[Senate Hearing 113-116]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 113-116
 
                ASSESSING U.S. PREPAREDNESS AND RESPONSE
                  IN THE ARCTIC: THE OPPORTUNITIES AND
                CHALLENGES OF INCREASED MARINE ACTIVITY
=======================================================================


                             FIELD HEARING

                               before the

     SUBCOMMITTEE ON OCEANS, ATMOSPHERE, FISHERIES, AND COAST GUARD

                                 of the

                         COMMITTEE ON COMMERCE,

                      SCIENCE, AND TRANSPORTATION

                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 27, 2013

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation





                  U.S. GOVERNMENT PRINTING OFFICE
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       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

            JOHN D. ROCKEFELLER IV, West Virginia, Chairman
BARBARA BOXER, California            JOHN THUNE, South Dakota, Ranking
BILL NELSON, Florida                 ROGER F. WICKER, Mississippi
MARIA CANTWELL, Washington           ROY BLUNT, Missouri
FRANK R. LAUTENBERG, New Jersey      MARCO RUBIO, Florida
MARK PRYOR, Arkansas                 KELLY AYOTTE, New Hampshire
CLAIRE McCASKILL, Missouri           DEAN HELLER, Nevada
AMY KLOBUCHAR, Minnesota             DAN COATS, Indiana
MARK WARNER, Virginia                TIM SCOTT, South Carolina
MARK BEGICH, Alaska                  TED CRUZ, Texas
RICHARD BLUMENTHAL, Connecticut      DEB FISCHER, Nebraska
BRIAN SCHATZ, Hawaii                 RON JOHNSON, Wisconsin
WILLIAM COWAN, Massachusetts
                    Ellen L. Doneski, Staff Director
                   James Reid, Deputy Staff Director
                     John Williams, General Counsel
              David Schwietert, Republican Staff Director
              Nick Rossi, Republican Deputy Staff Director
   Rebecca Seidel, Republican General Counsel and Chief Investigator
                                 ------                                

            SUBCOMMITTEE ON OCEANS, ATMOSPHERE, FISHERIES, 
                            AND COAST GUARD

MARK BEGICH, Alaska, Chairman        MARCO RUBIO, Florida, Ranking 
BILL NELSON, Florida                     Member
MARIA CANTWELL, Washington           ROGER F. WICKER, Mississippi
FRANK R. LAUTENBERG, New Jersey      KELLY AYOTTE, New Hampshire
RICHARD BLUMENTHAL, Connecticut      DAN COATS, Indiana
BRIAN SCHATZ, Hawaii                 TIM SCOTT, South Carolina
WILLIAM COWAN, Massachusetts         TED CRUZ, Texas


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on March 27, 2013...................................     1
Statement of Senator Begich......................................     1

                               Witnesses

Tommy P. Beaudreau, Acting Assistant Secretary, Land and Minerals 
  Management, U.S. Department of the Interior....................     3
    Prepared statement...........................................     5
Rear Admiral Thomas P. Ostebo, Commander, U.S. Coast Guard 
  Seventeenth District...........................................     7
    Prepared statement...........................................    10
Peter E. Slaiby, Vice President, Shell Alaska....................    12
    Prepared statement...........................................    14
Helen Brohl, Executive Director, U.S. Committee on the Marine 
  Transportation System..........................................    28
    Prepared statement...........................................    30
Captain Edward Page, USCG (Retired), Executive Director, Marine 
  Exchange of Alaska.............................................    33
    Prepared statement...........................................    36
Eleanor Huffines, Manager, U.S. Arctic Program, The Pew 
  Charitable Trusts..............................................    40
    Prepared statement...........................................    42
Matt Ganley, Vice President, Resources and External Affairs, 
  Bering Straits Native Corporation..............................    51
    Prepared statement...........................................    53
Jack Omelak, Executive Director, Alaska Nanuuq Commission and 
  Member, Arctic Marine Mammal Coalition.........................    55
    Prepared statement...........................................    56
    Letter dated January 30, 2013 from Rear Admiral Thomas P. 
      Ostebo, U.S. Coast Guard...................................    57

                                Appendix

Christopher M. Reddy, Ph.D., Woods Hole Oceanographic Institution    69
Letter dated September 20, 2012 from the Alaska Eskimo Whaling 
  Commission, Alaska Beluga Whale Committee, Eskimo Walrus 
  Commission, Alaska Nanuuq Commission and Ice Seal Committee....    71


                      ASSESSING U.S. PREPAREDNESS

                      AND RESPONSE IN THE ARCTIC:

                    THE OPPORTUNITIES AND CHALLENGES

                      OF INCREASED MARINE ACTIVITY

                              ----------                              


                       WEDNESDAY, MARCH 27, 2013

                               U.S. Senate,
Subcommittee on Oceans, Atmosphere, Fisheries, and 
                                       Coast Guard,
        Committee on Commerce, Science, and Transportation,
                                                     Anchorage, AK.
    The Subcommittee met, pursuant to notice, at 10:07 a.m. in 
room 307, University of Alaska Anchorage Campus, Hon. Mark 
Begich, Chairman of the Subcommittee, presiding.

            OPENING STATEMENT OF HON. MARK BEGICH, 
                    U.S. SENATOR FROM ALASKA

    Senator Begich. Thank you very much. Let's go ahead and 
call the meeting of the Oceans subcommittee hearing on Arctic 
matters to order, and we thank everyone for attending and being 
here, and we appreciate it. To our guests, we appreciate that 
they are also here.
    We have two government witnesses joining us by 
teleconference, videoconference actually, and we thank them. 
This is part of what you see with budget reductions. They can't 
be here, but we have tuned them in here, which we think is just 
as good. Alaskans are used to videoconferencing, so we thank 
them for being here. I will introduce them in a moment.
    As Chair of the Oceans Senate subcommittee, this is the 
fifth hearing on the opportunities and challenges facing Alaska 
with coming Arctic development. We have had hearings in 
Washington, D.C., Barrow, Anchorage, as well as several trips 
to communities in-between to engage Alaskans, investors, 
developers, policymakers and regulators in this discussion.
    Some question the future of Arctic development. I would 
like to say it's here, whether people like it or not. Arctic 
development, oil and gas exploration, shipping, tourism is 
happening in our Arctic waters now. The question is whether the 
U.S. will set the bar for doing it right by using strong 
science and data, by incorporating local and traditional 
knowledge with critical supporting infrastructure and under 
effective regulation to protect our Arctic people and 
communities and subsistence resources upon which they live.
    Since coming to the U.S. Senate, I have put together a 
package of legislation to help get us there, to improve our 
scientific understanding of the Arctic, to research Arctic 
health needs, develop the ports and other infrastructure we 
need, to share the Arctic generated revenues with its 
communities and tribes and strengthen our international profile 
in Arctic affairs.
    I am also working closely with the administration to make 
the right investments now to ensure safe and responsible 
development, such as adequate icebreaking capacity.
    Today our goal is to look specifically at current and 
anticipated future Marine activity in the Arctic. Let's be 
clear: this hearing is about the broad context of increased 
maritime activity, not just about oil and gas development or 
the KULLUK grounding this winter. The KULLUK was a high profile 
example of challenges posed to marine transportation in the 
Arctic. In 2012, there were more than 250 vessels operating in 
the Arctic Ocean, over 480 transiting through the Bering 
Strait. This, of course, is due to declining Arctic sea ice, 
which allows increased access for longer periods. It creates 
increased economic incentives for shipping to move through the 
Bering Strait and the Arctic Ocean.
    I've also said we face greater risks from the increasing 
traffic we are seeing along the Russian Northern Sea route and 
later through the Canadian Northwest Passage than we do from 
oil and gas drilling in the Arctic. In the challenging Arctic 
maritime environment, where there are no harbors or refuges and 
few aids to navigation or search and rescue assets, mariners 
also have less accurate weather forecasts and charts where 
there are dozens of miles between accurate depths and readings. 
Unlike oil and gas interests, which have incentives to work 
closely with Arctic communities, shipping interests are more 
transient and have fewer resources to mitigate risk and respond 
to problems.
    What I would like to now hear--we have two panels set up 
today--from our experts is what to expect in the short-term, 
medium and long-term, what we need and what we need to prepare 
for, which I hope our panels will address. I plan to take what 
I hear today back to Washington to move ahead on our Arctic 
legislation. This is timely because we are now considering the 
Coast Guard authorization bill. It seems like we just finished 
one, but we will be back into it, energy legislation, 
infrastructure investment, bills for the Army Corps, 
transportation, environmental protection agencies. A variety of 
issues are going to be in front of us for the next several 
months. So we look forward to the testimony today.
    Our first panel is made up of three individuals. Tommy 
Beaudreau is from the Department of Interior, who is joining us 
by VTC.
    One moment, Tommy. I will have you speak.
    Rear Admiral Tom Ostebo, Commander of the Coast Guard 
District 17. We were just joking a little bit there. We have 
this routine where we're always back together again.
    And Pete Slaiby, Vice President of Exploration of Shell.
    Again, this is our first panel. We'll have a second panel 
after this, and we thank all three of you for being willing to 
attend and be part of this testimony. Again, our goal is to 
focus on not only what we did this last year but where do we 
see the next stages of future Arctic development.
    Let me first turn to Assistant Secretary Tommy Beaudreau.
    Tommy?

       STATEMENT OF TOMMY P. BEAUDREAU, ACTING ASSISTANT

            SECRETARY, LAND AND MINERALS MANAGEMENT,

                U.S. DEPARTMENT OF THE INTERIOR

    Mr. Beaudreau. Thank you, Chairman Begich. I appreciate 
very much the opportunity to appear before the Subcommittee on 
Oceans, Atmosphere, Fisheries, and Coast Guard to discuss the 
extremely important and timely topic, ``Assessing U.S. 
Preparedness and Response in the Arctic: The Opportunities and 
Challenges of Increased Marine Activity.'' I apologize for 
being unable to appear at the field hearing in person in 
Anchorage, my hometown, and I'm grateful for the work of the 
Committee staff to facilitate this video connection, and I 
trust it's working.
    Senator Begich. Absolutely. It's only 75 degrees here, and 
it's sunny.
    [Laughter.]
    Senator Begich. But still, I'm glad to have you.
    Mr. Beaudreau. Spring is a little bit late in D.C., too.
    It's my sincere pleasure to appear on this panel, 
particularly with United States Coast Guard Rear Admiral 
Ostebo, for whom I have tremendous respect. No one understands 
more deeply the unique maritime challenges of working safely in 
offshore Alaska than Admiral Ostebo and the men and women of 
the Coast Guard 17th District.
    The Interior Department works closely with the Coast Guard 
on a range of strategic and oversight issues relating to Alaska 
and the U.S. Arctic, including offshore oil and gas 
exploration. The Coast Guard performed extremely well in 
planning for and playing a central role in overseeing Shell's 
2012 Alaska offshore oil and gas exploration program. In 
particular, I admire the courage and professionalism of the 
Coast Guard emergency response personnel, who safely rescued 
all crew members of the KULLUK drilling rig after the rig lost 
its tow during a severe storm in the Gulf of Alaska at the end 
of last December.
    I would like to start by emphasizing the strategic and 
economic importance of the Alaskan Arctic to the United States. 
The U.S. Arctic Outer Continental Shelf holds tremendous energy 
resource potential. For example, my agency, the Bureau of Ocean 
Energy Management, estimates that the Chukchi Sea contains more 
than 15 billion barrels of undiscovered recoverable oil, which 
is second only to the central Gulf of Mexico in terms of its 
offshore conventional energy potential.
    The United States is a leader among Arctic nations in 
evaluating the economic and energy potential of safe and 
environmentally responsible offshore oil and gas development in 
the Arctic, as well as the multitude of challenges facing the 
region, including the consequences of rapid climate change. It 
is essential that the United States understand the resource 
potential of the Arctic, and offshore oil and gas exploration 
has a key role in developing that understanding.
    However, exploration must be conducted cautiously, safely, 
and responsibly in light of the sensitive Arctic environment 
and the Alaska Natives who are closely connected to the Arctic 
Ocean for subsistence and fundamental aspects of their culture 
and traditions.
    DOI's recent review of Shell's 2012 Beaufort Sea and 
Chukchi Sea program, which I led, identified a number of 
principles for safe and responsible offshore oil and gas 
exploration in the Arctic for the future.
    First, all phases of an offshore Arctic program, including 
preparations, drilling, maritime and emergency response 
operations, must be integrated and subject to strong operator 
management and government oversight.
    Second, Arctic offshore operations must be well planned, 
fully ready, and have a clear objective in advance of the 
drilling season.
    These first two principles are fundamental to working 
safely offshore Alaska. Arctic offshore operations are 
extremely complex, and there are substantial environmental 
challenges and operational risks throughout every phase of the 
endeavor.
    Moreover, because of the inherent geographic, logistical 
and environmental challenges associated with working on the 
Arctic OCS, the operating plan and objectives of any offshore 
Arctic program must be well planned and designed to provide 
operational clarity, while also allowing for ample flexibility 
in light of variable and changing conditions and the need for 
safe demobilization.
    Third, operators must maintain strong, direct management 
and oversight of their contractors.
    Fourth, operators must understand and plan for the 
variability and challenges of Alaskan conditions. Reliable 
weather and ice forecasting play a significant role in ensuring 
safe operations offshore Alaska, including but not limited to 
the Arctic. Robust forecasting and tracking technology, 
information sharing among industry and government, and local 
knowledge and experience are essential to managing the 
substantial challenges and risks that Alaskan conditions pose 
for all offshore operations.
    Finally, respect for and coordination with local 
communities are paramount. It is imperative that offshore 
exploration in the Arctic be harmonized with the needs of North 
Slope communities, including traditional subsistence use.
    Our report also identified important principles for 
government oversight of offshore drilling activity in the 
Arctic that must be carried forward and further developed. The 
Federal Government, including DOI, Coast Guard, NOAA, EPA and 
others engaged in strong and in an unprecedented level of 
interagency coordination, information sharing, and cooperation 
related to the regulatory approval process and oversight of 
Shell's 2012 program. Senator Begich, I know this is an area 
that has been important to you and that you have championed. 
This is an area of success from the 2012 experience that should 
be carried forward and improved upon further in the future.
    Finally, government and industry should continue to 
evaluate appropriate Arctic-specific standards relating to 
offshore operations. For example, operators working in the 
Arctic should be encouraged to enter into resource sharing and 
mutual aid agreements to provide each other with access to 
operational and emergency response resources. This is an issue 
Admiral Ostebo and I have discussed at some length. A 
cooperative model offers potential logistical and commercial 
efficiency, as well as safety and environmental advantages and 
the reduction of cumulative operational risks and footprints, 
including air emissions.
    Thank you, and I look forward to answering questions.
    [The prepared statement of Mr. Beaudreau follows:]

