr. Markey. Thank you.
    Mr. Karpinski. Those are the new energy jobs.
    Mr. Markey. Thank you, Mr. Karpinski.
    Mr. Chairman, as you know, the Budget Control Act of 2011 
provides that, ``Not later than October 14, 2011, each 
committee of the House of Representatives and the Senate may 
transmit to the Joint Committee its recommendations for changes 
in law to reduce the deficit consistent with the goal of 
reducing the deficit by at least $1.5 trillion by 2021.''
    Give the enormity of this task, its importance to our 
nation's future, it is imperative that the Natural Resources 
Committee exercise this authority thoughtfully and in an 
expeditious and transparent manner. The Democratic staff has 
requested information regarding the process for submission and 
recommendations to the Joint Select Committee, but has received 
no response.
    I wrote to the Chairman on Monday to formally request that 
he schedule--I ask unanimous consent that I be given one 
additional minute like Mr. Flores was granted.
    Mr. Lamborn. We have to keep moving. We have to keep 
moving.
    Mr. Harris. Parliamentary inquiry.
    Mr. Markey. Parliamentary inquiry, Mr. Chairman?
    Mr. Lamborn. If you want to submit something for the 
record?
    Mr. Markey. Yes. I have had my staff----
    Mr. Harris. Parliamentary inquiry. Can I explain my 
objection? I have not had a chance to answer questions yet. You 
know, the Ranking Member has been in and out just like I have 
and has had a chance. I would be more than happy to yield you 
the minute at the end of my questioning.
    Mr. Markey. And I appreciate that very much. It is only 
that Mr. Flores was just given an additional minute and 50 
seconds, and I only need like an extra 20 seconds to finish and 
that was----
    Mr. Harris. I would be more than happy to yield that at the 
end of my time.
    Mr. Markey. When I was listening to the Majority Members, 
as long as there is a good line of thought going I don't stop 
people on that minute, but----
    Mr. Lamborn. Well, then, Mr. Markey, I was letting the 
witness finish a question. Mr. Flores wasn't going on. When he 
started to go on I gaveled him down.
    Mr. Markey. Well, I am not even a witness. I am finishing 
my thought that I had begun before my time had expired, and I 
am just trying to----
    Mr. Lamborn. Well, you have had 10 minutes so far.
    Mr. Markey. Again, I guess I can wait until the end of the 
gentleman's questions.
    Mr. Lamborn. I think that would be the best way to handle 
it.
    Mr. Markey. That is fine.
    Mr. Lamborn. OK. And now I would like to recognize myself 
for five minutes for questions. And, by the way, thank you all 
for your patience. We are in the home stretch. We will be done 
in just a few minutes.
    Mr. Rexford, can you tell me how many hotels there are in 
Kaktovik for tourists coming in to visit ANWR? Are there any 
hotels in your town?
    Mr. Rexford. Yes, we do. We have one brand new one, which 
is owned by our village corporation, and one smaller.
    Mr. Lamborn. How many rooms are in it?
    Mr. Rexford. Ten.
    Mr. Lamborn. OK. Thank you. Moving on here, do you think 
that the 2,000 acres that this bill refers to could be 
developed out of ANWR without injuring the wildlife in this 
National Wildlife Area Refuge?
    Mr. Rexford. Yes.
    Mr. Lamborn. And do you believe that a 2,000 acre footprint 
out of 19 million acres would ``destroy this place''--and I put 
quotes around destroy this place--as one of the other witnesses 
said earlier?
    Mr. Rexford. No, I don't.
    Mr. Lamborn. OK. Thank you. Mr. Jenkins, do you seriously 
think--wait. First let me preface by some information that Mr. 
Rexford added earlier in his written testimony.
    The Central Arctic caribou herd was around 3,000 in the 
1960s. Now it is up to 65,000, about a 22-fold increase. The 
Porcupine caribou herd is now about 169,000 strong. There are 
other herds apparently. Do you seriously think, Mr. Jenkins, 
given that, and we are talking about a wildlife refuge, the 
Alaska National Wildlife Refuge, that a 2,000 acre footprint 
would damage the caribou herds or other wildlife in the refuge?
    Mr. Jenkins. Well, first I dispute the 2,000 acre footprint 
part. I don't know if you were here earlier, but the whole 
analogy of a table and measuring the four legs was used.
    You know, the oil exists in the Coastal Plain of the Arctic 
refuge according to USGS in various pockets that stretch 
through its entire expanse. If you are going to access that 
oil, you have to have pipelines to connect that back to 
wherever you are taking it to.
    There is no way that you can access all that and actually 
bring it to market and actually be within a 2,000 acre 
footprint. It is just physically impossible, given what USGS 
tells us about where the oil is.
    Now, with respect to the caribou herds, the Central Arctic 
herd, one, it occupies an area where the Coastal Plain is much 
larger than the Arctic refuge, but, two, the Porcupine caribou 
herd does its migration from Canada over to this small part of 
the Coastal Plain. That Coastal Plain is their refuge where 
they give birth.
    So it is a different situation and it is also a different 
situation because the refuge on the eastern side of the North 
Slope is more arid. It is a different type of environment than 
over in the central and western Arctic to a certain degree.
    I would refer you to a letter that 1,000 scientists sent to 
President Bush some years back all arguing, including the 
National Academy of Sciences, that oil drilling on the Coastal 
Plain of the Arctic refuge, which is the refuge biological 
heart, would indeed adversely impact wildlife. Those are the 
experts. I am not an expert, but I do trust their opinion. 
Thank you.
    Mr. Lamborn. OK. I would now yield or now recognize Mr. 
Harris for five minutes.
    Mr. Harris. Thank you very much, and I am more than happy 
to yield to the Ranking Member, but I don't think he is 
available. He is coming back? If I have time at the end I will 
be more than happy to yield him a minute.
    Let me just ask. Mr. Sharp, let me ask you a question 
because the testimony from Mr. Karpinski was that this is not 
going to create jobs or raise revenue. How many jobs do you 
think----
    Mr. Karpinski. That is not correct, Mr. Harris.
    Mr. Harris. I believe you said if what we want to do is 
create jobs or raise revenue, that is not the way to do it.
    Mr. Karpinski. That is different than it won't create them.
    Mr. Harris. Actually, it is exactly the same.
    Mr. Karpinski. I said in my testimony it will create jobs, 
but it is not the way to do it, sir.
    Mr. Harris. I will get to you in a second, believe me. You 
see, that is the problem. That is the hyperbole that the 
Chairman talked about. That is why we are told that the 
stimulus created jobs when we know objectively it didn't. That 
is why we know that all Republicans are out to push granny off 
the cliff because of the hyperbole that your side engages in.
    Mr. Sharp, how many jobs do you think we could create? What 
is the range of jobs if we opened up without exception under 
current--if we allowed this to proceed, how many jobs? What do 
you think?
    Mr. Sharp. Congressman, I----
    Mr. Harris. I mean local jobs. I don't mean the downstream 
effect----
    Mr. Sharp. Thank you.
    Mr. Harris.--in the Lower 48 because there are a lot of 
those.
    Mr. Sharp. I appreciate that. There is a seasonal approach 
and then there is a legacy job approach, depending on how you 
look at it. In other words, that which maintains the operations 
of the field over time, assuming it opens up.
    I think it was misreported about the 19,000 jobs. In Alaska 
right now, the whole oil and gas industry has about 13,000 to 
14,000 jobs by state Department of Labor figures. That being 
said, the construction would be huge. It would put a lot of 
people to work, hundreds of thousands. Let me back up. That 
would include the downstream side also.
    From my local alone during the Trans-Alaska Pipeline in 
Fairbanks, Alaska, we had 11,000 people on our books. We are 
one of four pipeline unions, one of 14 building trades unions. 
If you were to exponentially multiply that out, depending on 
the engineering and the time that would be needed to do the 
construction of that oil field----
    Mr. Harris. Sure.
    Mr. Sharp.--times X amount of years, it would be huge.
    Mr. Harris. Thank you very much. You know, the bottom line 
is that there are people who are out of work who would have 
jobs. You know, at some point that is important I hope to both 
sides of the aisle.
    Now, Mr. Karpinski, does the League of Conservation Voters 
espouse increasing the gas tax as a way of decreasing 
consumption?
    Mr. Karpinski. No. We have not been involved in that 
conversation.
    Mr. Harris. Good. I am glad you haven't because, you see, 
you used the word gouge for what the oil companies do, and yet 
the tax take on a gallon of gas is far greater than the profit.
    You are aware of that; that the amount of taxes collected 
on a gallon of gas at both the state and local level and the 
Federal level is greater than the profits from oil companies. 
You are aware of that statistic?
    Mr. Karpinski. I have seen some data that suggests that.
    Mr. Harris. Some data? OK. Their profits are 8 percent on 
the dollar, and a gallon of gas is $3.50. If you do the math, 
the state and local tax is more.
    So do you also agree that the governments gouge the 
consumers? It is exactly the same. In fact, it is actually 
more. Is that a gouging?
    Mr. Karpinski. The gouge goes to the--as I said earlier----
    Mr. Harris. It is a very simple question.
    Mr. Karpinski. No.
    Mr. Harris. Do you consider that gouging?
    Mr. Karpinski. Because the gouging goes when the record 
breaking profits, Mr. Harris----
    Mr. Harris. Oh I see. When private companies do it, the 
private companies----
    Mr. Karpinski. $1 trillion in the last 10 years, $70 
billion in the----
    Mr. Harris. Excuse me, Mr. Chairman. Can I ask the witness 
a question?
    Mr. Karpinski.--last six months. You asked me a question. I 
get to answer it.
    Mr. Harris. Thank you. It is my time, not your time. You 
had your time. I have my time now.
    Now, Mr. Karpinski, so when the government does it, it is 
not gouging. When a private company does it, it is gouging.
    Mr. Karpinski. No. That is not what I said.
    Mr. Harris. I fully understand exactly where your side 
comes from on this.
    Mr. Lamborn. Mr. Harris? Mr. Harris?
    Mr. Harris. Yes?
    Mr. Lamborn. Would you like to yield the last minute of 
your time?
    Mr. Harris. Yes, but I still have about eight seconds here. 
I guess you should ask Mr. Karpinski to yield back some of that 
time.
    Mr. Karpinski. I thought you had asked me a question.
    Mr. Harris. Are oil companies the corporations in America 
that have the largest profit margin?
    Mr. Karpinski. Profit margin?
    Mr. Harris. Sure. Yes. Do you know what a profit margin is?
    Mr. Karpinski. I do understand. I am not----
    Mr. Harris. I understand in your business you don't have a 
profit margin because you don't actually----
    Mr. Karpinski. That is correct. We are a nonprofit. I 
appreciate that.
    Mr. Harris. That is right. Do you know what a profit margin 
is?
    Mr. Karpinski. Yes.
    Mr. Harris. Are they the largest?
    Mr. Karpinski. I do not think they are the largest profit 
margin. What I am talking about is their record breaking 
profits that they have made.
    Mr. Harris. The percent of each dollar that they make. 
Right.
    Mr. Karpinski. Record breaking profits that they made.
    Mr. Harris. Yes. Do you know what the largest company's 
profit was? Do you know who earned more than Chevron last year, 
last quarter? Apple Computer.
    Mr. Karpinski. I understand that.
    Mr. Harris. In fact, Apple's industry has the largest 
profit margin, 22 cents on every dollar, as opposed to oil. 
Now, is your group talking about the gouging that goes on from 
electronics companies when you go to an Apple store? It is a 
rhetorical question.
    I yield the balance of my time to Mr. Markey.
    Mr. Lamborn. I now recognize the representative from 
California.
    Mr. Harris. I yield the balance of my time.
    Mr. Markey. And I thank the gentleman, but I can wait. I 
can wait.
    Mr. Lamborn. Representative McClintock? You will wrap up, 
and if you have a minute for the Ranking Member at some point?
    Mr. McClintock. Well, if I have a minute left I will be 
happy to.
    The arguments we seem to have heard by the Majority against 
the notion of drilling in ANWR first is that it is going to 
take a long, long time to bring this oil to market. Of course, 
as Mr. Harris has pointed out, the jobs are immediate.
    But that line of reasoning reminds me of the story of 
General de Gaulle who ordered oak trees planted at his 
provisional headquarters. His adjunct said, ``Well, General, it 
is going to take a century for those oak trees to grow to 
maturity.'' General de Gaulle's response was, ``Well, then you 
better not waste any more time.''
    The other argument that we hear is that the supply that is 
going to be produced is minimal on a global scale and isn't 
really worth looking at, and this is the one place we were told 
by a Member, the one place on the planet we shouldn't be 
drilling.
    The problem, of course, is if you asked him well, how about 
drilling off the Gulf Coast, the answer is no. How about 
drilling offshore generally? The answer is no. How about 
drilling on shore generally? The answer is no. How about 
developing our vast shale oil reserves that are three times the 
size of the proven reserves in Saudi Arabia? The answer is no. 
How about running a pipeline from Canada that is developing its 
shale oil reserves? The answer is no. So what they are actually 
arguing is to shut down oil production in the United States.
    Councilman Rexford, perhaps you can help me on this. How do 
we lessen our dependence on foreign oil by prohibiting the 
development of our domestic supplies?
    Mr. Rexford. I have no idea how that would happen.
    Mr. McClintock. I have no idea either, and the sad thing is 
neither do they.
    We talked about the drilling footprint, how much land would 
be the footprint for drilling compared with the size of the 
total expanse of ANWR. I have been told that proportionally it 
is a postage stamp on a football field. Is that accurate?
    Mr. Rexford. That sounds about accurate.
    Mr. McClintock. So that is what we are talking about then? 
Proportionally, the drilling footprint on ANWR would be as a 
postage stamp is to an entire football field, but that is the 
one place we shouldn't be drilling we are told. I find that 
amazing.
    Mr. Karpinski, what is your alternative?
    Mr. Karpinski. A couple things. One is the oil and gas 
companies have 38 million----
    Mr. McClintock. No, no. What is your alternative?
    Mr. Karpinski. You asked me a question. Can I answer it?
    Mr. McClintock. Yes. I want to know what is the 
alternative?
    Mr. Karpinski. The companies already have 38 million acres 
that they have leased. The first thing, and it is in my 
testimony. Twenty-two million of those are not being explored 
enough.
    So, number one, in terms of drilling we are not against all 
drilling. That would be silly. We have never said that. But 
first go to the leases they already have. Over half of them 
they are not using. That is number one.
    Number two----
    Mr. McClintock. Well, they are not using----
    Mr. Karpinski. Can I answer the question?
    Mr. McClintock. Pardon me. They are not using because they 
are being blocked by permitting delays that are endless.
    Mr. Karpinski. In many instances that is not correct. 
Number two is you reduce your reliance on oil by reducing the 
demand. Most of the oil is used in our transportation system. 
We need a new vision of a new future which puts us in a new 
kind of automobile, which is exactly what the auto companies 
support.
    Mr. McClintock. And what is this new kind of automobile? Do 
you have it in production?
    Mr. Karpinski. Sure. The simplest version right now are 
hybrids on the road are much more efficient.
    Mr. McClintock. And how are we to generate the electricity?
    Mr. Karpinski. There is a vision that was just laid out 
with the auto companies standing at the table saying in the 
next 15 years we are going to go from about 30 miles per gallon 
to 55 miles per gallon. That is the vision for the future.
    Mr. McClintock. And how are we to generate the electricity, 
because when we try to put in new conventional power plants we 
are told no. When we try to put in nuclear power plants we are 
told no. We are told the answer is new technology. Is that your 
response?
    Mr. Karpinski. First of all, number one, the best way to 
reduce demand both in terms of electricity and oil is called 
efficiency. Efficiency. Reducing our use and then building 
efficiency, automobile efficiency, appliance efficiency. That 
is the single cheapest, quickest, cleanest, safest way we can 
reduce demand for electricity and for oil. It is pretty 
straightforward.
    Mr. McClintock. It seems to me that with any----
    Mr. Karpinski. It is pretty easy. You just have to get it 
done.
    Mr. McClintock. Reclaiming my time, it seems to me with any 
commodity when something is scarce it becomes expensive. When 
it is plentiful it is cheap.
    We have been embarking upon a policy of prohibiting 
development of our energy reserves to the point where they have 
become scarce. We are told that they are going to disappear 
anyway. Well, we were told in the 1960s that our oil supplies 
would be exhausted by the 1980s. We were told in the 1970s that 
it would be by the 1990s. Now we are being told it will be 
sometime 20 years from now.
    The point is when we look for more oil we find it. The 
problem is that we have been prohibited even from exploring 
vast tracts, let alone developing the reserves that we now 
have. That is the issue, and a new generation is coming along 
looking at this and saying what in the world are you people 
thinking? Record unemployment, record increases in energy 
prices. Why don't you develop the vast reserves we have?
    Mr. Lamborn. Thank you. And now before we wrap up I would 
like to recognize the Ranking Member to conclude his earlier 
statement.
    Mr. Markey. Thank you, Mr. Chairman, very much. We are 
tasked with the job of making a recommendation from this 
Committee in terms of where deficit reduction could come from 
the Committee's jurisdiction. We are going out of session again 
on Friday and taking off 10 more days, and we will be back in 
on October 3. We only have 11 days after that to make our 
recommendation.
    So I continue to urge that the Committee employ a vigorous, 
transparent process to consider any recommendations to the 
Joint Select Committee. In the meantime, the focus on opening 
up the pristine Arctic National Wildlife Refuge is misplaced, 
particularly because there are alternatives which would raise 
much more revenue to help reduce the deficit by requiring oil 
companies to pay a fair share for drilling on the public's 
lands.
    I therefore wish to inform you, Mr. Chairman, that the 
Minority intends to exercise its rights under Rule 11 of the 
House to call an additional day of hearings with witnesses 
chosen by the Minority so that this Committee can explore how 
opening up drilling in the Arctic refuge compares with other 
alternatives that the Committee could pursue to help reduce our 
nation's Federal deficit.
    Mr. Lamborn. OK. Thank you. We have concluded our 
questions. Members of the Committee may have additional 
questions for the record, and I would ask each of the witnesses 
to respond to those in writing.
    Before we recess, I would like to ask unanimous consent to 
include two documents in the record, one being a letter from 
the National Construction Alliance, which is composed of the 
United Brotherhood of Carpenters and Joiners, as well as the 
International Union of Operating Engineers, both of whom 
support opening ANWR to production, and the second document, 
which is a letter from State Representative Charisse Millett, 
and I hope I have that correct--or Miller; I can't read the 
writing--also supporting opening of ANWR.
    If there is no objection, those documents will be included 
in the record.
    Mr. Markey. Mr. Chairman, there is no objection on the part 
of the Minority.
    Mr. Lamborn. Thank you.
    Mr. Lamborn. And if there is no further business, the 
Committee will stand in recess.
    [Whereupon, at 12:43 p.m., the Committee was adjourned.]