 Prepared Statement of Tommy P. Beaudreau, Acting Assistant Secretary, 
     Land and Minerals Management, U.S. Department of the Interior
    Mr. Chairman and Members of the Subcommittee, I want to thank you 
for this timely hearing to examine the current and anticipated future 
offshore activity in the Arctic. On March 8, I delivered a report to 
Secretary of the Interior Ken Salazar regarding the review I led of 
Shell's 2012 Alaska Offshore Oil and Gas Exploration Program (Report), 
which the Department of the Interior (DOI) released to the public on 
March 14. I appreciate this opportunity to discuss this review, as well 
as long term planning with respect to offshore exploration in the 
Arctic.
    Offshore oil and gas development is a key component of the 
Administration's all-of-the-above energy strategy to grow America's 
economy, reduce our dependence on foreign oil and to create jobs here 
at home. As is emphasized in the Report, the Administration is 
committed to supporting safe and responsible exploration of potential 
energy resources in frontier areas such as the Arctic. The Arctic holds 
substantial oil and gas potential, but also presents unique technical 
challenges as well as environmental and cultural considerations. The 
Bureau of Ocean Energy Management (BOEM) estimates that the Chukchi Sea 
Planning Area alone holds more than 15 billion barrels of undiscovered, 
technically recoverable oil and 76 trillion cubic feet of natural gas, 
which is second only to the Central Gulf of Mexico in terms of resource 
potential on the United States outer continental shelf (OCS). BOEM also 
estimates that the Beaufort Sea Planning Area holds more than 8 billion 
barrels of oil and 27 trillion cubic feet of natural gas. Offshore oil 
and gas exploration in the Arctic must proceed cautiously and in a way 
that is safe, responsible, and respectful of the unique environment and 
culture of the Arctic and its communities.
    Prior to last summer, most exploration wells in Federal waters in 
the Beaufort and Chukchi Seas in the Alaskan Arctic were drilled during 
the late 1970s through the mid-1980s. Industry previously drilled a 
total of 30 exploratory wells in the Federal waters of the Beaufort 
Sea. Federal waters in the Chukchi Sea have a more limited history of 
exploration, with five exploration wells drilled between 1989 and 
1991--all resulting in the discovery of hydrocarbons.
    In 2012, DOI allowed Shell to move forward cautiously with limited 
drilling activities in the Beaufort and Chukchi Seas. Shell constructed 
top-hole sections for one well each in the Chukchi and Beaufort Seas. 
Shell's well at the Burger prospect in the Chukchi Sea was the first 
new well spud in that area in over two decades. Shell's 2012 offshore 
drilling program was subject to strong Federal oversight, including a 
range of Arctic-specific conditions and standards, such as requiring 
deployment of subsea containment systems as a prerequisite to drilling 
into hydrocarbon-bearing zones, limitations on the Chukchi Sea drilling 
season to provide time for open-water emergency response, a blackout on 
drilling activity during the subsistence hunts in the Beaufort Sea, and 
surrounding vessels with pre-laid boom during fuel transfers. DOI's 
Bureau of Safety and Environmental Enforcement (BSEE) had inspectors 
onboard both of Shell's rigs around the clock throughout drilling 
operations, and the U.S. Coast Guard was a constant presence in the 
Arctic as well.
    We learned a great deal from activities last summer--from both the 
successes and the problems Shell experienced--and it is important that 
we use all of the information that we learned from last summer in 
planning for the future.
Review of Shell's 2012 Operations
    On January 8, 2013, Secretary Salazar directed me to lead a high-
level assessment of Shell's 2012 offshore drilling program in the 
Beaufort and Chukchi Seas, including a review of the problems that 
Shell experienced last year with the certification of its containment 
vessel, the ARCTIC CHALLENGER; the deployment test of its containment 
dome; and its two drilling rigs, the NOBLE DISCOVERER and the KULLUK.
    The review team included BSEE Director Jim Watson, as well as 
senior leadership from BOEM and BSEE and a technical advisor from the 
U.S. Coast Guard. DOI retained the international consulting firm 
PricewaterhouseCoopers LLP (PwC) to provide expertise and support in 
reviewing issues related to safety and operational management systems. 
The review team received significant participation and contributions 
from the other Federal agencies involved in overseeing Shell's 2012 
activities, including the U.S. Fish and Wildlife Service, the National 
Oceanic and Atmospheric Administration (NOAA), the U.S. Coast Guard, 
the Environmental Protection Agency (EPA).
    Shell cooperated with our review. Our review team conducted 
meetings and interviews with Shell and its contractors in Washington, 
D.C., Alaska, Washington State and Houston. The review team also met 
with Alaska State legislators and regulatory officials, the North Slope 
Borough, Alaska Native organizations, environmental groups, independent 
engineers and economists, marine contractors, and oil and gas 
companies.
    On February 27, Shell announced its decision to pause exploration 
drilling activity for 2013 in both the Beaufort and Chukchi Seas to 
focus on preparation of equipment and plans before resuming its Arctic 
exploration program.
The Report's Findings
    The review focused on Shell's safety management systems, its 
oversight of contracted services, and its ability to meet the strict 
standards in place for Arctic development. It found that Shell entered 
the 2012 drilling season without having finalized key components of its 
program, including its ARCTIC CHALLENGER containment system, which put 
pressure on Shell's operations and schedule and limited Shell from 
drilling into oil-bearing zones last summer. Weaknesses in Shell's 
management of contractors on whom they relied for many critical aspects 
of its program--including development of its containment system, 
emission controls to comply with air permits, and maritime operations--
led to many of the problems that the company experienced.
    Accordingly, the Report makes a number of findings with respect to 
Shell's activities last year, and offers principles and recommendations 
for Shell, other operators, and government to support planning for 
future operations.
    First, the report found that all phases of an Arctic offshore 
program--including drilling, maritime and emergency response 
operations--must be integrated and subject to strong operator 
management and oversight. Before Shell resumes its Arctic program, the 
Report recommends that the company should submit to the Department of 
the Interior a comprehensive, integrated plan describing every phase of 
its operation from preparations through demobilization. Any future 
Arctic exploration program proposed by Shell should be well planned and 
finalized in advance of the drilling season.
    Operators must also maintain strong, direct management and 
oversight of their contractors, and have rigorous management systems 
tailored to the Arctic environment. This was an area where Shell fell 
short- contributing in large part to many of the problems Shell 
experienced last year, including its inability to deploy a functioning 
containment system, violation of the emission standards set in its air 
permits, and problems with both of its drilling rigs, including the 
KULLUK which was grounded near Kodiak Island during a towing operation 
in the Gulf of Alaska. Accordingly, the Report recommends that Shell 
complete a full third-party management system audit that will confirm 
that the company's management systems are appropriately tailored for 
Arctic operations.
    Offshore operators choosing to work in the Arctic must also 
recognize the reality of the unique challenges posed by the Arctic 
environment like extreme weather and limited infrastructure. Companies 
must understand and plan for the variability and challenges of 
conditions in Alaska, and work with people who are knowledgeable about 
and experienced with these tough conditions.
    The Report also stresses the critical need for coordination--across 
the Federal Government and with State and local partners, as well as 
with companies, local communities and other stakeholders. Following the 
process initiated by the Alaska Interagency Working Group established 
by Presidential Executive Order 13580 for the coordination of 
permitting of domestic energy projects in Alaska, the Federal 
Government--including DOI, NOAA, the U.S. Coast Guard, EPA and others--
engaged in a robust and unprecedented level of interagency 
coordination, information-sharing and cooperation related to the 
regulatory approval process and oversight of Shell's 2012 program. This 
process led to the more efficient and effective reviews of permits and 
approvals, stronger oversight of Shell's operations, better 
communication with local communities, greater awareness by Federal 
agencies of activities potentially impacting their areas of 
responsibility, and more efficient use of limited Federal resources. 
Public engagement by Federal agencies, including providing as much 
transparency and opportunity for public input as reasonably possible, 
is also important. This is an area of success from the 2012 experience 
that should be carried forward and improved upon in the future.
Developing a Region-Specific Model for Exploration in the Arctic Ocean
    The Report also strongly recommends implementation of a region-
specific model for offshore oil and gas exploration in the Alaskan 
Arctic. As Shell's 2012 experience has made absolutely clear, the 
Arctic OCS presents unique challenges associated with environmental and 
weather conditions, geographical remoteness, social and cultural 
considerations, and the absence of fixed infrastructure to support oil 
and gas activity, including resources necessary to respond in the event 
of an emergency. Shell's 2012 drilling program was subject to a number 
of Arctic-specific conditions and standards--including, among others, 
deployment of subsea containment systems as a prerequisite to drilling 
into hydrocarbon-bearing zones, limitations on the Chukchi Sea drilling 
season to provide time for open-water emergency response, a blackout on 
drilling activity during the subsistence hunts in the Beaufort Sea, and 
deploying pre-laid boom around vessels during fuel transfers. Shell 
also undertook additional measures, such as agreeing to transport out 
drilling muds and cuttings from its Beaufort Sea operation instead of 
discharging them into the ocean.
    Government and industry should continue to evaluate the potential 
development of additional Arctic-specific standards in the areas of 
drilling and maritime safety and emergency response equipment and 
systems. The United States has a leading role among Arctic nations in 
establishing appropriately high standards for safety, environmental 
protection and emergency response governing offshore oil and gas 
exploration in the Arctic Ocean. It is incumbent, therefore, on the 
United States to lead the way in establishing an operating model and 
standards tailored specifically to the extreme, unpredictable and 
rapidly changing conditions that exist in the Arctic even during the 
open water season.
    Finally, operators working in the Arctic should be encouraged to 
enter into resource sharing and mutual aid agreements to provide each 
other with access to operational and emergency response resources. The 
traditional operator-specific, ``go it alone'' model common with 
exploration programs in other regions is not appropriate for Arctic 
offshore operations. A cooperative, consortium-based model offers 
potential logistical and commercial efficiencies, as well as safety and 
environmental advantages through the reduction of cumulative 
operational risks and footprints (including air emissions). Following 
the Deepwater Horizon blowout and spill and after DOI's establishment 
of clear guidance requiring subsea containment in support of all 
deepwater drilling operations, industry pulled together resources, 
equipment and expertise to establish consortia designed to provide 
offshore operators with access to critical safety and emergency 
response equipment, such as capping stacks and other equipment 
necessary to respond to a subsea blowout. Arguably the need for mutual 
assistance and resource sharing covering both operational and emergency 
response assets and resources may be even greater in the Arctic.
Conclusion
    The information we collect from offshore exploration will be 
critical to longer-term planning for the Arctic OCS. For example, any 
information about geology and resource potential that may be developed 
from exploratory drilling or from geological and geophysical (G&G) 
exploration will be utilized in potential future lease sales in the 
Beaufort and Chukchi Sea Planning Areas. As offshore oil and gas 
exploration moves forward, information can also be utilized in planning 
for near and long-term associated infrastructure, spill response 
preparedness, and safety and environmental standards.

    Senator Begich. Thank you very much for your testimony.
    Let me now move to Admiral Ostebo. Thank you very much for 
your continued interest in the Arctic and your robust work, 
especially in this last season. So, please, let me have you go 
and testify.

  STATEMENT OF REAR ADMIRAL THOMAS P. OSTEBO, COMMANDER, U.S. 
                COAST GUARD SEVENTEENTH DISTRICT

    Admiral Ostebo. Senator Begich, distinguished colleagues--
Tommy, it's good to see you again. As always, I enjoy speaking 
on the great work that your Coast Guard is doing here in 
Alaska. I am pleased to discuss the Coast Guard's Arctic 
responsibilities and operations. This past summer we prepared 
for Arctic operations driven by increased offshore maritime 
activity and industry's planned drilling operations in the 
Chukchi and the Beaufort Sea.
    Collaborating closely with Federal, local, state, and 
tribal government partners, we worked with industry to regulate 
all parties operating offshore. The lessons we have learned 
from this past year will inform our planning and strategy to 
ensure that we remain always ready to ensure safety, security 
and stewardship in the emerging maritime frontier of the 
Arctic.
    Coast Guard operations in the Arctic last year consisted of 
Arctic Shield 2012, which will be an ongoing Coast Guard 
operation in perpetuity for the Arctic. The Coast Guard has 
been operating in the Arctic since 1867, when Alaska was just a 
territory. Then as now, our mission is to assist scientific 
exploration, chart the waters, provide humanitarian assistance 
to native tribes, conduct search and rescue, and enforce U.S. 
laws and regulations throughout the region.
    In Alaska, the Coast Guard's aircraft and vessels monitor 
more than 950,000 square miles of water off the Alaskan coast 
to enforce U.S. laws. We patrol an even larger area of the 
North Pacific, as you know, sir, to stop large-scale high-seas 
drift net fishing and other illegal fishing practices, 
including foreign incursions into the U.S. EEZ. We also conduct 
marine safety and environmental protection missions throughout 
the region.
    The Coast Guard continues to push forward to assess our 
capabilities to conduct operations in the Arctic. Since 2008, 
we have set up temporary forward operating locations on the 
North Slope, in Prudhoe Bay, Nome, Barrow, Kotzebue, to test 
our capabilities with cutters, boats, helicopters, 
communications equipment, and maritime safety and security 
teams. We also deployed our light icebreaking-capable ships, 
our 225-foot ocean-going buoy tenders to test our equipment, 
train our crews, and increase our awareness of the activity 
going on offshore.
    Additionally, each year from April to November we have 
flown two sorties a month to assess maritime activities in the 
region and to ensure maritime domain awareness. To protect the 
Arctic environment, we are reaching out to industry and the 
private sector to address their significant responsibilities 
for pollution prevention, preparedness and response. Those 
engaged in offshore commercial activity in the Arctic must also 
plan and prepare for emergency response in the face of a harsh 
environment, long transient distances for air and surface 
assets, and limited response resources.
    We continue to work to improve awareness, contingency 
planning and communications. We are also actively participating 
with Department of Interior-led interagency working group on 
coordination of domestic energy development and permitting in 
Alaska, established by Executive Order 13580, to synchronize 
the efforts of the Federal agencies responsible for overseeing 
safe and responsible development of Alaska's offshore energy 
opportunities.
    While prevention is critical, the Coast Guard must also be 
able to manage the response to pollution incidents where 
responsible parties are not known or fail to adequately 
respond. Last year we exercised our Vessel of Opportunity 
Skimming System, VOSS, and our Spill Oil Recovery System, SORS, 
in the Alaskan waters as part of Arctic Shield 12 in the 
vicinity of Barrow.
    Fisheries are also a concern in the region. The National 
Maritime Fisheries Service, based upon a recommendation from 
the North Pacific Fisheries Management Council, which the Coast 
Guard participates in, has imposed a moratorium on fishing 
within the U.S. Exclusive Economic Zone north of the Bering 
Strait until an assessment of the practicality of sustained 
commercial fishing is completed.
    The Coast Guard will continue to carry out its mission to 
enforce and protect living marine resources in the high 
latitudes. We are employing our Waterways Analysis and 
Management System to assess vessel traffic, which is continuing 
to grow, and the density to determine the need for improved 
aids to navigation and other safety requirements. We are also 
moving forward with the Bering Strait Port Access Route Study 
in coordination with our international partners, which is a 
primary analysis to evaluate vessel traffic management and 
appropriate ship routing measures in the Bering Strait.
    The Coast Guard continues to support international 
multilateral organizations, studies, projects and initiatives. 
We are actively working with the Arctic Council, International 
Maritime Organization and other respected working groups. We 
are leading the U.S. delegation of the Arctic Council's All 
Spill Task Force, which is developing international instruments 
on Arctic maritime oil pollution preparedness and response, and 
are conducting joint contingency response exercises with 
Canada.
    Last month, we hosted representatives from Russia, their 
State Maritime Pollution Control Salvage and Rescue 
Administration, to sign an expanded memorandum of understanding 
and joint contingency planning to foster cooperation between 
our two nations in the event of an oil spill in the region. We 
will continue to engage Arctic nations, international 
organizations, industry, academia, Alaska state, local, and 
tribal governments to strengthen our partnerships and agencies.
    Our engagement with the Alaska Native tribes continues to 
be highly beneficial. We are working hard to ensure tribal 
equities are recognized and that the indigenous people and 
their way of life are protected. We look forward to continuing 
to strengthen our partnership with Alaska Natives.
    Looking ahead, over the next 10 to 15 years, the Coast 
Guard's regional mission profile will continue to evolve. 
Increased human activity will increase the significance and the 
volume of maritime issues throughout the region, issues such as 
freedom of navigation, offshore resource exploration, and 
environmental preservation.
    The Coast Guard's strategic approach will pursue the 
capabilities in the future to perform our statutory missions as 
necessary in the Arctic to ensure a safe, secure, and 
environmentally sustainable operation to take place. This 
strategy will be consistent with our services approach to 
performing maritime safety and security and stewardship 
functions across all of our 11 statutory missions.
    Finally, the MODU KULLUK and NOBLE DISCOVERER, I need to 
mention the two of them. The Coast Guard certainly shares 
concerns regarding the recent grounding of MODU KULLUK, an 
event which highlights the rigors of operating in Alaskan 
waters. In January, I directed a marine casualty safety 
investigation into the facts and circumstances surrounding the 
grounding of the KULLUK. Members of the Coast Guard's 
investigation national center of expertise are leading the 
investigation and coordinating with local Coast Guard commands 
to utilize the technical expertise necessary to find out what 
happened. The National Transportation Safety Board, the Bureau 
of Safety and Environmental Enforcement are also involved to 
examine all aspects of the vessel casualty.
    Additionally, I also referred the casualty investigation of 
the drill ship Noble Discoverer, also operating in Alaska 
waters, to the Department of Justice for their review and 
potential follow-on action. Last week, I also referred a 
separate KULLUK investigation into potential violations from 
2012 to the Department of Justice for their review and 
potential follow-on action. As the Coast Guard and the 
Department of Justice are still actively engaged in these 
investigations, it would not be appropriate for me to provide 
additional information at this time. However, as soon as the 
investigation is complete and final reports are issued, 
Senator, I will ensure that you get a copy of them, and your 
staff does as well.
    In conclusion, Senator Begich and distinguished colleagues, 
the Coast Guard in Alaska will continue building its strategy 
using a whole-of-government approach that will inform national 
dialogue and policy and development of the Arctic region. While 
there are many challenges, the increasingly open Arctic Ocean 
also presents unique opportunities for our nation, and 
specifically for the people of Alaska. We look forward to 
working with the Congress on how the Coast Guard can continue 
to support our national Arctic objectives, protect its fragile 
environment, and remain semper paratus, always ready in the new 
ocean and for the people of Alaska.
    Thank you, sir, for this opportunity to testify here today. 
I look forward to your questions.
    [The prepared statement of Admiral Ostebo follows:]

    Prepared Statement of Rear Admiral Thomas P. Ostebo, Commander, 
                 U.S. Coast Guard Seventeenth District
    Senator Begich and distinguished colleagues, thank you for the 
opportunity to join you today. I am pleased to discuss Coast Guard 
Arctic responsibilities and operations. This past summer we prepared 
for Arctic activity driven by the oil industry's planned drilling 
operations in the Chukchi and Beaufort Seas. Partnering closely with 
Federal, State, Local, and Tribal government partners, and working with 
industry as the regulated parties, the Coast Guard was ready for 
operations in the Arctic with Operation Arctic Shield. The lessons we 
learned this past year will inform our planning and strategy, to ensure 
we remain always ready to ensure the safety, security and stewardship 
of the emerging maritime frontier of the Arctic.
Mobile Offshore Drilling Unit (MODU) Kulluk Grounding--On-Going 
        Investigation
    The Coast Guard shares your concerns regarding the grounding of the 
MODU KULLUK on December 31, 2012, which highlights the rigors of 
operating in Alaskan waters. The Coast Guard last inspected the KULLUK 
on December 20, 2012. The Coast Guard inspected and certificated the 
newly constructed Offshore Supply Vessel AIVIQ on April 20, 2012.
    In January, I directed a marine casualty safety investigation into 
the facts and circumstances surrounding the grounding of the KULLUK. 
Members of the Coast Guard's Investigation National Center of Expertise 
are leading the investigation, coordinating with local Coast Guard 
commands, and utilizing the technical expertise of the National 
Transportation Safety Board and the Bureau of Safety and Environmental 
Enforcement to examine all aspects of this vessel casualty. 
Furthermore, in order to provide timely feedback to the American public 
and the marine industry, the investigators have been authorized to make 
interim safety recommendations prior to the final release of the 
report.
    As my investigating officer is still actively engaged in the 
investigation, it would not be appropriate to provide additional 
information at this time. As soon as the investigation is complete, and 
the final report is issued, I will ensure a copy is provided to you and 
your staff.
    Additionally, in January I also referred the casualty investigation 
of the Drill Ship NOBLE DISCOVERER, also operating in Alaskan waters, 
to the Department of Justice (DOJ) for their review and potential 
follow-on action. Since the Coast Guard is actively assisting DOJ with 
the case, it would not be appropriate for me to provide information 
regarding this on-going investigation and I would refer any questions 
to DOJ.
The Coast Guard in Alaska and the Arctic Region
    The Coast Guard has been operating in the Arctic Ocean since 1867, 
when Alaska was just a territory. Then, as now, our mission is to 
assist scientific exploration, chart the waters, provide humanitarian 
assistance to native tribes, conduct search and rescue, and enforce 
U.S. laws and regulations.
    In Alaska, Coast Guard aircraft and vessels monitor more than 
950,000 square miles off the Alaskan coast to enforce U.S. laws. We 
patrol an even larger area of the North Pacific Ocean to stop large-
scale high seas drift netting and other illegal fishing practices, 
including foreign incursions into the U.S. Exclusive Economic Zone. We 
also conduct marine safety and environmental protection missions in the 
region.
    To protect the Arctic environment, we are engaging industry and the 
private sector to address their significant responsibilities for 
pollution prevention, preparedness, and response. Recognizing that 
pollution response is significantly more difficult in cold, ice, and 
darkness, enhancing preventative measures is critical. Those engaging 
in offshore commercial activity in the Arctic must also plan and 
prepare for emergency response in the face of a harsh environment, long 
transit distances for air and surface assets, and limited response 
resources. We continue to work to improve awareness, contingency 
planning, and communications.
    We are also actively participating in the Department of Interior-
led interagency working group on Coordination of Domestic Energy 
Development and Permitting in Alaska (established by Executive Order 
13580) to synchronize the efforts of Federal agencies responsible for 
overseeing the safe and responsible development of Alaska's onshore and 
offshore energy.
    While prevention is critical, the Coast Guard must be able to 
manage the response to pollution incidents where responsible parties 
are not known or fail to adequately respond. In 2010, we deployed an 
emergency vessel towing system north of the Arctic Circle. We have also 
exercised the Vessel of Opportunity Skimming System (VOSS) and the 
Spilled Oil Recovery System (SORS) in Alaskan waters, but we had yet to 
conduct exercises north of the Arctic Circle until this summer. Both of 
these systems enable vessels to collect oil in the event of a 
discharge, however, these systems have limited capacity and are only 
effective in ice-free conditions. As part of Arctic Shield 2012, we 
conducted the furthest northern deployment and testing of the SORS in 
the vicinity of Barrow.
    Fisheries are also a concern in the region. The National Marine 
Fisheries Service, based upon a recommendation from the North Pacific 
Fisheries Management Council, has imposed a moratorium on fishing 
within the U.S. Exclusive Economic Zone north of the Bering Strait 
until an assessment of the practicality of sustained commercial fishing 
is completed. The Coast Guard will continue to carry out its mission to 
enforce and protect living marine resources in the high latitudes.
    We are employing our Waterways Analysis and Management System to 
assess vessel traffic density and determine the need for improved aids 
to navigation and other safety requirements. We are also moving forward 
with a Bering Strait Port Access Route Study, in coordination with our 
international partners, which is a preliminary analysis to evaluate 
vessel traffic management and appropriate ship routing measures.
    The Coast Guard continues to support international and multilateral 
organizations, studies, projects and initiatives. We are actively 
working with the Arctic Council, International Maritime Organization 
and their respective working groups. We are leading the U.S. delegation 
to the Arctic Council Oil Spill Task Force that is developing an 
International Instrument on Arctic Marine Oil Pollution Preparedness 
and Response. We are also conducting joint contingency response 
exercises with Canada and we maintain communications and working 
relationships with Canadian and Russian agencies responsible for 
regional operations including Search and Rescue, law enforcement and 
oil spill response. We maintain bilateral response relationships with 
Canada and Russia, and last month we hosted representatives from the 
Russian State Marine Pollution Control Salvage and Rescue 
Administration to sign an expanded Memorandum of Understanding and 
Joint Contingency Plan to foster closer cooperation in oil spill 
response. We will continue to engage Arctic nations, international 
organizations, industry, academia and Alaskan state, local and tribal 
governments to strengthen our partnerships and inter-operability.
    Our engagement with Alaska Native Tribes continues to be highly 
beneficial. Our continued partnership has made our operations safer and 
more successful. We are working hard to ensure tribal equities are 
recognized, and that indigenous peoples and their way of life are 
protected. We look forward to continuing to strengthen our partnerships 
with our Alaskan Native partners.
    The Coast Guard continues to push forward and assess our 
capabilities to conduct operations in the Arctic. Since 2008, we set up 
small, temporary Forward Operating Locations on the North Slope in 
Prudhoe Bay, Nome, Barrow and Kotzebue to test our capabilities with 
boats, helicopters, and Maritime Safety and Security Teams. We also 
deployed our light-ice capable 225-foot ocean-going buoy tenders to 
test our equipment, train our crews and increase our awareness of 
activity. Additionally, each year from April to November we have flown 
two sorties a month to evaluate activities in the region.
    Looking ahead over the next 10-15 years, the Coast Guard's regional 
mission profile will continue to evolve. Increasing human activity will 
increase the significance and volume of maritime issues, such as 
freedom of navigation, offshore resource exploration, and environmental 
preservation. While summer sea ice is forecast to diminish further in 
the coming decades, the region will still be largely ice covered in the 
winter. Thus, ice will continue to present hazards even in the summer 
time.
The Coast Guard in Context of National Arctic Policy
    U.S. Arctic policy is set forth in the 2009 National Security 
Presidential Directive 66/Homeland Security Presidential Directive 25. 
For the past four years, as we are today with Arctic Shield 2012, we 
have been conducting limited Arctic operations during open water 
periods. However, we face many challenges looking into the future. Some 
Arctic operations demand specialized capabilities and personnel trained 
and equipped to operate in extreme climates. Our assessments of the 
Nation's requirements for operating in ice-laden waters will consider 
infrastructure requirements to support operations, and requirements for 
personnel and equipment to operate in extreme cold and ice.
    Given the scope of these challenges, we have been conducting oil-
in-ice research since 2010 to evaluate, develop, and test equipment and 
techniques that can be used to successfully track and recover oil in 
any ice filled waters, and have explored promising technologies, such 
as heated skimmers. The Coast Guard's strategic approach is to ensure 
we pursue the capabilities in the future to perform our statutory 
missions so we can ensure the Arctic is safe, secure, and 
environmentally sustainable. This strategy is consistent with our 
Service's approach to performing its Maritime Safety, Security, and 
Stewardship functions.
Conclusion
    Arctic Shield 2012 was an appropriate plan to meet projected 
mission requirements this past year. Moving forward, we will continue 
building our strategy using a whole-of-government approach that will 
inform national dialogue and policy development for this critical 
region.
    While there are many challenges, the increasingly open Arctic Ocean 
also presents unique opportunities. We look forward to working with the 
Congress on how our Coast Guard can continue to support our national 
Arctic objectives, protect its fragile environment and remain Semper 
Paratus--Always Ready in this new ocean.
    Thank you for the opportunity to testify today. I look forward to 
your questions.

    Senator Begich. Thank you very much, Admiral.
    Let me move now to Pete Slaiby, who is the Vice President 
of Shell exploration.

         STATEMENT OF PETER E. SLAIBY, VICE PRESIDENT, 
                          SHELL ALASKA

    Mr. Slaiby. Thank you very much, Senator Begich, Mr. Chair. 
I am Pete Slaiby, Vice President of Shell Alaska. I appreciate 
the opportunity today regarding this opportunity to testify 
about our activities in the Arctic. My presence here is no 
doubt related to Shell's exploration program offshore Alaska in 
2012. The program does involve marine activity. Today I will 
describe Shell's 2012 drilling operations in the Chukchi and 
the Beaufort Seas, with a focus on this maritime activity, and 
the activities that supported those operations. Then I am going 
to very briefly highlight some of the government and industry 
initiatives that contribute to the dialogue about maritime 
activities in the Arctic.
    I have put recommendations for policymakers in my written 
testimony, but because of time I won't be able to testify or 
speak to that today.
    In 2012, Shell drilled a portion of two wells, one in the 
Beaufort and one in the Chukchi, what we call top holes. 
Although the wells didn't reach hydrocarbon objectives because 
of the time constraints, they did mark an historic reentry into 
the U.S. Arctic offshore. These were the first wells drilled in 
open water offshore Alaska in more than 15 years and the first 
step to validating the enormous offshore resource potential.
    Shell's drilling program, supported by our logistics teams, 
oil spill response assets, and with serious attention to 
stakeholder expectations, was carried out safely and 
successfully. Let me say that again. Our drilling operations 
were completed safely and successfully. After the drilling 
ceased, we demobilized our vessels, including the DISCOVERER, 
the NOBLE DISCOVERER and the KULLUK drilling rigs, south of the 
U.S. Arctic theater. It was while leaving the theater of 
operations that issues with the DISCOVERER were identified by 
the Coast Guard and the KULLUK ran aground. These incidents are 
the subject of ongoing government investigations and I will not 
talk about them today.
    I would like to acknowledge publicly the efforts of over 
700 men and women who worked 24/7 on behalf of Shell and the 
incident command to ensure that that incident, the KULLUK 
grounding, did not escalate. Shell's offshore and onshore 
response teams put forward a Herculean effort in a very short 
amount of time. That included immediate escalation in the 
notifications to the appropriate government agencies, 
deployment of Shell air and marine assets, 19 tugs and 
approximately 20 aircraft, forward mobilized personnel to the 
impacted communities, and a suite of oil spill response 
equipment into the region.
    As you are aware, Mr. Chairman, no people were harmed, and 
there was minimal impact to the environment as the result of 
the KULLUK grounding. Finally, the assets I referred to played 
a key role in the recovery of the KULLUK, in many ways mirrored 
the marine and air assets that we have available during our 
drilling operations in the Arctic in 2012.
    Of course, the story wouldn't be complete without me 
acknowledging a couple of people in the room. Admiral Ostebo 
and the work that the Coast Guard played in that was absolutely 
key, as well as Captain Mehler. The amount of time that we 
spent together over New Year's in the Marriott was significant, 
and I feel that I know a lot about both of those gentlemen as 
well.
    We were also very, very happy to have spent and had a 
successful relationship with the people of Kodiak. One of the 
things I will share with you, Mr. Chair, is that during that 
time we did bring people in from Old Harbor in those areas, and 
they frankly said, you know, you have a very, very difficult 
situation here. You have the KULLUK on the beach, and we 
appreciate the fact that you have stood up 700 people, but we 
don't think that you will ever be able to get that rig off the 
beach.
    Of course, in my position, you can't predict what will 
happen. But I did promise that we would do everything we could 
to move the rig off the beach. So I am equally pleased that we 
were able to do what we did and promise what we did through the 
work of the Coast Guard, Shell, State of Alaska, the 
communities, and Smith Salvage. I'm very, very pleased that we 
were able to do what was arguably one of the most difficult 
marine salvage operations attempted on the Alaskan coast.
    Now, let me focus on some of the efforts on Shell's 2012 
exploration program that relate to marine operations and 
highlight some of the steps we took to ensure that these 
operations were completed safely and successfully.
    Going into the Alaskan Arctic, we understood that there was 
limited infrastructure. We assembled and brought the majority 
of the assets that we required, both onshore and offshore, with 
us. We did so with a commitment of setting the bar higher for 
an environmentally responsible program in the Arctic. We 
pursued the goal of having the smallest possible footprint and 
no significant influence or impact on the North Slope 
communities and the traditional hunting activities. At every 
step, we worked with Federal agencies, the State of Alaska, 
local governments and, most importantly, stakeholders on the 
North Slope to develop a program that aspired to the highest 
technical, operational, and environmental standards.
    Let me give you a few facts and figures on the marine and 
aviation logistics as far as accomplishments. They included 
approximately a quarter of a million miles traveled in 2012 by 
23 vessels; 500 vessel-to-vessel transfers; 3,250,000 gallons 
of ultra-low sulfur diesel transferred; 10 vessels built and 
six modified in shipyards across the U.S.; 250,000 tons of 
cargo transferred at sea; 20,000 protected species 
observations--walrus, seals, whales, et cetera--that continue 
to develop a very important data base; 11,877 personnel 
transfers; jobs for Alaskans; 562 rotary wing and 535 fixed 
wing flights. In short, we secured the tools and technologies 
needed to keep people safe and conserve the environment.
    As you are aware, maritime activities in the Arctic will 
increase and routes will open and oil and gas activity expand 
across the Arctic. Oil and gas development is underway, as you 
alluded, in the U.S., as well as offshore Russia, Canada, 
Norway and Greenland. Governments are considering appropriate 
policy responses through various international organizations 
such as the Arctic Council.
    Industry is contributing to the dialogue through a range of 
assessments and assignments and joint venture industry programs 
that increase knowledge about the Arctic. Such government and 
private sector initiatives must continue.
    I hope these remarks are useful and informative, and I 
thank the Senator for the opportunity today.
    [The prepared statement of Mr. Slaiby follows:]