    [Additional material submitted for the record follows:]

    [A statement submitted for the record by the Gwich'in 
Steering Committee follows:]

      Statement of Sarah James, Chair, Gwich'in Steering Committee

    Mr Chairman and Members of the Committee, thank you for allowing me 
a chance to tell you about how the Gwich'in people rely on the Arctic 
National Wildlife Refuge coastal plain for our livelyhood.
    I know you are concerned about jobs and the price of gas. We are 
too. I come from Arctic Village Alaska. There will not be many jobs 
there until summer, so there is little money. Everything from food to 
fuel comes in by plane and is expensive. We pay $10/gal to get gas for 
our boat or snow machine. I want you to know we understand what it is 
like to be unemployed and to face high prices.
    But the Gwich'in are caribou people. Caribou has provided for us 
since the beginning of time. Caribou is in our tools, clothing, songs 
and stories. If you marked on a map where the Gwich'in have always 
lived and also where the Porcupine Caribou Herd migrates, you would see 
how we live together. If you came to visit me at my village you would 
find caribou in every house and freezer in town.
    Just as we rely on caribou, the caribou depend on the Arctic 
Wildlife Refuge Coastal Plain. This is the birthplace and nursery 
grounds, where every Porcupine caribou calf gets its start in life. 
Even when deep snows mean the calves are born on Canada side, the 
mothers will bring their calves to the coastal plain as soon as they 
can. We call it Izhik Gwats'an Gwandaii Goodlit--the Sacred Place Where 
Life Begins
    Oil development here in the birthplace and nursery grounds would 
hurt the Porcupine caribou and threaten the future of my people. When 
oil development near Prudhoe Bay got too close, the caribou moved their 
calving area away, but there was lots of good ground and the herd grew. 
In the Arctic Refuge the mountains come close to the ocean, and the 
caribou have nowhere else to go. The biologists believe oil development 
here would make the herd decline even if the oil companies do 
everything right. It is not because of oil spills or some other 
accident. After migrating hundreds of miles and giving birth the cows 
and their calves are just too sensitive.
    We believe we have a right to continue our way of life, and that 
right is guaranteed by the United States in the International Covenant 
on Civil and Political Rights, ratified by the Senate, which reads in 
part ``. . .In no case may a people be deprived of their own means of 
subsistence.''
    We do have alternative sources of energy., and we have 
conservation. We have choices, but the Porcupine caribou don't have a 
choice. They will go where they have always gone to have their young, 
and then return to the Gwich'in as they always have.
    There are some places so important for other reasons--for the 
animals, for the Earth and for human rights that they should be 
respected. The Arctic Refuge Coastal Plain is one of them.
    Thank you
                                 ______
                                 
    [A letter submitted for the record by The Honorable 
Charisse Millett, Alaska State Representative, follows:]






    [A letter submitted for the record by the National 
Construction Alliance II follows:]






    [A statement submitted for the record by The Honorable 
Niki Tsongas, a Representative in Congress from the 
Commonwealth of Massachusetts, follows:]

 Statement of The Honorable Niki Tsongas, a Representative in Congress 
                 from the Commonwealth of Massachusetts

    Governor Parnell, Senators Begich and Murkowski, Mr. Sharp, Mr. 
Hall, Mr. Rexford, and Mr. Karpinski, thank you for your testimony 
today.
    My husband, Paul Tsongas, was instrumental in passing the Alaska 
Lands Act, one of the most significant land conservation measures in 
the history of our nation. The vision and importance of that momentous 
legislation is equally critical today. The Arctic National Wildlife 
Refuge (ANWR) is a national treasure. It covers over 19 million acres 
in northeast Alaska and is home to caribou herds, polar bears, muskox, 
gray wolves, and numerous other animal and plant species unique to the 
region.
    In 1987, and again in 1998, the U.S. Geological Survey (USGS) 
released reports detailing large amounts of crude oil within the refuge 
boundaries. However, USGS data indicates that any oil discovered in the 
Arctic Refuge would be scattered among multiple small fields, rather 
than concentrated in a single large field. This would make development 
slow and expensive, and would also expand the area exposed to 
environmental impacts. According to the U.S. Energy Information 
Administration, ANWR oil reserves would, at its peak, represent just .4 
to 1.2 percent of world oil consumption by 2030, and would have little 
impact on domestic oil prices. Similarly, ANWR oil would represent just 
a fraction of daily U.S. oil use, and America would still import tens 
of millions of barrels per day from overseas. Drilling in this region 
will neither reduce our nation's dependence on oil and lower the cost 
of energy, nor supply an amount significant enough to alter our need 
for foreign reserves.
    The United States Congress has consistently--and rightly--re-buffed 
Republican attempts to drill for oil in ANWR, and I will continue this 
tradition and oppose any future attempts to degrade this natural 
wonder. Vast areas of wilderness not only support a healthy 
environment, but preserve a piece of American history. Drilling in ANWR 
will provide no solutions to the very real problems facing our country. 
Rather than consenting to irreversible damage to our national treasures 
like the Arctic Refuge, we ought to focus on harnessing the power of 
clean, renewable energy to create high paying jobs, reduce our fossil 
fuel dependency, and begin to address the threat of climate change.






OVERSIGHT HEARING ON ``ANWR: JOBS, ENERGY AND DEFICIT REDUCTION.'' PART 
                                   2

                              ----------                              


                       Friday, November 18, 2011

                     U.S. House of Representatives

                     Committee on Natural Resources

                            Washington, D.C.

                              ----------                              

    The Committee met, pursuant to call, at 2:11 p.m., in Room 
1324, Longworth House Office Building, Hon. Doc Hastings 
[Chairman of the Committee] presiding.
    Present: Representatives Hastings, Young, Lamborn, 
McClintock, Harris, Markey, Kildee, Holt, Tsongas and Hanabusa.
    The Chairman. The Committee will come back to order.
    The Chair notes the presence of a quorum, which, under 
Committee Rule 3(e), is two Members.
    The Committee meets again today to resume its September 21, 
2011, hearing on ANWR: Jobs, Energy, and Deficit Reduction. 
Under Committee Rule 4(f), we will go straight to the witness 
testimony.
    We have seated at the panel our distinguished list of 
witnesses: Mr. Douglas Brinkley, Professor of History at Rice 
University; Ms. Sarah Agnus James, Board Chair of the Gwich'in 
Steering Committee; Mr. Erich Pica, President of the Friends of 
the Earth; and Ms. Lauren Pagel, Policy Director for 
Earthworks.
    For the record, at our first hearing we heard from two 
panels, and those panels included Governor Parnell of Alaska; 
Senator Lisa Murkowski from Alaska; Senator Mark Begich from 
Alaska; Congressman Don Young from Alaska; Mr. Fenton Rexford 
of Kaktovik, Alaska; Mr. Tim Sharp of Laborers Local 942 in 
Alaska, I think it was Fairbanks; Mr. Carey Hall, an ice road 
trucker; Mr. David Jenkins of Republicans for Environmental 
Protection; and Mr. Gene Karpinski from the League of 
Conservation Voters.
    For those of you that have not had the privilege or 
opportunity, whichever way you want to say it, to testify, your 
full statement will appear in the record. I would ask you to 
summarize your oral remarks. And the lights in front of you, 
when you start, the green light comes on. That means you have 5 
minutes. When the yellow light comes on, it means you are down 
to a minute. When the red light comes on, it means you are in 
trouble. But I would ask you to keep your remarks as close as 
you possibly can to that. Once again, your full statement will 
appear in the record.
    So, Mr. Brinkley, we will start with you. You are 
recognized for 5 minutes.

   STATEMENT OF DOUGLAS BRINKLEY, PROFESSOR OF HISTORY, RICE 
                           UNIVERSITY

    Dr. Brinkley. Thank you for having me, sir. It is wonderful 
to be here. I am an historian. I am writing right now a 
multiple-volume history of the American conservation movement. 
My first volume was The Wilderness Warrior, which was on 
Theodore Roosevelt, Gifford Pinchot, and others at the 
beginning of the 21st century. My second volume that is now 
next is called The Quiet World: Savings Alaska's Wilderness 
Kingdom, 1879-1960. So I have recently spent quite a bit of 
time in Alaska, including going to the Arctic refuge camping.
    I might add that I was also the Director of the Eisenhower 
Center. We would collect World War II oral histories of our 
veterans. I have written on D-Day and the Battle of the Bulge, 
working on work on Khe Sanh and the marines at Khe Sanh, et 
cetera. My father served in the Korean War as a ski trooper in 
Alaska.
    And I am very glad to see Mo Udall behind me here, one of 
the great figures, congressional figures, in American history 
on wilderness and Alaskan protection. I was hoping to get to 
meet Mr. Young, but I don't think he is here right now. He is 
there by the door, by the exit sign. And Mo Udall is there 
behind me, because Mo Udall had the right idea of what to do to 
protect Arctic Alaska, as did Dwight Eisenhower.
    The Arctic was saved by Ike 50 years ago. He was not known 
as one of our great conservationist Presidents per se at the 
time. He was a fiscal conservative. But he pushed for Alaska 
statehood, very bravely, because back then--Alaska today you 
think of as a red State--the first two Senators from Alaska 
were Democrats.
    Ike went forward with it, at any rate, for the State. And 
that is when the Arctic Refuge got created, with the Fairbanks 
Daily Miner for the Arctic Refuge being created, and it has 
become Eisenhower's great reserve. We just celebrated the 50th 
anniversary of the Arctic, and it is like Yellowstone or the 
Grand Canyon, the Great Smoky Mountains or Big Bend. It is one 
of the most important treasured landscapes in the United 
States.
    And I am here--the reason I flew in today, left my family 
and my three kids back in Austin, Texas--I came here today to 
propose that these kind of meetings probably need to stop. I 
think we are at the point now that President Obama needs to 
sign, using the Antiquities Act of 1906, power that Theodore 
Roosevelt used so effectively to save the Grand Canyon from 
congressional people who wanted to mine it for zinc, copper, 
and asbestos, and put the Coastal Plain, what is called 1002, 
the biological heart of the Arctic Refuge, the great polar bear 
denning area, the key cornerstone of our marine ecosystem of 
America's Arctic--Arctic Alaska--and create an Eisenhower 
national monument. Have an Executive Order by President Obama. 
I suggest we bypass Congress on this, as it is done 
consistently. In fact, George W. Bush, our last President, used 
the Antiquities Act to create the largest national monument in 
Hawaii, our great maritime national monument. Executive power. 
And I think the President needs to do that.
    We are living in a time of climate change. The Arctic 
Refuge is home of our charismatic animal, the polar bear. It is 
also a place that people get some solace in this noisy, 
hyperindustrialized world. How do you put a price tag on 
solitude? And the thought at this moment in time in 2011 that 
we are looking at a 50-year-old reserve and talking about 
opening it up to Dutch oil companies and British oil 
companies--there are people right now trying to mine uranium 
out of the Grand Canyon--this seems to me to be backwards. We 
have to move forward in this country.
    I am all for oil. I lived for a long while in New Orleans. 
Petroleum dollars are important. We need to be using the Gulf 
of Mexico as an industrial zone that we are. But we have to 
have treasured landscapes, and places like Chesapeake, in my 
opinion, and Arctic Alaska have earned the designation of being 
thematic with what American conservation is.
    Eisenhower not only saved the Arctic Refuge 50 years ago, 
but he also is the person in charge of demilitarizing and not 
having the Antarctica developed. And why we want to call it the 
Eisenhower National Monument and the Coastal Plain is the 
country finally do something for Eisenhower instead of just 
highway signs and parkway signs. It would be a fitting 
monument.
    I got to Anchorage, and there is an Eisenhower statue and a 
little memorial in there, but the role the U.S. Army has played 
in Alaska's history, in World War II, in building of the ALCAN 
Highway and the current U.S. troops there, the incredible role 
the Federal Government has played in Alaska. I think our 
country should honor Eisenhower the way North Dakota honored 
Theodore Roosevelt with Theodore Roosevelt National Park in the 
Badlands. We should have an Eisenhower National Monument in the 
Arctic Refuge.
    The Chairman. I thank the gentleman very much for his 
testimony.
    [The prepared statement of Dr. Brinkley follows:]

  Statement of Douglas Brinkley, Professor of History, Rice University

    No picture book can do justice to the ethereal beauty of the Arctic 
National Wildlife Refuge (ANWR). I camped there in the summer of 2010 
along the Hulahula River. The sky was like another ocean. The nearby 
mountains were ruins left over from the Ice Age. One afternoon in the 
Arctic I saw a grizzly climbing up a hill, running at tremendous speed. 
It was like a time machine had taken me back to the beginning of the 
world. Everything from the caribou herds to the wildflowers was 
primordial, uncontaminated, and fresh. Back in 1960 President Dwight D. 
Eisenhower was a true visionary when he created the Arctic Refuge. To 
Eisenhower, and his Interior Secretary Fred Seaton, Arctic Alaska--like 
Antarctica--was too precious a wilderness heirloom to permit 
destructive oil, gas, military, and mining activity. By saving this 
remote part of Arctic Alaska, Eisenhower earned his gold-starred place 
as one of America's great conservation presidents.
    To Eisenhower there were some natural places that defined what it 
meant to be American; the ANWR wilderness in northeastern Alaska is one 
of those sacred spots. Fifty years ago, our parents' and grandparents' 
generation--in the Eisenhower era--looked out across Alaska's North 
Slope wilderness and decided to set the Arctic Refuge aside as 
protected sanctuary for the abundant wildlife that depended on it. It 
rapidly became spiritual grounds where U.S. soldiers returned from 
overseas combat to heal. Outdoorspersons from all over the world come 
to Arctic Alaska to hunt, fish, and clear their minds from the white 
noise of hyper-industrialization. Congress, in my opinion, has a moral 
responsibility to help save Eisenhower's Arctic sanctuary--a wonder 
like Yellowstone, the Tetons, Big Bend, and the Grand Canyon--for 
future generations to enjoy.
    Last year ANWR celebrated its 50th anniversary as America's premier 
refuge. But virtually nothing was done to commemorate Eisenhower for 
his incredible conservation accomplishment as its brave founder. The 
U.S. Interior Department now has an opportunity to rectify this 
omission, to honor our 34th president for his extraordinary 
environmental foresight. Congress should urge President Obama to use 
the Antiquities Act of 1906 to permanently establish the Eisenhower 
National Monument out of Section 1002 land within ANWR. The Coastal 
Plain along the Beaufort Sea is the most important denning habitat for 
U.S. polar bears in the Arctic Alaska. It is also an essential habitat 
for wolves, grizzly, and brown bears. Over 130 bird species rely on the 
coastline, lakes, and rivers of ANWR for nesting, feeding, and 
breeding. Throughout the course of a year, at least one avian species 
from every state (except Hawaii) makes its way to ANWR. Birders from 
all of the country track the migratory patterns of birds like mallards, 
tundra swans, red-throated loons, snow geese, and northern pintail 
ducks on their way to the Arctic. Any loss of habitat in this region 
will necessarily result in a corresponding loss of opportunities for 
bird watching and hunting. The Eisenhower National Monument would 
secure lasting protection for the Coastal Plain's terrestrial and 
marine wildlife. There are those in the U.S. Congress who believe the 
Coastal Plain of ANWR should be leased to foreign oil companies like 
British Petroleum and Royal Dutch Shell. I believe it should remain an 
unmolested U.S. wilderness sanctuary, public land used for outdoors 
recreation by world citizens.
    As a former director of the Eisenhower Center, World War II 
scholar, and lover of Wild America, I think it's important that our 
nation honor conservation heroes. By commending the life and legacy of 
Eisenhower, declaring the 1002 area of ANWR the Eisenhower National 
Monument--via executive order--the Obama administration would be 
preserving one of America's wildest landscapes and honoring the great 
Supreme Allied Commander of the Second World War who was responsible 
for Alaskan statehood. Re-designating the Coastal Plain--the 
``biological heart'' of ANWR--is the proper way to nationally honor 
Eisenhower with something more meaningful than Interstate Highway signs 
and a parkway in New Jersey.
    As president of the United States, Eisenhower pushed for world 
peace and conservation in a number of imaginative ways. It is 
Eisenhower who spearheaded the successful global campaign to prohibit 
military bases, military exercises, and weapons testing in Antarctica. 
Today the majestic mountains that rise between Reeves Neve on the west, 
Reeves Glacier on the south, and Priestley Glacier on the north and 
east in Victoria Land, Antarctica are officially known as the 
Eisenhower Range.
    If Antarctica can honor Eisenhower's conservation legacy with a 
range, surely the United States can do the same in Arctic Alaska. There 
are those that argue Section 1002 should be designated Wilderness by 
Congress. I believe that process is too time consuming and slow. Alaska 
has already been harder hit by global warming than any other part of 
the nation. The state's average temperature has risen 4 degrees 
Fahrenheit in the past fifty years, and there have been major 
reductions in populations of coastal and marine bird species, seals, 
and sea lions. President George W. Bush rightfully used the Antiquities 
Act in 2006 to designate 195,000 square miles of the Pacific Ocean as 
the Northwestern Hawaiian Islands Marine National Monument when he 
thought that ecosystem was in peril. President Obama could become a 
conservation hero for doing the same for Section 1002 of Arctic Alaska.
    Let history show that Congresspersons on November 18, 2011--
recognizing the need to honor Eisenhower, protect a world-class 
landscape, and address the global climate crisis--urged the White House 
to add an additional layer of federal protection in Arctic Alaska. I 
look forward some day to camping with my wife and three children in the 
Eisenhower National Monument--a far better name than Section 1002--as 
the premier attraction in ANWR.
                                 ______
                                 
    The Chairman. Next I am pleased to represent Sarah Agnus 
James, the Board Chair of the Gwich'in Steering Committee. Ms. 
James, you are recognized for 5 minutes.

STATEMENT OF SARAH AGNUS JAMES, BOARD CHAIR, GWICH'IN STEERING 
                           COMMITTEE

    Ms. James. I am honored to speak on behalf of this 
Committee for my nation, which is Gwich'in Nation. I feel real 
honored to be here. English is my second language, so I will 
address to you and translate it in my language back to English. 
I will speak Gwich'in. English is my second language.
    [speaking in Native language.]
    I say: We came a long ways. We all came a long ways. We 
still have a long ways to go. On behalf of the elders that 
cannot be here today, and on behalf of the children that is not 
yet born, my people have been traveling all over the country 
trying to tell a story about a special place in the world, 
which is Iizhik Gwats'an Gwandaii Goodlit, ``sacred place where 
the life begin.'' We do that for our future generation.
    Back in 1988, it was alarming to our nation, to our elders. 
There was going to be a development of gas and oil in the 
Coastal Plain of the Arctic National Wildlife Refuge. The 
elders of the Nation called Gwich'in gathered in Arctic Village 
June 5, 2010. They came together because that is what they did 
before. They haven't got back together for about 150 years 
because there was a border put between them, U.S.-Canadian 
border. And when they got there, they were very wary that 
nobody really knows about us or going to hear about us. But the 
chief, the 15 chief on 15 Gwich'in villages, came up with a 
resolution and said the only way the world will know about 
Gwich'in is unless this is in black and white. So they pass a 
resolution to protect the Coastal Plain of the Arctic National 
Wildlife Refuge and the birthplace of the Porcupine caribou and 
the Gwich'in way of life.
    It was a hard decision for them because that will bring a 
lot of people and the interest to that area, but they have made 
that decision. They also know that they cannot do it by 
themselves, so they gave us two direction to do it in a good 
way and teach the world in a good way why we say no to oil and 
gas development. Even then, the global warming climate change 
was part of the conversation that went on.
    The way of life of caribou is our way of life, just like 
the buffalo is to the Plains Indians. It is our song, it is our 
dance, it is our story. Even today, 75 percent of our diet is 
still wild meat, which make up of mainly caribou, moose, fish, 
Dall sheep, small animals, and birds and ducks.
    We call that place up there, the Coastal Plain, the Arctic 
National Wildlife Refuge, we call it Iizhik Gwats'an Gwandaii 
Goodlit. That means ``sacred place where the life begin.'' For 
that reason, under the customary and traditional uses of the 
Porcupine caribou, we draft up an international Porcupine 
Caribou Commission agreement that it is signed in 1987.
    To us, it is human rights. We believe that we were put 
there by God to take care of that part of the world. That is 
our responsibility as Gwich'in people. We didn't come from 
anywhere, we are not going anywhere, and we are here to stay.
    The climate change is real in Alaska, and we have to make 
this Iizhik Gwats'an Gwandaii Goodlit permanent protection for 
our future generation.
    Thank you very much for listening to me.
    The Chairman. Thank you very much for your testimony.
    [The prepared statement of Ms. James follows:]

             Statement of Sarah Agnus James, Chairperson, 
                      Gwich'in Steering Committee

    Mr.Chairman and Members of the Committee:
    My name is Sarah James.
    I am Neetsa'ii Gwich'in from Arctic Village, Alaska, and I serve as 
Chairperson of the Gwich'in Steering Committee. Arctic is the 
northernmost Indian community anywhere. Only the Inuit live north of 
us--along the Arctic coast.
    The Gwich'in are caribou people. Caribou is our main food, it is in 
our tools and clothes and songs and stories and beadwork. We have lived 
right here with the caribou for hundreds of generations and will stay 
right far into the future. There are maybe 7,000 of us, mostly living 
in 15 small communities and villages scattered across northeast Alaska 
and the northwest corner of Canada. We are among the most remote and 
most traditional people in America.
    The Gwich'in Steering Committee was created by resolution of our 
Chiefs in 1988 at the first gathering of all our people in more than 
100 years--the Gwich'in Niintsyaa. Our job is to speak with one voice 
for all our Gwich'in people on the caribou issue. The Chiefs gave us 
two directions:
          to tell the world about the caribou and the Gwich'in 
        way of life, and what oil development would mean for the 
        Gwich'in; and
          to do it in a good way.
    So, Mr. Chairman, I am especially honored to be here today to carry 
out this important task for my Chiefs and my people.
    We respect the difficult job you have. We know about the problems 
of jobs and energy. In Arctic Village we only have jobs in the summer, 
and there are not enough to go around, so we know what it is like to be 
unemployed and to worry about how to pay our bills. We also know about 
energy problems. In Arctic Village everything is flown in. If you have 
a 4-wheeler or snow-machine, you will pay about $15/gallon for gas. 
Fuel for electric generators is flown in too, so electricity is really 
expensive. I'm not complaining, I love my life, but we do know what it 
means to have a ``deficit'' when life is expensive. But in the winter 
you can't just turn out the lights. You have to get the money to pay 
the bills. Go to town to get a job, or raise taxes. You have to keep 
the lights on at home.
    The idea of waiting to pay the bills for 10 or 15 years while you 
hope to find oil in the Arctic Wildlife Refuge is backwards. People 
need to go to work now. Our country, our government needs to fix our 
schools and roads and towns, and find a way to meet new needs like 
icebreakers--not 10 or 20 years fro now, but now. If it costs more 
money, we will pay our fair share. To go on pretending you can just cut 
costs without ruining our country is not telling the truth.
    But the question of oil development in the Arctic National Wildlife 
Refuge is not just about money and oil. It is about the most basic 
human rights of the Gwich'in.
    For the Gwich'in, this is a simple issue:
    Oil development in the birthplace and nursery grounds of the 
Porcupine (River) Caribou Herd would hurt the caribou and threaten the 
culture and way of life of my people and the viability of our 
communities.
    We know the coastal plain of the Arctic National Wildlife Refuge as 
Iizhik Gwats'an Gwandaii Goodlit, ``the Sacred Place Where Life 
Begins.'' After migrating 400 miles and giving birth, the mother 
caribou cannot be disturbed at this time, and our people may not go 
there then. The cows and their calves will move from place to place to 
find the cotton-grass and other new green sprouts they need to recover 
their strength and feed their calves. Depending on weather, the prime 
area for feeding might change from year to year, especially for the 
first weeks. Sometimes when snows are deep the caribou are born in 
Canada, but studies of radio-collared caribou show that as soon as she 
can, the mother caribou will lead her calf onto the Arctic Refuge's 
coastal plain. From what we know, every Porcupine caribou gets their 
start in life right there, at Iizhik Gwats'an Gwandaii Goodlit.
    When oil development around Prudhoe Bay came close to the calving 
grounds of the Central Arctic Caribou Herd, the cows and their calves 
were pushed away onto new calving- and nursery grounds. Because there 
was lots of good ground, this did not hurt them and those caribou 
prospered.
    The problem for Porcupine caribou is, in the Arctic Refuge the 
mountains come close to the Arctic Ocean--and the coastal plain is only 
a few miles wide. There are already more caribou per square mile on the 
Porcupine caribou calving and nursery grounds than almost any other 
caribou herd. If the caribou are disturbed they have no-where to go. 
Caribou biologists believe oil development, or any large-scale 
disturbance and noise, risks displacement of cow and calve caribou from 
essential habitats, would likely hurt productivity, leading to 
declines, and possibly alter migration patterns.
    These are the expected and unavoidable effects of oil development 
even if it is done right. This is not the risk we face if there is a 
spill or other large industrial accident.
    As indigenous people, we have the right to continue our way of 
life, and that right is guaranteed by the International Covenant on 
Civil and Political Rights, signed by the President and Ratified by the 
Senate. Article 1 of that Covenant reads in part:
        ``In no case may a people be deprived of their own means of 
        subsistence.''
    The U.S. and Canadian governments signed an international agreement 
for management and long-term protection of the Porcupine Caribou Herd 
(Ottawa, July 17, 1987), forming the International Porcupine Caribou 
Commission (IPCC). The objectives of the agreement were: ``To conserve 
the Porcupine Caribou Herd and its habitat through international 
cooperation and coordination so that the risk of irreversible damage or 
long-term adverse effects as a result of use of caribou or their 
habitat is minimized; To ensure opportunities for customary and 
traditional uses of the Porcupine Caribou Herd (emphasis added); To 
enable users of Porcupine Caribou to participate in the international 
coordination of the conservation of the Porcupine Caribou Herd and its 
habitat; To encourage cooperation [and] communication among 
governments, users of Porcupine Caribou and others to achieve these 
objectives.''
    Much of the language used in this international (governments-to-
governments) agreement admits and supports the Gwich'in human and 
cultural rights regarding caribou habitat:
        ``Acknowledging that there are various human uses of 
caribou and that for generations certain people of Yukon Territory and 
the Northwest Territories in Canada have customarily and traditionally 
harvested Porcupine Caribou to meet their nutritional, cultural and 
other essential needs and will continue to do so in the future. . .and 
that these people should participate in the conservation of the 
Porcupine Caribou Herd and its habitat;
        ``Recognizing that. . .caribou in their large free-roaming 
herds comprise a unique and irreplaceable natural resource of great 
value which each generation should maintain. . .so as to conserve them 
for future generations;''
        ``. . .actions for the conservation of the Porcupine 
Caribou Herd that result in the long-term detriment of other indigenous 
species of wild fauna and flora should be avoided;''
        [referencing territory covered] ``. . .caribou found north 
of 64 degrees, 30' north latitude and north of the Yukon River which 
usually share common and traditional calving and post-calving 
aggregation grounds between the Canning River in the State of Alaska 
and the Babbage River in Yukon Territory and which historically migrate 
within the State of Alaska, Yukon Territory, and the Northwest 
Territories;''
        [under `Objectives'] ``f. The Parties should avoid or 
minimize activities that would significantly disrupt migration or other 
important behavior patterns of the Porcupine Caribou Herd or that would 
otherwise lessen the ability of users of Porcupine Caribou to use the 
Herd.
    There are other documents that support our claim, but it is the 
very simple human right to continue to live our live on our traditional 
lands that I hope you will remember.
    Mahsi'choo (thank you)
                                 ______
                                 