  Prepared Statement of Peter E. Slaiby, Vice President, Shell Alaska
    Mr. Chairman, I am Pete Slaiby, Vice President of Shell Alaska. I 
appreciate the opportunity to testify today regarding maritime 
activities in the Arctic. My presence here is no doubt related to 
Shell's exploration program off the coast of Alaska--a program that 
involves maritime activity.
    Today, I will describe Shell's 2012 drilling operations in the 
Chukchi and Beaufort Seas with a focus on the maritime activities that 
supported those operations. Then, I will highlight some of the 
government and joint government-industry initiatives that will 
contribute to the dialogue about maritime activity in the Arctic. 
Finally, I will offer some recommendations for policymakers to 
consider.
Shell Alaska 2012
    In 2012 Shell drilled portions of two wells--one well in the 
Chukchi and one in the Beaufort. Although the wells did not reach the 
hydrocarbon objective, they did mark an historic re-entry into the U.S. 
Arctic offshore. They were the first wells drilled in the open water 
offshore Alaska in over 15 years; and the first step to validating the 
enormous offshore resource potential. Shell's drilling program, 
supported by our logistics team, oil spill-response assets, and with 
serious attention to stakeholder expectations, was carried out safely 
and successfully. Let me say that again--our drilling operations were 
completed safely and successfully.
    After drilling ceased, we demobilized our vessels, including the 
Discoverer and Kulluk drilling rigs south of the U.S. Arctic theatre. 
It was while leaving the theatre of operations that issues with the 
Discoverer were identified by the U.S. Coast Guard and the Kulluk ran 
aground. These incidents are the subject of ongoing government review, 
and therefore, I will not talk about them.
    I would like to acknowledge, publicly, the effort of the over 700 
hundred men and women who worked 24/7 on behalf of Shell and Incident 
Command to ensure the incident did not escalate. Shell's onshore and 
offshore response teams put forward a herculean effort in a time of 
need. That includes the immediate escalation and notifications to the 
proper agencies, deployment of Shell air and marine assets (19 tugs/
vessels and 20 aircraft), forward-mobilized personnel to impacted 
communities and a suite of oil-spill-response equipment to the region.
    As you are aware, Mr. Chairman, no people were harmed, and there 
was minimal impact to the environment as a result of the Kulluk's 
grounding. Finally, the assets I referred to that played a key role in 
the recovery of the Kulluk, in many ways, mirrored the marine and air 
assets we assembled and had available during our drilling operations in 
the Arctic in 2012.
    Now, I will focus in some detail on aspects of Shell's 2012 
exploration program that relate to maritime operations; and highlight 
some of the steps we took to ensure that these operations were safe and 
successful.
    Going into the Alaska Arctic, we understood that there was limited 
infrastructure. We had to assemble and bring the majority of onshore 
and offshore infrastructure with us. And we did so with a commitment to 
setting the bar for an environmentally responsible Arctic program. We 
pursued the goal of having the smallest possible footprint and no 
significant negative impact on North Slope communities and their 
traditional subsistence hunting activities.
    At every step, we worked with Federal agencies, the State of 
Alaska, local governments and most importantly, the residents of 
Alaska's North Slope, to develop a program that aspired to the highest 
technical, operational and environmental standards.
    Let me give you some facts and figures on our marine and aviation 
logistics accomplishments.

   Marine: 240,000 total nautical miles travelled in 2012 by 23 
        vessels

   500 vessel-to-vessel personnel transfers

   3,250,000 gallons of Ultra-Low Sulfur Diesel transferred

   10 vessels built or modified in 6 shipyards

   25,000 tons of cargo moved at sea

   20,000 protected species observations (whales, walrus, 
        seals, etc..) from vessels and aircraft

   11,877 personnel transfers

   562 rotary-wing and 535 fixed-wing flights

    In short, we secured the tools and technology needed to keep people 
safe and conserve the environment.
    Additionally, Shell undertook a number of programs and 
initiatives--all designed to ensure safe and responsible maritime 
operations. The following programs and initiatives played an enormous 
role in our 2012 program, and I will describe them in more detail after 
listing them.

   Shell Ice and Weather Advisory Center (SIWAC)

   Vessel Tracking System

   Simultaneous Operations Center

   Conflict Avoidance Agreement

   Oil Spill Contingency Agreement

   Communications Centers/Subsistence Advisor Program
SIWAC--Shell Ice and Weather Advisory Center
    Shell's commitment to ensuring safe and responsible maritime 
operations is underpinned by our investment in ice and weather 
forecasting systems. Shell developed and now operates the Shell Ice and 
Weather Advisory Center (SIWAC) and has done so since 2007. SIWAC is an 
integrated ice hazard detection and forecasting service that has 
evolved to be the most comprehensive and focused ice and weather 
operation covering the offshore and coastal areas from the Gulf of 
Alaska to the Canadian Beaufort. SIWAC staff integrate a constant 
stream of weather, sea, and ice data from many sources, including 
satellite imagery, Metocean buoy, field observers, high frequency Radar 
sites, and publically available data; Shell also planned and executed a 
total of 23 dedicated ice reconnaissance missions in 2012.
    At no time was the value of these professionals more evident than 
when we made the decision to moveoff the Burger well site in the 
Chukchi Sea one day after we commenced drilling. As frustrating as that 
was, it was the right call and one made possible by the world-class ice 
and weather forecasting we employ in the U.S. Arctic.
    Mr. Chairman, as you are acutely aware, Shell takes additional 
steps to ensure that others can benefit from these Arctic forecasts.
    For example, in 2012 SIWAC entered into a collaborative agreement 
with NOAA to share both near real-time and archived environmental data, 
such as buoy data and sea ice charts, which improves forecast products 
poduced by NOAA for the U.S. Arctic. Moreover, Shell also maintains a 
data-sharing agreement with NOAA regarding hydrography. The sea floor 
in the Beaufort and Chukchi Seas continues to be mapped, as Shell 
vessels transit these seas we collect hydrographic data and provide it 
to NOAA. We also engage in discussions to focus on mapping priorities.
Vessel Tracking
    Mr. Chairman, 23 Shell vessels traveled 240,000 nautical miles in 
the course of mobilization, demobilization, and season operations. 
Shell's marine activities to support operations in the Beaufort and 
Chukchi seas are bounded by a number of factors, including compliance 
with air and other permits and authorizations, management of protected 
species interactions, whaling blackout commitments, and significant 
steaming distances--many of which I will further describe. When active, 
Shell vessels provided real-time position data via vessel tracking 
systems to BOEM, the USCG, and the Alaska Marine Exchange. Shell vessel 
movement data was remotely monitored for internal safety, compliance, 
and operational reasons, and this data was also used in a Shell-
developed Graphical Information System which allowed data such as ice 
interpretations and temperature to be overlaid on maps.
Communication Centers and Subsistence Advisor Program
    Shell also carried out significant activities to communicate our 
operational and maritime activities with local communities, allowing us 
to minimize impacts on their subsistence and cultural activities. For 
example, Shell employed Subsistence Advisors in the local communities. 
Through twice-daily calls, we learned what hunting activities were 
occurring, how animals were migrating, and received feedback that 
helped us plan and adjust our operations so as to avoid interference 
and impacts. This worked very well and allowed for real-time 
adaptation. Shell also funded the operation of Communications Centers 
in each of the coastal communities. All Shell vessels called in to 
these centers every six hours around the clock, to state current 
location, current activities, and planned activities. These 
communications were made public, free and available to anyone who 
wanted information. This worked well for Shell and helped supply 
information to communities.
SIMOPS--Simultaneous Operations Center
    To enhance communication with the greater maritime communities and 
regulators, Shell also operated a forum for managing Simultaneous 
Operations in Barrow to facilitate mutual aid and conflict avoidance. 
In this forum, Shell staff brought forward information from the 
Subsistence Advisors and vessel tracking programs, incorporated data 
from other parties and conducted a daily information exchange via 
teleconference. All entities with operational activities--USCG, other 
agencies, communities--could use the forum for information exchange to 
keep tabs on Shell's activities, as well as other shipping activities 
to the extent possible. We have run this for the last five years, and 
it has worked well.
CAA--Conflict Avoidance Agreement
    As previously noted, Shell understands the importance of 
subsistence to local communities and has negotiated and signed key 
agreements to minimize our impacts on them. For example, Shell signed 
and abided by a Conflict Avoidance Agreement with the Alaska Eskimo 
Whaling Commission, which allowed operations following certain criteria 
and outside blackout times. This agreement also required zero discharge 
of drillig muds and cuttings and other treated waste streams in the 
Beaufort, the communication centers in coastal villages, protected 
species observers on marine vessels and overflights, transit and 
logistical requriements during the hunt, and providing assistance to 
whalers in the event of an emergency. Protected Species Observers have 
been used on all our vessels and have a critical role, being tasked 
with observing and reporting protected species and advising the vessel 
master to take appropriate mitigations, such as altering course and/or 
reducing vessel speed.
Good Neighbor Policy or Oil Spill Contingency Agreement
    Shell has a ``Good Neighbor Policy'', also known as the Oil Spill 
Contingency Agreement, among Shell, the Alaska Eskimo Whaling 
Commission, the North Slope Borough, and Inupiat Community of the 
Arctic Slope whereby Shell agrees to provide the financial and/or 
logistical support to facilitate an affected community's subsistence 
hunt in the event such hunt is impacted by an oil spill from Shell's 
exploration driling.
Science
    In the scientific arena, Shell has a long history of investing in 
environmental studies necessary to properly characterize and assess 
potential impacts to important ecological areas of the Chukchi and 
Beaufort Seas and the terrestrial areas of the North Slope. Shell 
invested $35 million in environmental monitoring and research in 2012 
alone, and we plan to continue our work in anticipation of future 
drilling. Shell also has an agreement with the North Slope Borough to 
invest annually $5 million in science projects related to oil and gas 
activities offshore.
    The bottom line is this: Shell continues to go above and beyond in 
putting a structure and systems in place that managed our operations in 
a safe and responsible manner and served to build confidence in our 
programs among stakeholders closest to the resource and, I'm proud to 
say, strong relationships built on trust. Most of what I just described 
to you was not required by government regulation, but reflects a 
corporate desire to do things right. All of these activities--as well 
as the professionalism of the people who carried them out--contributed 
to safe and successful offshore maritime and drilling operations.
    Shell will also continue to be an active collaborator with 
intergovernmental scientific planning and review boards, and Shell is 
pleased that Dr. Michael Macrander, our science team lead for the 
Arctic, is a member of the National Academy of Science's panel on 
Emerging Research Questions in the Arctic
Arctic Maritime Activity: Challenges Going Forward and Policy Responses
    Marine activity in the Arctic will increase as northern routes open 
and oil and gas activity expands across the Arctic. Oil and gas 
development is happening in the U.S. Arctic, as well as offshore 
Russia, Canada, Norway, and Greenland. Governments are considering the 
appropriate policy responses through various international 
organizations, such as the Arctic Council. Industry is contributing to 
the dialogue through a range of assessments and joint industry programs 
that increase knowledge about the Arctic. Such government and private 
sector initiatives should continue and be coordinated. There is a 
shared goal to ensure that as maritime operations expand in the Arctic 
they go forward safely.
    Policymakers should consider the following:
    Strong support for the Arctic Council--The Arctic Council is 
proving to be a viable forum for Arctic nations to come to agreement on 
mutually beneficial programs that can make a significant contribution 
to maritime safety and protection of the environment. The Arctic 
Council has several relevant working groups, such as the Arctic 
Monitoring & Assessment Programs; Emergency Prevention, Preparedness & 
Response and the Task Force on Oil Spill Preparedness and Response; 
Protection of the Arctic Marine Environment; and Sustainable 
Development Working Group. Given the proximity of oil and gas basins 
and the likelihood of oil and gas development stretching across 
national borders, the Arctic Council is best positioned to encourage 
harmonization of regulatory standards covering industrial development 
in the Arctic. This will facilitate development by reducing costly 
duplication or conflicting requirements in a single development basin.
    Ratification of the Law of the Sea Treaty--The U.S. is one of the 
few countries in the world that has not ratified the Treaty. Broad and 
diverse industry groups and companies support ratification.
    Support Industry Efforts to Set Arctic Shipping Standards. IMO is 
currently developing a draft International code of safety for ships 
operating in polar waters (Polar Code), which would cover the full 
range of design, construction, equipment, operational, training, 
stability, search and rescue and environmental protection matters 
relevant to ships operating in the waters surrounding the two poles.
    Support Additional Arctic Scientific Research and Technology 
Development. Technology development is essential for taking safe 
operational practice and making it safer and enhancing mitigations to 
further protect the environment. These are areas where Shell invests. 
Shell is supporting the ongoing Arctic oil spill response joint 
industry project that is advancing capability in this important area.
Revenue Sharing for Alaska
    I want to acknowledge the effort you and Senator Murkowski are 
spearheading in Washington D.C. to extend OCS revenue sharing for 
Alaska. Current law provides that revenue from OCS leases in the Gulf 
of Mexico is shared with the Gulf States of Alabama, Louisiana, 
Mississippi and Texas. It is not fair that revenue from OCS leases off 
the coast of Alaska is not shared. Congress should approve legislation 
that gives Alaska a portion of the Federal revenue generated by 
production on current and future leases.
    Revenues shared with Alaska could then be available to invest into 
coastal marine infrastructure such as ports and harbors, community-
based support equipment, airports and other shore-based logistic 
infrastructure available for all marine users to benefit.
Conclusion
    I hope these remarks are useful and informative. Thank you, Senator 
Begich. I am happy to answer questions.