    The Chairman. Now I recognize Mr. Erich Pica, President of 
the Friends of the Earth. You are recognized for 5 minutes.

            STATEMENT OF ERICH G. PICA, PRESIDENT, 
                      FRIENDS OF THE EARTH

    Mr. Pica. Thank you, Chairman Hastings, Ranking Member 
Markey, and the members of the Committee. I appreciate the 
opportunity to testify today.
    My name is Erich Pica, and I am President of Friends of the 
Earth United States. Friends of the Earth is a national 
environmental nonprofit advocacy organization, and we are a 
member of Friends of the Earth International, which is the 
world's largest federation of grassroots environmental 
organizations, with member groups in 76 countries.
    Friends of the Earth has worked on environmental, tax, and 
budget issues for more than 30 years, and I have authored or 
written multiple reports on tax and environmental budget 
issues, including our Green Scissors report.
    The Joint Select Committee on Deficit Reduction has been 
tasked with coming up with $1.5 trillion in budget savings, on 
top of the $900 billion of cuts that have been made this year. 
While I believe that the supercommittee process is deeply 
flawed, the Natural Resources Committee has the opportunity to 
do something positive for the environment and taxpayers. 
Instead of facing this challenge head on, I believe that the 
Committee is myopically focusing on increased drilling in the 
Arctic National Wildlife Refuge with the hopes and promise of 
increasing Federal revenues.
    From the Federal revenue side of the equation, drilling in 
the Arctic is largely speculative, largely the equivalent of 
investing--this is the equivalent of investing in either a 
subprime mortgage or, dare I say, the Greek debt. And here is 
why. The Congressional Research Service estimates that revenue 
is simply unrealistic. The $191 billion over 30 years 
projection assumes a 50-50 cost split between the State and 
Federal Government. Current law says that 90 percent of that 
goes to Alaska, and 10 percent goes to the Federal Government. 
CRS also assumed a 33 percent tax rate for oil and gas 
companies. According to the Citizens for Tax Justice and the 
companies they looked at, no company they looked at paid that 
rate. And in fact, ExxonMobil, with $9.9 billion in pretax 
profits, only paid a .4 percent tax rate over the last 2 years. 
Finally, the estimate is over 20 years--which begins in 20 
years--which is highly speculative.
    A better bet is simply ending existing oil and tax 
giveaways, which would save taxpayers over $300 billion in the 
same period without damaging the Arctic. While these tax breaks 
and tax credits fall outside of this Committee's jurisdiction, 
increasing oil royalties fall within this Committee's 
jurisdiction. Submitting legislation to the supercommittee to 
fix the royalty-free oil and gas leases in the Gulf of Mexico 
could raise more than $53 billion. Simply raising royalty rates 
and taxes on oil companies could raise an additional tens of 
billions of dollars. The U.S. Currently lags behind countries 
like Norway, China, Australia, and Nigeria in capturing 
taxpayer revenue for oil and gas resources.
    But this Committee's jurisdiction is not limited to oil and 
gas resources. There is the 1872 Mining Law, which Lauren is 
going to testify on. This is a 140-year-old law that allows 
corporations to essentially take minerals for free off of 
public lands--gold, silver, copper; some of our most valuable 
resources. The Committee can also end a $100-million-a-year 
loss in the grazing program by either ending the program or 
simply charging what States and other private ranchers do, 
which is the fair market value for grazing. And finally, we are 
still paying for money-losing timber sales.
    The savings from reevaluating natural resources and getting 
the Federal Government's fair share are just the tip of the 
iceberg. This August, Friends of the Earth, along with 
Taxpayers for Common Sense, Public Citizen, and the Heritage 
Institute, a libertarian organization, released the Green 
Scissors 2011 report, which identified more than $380 billion 
in savings over the next 5 years.
    I want to commend Congressman Markey for his legislation 
that I believe was introduced yesterday for taking on some of 
these subjects. Ending perverse incentives that are destroying 
our environment is an important step that this Committee can 
make and a great contribution it can make to the 
supercommittee. These are not the root problems, though. The 
root problem is the environmental destruction that is occurring 
on our public lands and the fact that our government simply is 
giving away the resources to corporations to do with what they 
please. This has to end, and the supercommittee can do 
something about this with the Natural Resource Committee's 
help.
    Thank you, and I welcome any questions that come along.
    The Chairman. Thank you very much, Mr. Pica, for your 
testimony.
    [The prepared statement of Mr. Pica follows:]

      Statement of Erich G. Pica, President, Friends of the Earth

    Chairman Hastings, Ranking Member Markey, and members of the 
committee, thank you for giving me the opportunity to testify before 
you today.
    My name is Erich Pica and I am the President of Friends of the 
Earth US. Friends of the Earth fights to defend the environment and 
create a more healthy and just world. We are a member of a federation 
of grassroots groups working in 76 countries on today's most urgent 
environmental and social justice issues. Friends of the Earth US has 
more than 30 years of experience working on tax and budget issues and I 
personally have authored numerous reports on environment and tax and 
budget issues, including our Green Scissors report, which identifies 
wasteful spending that is harmful to the environment.
    The Joint Select Committee on Deficit Reduction has been tasked 
with coming up with $1.5 trillion dollars in budget savings, on top of 
the $900 billion in spending cuts that were agreed to as part of the 
latest debt ceiling increase. If the Joint Select Committee on Deficit 
Reduction cannot reach an agreement another $1.2 trillion dollars in 
cuts will be implemented automatically. Environmental programs stand 
among those that will be the hardest hit by these cuts. On behalf of 
our members and activists, I urge Congress not to accept a bad deal 
that extends the Bush tax cuts or weakens important parts of our social 
safety net. It is not too late to press the reset button on this flawed 
process.
    Over the past few months, we have all seen the rise of the Occupy 
movement in cities across the country and around the world. Friends of 
the Earth stands in solidarity with this movement, which serves as a 
reminder of the need for our government--and our budget--to serve 
people and the planet, not corporate polluters. This continuing public 
outcry for fundamental economic justice stands in stark contrast to the 
rhetoric about the ``need'' to cut social safety nets and environmental 
protections that has dominated the political discourse for much of the 
last year.
    The growing inequality in the United States and around the world 
manifests itself not only through disparities of wealth and 
opportunity, but of political power. In a country where money is speech 
and corporations are considered people, it is little wonder that the 
wealthiest seem to hold a tight grip on our political system. In the 
last decade, the influence of big business has expanded to such an 
extent that our civil and political systems have largely been captured 
by corporate lobbyists and campaign donations.
    Today, functions that were once the domain of the public sector--
from the provision of services, to the protection of our commons, to 
the fighting of our wars and even the writing of our laws--have been 
taken over by corporations that put profit before the public interest. 
There is perhaps no better illustration of this than the use of our 
public lands and waters. Increasingly multi-national corporations are 
being given control of our public's lands to exploit them for profit. 
Opening up the Arctic National Wildlife Refuge for drilling would be 
one more in a long line of giveaway of public lands for private 
profits.
    Drilling the Arctic National Wildlife Refuge to raise revenue is a 
false solution, and it goes directly against the values of the American 
people, which overwhelmingly support protecting the Refuge and our 
natural heritage. There are some places in this country that should be 
left untouched. Unfortunately, it is too late for many of them. We can 
still preserve Arctic Refuge, one of the last vast pristine, 
undisturbed wildernesses left in America.
    Efforts to authorize oil production in the Arctic would replace 
wilderness with oil derricks, roads, long pipelines connected by feeder 
pipelines, power plants, oil processing facilities, and landfills. It 
would despoil this wilderness with air pollution (particularly nitrogen 
oxides and methane, a greenhouse gas), oil spills, drilling wastes and 
sewer sludge. Both exploration and development would cause direct and 
cumulative impacts to our natural heritage, as well as to the wildlife 
and subsistence resources that the Arctic Refuge was established to 
protect. All of this sacrifice comes for little gain.
    The Congressional Research Service has estimated that drilling in 
the refuge could raise $191 billion over the 30 year drilling 
period.\1\ While this sounds like a significant amount of money, simply 
ending existing oil and gas tax giveaways would save taxpayers well 
over $300 billion in that same period without any of the damage that 
would accompany Arctic drilling.
---------------------------------------------------------------------------
    \1\ Congressional Research Service, Possible Federal Revenue from 
Oil Development of ANWR and Nearby Areas, RL34547, June 2008.
---------------------------------------------------------------------------
    The Congressional Research Service projections are unrealistically 
optimistic about the revenues that could be raised by drilling. The 
estimate assumes a 50/50 split of royalties between the State of Alaska 
and the federal government, but current law under the Alaska Statehood 
Act has 90% of royalties going to Alaska and only 10% going to the 
federal government. The Congressional Research Service analysis also 
assumes an unreasonably high effective tax rate of 33% on oil and gas 
revenues. A recent analysis by Citizens for Tax Justice found no oil 
and gas companies that are paying rates that high in the US.\2\ To 
illustrate, over the past two years ExxonMobil only paid an effective 
tax rate of .4% on their $9.9 billion in pretax US profits.\3\ Finally, 
drilling in the arctic cannot be a budget solution for today. The bulk 
of these highly speculative and likely diminutive funds would not be 
realized until 20 years into a drilling program, when production would 
be at its peak. And even if Congressional Research Service's estimates 
turn out to be accurate, it is simply not worth the environmental 
destruction it would create.
---------------------------------------------------------------------------
    \2\ Citizens for Tax Justice, The Great Myth about the Great Myth 
about Oil Tax Breaks, http://tax.com/taxcom/features.nsf/Articles/
A276A2A68C3C993B8525783300510DDF?OpenDocument
    \3\ Citizens for Tax Justice, Congress Should End Oil & Gas Tax 
Breaks, April 29th 2011
---------------------------------------------------------------------------
    What makes this giveaway particularly egregious is that some are 
justifying it under the pretense of fiscal responsibility, while the 
same companies that stand to benefit are currently robbing taxpayers of 
billions of dollars worth of resources each year. An honest discussion 
about how to raise revenue from oil and gas production or other natural 
resources must start with making sure that taxpayers get a fair return 
on the resources that are already being exploited, not with how to open 
up even more lands to oil and gas companies at cut rate prices.
    We should begin by making oil companies pay for the oil they are 
extracting in public waters in the Gulf of Mexico. According to the 
Government Accountability Office taxpayers stand to loose $53 billion 
from royalty free leases in the Gulf.\4\
---------------------------------------------------------------------------
    \4\ United States Government Accountability Office, Oil and Gas 
Royalties: Litigation over Royalty Relief Could Cost the Federal 
Government Billions of Dollars, GAO-08-792R Royalty Relief, June 5 
2008.
---------------------------------------------------------------------------
    Even when taxpayers are getting some return for our oil and gas 
resources, we are still not receiving our fair share. That's because 
even after President Bush increased federal royalty rates for oil and 
gas, these rates are among the lowest in the world. And all of this is 
on top of the more than $10 billion a year in tax incentives that we 
give to this polluting industry that is helping them produce record 
profits.
    But it is not just oil and gas that is being handed over to 
corporations for free. The 1872 Mining law allows corporations to take 
valuable minerals such as gold, silver and copper from our land for 
free, costing taxpayers over $300 million every year. Similarly, the 
federal government actually loses $100 million a year on its grazing 
program. That's right: despite the fact that we charge grazing fees, 
taxpayers would save money--and protect the environment--by simply 
eliminating grazing on our federal lands. At minimum, we should 
increase the grazing fees to market prices.
    And the programs I mentioned are just the tip of the iceberg. Our 
Green Scissors 2011 report identifies more than $380 billion in 
potential savings over 5 years that could be achieved by eliminating 
subsidies--many of them corporate handouts--while benefitting the 
environment. We released this report in partnership with Taxpayers for 
Common Sense, Public Citizen and The Heartland Institute. Clearly, that 
is a diverse group with divergent views about the role of government. 
But we can get past our differences and all agree that these proposals 
make sense.
    Recommendations from Green Scissors 2011 that are under the 
jurisdiction of this Committee include:
    Reforming the 1872 Mining Law: The 1872 Mining Law is perhaps the 
grandfather of all anti-environmental giveaways. First enacted under 
President Ulysses S. Grant in 1872, the law was intended to promote 
western settlement. Yet, 139 years later, this anachronistic law 
remains unchanged, providing an enormous subsidy to the biggest mining 
operators in the world like UK-based Rio Tinto. Under the 1872 law, 
mining companies pay no royalties for the minerals they remove from 
federal lands and can purchase federal land for $5 per acre (a weak 
annual moratorium on purchases has been put in place, but there is no 
permanent fix). Taxpayers receive nothing for the approximately $2.4 
billion worth of precious minerals such as gold, silver and copper that 
mining companies extract annually from federal lands. A royalty rate of 
just 12.5% would return $300 million to taxpayers annually.
    Ending Royalty Free Leases: The federal government gives away oil 
and gas deposits for free. For years gasoline prices have been at 
record levels and oil companies have enjoyed sky-high profits, making 
the subsidization of the industry particularly egregious. The 1995 Deep 
Water Royalty Relief Act (DWRRA) provided royalty ``relief'' for leases 
sold from 1996-2000. According to the Government Accountability Office 
in 2008 the total cost to taxpayers could exceed $53 billion in the 
next 25 years.\5\ Instead of fixing this giant giveaway, Congress 
widened it in 2005 by providing additional royalty relief in the Energy 
Policy Act.
---------------------------------------------------------------------------
    \5\ United States Government Accountability Office, Oil and Gas 
Royalties: Litigation over Royalty Relief Could Cost the Federal 
Government Billions of Dollars, GAO-08-792R Royalty Relief, June 5 
2008.
---------------------------------------------------------------------------
    Receiving Fair Value for Oil and Gas Royalties: Taxpayers are being 
cheated out of billions of dollars because of lax oversight by our 
nation's royalty collection system and low royalty rates. The 
Government Accountability Office has targeted the nation's oil and gas 
royalty collection for serious criticism, giving it a ``high risk for 
waste'' tag this year.\6\ In 2008 the Government Accountability Office 
found that over the last two years the Department of the Interior had 
made continual blunders with the collection of company-reported data 
and offered unreliable sales data that do not reflect market prices for 
oil and gas. Even when the royalty system is working properly taxpayers 
are getting less than their fair share. According to a 2007 Government 
Accountability Office report, despite a recent increase in rates for 
offshore oil and gas royalties, US rates for oil and gas production are 
among the lowest in the world, and lower than those of the states.\7\ 
Royalty rates for oil and gas production on-shore have not been raised 
in over 25 years. The failure to charge and collect appropriate fees 
for oil and gas production on public lands is robbing taxpayers of much 
needed revenue.
---------------------------------------------------------------------------
    \6\ Government Accountability Office, High Risk Series Update, GAO-
11-270, February 2011.
    \7\ Government Accountability Office, Oil and Gas Royalties: A 
Comparison of the Share of Revenue Received from Oil and Gas Production 
by the Federal Government and Other Resource Owners; GAO-07-676R, May 
1, 2007.
---------------------------------------------------------------------------
    Reforming Grazing Fees: In 2009 the United States Forest Service 
and Bureau of Land Management public grazing programs cost taxpayers 
$120 million to operate but collected only $17 million in fees, costing 
taxpayers $103 million. The reason for this loss is because federal 
grazing fees are lower than the fees charged by almost every state, 
offering a giant subsidy to a small percentage of ranchers. In fiscal 
year 2007, federal grazing fees fell to $1.35 per acre, the lowest 
amount allowed by law. To put that in perspective, the first uniform 
federal grazing fee that was established in 1934 was set at $1.23 per 
acre. The equivalent, in 2010 dollars, is $19.81 per acre. Using state 
formulas to assess grazing fees would save taxpayers $41 million over 5 
years.\8\
---------------------------------------------------------------------------
    \8\ Congressional Budget Office, Reducing the Deficit: Spending and 
Budget Options, Pub. No. 4212, March 2011.
---------------------------------------------------------------------------
    Stopping Money Losing Timber Sales: According to the Congressional 
Budget Office, the United States Forest Service has spent more on the 
timber program in recent years than it has collected in revenue from 
the companies that harvest the timber.\9\ In 2008 the United States 
Forest Service lost $45 million by selling rights to log roughly 2.5 
billion board feet of public timber. The Congressional Budget Office 
estimated that reducing money for timber sales that lose money could 
save taxpayers $276 million over 5 years.
---------------------------------------------------------------------------
    \9\ Congressional Budget Office, Reducing Budget Options Vol 2, 
Pub. No. 3191, August 2009.
---------------------------------------------------------------------------
    Even with $380 billion in potential savings, the Green Scissors 
2011 report was unable to document all of the savings that could be 
achieved by protecting the environment. Other key ideas that this 
committee should explore include:
    Increasing Offshore Oil and Gas Inspection Fees: The Deepwater 
Horizon tragedy in the Gulf of Mexico highlighted the inadequacy of our 
current safety and response system for oil spills. We badly need to 
upgrade these systems and we should ensure that industry, and not 
taxpayers, pays the cost. The No Free Inspections for Oil Companies 
Act, H.R. 2566 would save taxpayers $500 million over 10 years by 
making the oil and gas industry bear some of the costs caused by their 
industry.
    Ending Giveaways to States: The Gulf of Mexico Energy Security Act 
of 2006 gave 37.5% of revenue from selected offshore leases in federal 
waters to a select group of states. This arrangement provides some 
states with a massive financial incentive to support increased oil and 
gas production and the perpetuation of our fossil fuels based economy. 
It will also have a significant cost on the rest of the country, 
costing the Federal Treasury $150 billion over the next 60 years. We 
should not be giving away federal resources to a few favored states.
    Ending perverse incentives for destroying our environment is an 
important step for fiscal and environmental stewardship. But the root 
problems that are plaguing our environment are the same ones that are 
harming our economy and weakening our nation. Our government is simply 
too responsive to the wants of powerful corporations at the expense of 
the majority of Americans. To solve these problems we need to not only 
end polluter subsidies, but also end of the Bush tax cuts that are 
largely responsible for our current budget crunch impose a transactions 
tax on Wall Street traders who have caused much of our current economic 
crisis, put a stop to offshore tax avoidance, increase taxes for the 
wealthy, and implement other progressive fiscal policies. Progressive 
tax, economic and financial policies are not only critical for our 
environment, but are also fairer and more equitable for our society.
    We need to refocus our national conversation on how wealth and 
power have become increasingly concentrated, not on how we can funnel 
even more wealth to a chosen few at tremendous cost to us all.
    Thank you, and I welcome any questions.
                                 ______
                                 
    [NOTE: ``Green Scissors Cutting Wasteful and Environmentally 
Harmful Spending 2011'` submitted for the record has been retained in 
the Committee's official files. It can be found at the following site: 
http://greenscissors.com/news/green-scissors-2011/
    The Chairman. Last, we will go to Ms. Lauren Pagel, Policy 
Director for Earthworks. You are recognized for 5 minutes.

     STATEMENT OF LAUREN PAGEL, POLICY DIRECTOR, EARTHWORKS

    Ms. Pagel. Thank you, Chairman Hastings, Ranking Member 
Markey, and members of the Committee, for the opportunity to 
speak to you today about the importance of ensuring that mining 
companies pay their fair share to reduce the deficit and create 
jobs.
    Earthworks is a national conservation organization 
dedicated to protecting communities and the environment from 
the destructive impacts of mineral development here in the U.S. 
and internationally.
    These are direct quotes from the 2010 annual reports of the 
top five hardrock mining companies: ``Record underlying 
earnings''; ``record cash flow''; ``record revenue''; ``record 
financial results''; ``the best financial results in our 
company's history.''
    Right now, we are subsidizing these record-breaking profits 
and allowing a lucrative, well-established industry to fleece 
the taxpayer out of millions of dollars while externalizing 
their environmental costs. The antiquated 1872 mining law, as 
Erich mentioned, still allows mining companies to take minerals 
from public lands for free with no royalty paid to the 
taxpayer. Unlike the coal, oil, and gas industries that pay a 
royalty, gold, copper, silver, and uranium are frequently taken 
from our forest and other lands by both foreign and domestic 
mining companies, with no return to the Federal Treasury.
    Real and meaningful reform of the 1872 Mining Law is needed 
to protect both taxpayers and the environment. This reform 
should include a fair return to the taxpayer, as well as 
operating and reclamation standards, and the ability to balance 
mining with other uses. Hardrock mining companies should be 
required to pay a royalty similar to what other extractive 
industries pay, a 12.5 percent royalty, which is in the 
legislation that Mr. Markey introduced recently and would 
generate about $300 million a year.
    In addition to free minerals, mining companies receive a 
substantial additional subsidy called the Percentage Depletion 
Allowance, which allows foreign and domestic companies to 
deduct from their corporate income taxes a fixed percentage of 
their mine-specific income. For companies that mine on public 
lands, this amounts to a double subsidy, because the minerals 
weren't purchased to begin with; so minerals that were taken 
for free under the 1872 Mining Law, and then you receive an 
additional tax deduction on that.
    The depletion allowance is an exceptional tax break for 
U.S. mineral producers. The oil and gas industry has something 
similar, and it is beyond what is granted to other private 
industries. Repealing the depletion allowance for hardrock 
mining would save the taxpayer almost $800 million a year.
    We also support a reclamation fee on all hardrock mining. 
We must find a way to begin the tremendous task of cleaning up 
the hundreds of thousands of abandoned mines that litter the 
Western United States. With a $50 billion price tag for 
cleanup, and 40 percent of the headwaters of Western watersheds 
polluted by mine waste, a dedicated source of funding is long 
overdue. A $200 million reclamation fee similar to the one that 
is in Mr. Markey's new legislation, H.R. 3446, would clean up 
mines and also create at least 13,000 jobs. A steady stream of 
abandoned mine land funding will also allow us to also stop 
spending money generated by the coal industry to clean up the 
mess that the hardrock mining industry makes, savings taxpayers 
an additional $100 million a year.
    Unfortunately, abandoned mines are not the only liability 
held by U.S. taxpayers for the mining industry. Existing mines 
are likely to produce even more polluted streams and scarred 
land, and billions of dollars in inadequate financial 
assurances have been identified.
    Perpetual water pollution is one of the most serious 
consequences of large-scale industrial mining operations and 
one of the most costly postclosure expenditures. The problem is 
exacerbated by two loopholes in the Clean Water Act that allow 
mining companies to dump their waste directly into streams, 
wetlands, and lakes. By closing these two loopholes, we can 
prevent these long-term pollution problems. This coupled with 
reforming the way that financial assurances are calculated can 
ensure that mining companies pay for the cost of doing business 
and American taxpayers do not.
    It is past time for taxpayers to stop directly subsidizing 
multibillion-dollar mining companies with royalty-free mining 
and massive tax breaks. We also need to stop the indirect 
financing of these companies that allow them to foist their 
environmental costs of extraction onto taxpayers and 
communities. American taxpayers and communities that live with 
these pollution issues each day deserve better.
    Free minerals, abandoned mines, subsidies, loopholes for 
major environmental laws, and inadequate bonding have created 
an unsustainable situation in this country. It is time to 
repurpose these billions of dollars and put that money toward 
deficit reduction, job creation, and cleaning up our Nation's 
polluted land and waters.
    Thank you.
    The Chairman. Thank you for your testimony.
    [The prepared statement of Ms. Pagel follows:]