    Senator Begich. Thank you very much, Pete, and thank you 
for the recommendations in your written testimony. I'll ask you 
some questions on that in just a second.
    What I'd like to do is ask Tommy Beaudreau first a series 
of questions. I know at a quarter till we have to sign you off 
to hook up another VTC, so I'll try to go through my questions 
fairly rapidly here, if you can bear with me.
    First is, as we're working through the sequestration, the 
budget cuts that were automatically implemented throughout all 
the different agencies, do you see those reductions and 
sequestration having an impact in doing permits in a timely 
manner for 2014?
    Mr. Beaudreau. So sequestration, as you know, Senator, 
presents enormous challenges across the Federal Government, and 
that's certainly true of agencies for which I am responsible, 
in particular BOEM and BSEE. BOEM and BSEE are nothing if not 
can-do agencies. I expect that we will do our utmost, as we 
always have, to complete our work in a very thorough way, 
demand compliance with our high standards, but complete our 
work promptly as well.
    This will require a lot of resource management and, 
frankly, I am concerned about the potential impact of 
sequester. Remember the history of MMS and the reason BOEM and 
BSEE are in existence in the first place. MMS was a severely 
under-resourced agency. We have worked with Congress in 
connection with our reform efforts to remedy that in large 
part, and I am concerned that sequester presents a step 
backward from that.
    But we will continue to do everything we can to fulfill our 
responsibilities, and do so thoroughly, and do so promptly.
    Senator Begich. Let me, if I can follow up on that, I know 
you now have new requirements to do the--you took over what EPA 
used to do on air permits for drilling. Is that also now--I 
guess the first question is have you been able to gear up under 
these conditions of sequestration, and are you seeing also a 
potential of a slowdown in that process? As you know, that's a 
new piece of your equation taken from EPA. Can you give me a 
little comment on that, or is that similar to what you have 
just described for the sequestration overall?
    Mr. Beaudreau. Well, it's similar, but we are very far 
along in establishing our air quality program with respect to 
the Arctic OCS. That requires and we have conducted very close 
work with EPA. The EPA was quite far along, actually, in 
reviewing air permits emissions from, for example, Conoco 
Phillips. So we have been able to piggyback from that work 
moving forward, which I think has been great assistance to the 
program.
    As you know, Senator, there are significant differences 
between the air quality program administered under the Outer 
Continental Shelf Lands Act and EPA's authorities. So we are 
carrying forward the quality of the air quality analysis 
through a combination of application of our regs, as well as 
NEPA, but also implementing what I hope will be a very 
efficient and clear process.
    So there are budget challenges associated with all of this, 
but we are trying to address those challenges bureau-wide, not 
merely in the region.
    Senator Begich. Will you be able to--and I'm going to move 
to another subject here in a second, but just to finish up on 
the budgetary issues, will you be able to at some point, from 
your department or from the broader perspective of the Interior 
Department, be able to report to us here is where you think 
there might be slowdowns or impacts enough where we can get a 
longer-term picture? Because, as you know, you know it better 
than probably most in your department because you are from 
Alaska, that the timetable of how you do this permitting is 
critical, because you can literally be off a few months and 
change a year or a year-and-a-half of development because of 
the timetable of development that occurs here in Alaska versus 
the Gulf of Mexico, as an example.
    Will you be able to report to us at some point?
    Mr. Beaudreau. Yes, I am absolutely willing to continue 
communicating on a real-time basis with this issue. Permitting 
in Alaska presents the challenge you describe. You have to have 
a very efficient and timely process given the limited drilling 
window. From a regulatory perspective, it also offers certain 
advantages in that the volume is not as large as, say, the Gulf 
of Mexico, for example, and you are able to do some advance 
planning, particularly now that, for example, Shell has paused 
its program. So we are really looking at 2014 potentially for 
Shell, as well as for Conoco Phillips. So that offers, in my 
mind, opportunity for advance planning, including around 
internal resources.
    Senator Begich. Let me ask you two other quick questions, 
and then, while you were talking, a thing flashed across here 
telling us we have just minutes left with you. You can't see 
that. We can only see it.
    [Laughter.]
    Mr. Beaudreau. That wasn't my doing.
    Senator Begich. I know.
    [Laughter.]
    Senator Begich. It's a new technology. I like it now. You 
guys probably love this from your end of testimony. You get 
this little sign that flashes up. I know it wasn't your doing.
    Let me ask you, because Conoco Phillips will be doing a 
different type of drilling. I think it's a jack-up rig and how 
the blowout preventers are situated. They're not down on the 
ocean floor. They're on the rig itself.
    Maybe you can't answer this yet. Are you going to require 
Conoco Phillips to have a containment dome similar to what 
Shell has done, or are you going to just utilize the blowout 
preventers on the surface? Give me a sense there. Maybe you 
can't answer this yet because it is still in process, but can 
you give me a little sense there on that?
    Mr. Beaudreau. Yes. Generally, we're going to look for the 
same things from Conoco Phillips that we looked for with 
respect to Shell's operation, which is a performance standard 
around the ability to address any loss of well control at the 
source. That is extremely important, particularly in the Arctic 
environment, where opportunities for a spill response in the 
event of a loss of well control are limited by the remoteness 
of the geography, encroachment of sea ice, and a host of other 
factors.
    So we will be working very closely with Conoco Phillips on 
their ability to perform with respect to source control. We 
don't prescribe a one-size-fits-all solution to this issue, but 
we will be very demanding on this issue.
    Senator Begich. I will end with this, and again, I want to 
thank you for your testimony, thank you for participating. I 
know we will have more questions for you we will present 
through the record. But I think this is a simple question, and 
that is the interagency working group, I'm assuming that it is 
working well, and if you have recommendations, not necessarily 
right now but if you have recommendations to improve that, I 
would be very interested in hearing that at some point, because 
I know it's something I am very obviously active around. I 
think it's been working, but maybe you can give a quick comment 
on that, and then we will look for recommendations later.
    Mr. Beaudreau. Yes, it is working quite well. The focus and 
the genesis of the working group was around permitting issues. 
That remains one of the core focuses of the working group. But 
we are taking it further under Deputy Secretary Hayes' 
leadership to improve the overall quality, as well as the 
efficiency of Federal oversight in Alaska, including 
coordination with the public and stakeholder outreach.
    As you know, we, in executing our statutory 
responsibilities, place a significant interest in public 
outreach and outreach with Native communities. There are real 
opportunities through the working group to ensure that that 
input is shared broadly through the Federal Government, as well 
as to minimize the burden on local communities from all the 
Federal agencies seeking their input. So there are real 
opportunities there that we will be carrying forth.
    Senator Begich. Thank you very much, Tommy. Right across, 
you cannot see it, it says, ``This meeting will end in 1 
minute,'' so your timing was perfect.
    [Laughter.]
    Senator Begich. So let me just say thank you very much. 
Thank you for testifying. I appreciate you doing this by VTC. 
We, of course, as you know, in Alaska, it's not unusual for us 
to do this, and I think it worked very well. So I thank you for 
your testimony and thank you for participating. I think they 
will do something to you momentarily and you will vanish from 
our screen, but I'm going to continue with the two other folks 
here. So, thank you again for being here.
    Mr. Beaudreau. Thank you, Senator.
    Senator Begich. We are still on screen, so be careful what 
you do.
    [Laughter.]
    Senator Begich. Let me ask Admiral Ostebo, you had a couple 
of things that I thought were interesting to me, and one is--
you mentioned this not only in your last testimony last year we 
had, but also here, the ongoing concern of--you know, oil and 
gas development is important, but in the sense of shipping, the 
amount of movement of ships in the Arctic and the Bering Sea is 
increasing at a dramatic pace, more than I think most people in 
the country realize, and that creates unique challenges.
    There was one note I made, and it was on the International 
Maritime Organization polar code, which is all about what is 
the standard we will all operate under in this region. Can you 
give me an update on kind of where that is at?
    For folks that are here, and also listening, this is not 
just about shipping. It's also the many vessels that Pete 
Slaiby talked about that he utilized. They all have to transit 
through there. So it's a multifaceted use of that area.
    But tell me how that is coming about and what we see as 
long-term to make sure that we have some standards, because a 
lot of those ships are foreign flagged, and we have no clue 
about their capacity, their condition. Hopefully we know what 
they have in them, but even that may be of concern. So give me 
your thoughts on where we are on that and where we think we 
might be going.
    Admiral Ostebo. Yes, Sir. Sir, that's a great question, and 
it hits a number of facets I can cover in one, hopefully not 
too long response.
    You mentioned, sir, almost 500 vessels went through the 
Bering Strait last year. Twenty-two of them were Shell's. The 
rest of them belong to somebody else. Who did they belong to, 
where were they going, what were they carrying, what were their 
qualifications, were there mariners on board, what was the 
material condition of the ships varied greatly. If it was a 
ship that was leaving from a U.S. port going to another U.S. 
port, if it was a shipping or a barge combination that was 
engaged in U.S. traffic and trade, we had a lot of oversight on 
that. But if it is, as you said, a foreign flagged vessel with 
a foreign crew going from one foreign port on the north side of 
Russia, for example, to Singapore or China, there is very 
little that the U.S. can demand and very little that the Coast 
Guard can do to become informed about that or to demand certain 
standards of care on board those ships.
    To address that problem, what is being done through the IMO 
is this idea of let's have a polar code that addresses not only 
the standards of operation----
    Senator Begich. IMO is International Maritime Organization.
    Admiral Ostebo. International Maritime Organization under 
the United Nations. So to take a look at what would be the 
appropriate material conditions and requirements on ships that 
operate in the Arctic, hull thickness, propulsion requirements, 
endurance requirements, firefighting requirements, those kinds 
of safety standards.
    Senator Begich. So safety requirements.
    Admiral Ostebo. Safety of life at sea we call it, SOLAS 
requirements. What would those look like in the Arctic? What 
would be the prudent set there? Also, what would be a prudent 
set of qualifications for the mariners that operate those? 
Would they have to be ice pilots? Would they have to have a 
certain amount of training to operate in the Arctic? Both of 
those things would have to go together. Obviously, having the 
greatest ship in the world with inappropriately trained folks, 
it doesn't really help you out. They both have to come 
together.
    That is moving forward. The Coast Guard is heavily involved 
in structuring that. But as you know, sir, as a major 
international agreement, it takes time to move that forward. 
Since the time that that initiative began, things have changed 
in the Arctic. So things like the offshore mobile drilling 
rigs, they are not necessarily covered. The carbon footprint 
for ships is not necessarily covered. There is going to be an 
opportunity to go back and modify some of our requirements in 
the polar code, but currently it's primarily about safety of 
life at sea, firefighting and response capabilities on board 
the ship, and the mariner qualifications, and it is moving 
forward slowly through the IMO process.
    Senator Begich. And do you feel the other countries are 
participating in a way that is going to produce an end product?
    Admiral Ostebo. Yes, sir. The other Arctic nations I think 
are working very closely and collaboratively together. One of 
the things that we see happening through the Arctic Council and 
through some observer status is that a lot of other countries 
that might not--you wouldn't normally think of involved in the 
Arctic are working hard to have their contributions put in 
there. For example, I recently met with the Singapore 
Ambassador, and he is very interested in influencing the polar 
code. So the more people that come to this, as you know, from a 
committee perspective, it's harder to do, Senator.
    Senator Begich. Very good. Let me ask you on this same 
subject, and I know it's a concern, but tell me, as the Admiral 
for the 17th District, both are probably concerns of oil and 
gas development and shipping, but what is the bigger of the two 
over the long haul here?
    We are about to have someone else--OK, hang on one second.
    Helen, you are on the next panel. We haven't gotten to you 
yet, so be patient. You can sit there patiently, or you can 
come back to the screen when we call on you. But just so you 
know, you are on screen. So whatever you do, we will be 
watching you.
    [Laughter.]
    Senator Begich. It's your choice. So don't feel like you 
have to sit there and watch us go through this. We are closing 
out the second panel, or first panel here. So, thank you very 
much for being here.
    So, what is the biggest risk? One of the things I've said 
is the shipping is what I'm always worried about. There are 
multiple standards on oil and gas industry from many different 
agencies, but on shipping it makes me more nervous. Tell me 
where do you see the risk in the Arctic and the Bering Sea, 
because they are connected in the way of the transportation 
route.
    Admiral Ostebo. Senator, first, in my job, I am worried 
about everything.
    Senator Begich. I knew that answer.
    Admiral Ostebo. So I never sleep. And certainly when it 
comes to environmental issues, it's hard to say whether a 
gallon of oil on the water is not a problem or is a problem. 
Anything going in the water that shouldn't be there is a 
concern to us, including anything that produces a sheen on the 
U.S. waters is something that we need to be involved with.
    With that said, when I look at risk, and when I look at the 
resources that I have, you have to take that risk apart a 
little bit. There is the consequence side of risk, how big the 
consequence is from something that happens, and the likelihood 
of something happening. So when I look at likelihood and I look 
at the numbers of ships that are coming through the Bering, and 
I look at the number of incidents we've had in the Alaskan 
waters--fires, emissions, collisions, groundings, people 
falling overboard--when the KULLUK incident happened, we had 15 
other cases going on in the State of Alaska at the same time.
    Senator Begich. At the same time.
    Admiral Ostebo. At the same moment, the same day. When I 
look at the numbers of groundings that we have, we have one 
which I brought some pictures of that is very much a big 
concern to me today with a Pacific producer who is aground on 
Kodiak Island. The highest probability----
    Senator Begich. Hold on a second, Admiral. I want to make 
sure that--they are working on it, so go ahead.
    Admiral Ostebo. The highest probability of incidents is 
clearly in the increased maritime traffic across the board. 
That is clearly the number one spot.
    Senator Begich. Is it because it is so multifaceted that 
you don't have one person to go to to say, OK, here is what we 
need to do?
    Admiral Ostebo. If you look at the work that we had working 
with industry last year, we knew where all their ships were. We 
were all over them. We had people on board them. We inspected 
them. They were all covered by AIS. They were very informed----
    Senator Begich. You had a higher standard.
    Admiral Ostebo. A higher standard. It was like we gang-
tackled that problem of drilling two holes in the Arctic last 
year, and they brought a lot of resources with them. You had 
two drilling rigs. Like I said, there were 22 vessels out 
there. All those other vessels were there to support that. You 
don't have that when you have a liquid condensate vessel coming 
from the North Slope of Russia through the Bering Strait, 
unannounced, with unknown crew and millions of gallons of 
product on board. Those things can seriously bother me. I don't 
know what route they are taking, and they show up on our screen 
randomly.
    Senator Begich. Let me ask two quick questions, and then 
I'll move to Pete Slaiby, and then I'll close out. But again, I 
thank you for your patience here.
    With the activity that occurred this year, and you 
mentioned the comment that Arctic Shell is kind of in 
perpetuity at different levels, depending on activity, I'm 
assuming.
    Admiral Ostebo. Yes, sir.
    Senator Begich. Do you feel like 2014, again, anticipating 
that Shell will be back in the waters, as well as potentially 
Conoco Phillips, that you are prepared even under the 
sequestration levels that we are at, or is that a risk factor 
that we have to calculate in and do what we can, obviously, on 
our end? And that may have been an answer to the question by 
the question I gave you, but tell me what you are thinking for 
2014. With sequestration, with Shell, Conoco Phillips 
potentially, now you have two kind of overlapping inside that 
region.
    Admiral Ostebo. Senator, I would submit that Coast Guard 
activities in the region are going to grow and be persistent, 
obviously changed by the amount of activity that goes on there, 
and oil and gas exploration is one part of that. If there is no 
more oil and gas exploration in the Arctic, the Coast Guard's 
presence will continue to grow there with all this other 
activity we have talked about.
    So we are attenuating our efforts based on the need that we 
see. Clearly, the summer of 2013, this coming summer, the Coast 
Guard will be there. We will have a national security cutter up 
there. We are looking to move a buoy tender up there. We're 
going to do some more experiments and exercise work. We have a 
whole list of things we're going to continue to do, although 
oil and gas exploration is not going to be taking place like it 
did last year. So you can rest assured----
    Senator Begich. There will still be activity there, but 
just on the level of training and testing, and also being aware 
because there is other activity outside of oil and gas going 
on.
    Admiral Ostebo. Yes, sir. And this also actually gives us 
an opportunity to focus more on the Bering Strait. So we'll put 
a lot of assets in there, and we will continue with our 
outreach with the local communities up there that we have 
started and that I think is going very well.
    In the summer of 2014, if Shell decides to drill, if Conoco 
Phillips shows up to drill, if our Canadian friends decide to 
move forward, as they are planning on doing, if our Russian 
friends decide to do the same, and with Pt. Thompson--I think 
it is important for a lot of folks to realize that Pt. Thompson 
is opening up. There are some 30 or 40 barges with a whole city 
that is going to go there to open up that field. That is all 
going to be from offshore. That is all going to be 
international traffic that brings that there. Equipment that's 
built in China and Singapore and other places will all have to 
come in, and the Coast Guard will be all over that because that 
provides lots of opportunity for accidents.
    So the Coast Guard will be there in the summer of 2013 and 
the summer of 2014 and beyond, a lot more I would suspect in 
the summer of 2014.
    Sequestration. Clearly, as Director Beaudreau brought up, 
sequestration is an issue for all of us, and the Coast Guard, 
particularly District 17, is working hard to figure out how 
best to manage the risks and the impacts of sequestration. We 
have a reduction in our flight hours, and our offshore maritime 
activity is being reduced because of that. The exact impacts, I 
will be getting a briefing before the end of this week, 
actually tomorrow, from my staff on how exactly they will 
recommend I adjust to that.
    Now, as far as 2014 goes in sequestration, Senator, as you 
know, that could be a million years from now.
    Senator Begich. Right. In Senate time, it is.
    Admiral Ostebo. Everything is changing. So we had a 
continuing resolution, then we had sequestration, now have a 
new continuing resolution, and we are still trying to balance 
all those books and see how we can do it.
    I will finally end with this is the Coast Guard issue, 
Senator, and not just my issue here in District 17. It is an 
all-hands-on-deck event for the United States Coast Guard 
around the Nation. So forces do flow from elsewhere as we look 
to balance the Coast Guard activities to Alaska to address 
this. So it's not just myself out here trying to figure this 
out on my own. Thank you very much.
    Senator Begich. Thank you very much.
    Pete, thank you very much for being patient here. I know 
that because of limitations of the reports that are being done 
and the work that is done by different agencies that you 
responded to on the KULLUK, let me ask you if I can ask you 
maybe a general question. You had an incredible operation at--I 
think it was the Marriott, if I remember right, the incident 
command, and you had lots of pieces to it, lots of people, lots 
of other activities. In your process--and again, if you can't 
comment now, but in the process of when you prepare the reports 
for the different agencies, are you going to talk about what 
you can do to improve that, or was it what you thought it would 
be, or what can you tell us now?
    It seemed to be a lot of people, and I know you're probably 
doing an internal analysis, I'm assuming, of how that went, 
where are some tweaks or where changes could be made. Can you 
comment on any of that at this point, or is that something that 
has to be limited because of the work you are doing with the 
Justice Department, as well as the Interior Department and the 
Coast Guard?
    Mr. Slaiby. We can comment on the response itself. It's 
really, I think, more out with the investigation.
    Senator Begich. Sure.
    Mr. Slaiby. We were very happy that we were able to stand 
up and bring all those folks together basically over New Year's 
and the period thereafter. As we said, actually a little over 
700 people. We were able to mobilize assets that we had, 
frankly, put away for the winter. Our oil spill response 
capacity was located both in Seward and Dutch Harbor, 
tremendous responses from some of our local companies here.
    You know, over the years, we had done a lot of oil spill 
training with folks at ASRC, their energy services, with UIC, 
with Alaska Clean Seas. And very, very quickly, within a matter 
of two or 3 days, we were literally able to take the snow off 
some of these assets in Seward and bring them up and mobilize 
them. Between the assets that were mobilized in Dutch and 
Seward, I think we were able to address a lot of the concerns 
the stakeholders had, that the incident command had, in a very 
short order.
    One of the things that worked very well, obviously, because 
of the proximity to Kodiak, was the access to the helicopters 
and the crews on those rescue helicopters. If this were to have 
been an incident in the Slope, we would have been a little 
closer to where our air assets were.
    And finally I will say as well for my industry partners. 
Clearly, the Coast Guard came through. We had a number of 
vessels that we were able to pull through, but we called and 
got a helicopter released from our colleagues at Exxon Mobil in 
17 minutes from the time we made the call.
    Senator Begich. So as you examine it and as you move 
forward, you will probably do some internal recommendations as 
you improve or enhance it. Is that a fair statement?
    Mr. Slaiby. We worked an awful lot with the Coast Guard, 
again Captain Mehler and Admiral Ostebo will testify. We had a 
number of full call-out drills last year. We had two drills 
going into 2012 where we actually flew a number of folks up 
from out of state to help us in there. So we had practiced what 
was going on, and fortune favors the prepared. I do feel that 
the success we had in getting the KULLUK off the rocks was due 
to the work we had done with the Coast Guard, with the State of 
Alaska, and with other Federal agencies.
    Senator Begich. Let me ask you two quick questions, and 
then I'm going to have to close things off. But one, you did a 
conflict avoidance agreement with the whaling captains in the 
communities up there. How do you feel that worked out? 
Obviously, this would be from your perspective. But how do you 
think that worked, that kind of sitting down and working this 
out? Tell me your thoughts on that.
    Mr. Slaiby. We think it worked pretty well. You know, we 
had talked in my testimony, Senator, about the fact that we 
weren't able to get our wells through hydrocarbon sessions. We 
obviously had reasons that we couldn't do that. But one of the 
things we had to work with was the whaling activities in the 
Beaufort, and we had agreed through the conflict avoidance 
agreement that we would not engage in activities during whaling 
on Cross Island, and what's going on in Kaktovik as well. It's 
very difficult to do, but it's something we said we would do, 
and we honored.
    Senator Begich. Now the last question, regarding the 
interagency working group. You had stated the last time we had 
a hearing, your desire--your sense was that it was working, but 
your desire was to determine how you make this more permanent 
so it's not just at the whim of the current president or what 
might happen administratively. Is that still your position, to 
see this more permanent so there is some long-term structure?
    Mr. Slaiby. Yes, absolutely. I think the work that Deputy 
Secretary Hayes did was excellent, and I'm sure Deputy 
Secretary Beaudreau will continue down the same line. But we do 
need to make it sustainable through a number of different 
operators, through Conoco and Statoil and eventually others 
that might come on. I think the work that it's doing does need 
to survive political transitions----
    Senator Begich. Personnel and political----
    Mr. Slaiby. Yes, but it has been. It has been a sea change 
practically in how things have been done. I also think that in 
a time of sequester and in a time when we are really looking to 
up the quality of permits, you are getting a better quality 
program at potentially a more efficient cost structure, and 
everybody benefits with that in place.
    Senator Begich. Very good. Let me end there, and I do have 
some other questions. I will just submit them for the record, 
if that's OK.
    Mr. Slaiby. Thank you very much, Senator.
    Senator Begich. I appreciate all of you being here. And 
again, thank you for giving your testimony. We have your 
written testimony, and then I know Pete Slaiby gave some 
recommendations, and I am probably going to correspond with you 
on some of those thoughts there.
    Mr. Slaiby. Thank you very much, Senator.
    Senator Begich. Thank you all very much. We will dismiss 
this panel.
    We will have the next panel assemble very quickly here. 
Helen, we will be going to you first, so be prepared here. 
Thank you very much. Give us a second here to set up. Thank you 
very much.
    Our next panel, if staff can set those up, great. We have 
one, two, three, four, five, and we'll try to go through those.
    Helen Brohl, Executive Director of U.S. Committee on Marine 
Transportation System.
    Mr. Ed Page, Executive Director of the Marine Exchange of 
Alaska.
    Ms. Eleanor Huffines, Manager, U.S. Arctic Campaign, Pew 
Charitable Trusts.
    Matt Ganley, Vice President, Bering Straits Native Corp.
    And we've had an additional one.
    And then Mr. Jack Omelak, of Nanuuq Commission. Thank you 
very much.
    Let me go ahead and again thank the panel for being here. 
Thank you for participating. Again, you got a sense if we can 
keep your testimony close to 5 minutes each, that would be 
appropriate, and we'll start right off the bat. Again, this is 
our second panel, again talking about the Arctic in a broader 
sense. Again, we appreciate Helen Brohl, Executive Director, 
U.S. Committee on Marine Transportation Systems, being here on 
video teleconference.
    As I mentioned earlier, Helen, before you got on, that due 
to sequester and other budget reductions, we couldn't have you 
here in person. You're missing 70-degree summer weather here, 
no snow. But we think this is great that you're able to 
participate. The last testimony we had from Tommy Beaudreau 
went very well. It works very clean. So again, thank you for 
your willingness to testify here, and it saves a little money 
to the Federal Government. We like doing that. So again, 
appreciate your time.
    I'll open with you, and if you want to go ahead with your 
testimony, we greatly appreciate it.