         Statement of Lauren Pagel, Policy Director, Earthworks

    Thank you Mr. Chairman, Ranking Member Markey and Members of the 
Committee for the opportunity to speak to you today about the 
importance of ensuring that mining companies pay their fair share and 
internalize the costs of doing business.
    Earthworks is a national conservation organization dedicated to 
protecting communities and the environment from destructive mineral 
development, here in the United States and internationally. We work 
closely with broad coalitions of local government, Native Americans, 
citizen groups and other conservation organizations to improve the 
policies governing hard rock mining and oil and gas development.
Record Profits
    In 2010, the top five hardrock mining companies with operations in 
the United States--made a total profit of $29 billion. Rio Tinto, who 
operated the Bingham Canyon mine in Utah, defined last year by ``record 
underlying earnings'' and ``record cash flow.'' Freeport McMoran, who 
operates seven copper mines in the Southwestern United States said that 
this year yielded ``the best financial results in our company's 
history.''
    With precious metals prices near all time highs, big mining 
companies are enjoying astounding profits. Newmont Mining of Denver--
the largest producer in the United States and operator of three mines 
that are among the nation's ten biggest sources of toxic pollution--saw 
profits double from 2008 to 2010, to $1.8 billion last year. At Barrick 
Gold Co. of Toronto--the world's largest gold producer, profits for the 
second quarter of 2011 were $1.2 billion, up 35 percent over 2010.
Free Minerals
    The 1872 Mining Law is one of the last remaining dinosaurs of the 
old West. Signed by President Ulysses S. Grant over 135 years ago, this 
law still governs hardrock mining on federal public lands. The law 
covers hardrock mining on 270 million of acres of publicly owned 
lands--mostly in the Rocky Mountain West and Alaska.
    This antiquated law allows mining companies to take hardrock 
minerals from public lands with no royalty paid to the taxpayer. Unlike 
the coal mining industry, which is required by the Surface Mining 
Control and Reclamation Act (SMCRA) to pay an 8% or 12.5% royalty, 
gold, copper, silver and uranium are frequently taken from our forests 
and other lands by both foreign and domestic mining companies with no 
return to the federal treasury.
    The United States is the only country in the world that does not 
charge a royalty for minerals taken from federal lands, and claims are 
on the rise. From 2005 to 2010, the number of mining claims on public 
lands rose by 74%.
    Hardrock mining companies should be required to pay a royalty 
similar to what other extractive industries pay--a gross proceeds 
royalty, based on the value of the mineral minus the smelting costs. A 
12.5% royalty on the minerals taken from public lands could generate as 
much as $300 million a year.
    Real and meaningful reform of the 1872 Mining Law must contain 
several other key principles in addition to a royalty:
        1.  The elimination of patenting of federal lands--the sale of 
        mineral bearing public lands for $5/acre, or less.
        2.  The ability of land managers to deny mining activities on 
        federal lands where conflicts exist with other, more important 
        resource values.
        3.  Comprehensive reclamation requirements for all mining, with 
        particular consider to protecting water resources that could be 
        polluted by mining.
        4.  Adequate financial assurances in place to cover the costs 
        of reclaiming mines.
        5.  A reclamation fee charged on all hardrock mining in the 
        United States, regardless of its location, that funds an 
        abandoned mine program.
Double Subsidies
    In addition to taking minerals from public lands for free, the 
hardrock mining industry also receives a substantial additional subsidy 
called the Percentage Depletion Allowance (PDA). The depletion 
allowance allows both foreign and domestic mining companies to deduct 
from its corporate income taxes a fixed percentage of its mine specific 
income. The rationale for this deduction the value of its asset (the 
mineral in the ground) declines as mining progresses.
    For companies that mine on public lands, this amounts to a double 
subsidy, because the minerals weren't purchased, they were freely taken 
under the 1872 Mining Law. The Percentage Depletion Allowance is like 
winning a free car in a sweepstakes and then having the car 
manufacturer pay you for the fact that the price of the car decreases 
when you drive it off the lot.
     The PDA applies nationwide to mining operations on private and 
public lands, and constitutes an exceptional tax break for U.S. mineral 
producers beyond those granted to other private industries. The tax 
break that Newmont (the world's second largest gold mining company) 
took under this deduction alone totaled $151 million in 2010. Repealing 
the percentage depletion allowance would save the taxpayer $3.8 billion 
over 5 years.
Taxpayer Liability for Abandoned Mines
    In 1993, Earthworks assessed the scope of the abandoned mine 
problem and estimated that there are over 550,000 abandoned mines in 
the U.S., mostly in the West. To date, there is still no comprehensive 
inventory of abandoned hardrock mines, and funds to clean up these 
sites remain limited because there is no dedicated funding source--
unlike with coal mines. The cost to clean up these abandoned sites is 
staggering. According to the Environmental Protection Agency (EPA), 
total clean-up costs could exceed $50 billion.
    Western communities face significant burdens associated with these 
old mines. According to the Environmental Protection Agency, at least 
40 percent of the stream reaches in the headwaters of western 
watersheds are polluted from mining--much of it from abandoned mines. 
Many of these abandoned mine sites have significant acid mine drainage 
problems, which can persist for thousands of years if left untreated. 
Downstream communities pay the costs to clean up water polluted from 
abandoned mines for household use. Polluted waters affect recreation, 
agriculture, and impact property values. Fish and wildlife resources 
are also negatively impacted.
    Abandoned uranium mines pose the added threat of radiation. Surface 
and underground uranium mining produces waste, which contain naturally 
occurring radioactive materials in addition to the heavy metals found 
in most hardrock mine waste. When these toxic materials become exposed 
to the environment through mining activities, they can be mobilized in 
air and water. Continued exposure to radioactive materials such as 
radium and thorium cause serious health problems. The EPA estimates 
there are at least 4,000 abandoned uranium mines in 14 western states, 
with most situated in Colorado, Utah, New Mexico, Arizona, and Wyoming.
    The single largest obstacle to the restoration of abandoned 
hardrock mines is the lack of funding. In states like Montana--where 
revenues exist from a state severance tax and the state is authorized 
to restore abandoned mines with revenues from the coal abandoned mine 
land fund--there is a small stream of revenue (on average about $3.5 
million) available to remediate only a few small sites a year, but it 
is not enough to address the serious problems posed by the 6,000 
inventoried abandoned mines across the state, and the estimated 3,700 
miles of rivers and streams polluted by harmful metals, primarily from 
abandoned mines. In other states, such as California and New Mexico, 
there are few sources of funds available to correct this pervasive 
problem in old mining districts. As a result, the number of abandoned 
mine lands that cause safety or environmental hazards far outweigh the 
funding available to restore them.
    Unlike the coal mining industry, which is required by the Surface 
Mining Control and Reclamation Act (SMCRA) to pay into an Abandoned 
Mine Land Fund via a reclamation fee, the hardrock mining industry pays 
no such fee. A steady-stream of long-term funding for hardrock AML 
clean up, similar to the SMCRA program, is essential to dealing with 
the scope of the problems western states face from abandoned mines.
    As part of its FY2012 budget, the Obama administration has proposed 
a 1% reclamation fee on all hardrock mining, similar to the fee paid by 
coal mines. This fee would generate $200 million per year to fund 
abandoned mine restoration, creating an estimated 13,000 jobs per year.
Current and Future Taxpayer Liability
    While abandoned mine sites litter the landscape of the western 
United States, currently existing mines are likely to produce even more 
polluted streams and scarred lands. In modern mining, reclamation bonds 
and similar forms of financial assurance are intended to guarantee that 
if a mining company is unable or unwilling to clean up after a mine 
closes, funds will be available to remedy and prevent pollution at the 
site.
    American taxpayers today are potentially liable for more than $12 
billion in clean-up costs for currently operating hardrock mining 
sites. Because mining companies are inadequately insured to pay for 
cleaning up their toxic pollution, the public is left footing the 
enormous costs. According to GAO, from 1997 to 2008, four federal 
agencies--BLM, the Forest Service, EPA, and OSM--had spent at least a 
total of $2.6 billion to reclaim abandoned hardrock mines on federal, 
state, private, and Indian lands.
    Perpetual water pollution is one of the most serious consequences 
of large-scale industrial mining operations and one of the most costly 
post-closure expenditures. This problem is exacerbated by two loopholes 
in the Clean Water Act that allow mining companies to dump their waste 
directly into streams, wetlands and lakes. Hardrock mines produce 
millions, sometimes billions of tons of waste. The production of one 
gold ring produces 20 tons of mine waste. Mine waste and tailings 
frequently contain toxic chemicals such as arsenic, cadmium, and lead.
    The first loophole is found in EPA and Army Corps of Engineers 
regulations that state that Clean Water Act protections do not apply to 
what the Corps calls ``waste treatment systems.'' This exclusion allows 
mine developers to build a dam across the mouth of a valley and dump 
their wastes into the waters behind the dam because these waters have 
become part of a ``waste treatment system'' and are no longer 
considered to be a river, lake, or wetland deserving of protection. 
This legal fiction--that waters impounded by mine developers are no 
longer waters--defeats the very purpose and spirit of the Clean Water 
Act.
    During the Bush administration, EPA and the Army Corps of Engineers 
created a second dangerous loophole that has allowed mining 
corporations to call mining waste ``fill material'' and therefore 
bypass pollution standards--even though the waste includes toxic 
chemicals. Because of these two loopholes, it has become a common 
industry practice for mines to use our lakes, streams, and other waters 
as cheap toxic waste dumps.
    By closing loopholes in the Clean Water Act, we can prevent some of 
the long-term pollution problems associated with many open pit mines. 
This, coupled with reforming the way that financial assurances are 
calculated, will ensure that each mining companies cost of doing 
business is internalized and American taxpayers are not left to foot 
the bill for clean up of dozens of mine sites with inadequate 
reclamation bonds. We must protect the public from further liability in 
the event a company cannot meet its environmental obligations.
Conclusion
    It's past time for taxpayers to stop directly subsidizing 
multibillion-dollar mining companies with royalty-free mining and 
massive tax breaks. We need also stop indirectly subsidizing these 
multinational corporations by allowing them to foist the environmental 
costs of extraction onto taxpayers and communities.
    Taxpayers and the communities that live with these pollution issues 
each day deserve better. Free minerals, abandoned mines, tax 
deductions, loopholes from major environmental laws and inadequate 
bonding have created an expensively unsustainable situation in this 
country. Hundreds of billions of dollars of taxpayer resources have 
been gifted to the mining industry by the 1872 Mining Law. And billions 
more are essentially given away each year--money that could be used to 
create jobs to clean up our nation's waters and lands.
    Earthworks recommends Congress end the subsidies for the mining 
industry, starting with real and meaningful reform of the 1872 Mining 
Law. Any law that gives away community property while allowing mining 
to occur in sacred and otherwise special places is long past due for an 
overhaul. We also encourage the Obama administration to prevent future 
expensive environmental liabilities by closing loopholes in the Clean 
Water Act that allow mine waste dumping in our nations waters, and by 
strengthening current bonding standards under the Federal Land 
Management and Policy Act.
    We encourage the Joint Select Committee on Deficit Reduction to 
move forward with a reclamation fee on all hardrock mining operations. 
The steady-source of funding created by this fee will go a long way in 
reducing the current taxpayer burden for this liability. We also hope 
that the Select Committee will repeal the Percentage Depletion 
Allowance for nonfuel (hardrock) minerals, which will help decrease the 
deficit by almost $800 million a year.
                                 ______
                                 
    The Chairman. Ms. Pagel, I want to take this opportunity to 
clarify the topic of the hearing for you and the public who may 
be watching or listening to the broadcast of this hearing. Our 
invitation to you and other witnesses indicated the topic of 
the hearing is: ANWR: Jobs, Energy, and Deficit Reduction.
    The other testimony that we have received, albeit some more 
than others, at least tangentially is related to the topic at 
hand; however, other than the header, I know that your 
testimony doesn't even mention ANWR a single time. At best, I 
question the pertinence of your testimony on the subject matter 
of this hearing.
    So that being said, I will just remind the witnesses and 
the Members to stay on the topic, which, of course, is: ANWR: 
Jobs, Energy, and Deficit Reduction.
    With that, we will enter into the question period. I 
recognize the gentleman from Massachusetts Mr. Markey.
    Mr. Markey. Thank you, Mr. Chairman, very much.
    I might interject at this point that I heard Ms. Pagel, as 
I did Mr. Pica, endorse the legislation which I introduced with 
Mr. Holt and Mr. Grijalva that calls for a larger collection of 
revenue from the oil industry and the mining industry as an 
alternative to drilling in the Arctic Refuge. I think that is 
directly pertinent because they both offered an alternative to 
the proposal which the majority has before the Committee. I 
think that is right on point. In fact, as we heard earlier, 
upwards of $300 billion can be collected from going down that 
route, whereas only $600 million can be collected from the 
route that the majority is proposing over the next 10 years.
    So I think that is right on the money, and it just kind of 
deals with the oil industry and the mining industry, as they 
right now get away without paying their fair share of the dues 
to live in our country, while putting the burden on others and 
asking for a sacrifice to be made by, in this instance, an area 
of our country which has often been compared to the African 
Serengeti. So I think it is right on point.
    Maybe, Professor Brinkley, you can put this in perspective 
for us, this question of what it is that we receive because we 
would try to preserve this area from having oil and other 
natural resources be drilled for on this location.
    Dr. Brinkley. Well, I come at this as somebody who loves 
America. We sing a song ``America the Beautiful,'' and we 
choose treasured landscapes in this country, and we protect 
them with our lives. Theodore Roosevelt used to say, ``The 
Europeans can keep the Louvre and Westminster Abbey, but we 
have the Tetons, we have redwood California, we have the Grand 
Canyon.''
    Arctic Alaska is a very significant landscape to the psyche 
of the American people. When you study U.S. history, wilderness 
is something to be treasured and preserved, particularly in the 
20th century, because it reestablishes the American spirit.
    Many soldiers, people that were veterans from Vietnam, go 
up to the Arctic Refuge with backpack on to hike. Recreation 
dollars for the Arctic Refuge, people--myself included--camping 
up there. Ecotourism, as I write about in a book I recently 
did, The Quiet World, with people at Denali Lodge. Nobody 
thought people were going to come to Mount McKinley. Nobody 
though people were going to come to see glaciers of the Inside 
Passage. Ecotourism is a huge industry for Alaska. To talk 
about saving of the Arctic is to talk about the money of the 
Arctic, and more as more, as the world shrinks, you are going 
to have people looking for true wildernesses. The Arctic Refuge 
is called the last wilderness.
    Incidentally, it has always been called the Arctic Refuge 
until the oil lobby started calling it ANWR, because it sounds 
like Anwar Sadat or some country in the Middle East. Do you 
want to drill ANWR? Yes. Do you want to molest Eisenhower's 
great wildlife reserve? No.
    So it is the way the issues frame. But what I have found 
odious over the past 50 years are people that have been saying 
that there is no biological heart to the Arctic Refuge, that it 
is a wasteland, there is nothing there; a few caribou rubbing 
their bellies against pipes. And I know in particular Mr. Young 
knows better than that, because I know he is a trapper and 
spent time up there.
    The question becomes: What price? How buyable are 
Americans? How low do we get when we start taking our key 
heirlooms and we start selling them to Dutch Royal Shell or 
British Petroleum? BP's recent report has walruses living in 
the Gulf of Mexico. Do we think that they know how to drill up 
in the Arctic? They don't.
    We have had spill on the tundra. This is a very fragile and 
special ecosytem, and the Arctic and Antarctica are world 
heritage centers. There is going to be drilling that goes on up 
there. But when we have our Nation's largest wildlife preserve, 
the crown jewel of 500 wildlife reserves, and to be even 
suggesting in 2011, in a time of climate crisis, that we are 
going to drill, drill, drill the Arctic Refuge, it has become a 
political issue, and I think it needs to be taken out of the 
Committee, taken out of Congress, and I think President Obama 
needs to sign an Executive Order creating a national monument 
for further Federal protection within the Arctic Refuge.
    Mr. Markey. Thank you, Professor. Thank you for raising Moe 
Udall's name. The first day he was here as Chairman was my 
first day on the Committee, 35 years ago.
    Dr. Brinkley. They are a great American family, the Udall 
family.
    Mr. Markey. So thank you so much for raising his name and 
memory because it means a lot to so many of us on the 
Committee.
    Thank you, Mr. Chairman.
    The Chairman. The time of the gentleman has expired.
    In response to my friend, I just remind you that this is an 
extension of an earlier hearing, which was ANWR. The gentleman 
could have correctly brought up what he brought up in his 
remarks this morning when, in fact, we did have a Subcommittee 
hearing of the Energy and Minerals Subcommittee, where, in 
fact, that testimony would have been pertinent. But this is 
this testimony about ANWR.
    Mr. Markey. If I may, Mr. Chairman, just to say I felt that 
we needed this hearing so that the deficit reduction aspect of 
that hearing that we have already had was properly inserted 
into the record.
    The Chairman. I just tell the gentleman that the hearing--
one can read into whatever one wants on a direction of where 
developing the resources in ANWR would go, but the hearing was 
on ANWR.
    Mr. Markey. Deficit reduction.
    The Chairman. But the hearing was on ANWR.
    With that, I will recognize the gentleman from Alaska Mr. 
Young.
    Mr. Young. Thank you, Chairman, and thanks for having this 
hearing. I will tell you if you ever want to see an exercise in 
futility, it is this hearing. That side has already made up its 
mind. This side has already made up its mind. And the--I call 
it garbage, Dr. Rice, that comes from the mouth----
    Dr. Brinkley. Dr. Brinkley. Rice is the university.
    Mr. Young. I will call you anything I want when you sit in 
that chair.
    Dr. Brinkley. Pardon?
    Mr. Young. You just be quiet. You be quiet
    Dr. Brinkley. You don't own me. I pay your salary. I will 
tell you right now----
    The Chairman. If the gentleman will suspend, I will remind 
Members----
    Dr. Brinkley. I work for the private sector. You work for 
the taxpayers.
    The Chairman. Mr. Brinkley, you were invited here for 
testimony, and we look forward to your testimony. You got the 
time to say what---
    Dr. Brinkley. He called me garbage and called me Mr. Rice. 
I needed to correct the record.
    The Chairman. Mr. Brinkley, we see a lot of people here, 
and from time to time we make faux pas. Nobody is perfect here. 
But to interrupt breaks the comity--we are going to have 
disagreements here. You have already seen that.
    Dr. Brinkley. He called me Mr. Rice and used ``garbage'' in 
the word Mr. Rice. You would do that if somebody said that to 
your name, too.
    The Chairman. Mr. Brinkley, I have been called a lot of 
things in my time.
    Dr. Brinkley. I wouldn't call you that. You are a good 
Congressman.
    The Chairman. Mr. Brinkley, do you want to continue sitting 
at this panel?
    Dr. Brinkley. Yes.
    The Chairman. OK, then, please follow the rules.
    Mr. Young.
    Mr. Young. What I am suggesting, Mr. Brinkley----
    Dr. Brinkley. Thank you.
    Mr. Young. You say you have been up there. You have camped 
one time. How many people ever visited the Arctic Wildlife 
Refuge last year?
    Dr. Brinkley. Not many.
    Mr. Young. Not many. We have sort of an elitist group who 
are going up there, an elitist group.
    Now, I have been all over that area.
    Dr. Brinkley. I know you have.
    Mr. Young. And I know what I am talking about. The Arctic 
Plain is really nothing. You say it is not the heart. It is not 
the heart. It is not the heart. It is part of the most desolate 
part of the area. And what hurts me the most is you sit there 
in the Rice University, when the people support drilling for 
their good and good of this Nation, as a college professor in 
an ivory tower.
    You can go up and you camp and spend your time, and I hope 
you spend a lot of money. But the reality is this area should 
be drilled. I have been fighting this battle for 39 years. It 
was set aside for drilling, not by the oil companies, but by 
Henry ``Scoop'' Jackson, by Ted Stevens, by the Administration, 
because they knew the potential was there. And we did put the 
safeguards in there that the Congress have to vote on it.
    Now, you can go on all the pontification you want. That 
refuge is 19 million acres. Nineteen million acres. We are 
talking about less than 3,000 acres, a little tiny thing. It is 
like the hair on your head. You pull one hair, you are not 
going to miss it. And this country is starving itself because 
we are buying foreign oil.
    To say that we don't need the Arctic Wildlife Refuge is 
wrong. And I am listening to the people that live there, not 
the people that live 400 miles away, not the people that live 
in Fairbanks, not the people that say they represent a certain 
group, when they do not. I am not saying that. I am saying 
let's listen to the people that live there. Seventy-six percent 
of Alaskans support it, and everybody that I know of on that 
coast, other than a small group of people, say it is the right 
thing to do because they know it can be done.
    It is 74 miles from the pipeline, 74 miles of pipe.
    Mr. Chairman, again, thank you for the interruption. I made 
a mistake when I said ``Mr. Rice'' because I heard the Rice 
University, and that can get in my mind. But like I say, when 
we are here, we are the ones that ask the questions, and you 
answer the questions. You may not work in the private sector.
    Dr. Brinkley. I do work in the private sector.
    Mr. Young. By the way--I am not asking you a question yet. 
You may not. But when you think about it a moment, you made a 
comment about me is why I am really pissed right now, is 
because you, in fact, said that I wasn't here. I was over on 
the Floor voting.
    Dr. Brinkley. I know you were.
    Mr. Young. OK. Then don't mention my name.
    I yield back the time.
    Dr. Brinkley. I mentioned your portrait is behind me.
    The Chairman. The gentleman yields back his time.
    The Chair recognizes the gentleman from New Jersey, Mr. 
Holt.
    Mr. Holt. Thank you, Mr. Chairman.
    Ms. James, could you tell us again the name that the 
Gwich'in call the region, the wildlife refuge region, both in 
the Gwich'in language and in a translation, please?
    Ms. James. Iizhik Gwats'an Gwandaii Goodlit. That means 
``sacred place where the life begins.''
    Mr. Holt. Where the life begins. I think that highlights 
the significance that this is more than a local issue. There is 
much more that derives from this than the entertainment of a 
few elite people, I think. This is, I think, a national 
treasure.
    Mr. Pica, we have heard it over and over again and as 
recently as a few minutes ago that this area is visited by so 
few people, and it really should be a local issue. What do you 
have to say to that? And maybe it helps to keep in mind what 
Mr. Brinkley said earlier about the so few people who were 
visiting Yosemite; these so few people who were visiting. It 
was only a little over 120 years ago that anybody went through 
the Grand Canyon, it was so few people that visited Glacier, 
and on and on.
    Would you comment, please?
    Mr. Pica. These are Federal lands. The Federal taxpayer and 
the Federal Government has a right to preserve these lands and 
to protect these lands how the majority of Americans feel they 
need to protect it. And there are some places in this country 
and there are some places globally that should not be exploited 
for natural resource extraction, and that includes oil and gas.
    Everywhere where oil and gas drilling occurs, there are 
spills, there are leaks, there is significant damage that 
occurs. The Arctic National Wildlife Refuge is one of those 
places where I think we can say we don't need to damage any 
more places.
    Mr. Holt. And I would like to give both you and Ms. Pagel 
an opportunity to address this concern that somehow you are off 
topic. Isn't what we are talking about here whether lands that 
belong to the American people should be given to private 
exploitation without royalty, without recompense?
    Mr. Pica. Precisely. If I look at how much oil royalties 
the State of Alaska is getting, it far exceeds what the Federal 
Government is getting right now. So if we want to talk about 
what is fair for the taxpayer, we need to talk about what the 
Federal Government is getting for those areas that are 
currently open for exploitation and exploration, and it is far 
below even what the State of Alaska is getting.
    Mr. Holt. Ms. Pagel.
    Ms. Pagel. I agree that there are some places that just 
shouldn't be mined or drilled, and this is one of those places, 
and that my testimony was about there are alternatives. I want 
to reduce the deficit and create jobs for this country just as 
much as anyone else. There are ways to do that that don't 
necessarily involve exploiting places that are sacred to some.
    Mr. Holt. Mr. Brinkley and Ms. James, earlier today a 
Subcommittee of this Committee considered an Alaskan energy 
bill that would allow 10,000 acres of impact to the Coastal 
Plain for every 100,000 acres of leased land in the refuge. In 
other words--and maybe you are not familiar with this, but 
perhaps you could comment on it. The question is just how small 
is the footprint, how much environmental damage would be done 
if this place--if these treasures were allowed for private 
exploitation.
    Ms. James. To my people, they need to acknowledge it is not 
as safe for my birthplace, a sacred place where the life begin. 
That is how we see it. When there was an oil spill in Prince 
William Sound, one of our elders said the water is dead. And it 
has been happening. From that day, we call that day the water 
died. We are very cautious about those things that happen, and 
what we see, and what we hear and what weather is doing. We 
live there for thousand of years with caribou. Caribou is 
like--they are in our heart, and we are in their heart. We take 
care of each other for thousands of years. There is no place in 
the world that is as safe as that place.
    The Chairman. The time of the gentleman has expired.
    The gentleman from Maryland Mr. Harris is recognized.
    Dr. Harris. Thank you very much, Mr. Chairman.
    Mr. Chairman, reading over the testimony, I kind of share 
your pessimism that the testimony is pertinent to ANWR. But 
since the testimony opens the door for such kinds of questions, 
I am going to ask Mr. Pica--I know we had a State Senator in 
Maryland, very well known, by the same last name. I find your 
written testimony very interesting because actually the first 
page sounds like kind of a manifesto, I guess, against American 
capitalism. So I suppose you take the position against it.
    But the last sentence of the first page says, In the last 
decade, the influence of big business has expanded to such an 
extent that our civil and political systems have largely been 
captured by corporate lobbyists and campaign donations.
    Now, is it your opinion or the opinion of Friends of the 
Earth that Solyndra absolutely epitomizes that relationship; 
the debacle about Solyndra and corporate donation connections 
and things like that?
    Mr. Pica. Friends of the Earth actually opposed the loan 
guarantee program when it was first created in 2005. We had 
predicted that the process would be open for manipulation, 
regardless of which party occurred.
    Dr. Harris. Even if it is an Administration that promised a 
change, and we are not going to let lobbyists do anything, so 
your opinion--I guess you kind of share the opinion made on 
this side of the aisle that Solyndra is really that kind of 
problem.
    Mr. Pica. I haven't seen all the testimony. I haven't been 
privy to it. But I do believe that this was a bad program to 
begin with. And this was a 2005 program when it was created.
    Dr. Harris. Sure. But the loan was administered in 2009, is 
that correct, the Solyndra loan guarantee? The 2005 program was 
greatly expanded by the stimulus plan, and, in fact, it was a 
result of the stimulus plan that the money eventually was 
guaranteed. Is that correct?
    Mr. Pica. I am not familiar.
    Dr. Harris. Let us go on to the next paragraph in your 
testimony, because it says, ``Today functions that were once 
the domain of the public sector, from the provision of 
services, to the protection of our commons, to the fighting of 
wars, have been taken over by corporations.''
    Do you really think that our soldiers and sailors who are 
overseas fighting wars are taken over by corporations? Do you 
really think that we fight wars with corporations, not with 
young men and women, Americans going overseas, trying to do the 
best they can? Do you realize the implication of the words you 
put down on paper here?
    Mr. Pica. I do believe that the Blackwater incidents that 
occurred in the Middle East is a prime example of where we have 
had privatization of what should be the State Department 
security forces.
    Dr. Harris. Well, thank goodness you don't imply that that 
is our soldiers and sailors.
    Now, you also say that--in here you say, ``Even if the 
Congressional Research Service's estimates on what we could 
gain from this turn out to be accurate, simply not worth the 
environmental destruction it would create.'' You don't say it 
could create, might create. One hundred percent chance of a 
spill or something.
    Could you just very briefly outline, because I don't have 
much more time, what the environmental destruction that it 
would create? You used the word ``would.''
    Mr. Pica. Yes. Every pipeline that we know of leaks. The 
Keystone XL pipeline or the Keystone 1 pipeline, a brand new 
pipeline, has leaked over a dozen times.
    Dr. Harris. How large are those leaks?
    Mr. Pica. They are fairly substantial leaks.
    Dr. Harris. Can you compare them to the natural leaks of 
oil in the United States?
    Mr. Pica. I don't have those statistics.