         STATEMENT OF HELEN BROHL, EXECUTIVE DIRECTOR, 
       U.S. COMMITTEE ON THE MARINE TRANSPORTATION SYSTEM

    Ms. Brohl. Thank you, Mr. Chairman. I'm just testing. Can 
you hear me okay, sir?
    Senator Begich. We can hear you perfect.
    Ms. Brohl. Thank you so much. Chairman Begich, thank you 
for the opportunity to provide testimony today to you and the 
Senate Commerce Committee's Subcommittee on Oceans, Atmosphere, 
Fisheries, and Coast Guard's field hearing in Anchorage. Thank 
you again for allowing us to participate by VTC from our 
headquarters in Washington.
    The Committee on the Marine Transportation System, or CMTS, 
originated as a Federal cabinet-level interagency committee 
established at the direction of the President in 2004. This 
past December, Congress institutionalized the Committee in 
statute in the Coast Guard and Maritime Transportation Act of 
2012.
    The CMTS includes 28 member departments, independent 
agencies and White House offices, including DHS, the Coast 
Guard, and the Department of Interior. The Secretary of 
Transportation serves as the Chair.
    The CMTS is identified as the U.S. Marine Transportation 
System and is within the purview of over 35 individual Federal 
agencies. The purpose of the CMTS is to assess the adequacy of 
the marine transportation system, which includes ports, 
waterways, channels, and their intermodal connections; and to 
promote the integration of the MTS with other modes of 
transportation and other uses of the marine environment; and 
coordinate recommendations with regard to Federal policies that 
impact the MTS.
    The United States is an Arctic nation. As climate change, 
including the loss of sea ice, creates a more accessible 
Arctic, we must conserve the need for future action and 
guidance that will facilitate safe and efficient navigation, 
permit supplies and property, reduce the risk of environmental 
damage to the region, and preserve the way of life of the 
Native Alaskan tribes.
    So the U.S. Arctic MTS should be capable of meeting the 
safety, security, and environmental protection needs of present 
and future Arctic stakeholders and activities.
    Under Section 307 of the Coast Guard Authorization Act of 
2010, the CMTS was directed to coordinate the establishment of 
domestic transportation policies in the Arctic. This 
coordination includes the consideration of national policies 
and guidance related to safe and secure maritime shipping in 
the Arctic.
    To advance this coordination, the CMTS created an 
interagency action team to oversee the development of a draft 
report titled, ``U.S. Arctic Marine Transportation System: 
Overview and Priorities for Action 2013.'' This draft report is 
currently on the CMTS website at www.cmts.gov for public 
inspection with a 45-day public comment period which ends on 
April 22. The CMTS expects to finalize the report once public 
comments have been compiled and assessed.
    The draft CMTS Arctic MTS Report identifies existing Arctic 
MTS policies; assesses present and projected uses of the 
Arctic; describes the essential components of a U.S. Arctic 
MTS; describes the potential benefits of a U.S. Arctic MTS; 
provides an evaluation of the current condition of the U.S. 
Arctic MTS; and recommends actions through which CMTS agencies 
can, working with stakeholders, strengthen the MTS to meet the 
Nation's goals for safe Arctic economic activity and 
environmental protection.
    As part of its assessment, the CMTS identified five 
components and 16 sub-elements of the U.S. Arctic MTS. The five 
main components include: navigable waterways, which includes 
things like places of refuge for ships; physical 
infrastructures such as geodetic control infrastructure; MTS 
information infrastructure such as hydrographic surveys; MTS 
response surveys such as escort services and icebreaking; and 
vessels, including crew standards and training.
    For each of the 16 sub-elements within these five 
components, the draft report provides a description of the 
issue, its status, associated challenges, current Federal 
activities, and future Federal actions needed. These issue 
papers are located under Chapter 3 and also identify non-
Federal partners.
    Taken together, the Arctic MTS issue papers recognize the 
Arctic MTS as a nascent system that would need considerable 
public/private investment to support increased Arctic traffic 
if projected future growth in regional and trans-Arctic 
shipping is realized.
    As it has been stated, changing conditions in the Arctic 
create an opportunity for the United States to develop a new 
Arctic marine transportation system. Working cooperatively with 
Federal, state, local and tribal authorities, the MTS may be 
sustainably managed to the benefit of all stakeholders.
    CMTS, in its draft U.S. Arctic MTS Overview and Action 
report, puts forward short-term and long-term recommendations, 
and a comprehensive strategy to address the development of the 
Arctic MTS and supporting elements across all MTS components 
and stakeholders. I would like to note that many of these 
recommendations are complementary to the soon-to-be-released 
National Ocean Policy Implementation Plan.
    If an Arctic MTS is to be developed, the CMTS recognizes 
the interdependent nature of marine transportation system 
elements and recommends that the United States first focus to 
improve the Arctic MTS in two primary MTS component areas. 
These are information infrastructure, including sea ice and 
marine weather forecasts, mapping and charting, communications, 
and AIS coverage; and response services, including 
environmental response management, search and rescue, and ice-
breaking capability.
    While not yet final, an appropriate mix of MTS services is 
called for in the MTS report to bridge existing gaps and 
provide a safe, secure, and environmentally sound MTS to 
address the full range of issues impacting the U.S. Arctic and 
the Arctic region at large.
    Thank you, Mr. Chairman. I appreciate again the opportunity 
to testify, and I'll be happy to answer any questions you may 
have.
    [The prepared statement of Ms. Brohl follows:]

    Prepared Statement of the United States Committee on the Marine 
                         Transportation System
I. Introduction
    The U.S. Committee on the Marine Transportation System (CMTS) 
appreciates the opportunity to participate in the Senate Commerce 
Committee, Subcommittee on Oceans, Atmosphere, Fisheries, and Coast 
Guard's field hearing in Anchorage, Alaska to discuss Arctic maritime 
safety.
    The United States is an Arctic nation. As climate change, including 
the loss of sea ice create a more accessible Arctic, we must consider 
the need for future action and guidance that will facilitate safe and 
efficient navigation, prevent loss of life and property, and reduce the 
risk of environmental damage in the region. Safe marine transportation 
is fundamental to each of these pursuits. For this reason, a U.S. 
Arctic Marine Transportation System (MTS) should be capable of meeting 
the safety, security and environmental protection needs of present and 
future Arctic stakeholders and activities.
II. CMTS and the Coordination of Domestic Arctic Transportation 
        Policies
    The Committee on the Marine Transportation System (CMTS) originated 
as a Federal cabinet-level, interagency committee established at the 
direction of the President in 2004. Congress institutionalized the 
Committee in statute (P.L. 112-213) in December 2012. The CMTS has 28 
member departments, agencies and White House offices. The Secretary of 
Transportation serves as its Chair. The movement of people and goods 
through the U.S. MTS is within the purview of many individual Federal 
agencies and programs. As specified in P.L. 112-213, the purpose of the 
CMTS is to assess the adequacy of the marine transportation system 
(including ports, waterways, channels, and their intermodal 
connections); promote the integration of the marine transportation 
system with other modes of transportation and other uses of the marine 
environment; and coordinate recommendations with regard to Federal 
policies that impact the marine transportation system.
    Under section 307 of the Coast Guard Authorization Act of 2010, the 
CMTS was directed to coordinate the establishment of domestic 
transportation policies in the Arctic. This coordination includes the 
consideration of national policies and guidance related to safe and 
secure maritime shipping in the Arctic. To advance this coordination, 
the CMTS Coordinating Board created a nine-member interagency 
subcommittee (integrated action team or ``IAT'') led by the Maritime 
Administration, National Oceanic and Atmospheric Administration, and 
the U.S. Coast Guard.
    The IAT oversaw development of a draft report titled U.S. Arctic 
Marine Transportation System: Overview and Priorities for Action 2013. 
The CMTS has made the draft report available for public inspection with 
a 45-day public comment period ending April 22, 2013. The draft report 
is available on the CMTS website, www.cmts.gov. The CMTS expects to 
finalize the report once public comments have been complied and 
assessed.
    Briefly, the draft report:

   Identifies existing Arctic MTS Federal policies;

   Assesses present and projected uses of the Arctic, and 
        reported implications for U.S. transportation policies and a 
        U.S. Arctic MTS;

   Describes the essential components of a U.S. Arctic MTS that 
        would provide for safe, secure, environmentally sustainable and 
        reliable navigation;

   Describes the potential benefits of a U.S. Arctic MTS for 
        maritime commerce, indigenous peoples and communities, and the 
        environment;

   Provides an evaluation of the current condition of the U.S. 
        Arctic MTS, including physical and information infrastructure 
        and human capital; and,

   Recommends actions through which CMTS agencies can, working 
        with stakeholders, strengthen the U.S. Arctic MTS to meet the 
        Nation's goals for safe Arctic economic activity and 
        environmental protection.
Current and Future State of Arctic Shipping
    Commercial shipping activity in the U.S. Arctic is primarily 
regional; it is centered on the limited use of maritime transport of 
natural resources from the Arctic. The most recent and reliable data 
provided by the U.S. Coast Guard and the Alaska Marine Exchange reports 
that ``for 2008 to 2012, total annual vessel traffic in the Arctic 
region grew from 120 to 250 regional transits. The growth rate was 
highest for tanker vessels, with tugs and other cargo vessels being the 
second and third largest categories of movements. Bering Strait 
transits from 2008 to 2012 rose from 220 to 480.
    An ice-diminished Arctic is now creating growth potential for 
commercial shipping on trans-Arctic routes. Various media reports 
suggest that Russia is interested in developing a Northern Sea Route 
(NSR) for transit between Europe and Asia. According to the Barents 
Observer, (http://barentsobserver.com/en/arctic/2012/11/46-vessels-
through-northern-sea-route-23-11) 46 vessels transited this NSR in 
2012. A significant increase in Arctic marine traffic via the NSR could 
eventually raise the geostrategic profile of the Bering Strait. The 
draft report concludes that while the number of vessels in the Arctic 
is relatively small when compared to the tens of thousands of vessels 
that come in and out of U.S. ports on an annual basis, maritime 
shipping in and through the U.S. Arctic is on the rise.
    During ice-diminished periods and in ice-free locations, the most 
economic means of maritime transportation of general cargo and supplies 
to communities is usually by tug and barge. Shallow draft Alaska tug 
and barge businesses haul fuel, gravel and supplies to Prudhoe Bay, Red 
Dog Mine and Alaska coastal communities (predominately Alaska Native 
villages). Tugs support offshore oil and gas operations for ice 
management and towing duties. Tugs and barges also support and help 
respond to pollution events. The need for tug and barge operations will 
continue as local communities grow and, in some cases, relocate due to 
coastal erosion.
    Offshore oil exploration and eventually, production, will depend on 
safe marine transportation for vessels that staff the drill site, move 
the resources from site to customer, and, in the event of an incident, 
support a spill response or other emergency. For example, in advance of 
summer 2012 offshore Arctic exploratory drilling programs in the 
Beaufort and Chukchi Seas, Shell Oil Company received conditional 
approval for its exploration plans from the Bureau of Ocean Energy 
Management and full approval on its Oil Spill Response Plans from the 
Bureau of Safety and Environmental Enforcement (BSEE). Both programs 
included a flotilla of up to 22 vessels to drill, supply the 14 Darya 
rigs, and support oil spill response. Shell plans to delay exploration 
in 2013, but continue exploration in 2014. ConocoPhillips, which also 
holds leases in the Chukchi Sea, is making similar preparations for 
potential exploratory drilling in 2014.
    Within the U.S. Arctic, marine-based tourism is currently very 
limited. Only Hapag-Lloyd Cruises offers voyages through the Northwest 
Passages with stops at ports within the U.S. Arctic in Nome, Point Hope 
and Barrow, AK.\1\ Cruising in such cold, remote waters poses special 
challenges to normal contingency planning. In an ice-diminished Arctic, 
the rise of tourism and passenger traffic, as well as commercial 
shipping, may require adjustment to existing safety regulations as well 
as forward basing of Federal and state response and rescue 
capabilities.
    In the U.S. Arctic, fishing is currently concentrated in the Bering 
Sea. The North Pacific Fisheries Management Council has closed the 
Arctic Management Area in U.S. waters in the Beaufort and Chukchi Seas. 
If increasing temperatures and changing ocean conditions shift 
distribution of some fish species into the Beaufort and Chukchi Seas, 
sustainable harvests north of the Bering Sea may in time be authorized, 
possibly resulting in a commensurate increase in fishing operations; 
thus, creating another future source of increased vessel traffic in 
U.S. Arctic waters.
IV. Components and Current Condition of a U.S. Arctic Marine 
        Transportation System (MTS)
    As part of it assessment of Arctic marine transportation, the CMTS 
identified five components and 16 elements of a U.S. Arctic marine 
transportation system. Based on traditional components and elements of 
other U.S. regional marine transportation systems, the components and 
elements needed to develop a U.S. Arctic MTS would include:

    Navigable Waterways

   Places of Refuge for Ships

   Areas of Heightened Ecological Significance

    Physical Infrastructure

   Ports and Associated Facilities

   Geodetic Control Infrastructure

    MTS Information Infrastructure

   Hydrographic Surveys

   Shoreline Mapping

   Aids to Navigation (AtoN)

   Communications

   Marine Weather and Sea Ice Forecasts

   Real-Time Navigation Information

   Automatic Identification System (AIS)

    MTS Response Services

   Vessel Escort and Icebreaking

   Environmental Response Management

   Search and Rescue/Emergency Response

    Vessels

   Polar Code/Guidelines for Ships Operating in Arctic Ice-
        Covered Waters

   Crew Standards/Training

    For each of these 16 U.S. Arctic MTS elements the draft report 
provides an issue description, its status, challenges, current Federal 
activities, and future Federal actions needed. These issues papers also 
identify non-federal partners.
V. Current Condition of the Arctic MTS
    Taken together the Arctic MTS issue papers recognize the Arctic MTS 
as a nascent system that would need considerable public/private 
investment to support increased Arctic traffic if projected future 
growth in regional and trans Arctic shipping is realized. This is 
particularly true in the U.S. Chukchi and Beaufort Seas. Less than 1 
percent of charted navigationally significant Arctic waters have been 
surveyed with modern technology to determine depths and depict hazards 
to navigation. There are no harbors of refuge or deep-water port 
facilities in this region, and there are no aids to navigation north of 
the Bering Strait, except for eight buoys supporting the Red Dog mine.
    There have been advances in Automatic Identification System (AIS) 
coverage of vessel movements in the Bering Strait and along the North 
Slope and insurance-driven concerns are motivating the shipping 
industry to address region-specific safety concerns. There are 
currently 19 AIS receiving stations for the Bering Sea including the 
Aleutian Islands and 11 AIS receiving stations for the Bering Sea 
northward. All of these AIS stations are operated by the Marine 
Exchange of Alaska, data from which is made available to the USCG. 
Additionally, the Coast Guard (USCG) continues to push forward and 
assess its capabilities to conduct operations in the Arctic. Since 
2008, USCG set up small, temporary Forward Operating Locations on the 
North Slope in Prudhoe Bay, Nome, Barrow and Kotzebue to test their 
capabilities with boats, helicopters, and Maritime Safety and Security 
Teams. They also deployed light-ice capable 225-foot ocean-going buoy 
tenders to test their equipment, train crews and increase awareness of 
activity. Additionally, each year from April to November USCG has flown 
two sorties a month to evaluate activities in the region.
    Similar to navigation charting, an Arctic MTS will depend on timely 
Arctic weather forecasts and sea ice predictions. Currently reliable 
Arctic forecasts are available two to three days out, compared with 
five to seven-day predictive capabilities in the rest of the United 
States. Atmospheric and oceanographic observations, including useful 
forecasts of marine weather and sea ice for the Arctic Ocean, are the 
fundamental information necessary to support MTS services.
    Lastly, the harsh Arctic conditions impose unique requirements for 
safe vessel operation, especially in the ice-covered waters of the 
higher latitudes. Governmental agencies and commercial companies 
engaged in maritime operations in the U.S. Arctic will need ice-capable 
vessels to safely navigate in ice-covered waters. While there are no 
specialized qualifications, training or certifications currently in 
existence for crews of vessels that operate in polar waters, the U.S. 
is participating in IMO Polar Code development that will provide 
guidelines for crew standards, including specialized qualifications, 
training and certification guidelines. Foreign ice-breaking vessels are 
allowed to work in ice-covered U.S. waters under an exemption that 
expires in 2017.
VI. Conclusion
    As climate change, including the resulting loss of sea ice create a 
more accessible Arctic, there is a corresponding Federal responsibility 
to review beneficial opportunities for commerce, specifically regional 
and trans Arctic maritime transportation.
    Compared to maritime transit around the rest of the continental 
United States, the Arctic is an intensely harsh operating environment, 
with extreme cold, heavy fog, severe storms, and the added elements of 
unpredictable ice flows and changing sea ice conditions.
    Changing conditions in the Arctic create an opportunity for the 
United States to develop a new Arctic MTS. Working cooperatively with 
federal, state, local and tribal authorities, the MTS may be 
sustainably managed to the benefit of all stakeholders. Each 
stakeholder must responsibly embrace their respective role to ensure 
optimal use of resources, and with collective dedication to protect 
indigenous cultures, rare and endangered wildlife, and the environment. 
CMTS, in its draft U.S. Arctic MTS: Overview and Priorities for Action 
report, puts forward short term and long term recommendations, and a 
comprehensive strategy to address the development of the Arctic MTS and 
supporting elements across all MTS components and stakeholders. I would 
like to note that many of these recommendations are complementary to 
the soon-to-be-released National Ocean Policy Implementation Plan. 
(NOC) If an Arctic MTS is to be developed, the CMTS recognizes the 
interdependent nature of marine transportation system elements, and 
recommends that the United States first focus efforts to improve the 
Arctic MTS in two primary MTS component areas:

   MTS Information Infrastructure, including sea ice and marine 
        weather forecasts, mapping and charting, communications, and 
        AIS coverage, and

   MTS Response Services, including environmental response 
        management, search and rescue, and ice breaking capability.

    While not yet final, an appropriate mix of MTS services, actions 
and notice and comment regulation is called for in the Arctic MTS 
report to bridge existing gaps and provide a safe, secure and 
environmentally sound MTS to address the full range of issues impacting 
the U.S. Arctic and the Arctic region at large.
    Thank you again for the opportunity to participate in this hearing, 
Chairman Begich. I would be glad to respond to any questions you may 
have.

    Senator Begich. Thank you very much. It came across very 
well and we could hear you perfect. So again, thank you. Be 
patient as we go through a couple more testimonies, and then 
I'll come back to you first for questions. So we will recognize 
your time and limitations.
    The next person I have is Ed Page, Executive Director of 
the Marine Exchange of Alaska. I have visited your facility and 
it's impressive, what you're doing down there. So, please.