    Dr. Harris. Could I ask you to look into that since you 
bring that up as part of your testimony? Can I ask you to look 
into that and just compare those two? Thank you.
    Dr. Harris. Let me get, because you bring up the Keystone 
XL--what is your opinion about the Keystone XL pipeline 
project?
    Mr. Pica. The President made the right decision in delaying 
that pipeline. The process of environmental review was 
fundamentally flawed.
    Dr. Harris. Is that because it was done by the State 
Department, or 3 years just wasn't long enough?
    Mr. Pica. I think the documents that Friends of the Earth 
exposed with the State Department demonstrated that the 
relationship between TransCanada, the company Cardinal-Intrex 
actually violated the intent of the National Environmental 
Policy Act.
    Dr. Harris. Is Friends of the Earth going to oppose the 
pipeline that is going to be built westward to the Canadian 
ports so the oil can be shipped----
    The Chairman. If the gentleman would suspend just for a 
moment. The Keystone pipeline, again, is not subject of this, 
too. I know that sometimes we get off tangentially.
    Dr. Harris. I know, Mr. Chairman, but as your point is, I 
mean, you know, I was led there. I didn't wander. I was led.
    Is the Friends of the Earth going to oppose that pipeline 
as well?
    Mr. Pica. Yes.
    Dr. Harris. So you just basically don't want the oil to be 
extracted anywhere because you have to ship it somehow.
    Mr. Pica. We believe the tar sands need, the arboreal 
forests that are in Alberta need to preserve their biological 
rich area. They are perhaps one of the most biological rich 
areas comparative to the tropical rainforest down in Brazil and 
South America.
    Dr. Harris. They sure are rich. And, you know, oil is part 
of the biology, and Canada is lucky they are using it.
    Thank you, Mr. Chairman.
    The Chairman. The time of the gentleman has expired.
    Mr. Grijalva is recognized for 5 minutes.
    Mr. Grijalva. Thank you, Mr. Chairman.
    Mr. Pica, just a couple of quick questions. I wasn't 
terribly disturbed by that paragraph.
    The CRS is projecting in their study more revenue from 
taxes than from royalties. Why is that?
    Mr. Pica. Because the CRS is looking at the corporate 
business tax rate, which is 33 percent. And we just know 
through studies and through the amount of tax deductions and 
tax loopholes that are currently in the Tax Code that that is 
just not a realistic estimate coming from the Congressional 
Research Service.
    Mr. Grijalva. We have been subsidizing the oil and gas 
industry for how long?
    Mr. Pica. The Tax Code was originally created in 1911. 
About 2 years after that was when the oil and gas industry 
burrowed its first tax credit into the Tax Code. It was a 
Percentage Depletion Allowance. So for nearly 100 years, the 
U.S. Government has been providing some sort of subsidy to the 
oil and gas industry for exploitation and exploration of oil 
and gas resources in America.
    Mr. Grijalva. Despite the claims made by the proponents of 
drilling in the refuge about the revenue that would be 
generated, the Congressional Budget Office projects that 
taxpayers would only see $3 billion over the first 10 years. In 
addition, Alaskan State officials have often said they will sue 
to recover 90 percent of drilling revenues if the refuge was 
open. That means that if they were successful, the taxpayers 
would receive about $600 billion.
    So I think it is not just about the subsidies. There are 
other things at stake here. But if that is the main proponent 
argument, it is full of holes. There is no net return for the 
taxpayer if it was to happen.
    So does the industry, given what has happened in the last 
two or three quarters, really need subsidies to drill? That is 
the question, if you don't mind.
    Mr. Pica. I would say given their multibillion dollars in 
profits--I think they have almost a trillion dollars in profits 
over the last 10 years--I would say they don't need the 
incentives to drill.
    Mr. Grijalva. Just one general question for all the 
panelists, and I appreciate you taking your time on a Friday.
    This Committee has recommended, the majority, drilling in 
the refuge to be part of the supercommittee's recommendation 
for revenue generation. Your reaction to that recommendation, 
if you don't mind, beginning with Dr. Brinkley.
    Dr. Brinkley. Well, it is an awful idea. And I need to 
correct the record, because C-SPAN is covering this, and there 
was a misstatement made by the Congressman who has yet again 
left, doesn't stay, blows smoke, and then leaves. But Ted 
Stevens had been for the creation of ANWR in 1960. Ted Stevens 
was a lawyer for the creation of the Arctic. It is only when 
oil was found there----
    The Chairman. The gentleman will suspend.
    Mr. Grijalva. But I am on the clock.
    The Chairman. The gentleman will suspend. I will give the 
time back to you.
    I just want to say, Mr. Brinkley, people come and go from 
Committee meetings all of the time, and to suggest that there 
is not a reason that one Member leaves for a good reason that 
you don't know about, I think, is disrespectful, at best.
    Dr. Brinkley. I was just disappointed.
    The Chairman. Disrespectful, at best. So I would appreciate 
if you would respond to the questions that Members are giving 
you. You will see Members walk in and out of here all the time. 
Everybody has----
    Dr. Brinkley. He misstated Ted Stevens' record. I was 
trying to correct it.
    The Chairman. You referenced a Member that was sitting 
here.
    Dr. Brinkley. Because he is the one who misstated. If we 
don't correct the record now, when is it going to get 
corrected?
    The Chairman. You could have made the observation rather 
than elaborating on the whereabouts of people. You need to be 
respectful of people because they come and go all the time.
    The gentleman probably had what, 3-1/2 minutes or so when I 
interrupted.
    Mr. Grijalva. Five.
    The Chairman. Nice try. I will give you another 2 minutes 
in the red when it goes.
    Mr. Grijalva. The general question, with the majority of 
the Committee recommending to the supercommittee that drilling 
in the refuge would be a revenue generator that they would like 
to see the supercommittee make as part of the recommendation, 
Dr. Brinkley, it is an awful idea.
    Dr. Brinkley. It should have nothing to do, the 
supercommittee, with the Arctic Refuge. It is our Nation's 
number one premier wildlife refuge. Just because we hit low 
economic times is not the time to start opening up treasured 
landscapes. And this happens in history time and again. There 
was an effort by Congress to mine the Grand Canyon for zinc, 
asbestos, and copper when the economy gets bad. We have to be a 
tougher people than that.
    Mr. Grijalva. Let me give your fellow panelists a chance.
    Ms. James.
    Ms. James. Yes. Thank you for asking me that question, 
because to us, sacred place where the life begin is no other 
place in the world that needs to be protected. It is a special 
place that needs to be protected, and there shouldn't be any 
gas or oil development there because it belongs to all of us 
Americans. And so far, since 1988, Americans have spoken loud 
and clear repeatedly, battle after battle, spoke out very 
clearly that they don't want no gas and oil development there. 
Let us give those Americans a chance of what they wanted. And 
that is what the land is for. It is a public interest land for 
the voters.
    Mr. Grijalva. Thank you.
    There were over a million comments. I don't think those 
should be readily ignored as we go through this process.
    Mr. Pica, if you don't mind.
    Mr. Pica. Absolutely not. If the supercommittee is looking 
to get revenue, they should be looking at drilling into the Tax 
Code. There are tens of billions of dollars--I think we have a 
$100 billion in tax breaks, if they were repealed.
    Ms. Pagel. Absolutely not. I think that there are better 
ways, and those are the ways that we need to look at. In my 
testimony I have laid out at least a couple of billion dollars 
a year in savings. The legislation, H.R. 3446, that was just 
introduced, lays out another couple billion. We need to think 
about the long term and fairness. There are industries that are 
not paying now that can afford to. We need to look at that 
first.
    Mr. Grijalva. There are other issues that--environmental, 
cultural, that are critical and should not be ignored.
    But I wanted to concentrate on the money side because that 
seems to be the primary argument. One could surmise that--I 
don't know if this has as much to do with energy independence 
and economy as it does with the timing, the political 
expediency because of the times that we are in.
    Just for the record, Mr. Chairman, thank you. There are 
more private contractors in security in Iraq and Afghanistan 
than there are uniformed American men and women. I just thought 
I would put that in the record. Thank you.
    The Chairman. The time of the gentleman this time did 
expire.
    The gentlelady from Massachusetts Ms. Tsongas is recognized 
for 5 minutes.
    Ms. Tsongas. Thank you, Mr. Chairman.
    As I am listening to the debate, it is bringing back a lot 
of memories, because I remember in 1980 when my husband was a 
relatively newly elected United States Senator, he was very 
proud to work on the Alaska Lands Act and work with then-
Senator Ted Stevens. I remember so clearly when finally that 
Act was voted on and signed into law. It was quite a moment to 
celebrate. But I think we also knew that it was--we were not 
locking the door on Alaska, the beautiful landscape there that 
has been protected. And here we are in very dramatic and 
difficult economic times in our country. We know we have to 
deal with our debt and deficit. We know we have to deal with 
our dependence on fossil fuels and foreign oil in particular. 
And so Alaska is again at the forefront.
    But as we hear this testimony from all of you how you value 
so much the extraordinary landscape, the sacred place that you 
call it as well, we are faced with trying to find a balancing 
act. And it comes--whatever we may get out of it in the near 
term, it obviously comes with great cost.
    And so one of the issues I think we have to ask and think 
about is as we also have to wrestle with climate change, and we 
know there has been a warming there, just what the impacts 
would be there, too, again, creating extraordinary costs that 
we would have to confront in the coming years if we are not 
sensitive to this.
    So is not just about jobs today, or access to oil, which we 
know will take many years to really come to fruition. It is 
about sacrificing an extraordinary landscape and perhaps also 
exacerbating another great challenge we have, which is climate 
change.
    So I would welcome, Mr. Pica, your thoughts and anybody 
else who would like to say something about it.
    Mr. Pica. Absolutely. The debate over the Arctic National 
Wildlife Refuge, we talk about jobs, we talk about subsidies 
and royalties and how much money can come into the Federal 
Government. But what we also have to be thinking about with 
climate change is the ability that these natural resources are 
going to be dramatically impaired by what is already occurring 
in the atmosphere, and that drilling into these resources by 
erecting pipelines, we will be impairing these and making it 
more difficult for these ecosystems and the wildlife that 
thrives on these ecosystems to survive. And that, to me, is a 
risk that we should not be taking at this time, nor in the 
future.
    Ms. Tsongas. Anybody else?
    Mr. Brinkley.
    Dr. Brinkley. I think both Democrats and Republicans know 
we are in a time of climate crisis. And the idea, after the BP 
spill, of drilling in the Arctic Refuge, our Nation's largest 
wildlife refuge, created by Dwight Eisenhower, a conservative 
Republican President, at this moment in time makes zero sense.
    There are a lot of other issues. If we were going to go--we 
would have no park system; believe me, we would have no 
national forests, because the extraction industries want to 
take, make money, and go. They like to gouge. And we have to 
have watchdog groups and keep eyes on them.
    But to hear a Congressman today say there is nothing in his 
district; it is boring, it is flat, it is not exciting, I don't 
know a Representative that doesn't love their district. Every 
State in America's landscape is beautiful if you love it. But 
some people love money more than their homeland or where they 
live, and I am afraid that that is why this fight has to keep 
coming up. Fifty years later we are still trying to tell people 
the Arctic Refuge is real. It belongs to the American people--
all of us--not just the people of Alaska.
    Ms. James. On behalf of the Gwich'in Nation, we call that 
place, I repeatedly say, our birthplace, and any birthplace 
should be protected. To us, we have been there for thousands of 
years. We are healthy. I am 67 years old right now, and I am 
pretty healthy. I live in the village. We live very healthy 
life because most of our food is from the land. And it is good 
for us and make us who we are and be proud of who we are. I am 
proud to be Gwich'in. I am proud to be caribou people. Any of 
our resource or any of the things that we use making us healthy 
and powerful, there is no price on it. Taking care of the 
caribou has always been our job. We are original heart that 
way. I just can't see that be taken away as human rights 
protection of human rights to me and to my people. Thank you.
    The Chairman. The time of the gentlelady has expired.
    The Chair recognizes the gentlelady from Hawaii Ms. 
Hanabusa.
    Ms. Hanabusa. Thank you, Mr. Chair.
    Thank you, members of the panel.
    I come at this from a different perspective, just so you 
know that up front, and the reason is because I represent 
Hawaii, and Hawaii has indigenous people as well. So when we 
were first--I am very new here, but in my first exposure to 
ANWR, it was in terms of the--Congressman Young is not here to 
correct my pronunciation--but the Kaktovik. Is it Kaktovik, Ms. 
James?
    Ms. James. Yes. Kaktovik at the border of Canada.
    Ms. Hanabusa. The Coastal Plain.
    Ms. Hanabusa. So first, my first question for Mr. Pica and 
Ms. Pagel is have you ever been to ANWR, the both of you?
    Mr. Pica. I have not, but Friends of the Earth have members 
in Alaska that we represent here in Washington, D.C.
    Ms. Hanabusa. I understand that. Because I haven't, so I am 
interested in those who have. Ms. James, who lives, I believe, 
in part of ANWR, and Mr. Brinkley, who has recently visited 
there.
    First of all, Ms. James, you are, of course, a member of 
the Gwich'in?
    Ms. James. Yes, Gwich'in.
    Ms. Hanabusa. Gwich'in Tribe?
    Ms. James. Wich'in, and put G in the front, Gwich'in.
    Ms. Hanabusa. The first question I have, because when we 
talk about Alaska, ANWR, as well as the rights of the Natives, 
my first question is are you part of the ANSCA settlement? Is 
your tribe part of that?
    Ms. James. Arctic Village and Venetie didn't go with ANSCA, 
we went with IRA, now is fee simple fee title, and we have 1.8 
million acres of land.
    Ms. Hanabusa. OK. Where are you in relationship to the--to 
ANWR? Are you located within----
    Ms. James. It is about 75 miles south of Coastal Plain.
    Ms. Hanabusa. OK. So you are actually--I saw pictures of 
it. So we have the Coastal Plain, and then you have the 
mountains. So you are more in the mountainous section of ANWR?
    Ms. James. Pardon me?
    Ms. Hanabusa. Are you more in the mountainous section of 
ANWR?
    Ms. James. The Brooks Range is a natural--God put it there 
between Inupiat and Gwich'in. So that is Inupiat, this one is 
Gwich'in.
    Ms. Hanabusa. Now, we are all--I am sure all of you know 
that one of the interesting points with how the Kaktovik Tribe 
comes before us is the fact that the Federal Government, after 
entering into ANSCA, and it normally retains the subsurface 
rights to the regional corporation, Kaktovik was able to secure 
the subsurface rights, unlike other tribes, because of the fact 
that the government, we took other parts of their land. It was 
conditioned upon Congress giving them the right to drill, 
however, but they do have the subsurface rights, which normally 
flows to the regional corporation.
    So, to me, this is an issue of the rights of Native people. 
And as you know, we bought Alaska from the Russians, and part 
of the compact when we entered into that agreement was we 
agreed that we would not interfere with the rights of the 
Native people. Now, I am not talking about energy, I am not 
talking about the supercommittee, and maybe the Chair will rule 
me out of order, but that is what I am concerned about. I want 
to know how, when you know that we are talking about rights of 
Native peoples that we as a government has given them, the 
rights to the subsurface as well as the surface rights, and 
what they are looking at here is to really execute on those 
rights, why is that something that you find to be such a 
travesty and something that is unacceptable?
    And, Ms. James, I know that you are in a slightly different 
position because you are--your tribe relies on caribou; 
Kaktoviks rely on whales and seals, as I understand it.
    Let us start with you, Mr. Brinkley. This is an issue, to 
me, of Native rights, and this is an agreement and a contract 
that was entered into when we bought Alaska, and now we are in 
this position. So can you explain to me why you think that you 
can----
    Dr. Brinkley. There was a similar up in northern Alaska in 
the 1950s and 1960s when Edward Teller, father of the hydrogen 
bomb, went to Alaska and wanted to detonate nuclear bombs 
amongst the Native people, which would have contaminated all of 
the tundra, poisoned all of the caribou. There are always these 
projects up in an area like that where people don't have a lot 
of power and a lot of rights, and the Arctic Refuge is a home 
today for Native people that live in the refuge.
    Ms. Hanabusa. Mr. Brinkley, that is the 50--that is before 
we entered into these agreements, and I do not believe that the 
regional councils or the tribes are not well represented by 
their respective attorneys. I do not believe that they are in 
lesser bargaining positions. And, again, that is my issue, and 
I would appreciate--since I am out of time, I would appreciate 
it if you would all respond to me in writing. Thank you very 
much, Mr. Chair.
    The Chairman. The time of the gentlelady has expired, and I 
would say, as usual, with hearings like this, after the fact 
there are questions that come up, and we would like, when you 
do get asked a question--obviously Ms. Hanabusa has a very 
serious question she would like a response to--that response 
should come to the full Committee so we all have that, so we 
all have that response.
    With that, the panel is now dismissed, and I want to thank 
them very much for being here today. If there is no further 
business to come before the Committee, the Committee stands 
adjourned.
    [Whereupon, at 3:18 p.m., the Committee was adjourned.]

                                 
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