  STATEMENT OF CAPTAIN EDWARD PAGE, USCG (RETIRED), EXECUTIVE 
              DIRECTOR, MARINE EXCHANGE OF ALASKA

    Mr. Page. Thank you, sir. Thank you for the opportunity to 
speak today on these pressing issues in Alaska.
    Having served in the maritime profession in Alaska for over 
24 years as a prior Coast Guard Officer and presently as the 
Executive Director of the Marine Exchange of Alaska, I have 
seen firsthand the changes in maritime activity in Alaska and 
appreciate the importance of ensuring safe, environmentally 
sound maritime operations in the Arctic.
    I have sailed on Coast Guard vessels, oil tankers, 
container ships, fishing vessels, tugs, oil exploration support 
vessels, oil spill response vessels, cruise ships, and cargo 
ships in Alaskan waters. I can attest to the fact that 
operating in water does, in fact, present some unique 
challenges, and having responded to search and rescue cases 
where mariners have perished, as well as numerous oil spills, 
including the Exxon Valdez oil spill, I have recognized the 
need for having better information on vessels' locations or 
maritime awareness, which is the common term used, capable of 
both prevention and response to maritime casualties.
    Senator Begich. Hold it, Ed.
    [Telephone.]
    Senator Begich. Sorry, Ed. Please go ahead.
    That will embarrass Jim for a long time.
    [Laughter.]
    Mr. Page. While serving as Captain of the Port for Los 
Angeles Long Beach, the Coast Guard and I, in my capacity as 
Captain of the Port, partnered with the legacy Marine Exchange 
of Southern California, which is also a nonprofit organization, 
and the State of California to build and operate a vessel 
traffic system for that port area that utilized a 25-mile 
radar, which certainly is not adequate for Alaska waters.
    But the model of shared marine history and government 
partnership is, in fact, a model that has been taken and 
brought up to Alaska. But due to the enormity of our state, the 
Marine Exchange of Alaska utilized emerging and newer 
technologies, including the use of automatic identification 
systems, or AIS is the acronym, a satellite tracking technology 
that is largely funded today by the maritime industry, the 
State of Alaska, and the Coast Guard.
    It was adopted by the IMO, the International Maritime 
Organization. Most vessels engaged in international trade are 
required to be equipped with AIS transponders that broadcast 
the vessel location, type, speed, course, and other valuable 
information several times a minute over VHF radio frequencies. 
This substantially enhances maritime safety as it is received 
and processed by other vessels in the area, as well as by shore 
and satellite AIS receivers, and this information is 
disseminated to the Coast Guard, state agencies, and to the 
maritime community.
    In 2005, the Marine Exchange built and operates today over 
95 AIS receiver sites in Alaska and throughout the Arctic, out 
to the Aleutian Islands and down to Ketchikan. This system is 
providing historical and real-time information on vessels' 
locations and has been used in coordinating responses to vessel 
distress and to locate vessels that are the source of oil 
spills. Most recently, it was used by the Coast Guard and Shell 
during the fuel platform KULLUK incident in Alaska.
    The system also monitors compliance with vessel speed 
restrictions in well-protected areas. It triggers alerts to 
prevent the presence of both high-profile vessels and aircraft 
in the flight path of the Kodiak Airport, and alarms when a 
vessel sets anchor on an underwater fiber cable serving Alaska 
so they can know where to effect the repairs.
    In fact, Shell Oil has been one of the more proactive users 
of the system and has employed the Marine Exchange to send 
alerts when their contracted vessels approach a vicinity of 
areas that are restricted by permits issued to do the drilling. 
When a vessel approaches these restricted areas, the Marine 
Exchange's 24-hour operation center alerted both the vessel 
operator and Shell. As a result of this proactive measure, 
there were no incursions in Ledger Bay this past year.
    The Marine Exchange's Arctic network has provided 
information on vessel activity over the last several years to 
the Coast Guard and to other agencies to assess the extent of 
increasing traffic and the risks that they present. Our system 
tracks vessels and reaches across through Russian waters and 
receives the AIS transmissions of all vessels equipped with AIS 
that are transiting the Bering Strait to and from the Arctic. 
So many reports that you see and the graphics of traffic 
through the Arctic, as you well know, Senator, are from the 
Marine Exchange's vessel tracking system.
    While it is often somewhat difficult to find actual traffic 
activity because there are many different ways of counting 
vessels and metrics and whether a ship is a tug and what-have-
you, as noted earlier, it is somewhere in the neighborhood of 
400 vessels that have gone through the Bering Straits this past 
year. It is reflecting a modest increase over the last several 
years, as we contracted for about 5 years now. Each year there 
are more vessels going across and different types of vessels 
going across, and most recently exploration vessels, and of 
course Russia is now bringing more vessels across the top.
    While the risks presented by maritime traffic in the region 
do exist, I think they are somewhat modest when you compare it 
to the ports of Seattle and San Francisco and L.A., provided 
that in those places, where there is Coast Guard monitoring, 
oversight and presence, there is also the same in the Arctic. 
Certainly, the Coast Guard is much like a policeman on the 
highway. Their presence influences the behavior of vessel 
operators and ensures compliance with various regulations and 
safety standards.
    I feel this is an appropriate time to start implementing 
this risk reduction mechanism, not after an accident but before 
they happen. So this focus and a hearing such as this are 
certainly appropriate and timely. When we reflect back, there 
was no government surveillance when the Exxon Valdez ran 
aground in 1989 because the vessel was sailed past the Coast 
Guard's radar coverage. Of course, today there is complete 
coverage provided by AIS of Prince William Sound. So it is 
under the watchful eye of the Coast Guard, and vessels' 
behavior is influenced accordingly.
    Here is where I find some improvement in maritime safety in 
the Arctic can be realized, expanding the Coast Guard AIS 
carriage requirements for vessels to all commercial vessels, 
and not only to vessels engaged in international trade. There 
were regulations drafted some four years ago by the Coast Guard 
to address this issue. In fact, other nations around the world 
have done so. But today, the regulations do not require most of 
those vessels operating up in the Arctic on domestic trade, the 
Shell vessels in particular, they are not required to have AIS. 
The vessels are exceeding the regulatory requirements by having 
AIS on board and allowing that visibility.
    Regulations should be published, the draft regulations 
should be published to provide a level playing field to make 
sure all vessels operating in the Arctic have AIS. This in turn 
will allow the Coast Guard to monitor surveillance and ensure 
compliance with the various safety requirements. This concept 
comports with the 1989 International Arctic Maritime Shipping 
Assessment that recommended--I believe it was 1999, actually, 
or 2009, sorry--that recommended all commercial vessels 
operating in the Arctic be equipped with AIS. So it is not just 
Ed Page saying this. Others have also found merit in AIS.
    AIS is also from the outset designed to provide two-way 
communications. In other words, you can disseminate safety 
information over the same system. It has greater range, it's 
clear, it's digital, and it can provide more information. In 
our case, we have developed, working with the Alaska Ocean 
Observing System that provided some support and funding, the 
capability--we bought the equipment, and we tested it, and we 
have demonstrated it works--to send ice information and weather 
information to vessels over AIS.
    However, we can't receive the permits to do it. So even 
though we can't turn it on, and we have turned it on and tested 
it, but we can't legally turn it on to send information out 
because we can't get the permits to do so even though it has 
been done in Europe. I believe that the agency should be more 
proactive in facilitating this ability to provide safety 
information to vessels through this newer technology. That 
would enhance maritime safety in this region, as well as other 
regions.
    Last, I believe the implementation of long-delayed Coast 
Guard non-tank vessel regulations, which seem to be having some 
movement as of late, will reduce the risk and consequences of 
oil spills as the regulation will require cargo and other non-
tank vessels to contribute to the commercial oil spill 
prevention and response capabilities in Alaska. Right now, 
these regulations only apply to tankers, and they are footing 
the bill, and they pay for the response capability. But we can 
expand capabilities if and when non-tank vessels are also 
required. Of course, this is a law that was passed by Congress 
10 years ago, I believe. So I think it's time to implement the 
regulations.
    While our work is not done at the Marine Exchange, there 
are many more AIS stations that we need to build and increase 
the range of, as well as fully implement the weather sensors 
and weather transmitters and safety information to vessels, 
those capabilities. If it was not for the Coast Guard, the 
State of Alaska and the marine industry's shared commitment to 
improve maritime safety, this system simply would not exist. 
This private/public partnership is a cost-effective solution 
that no other government agency or contractor was willing or 
able to do, and this operation and maintenance of the 24-hour 
operation center and extensive tracking network is provided at 
a total cost of about $2.5 million per year.
    Those are the end of my comments, sir.
    [The prepared statement of Mr. Page follows:]

 Prepared Statement of Captain Edward Page, USCG (Retired), Executive 
                  Director, Marine Exchange of Alaska
Introduction
    Good morning Chairman Rockefeller and distinguished members of the 
Subcommittee. It is my pleasure to be here today to discuss the 
preparedness and response in the Arctic and the opportunities and 
challenges of increased maritime activity.
    Having served in the maritime profession in Alaska for over 24 
years as a prior Coast Guard officer and presently as Executive 
Director of the Marine Exchange of Alaska I have seen firsthand the 
changes in maritime activity in Alaska and appreciate the import of 
ensuring safe and environmentally sound maritime operations in the 
Arctic. I have sailed on Coast Guard vessels, oil tankers, container 
ships, fishing vessels, tugs, oil exploration and support vessels, oil 
spill response vessels, cruise ships and cargo ships in Alaska waters 
and can attest to the fact operating in Alaska presents unique 
challenges. Having responded to search and rescue cases where mariners 
have perished and numerous oil spills, including the EXXON VALDEZ oil 
spill, I have recognized the need for having better information on 
vessels' locations or maritime domain awareness to aid both prevention 
of and response to maritime casualties. While serving as Captain of the 
Port for Los Angeles/Long Beach the Coast Guard partnered with the 
legacy Marine Exchange of Southern California and the State of 
California to build and operate a Vessel Tracking System for that port 
area that utilized a 25 mile range radar to track vessels. This 
successful model of shared marine industry and government partnership 
has been replicated in Alaska, however, due to the enormity of this 
state, the Marine Exchange of Alaska utilizes emerging vessel tracking 
technologies of Automatic Identification Systems or AIS and satellite 
tracking that is largely funded by the maritime industry, the State of 
Alaska and the Coast Guard.
    As adopted by the International Maritime Organization (IMO) most 
vessels engaged in international trade are required to be equipped with 
AIS transponders that broadcast the vessel's location, type, speed, 
course, destination and other valuable information several times a 
minute over VHF radio frequencies. This data substantially enhances 
maritime safety as it is received and processed by other vessels in the 
area as well as by shore and satellite AIS receivers and disseminated 
to the Coast Guard, state agencies and the maritime community. Since 
2005, the Marine Exchange of Alaska has built and operates over 95 AIS 
receiving sites in Alaska that have provided historical and real time 
information on vessels locations. This vessel tracking system has been 
used to aid coordinating responses to vessels in distress and to locate 
vessels that are the source of oil spills. Most recently it was used by 
the Coast Guard and Shell during the drill platform KULLUK incident in 
Alaska. This system also monitors compliance with vessel speed 
restrictions in whale protected areas, triggers alerts to prevent the 
presence of both high profile vessels and aircraft in the flight path 
of an airport and alarms when a vessel sets anchor on an underwater 
fiber cable serving Alaska.
    Shell Oil has been one of the more proactive users of this system 
and has employed the Marine Exchange to send alerts when their 
contracted vessels approach the vicinity of areas restricted by 
permits. When a vessel approached these restricted areas the Marine 
Exchange 24 hour operations center alerted both the vessel operator and 
Shell. As a result of this proactive measure, there were no incursions 
in Ledyard Bay this year.
    The Marine Exchange's Arctic network has provided information on 
vessel activity over the last several years to the Coast Guard and 
other agencies to assess the extent of increasing traffic. The system's 
range reaches across to Russia and receives the AIS transmissions of 
all vessels transiting the Bering Strait to and from the Arctic. While 
it is difficult to define the level of traffic in the Arctic as there 
are various metrics that are being used, the Marine Exchange system 
received data from approximately 350 commercial vessels transiting the 
Bering Strait in 2012, reflecting a modest increase in traffic over the 
last several years. In light of receding ice, Russia's increased 
maritime activity and oil exploration operations we anticipate maritime 
traffic will continue to grow. The risks presented by maritime traffic 
in this region are modest and manageable provided there is Coast Guard 
monitoring, oversight and presence. This is the time to implement risk 
reduction measures. There was no government surveillance when the Exxon 
Valdez sailed past the Coast Guard's radar coverage in Prince William 
Sound in 1989. There is complete AIS surveillance of the area today.
    Areas where improvements in maritime safety in the Arctic can be 
realized are in expanding the Coast Guard AIS carriage requirements to 
all commercial vessels and not only vessels engaged in international 
trade. Draft regulations were published four years ago to address this 
but were never finalized. Presently, responsible U.S. vessels operating 
in the Arctic are exceeding the Coast Guard regulations and are 
equipped with AIS. The regulations will level the playing field and 
require all commercial vessels to be equipped with AIS that in turn 
aids Coast Guard monitoring and surveillance. This comports with the 
1989 International Arctic Maritime Shipping Assessment that recommended 
all commercial vessels operating in the Arctic be equipped with AIS.
    AIS is designed to provide two way communications, and in Europe 
and some areas of the U.S. AIS is being used to transmit weather and 
safety information. While the Marine Exchange has secured funds from 
the Alaska Ocean Observing System to develop the ability to transmit 
environmental information including weather and the presence of ice or 
whales via AIS, the permitting agencies have not processed our requests 
to allow transmitting this and other safety information via the Alaska 
AIS network. While we have developed the technology, procured, 
installed and tested the equipment to do this, we don't have permission 
to turn it on. We need NOAA, the Coast Guard and FCC to expedite 
processing our permit requests.
    Lastly, implementation of the long delayed draft Coast Guard non-
tank vessel regulations will reduce the risk and consequence of oil 
spills as they will require cargo and other non-tank vessels to 
contribute to the commercial oil spill prevention and response 
capabilities in Alaska.
Conclusion
    While the Marine Exchange's work is not done, and many more AIS 
stations augmented with weather sensors and AIS transmitters will need 
to be built and maintained, if not for the Coast Guard, State of Alaska 
and the marine industry's shared commitment to improve maritime safety, 
the Alaska maritime safety net would not exist. This private public 
partnership is a cost effective solution that no other government 
agency or contractor was willing or able to do. The operation, 
maintenance, expansion of this extensive Alaska vessel tracking system 
and 24x7 monitoring is provided at a total cost of $2.5 million per 
year.

Enclosures:

  1.  Arctic Maritime Activity in 2012 and AIS Sites in Alaska

  2.  Tracking of Oil Exploration Fleet and other vessels in Alaska









    Senator Begich. Thank you very much, Ed.
    Next we have Eleanor Huffines, Manager, U.S. Arctic 
Campaign, Pew Charitable Trusts.
    Eleanor?

 STATEMENT OF ELEANOR HUFFINES, MANAGER, U.S. ARCTIC PROGRAM, 
                   THE PEW CHARITABLE TRUSTS

    Ms. Huffines. Thank you, Senator. Thank you very much for 
the opportunity to be here today. As an initial matter, Pew is 
very appreciative of your continued focus on the Arctic. In 
fact, in a July 2012 letter, the President, you and Senator 
Murkowski rightly identified the need for the U.S. to develop a 
comprehensive U.S. Arctic policy to better address the 
challenges and opportunities we're facing in the region. And so 
we're very supportive of that initiative.
    The future of the Arctic does not need to be an endless 
battle of perceived tradeoffs between culture, environment and 
economics. Developing a plan that addresses the full range of 
human activities and interactions with the environment creates 
an opportunity to assess and address the multiple stressors 
already present or projected to start or increase from vessel 
traffic, offshore energy, and shipping.
    To be effective, Pew believes the comprehensive U.S. Arctic 
policy must be driven by four guiding principles. Many of these 
principles have been mentioned in testimony earlier today, but 
we believe they are so significant they should be repeated, so 
I apologize for some of the repetition you all will experience.
    First, local communities must have a meaningful voice in 
decisionmaking. Residents of Arctic communities are an integral 
part of the region's rich ecosystem. The Federal Government 
must ensure meaningful opportunities for local governments, 
tribes, co-management organizations, regional non-profits and 
ANCSA corporations are involved from the beginning of 
decisionmaking.
    The Federal Government is required to consult fully with 
Alaska Native tribes on a government-to-government basis, and 
any governance framework needs to incorporate consultation and 
traditional knowledge well in advance of management decisions, 
including a strategy for sharing information and providing 
feedback about indigenous concerns back to them in the region 
before the decisions are announced.
    Second, a comprehensive U.S. Arctic policy should include 
an understanding that ecosystem health is essential for 
maintaining a subsistence way of life and that areas of the 
ocean are important for maintaining the ecosystem, integrity 
and function of those areas must be safeguarded.
    For many residents of the Arctic, there is a direct 
connection between the continued health of the marine 
environment and the health of their food supply, their culture 
and themselves. The Federal Government must take a careful look 
at the potential impact to subsistence resources and show its 
commitment toward ensuring these resources are protected.
    Areas within an ecosystem are not equal in ecological 
terms. Some areas contribute disproportionately to ecosystem 
structure and functioning. Important ecological areas may 
include places that are important for subsistence that are used 
for maintaining the viability of a species or contribute 
disproportionately to an ecosystem's productivity, biodiversity 
or resilience. The Federal Government needs to undertake a 
process to identify and protect these areas in the Bering, 
Beaufort, and Chukchi Seas.
    Third, science must guide decisionmaking. To make informed 
management decisions, it will be critical to have a better 
understanding of the cumulative effects of climate change, 
ocean acidification, and industrial stresses on the marine 
environment and how these stresses interact with one another to 
affect the ecosystems, species, and the people of the region. 
Developing a vigorous and lasting monitoring program will be 
essential to generate reliable information and reduce the 
degree of uncertainty in the knowledge of our Arctic ecosystem.
    There has been significant progress in the past two years 
in information and data gathered in efforts by both government 
and industry, including synthesis efforts like PacMARS and 
SOAR. Yet despite these efforts, the Arctic marine environment 
remains a difficult place to study and understand. Senate Bill 
272, your bill, the Arctic Research Monitoring and Observing 
Act of 2013, offers several solutions to these challenges. If 
passed, the bill's provisions could perform the backbone of a 
long-term research and monitoring program, something that Pew 
has long advocated for in the Arctic.
    And finally, as part of the government's commitment to 
developing Alaska resources cautiously and subject to the 
highest safety and environmental standards, Arctic-specific oil 
spill prevention and response standards must be developed and 
applied to all companies operating in the region, for all 
industrial activities, including offshore oil and gas and 
vessel traffic. These standards should account for an area's 
remote location, lack of infrastructure, and unique operating 
conditions due to severe and changing climate.
    The Ocean Energy Safety Advisory Committee recommendations 
and the Department of Interior's review represent a welcome 
first step toward identifying necessary safety and system 
improvements. These four core principles should serve as the 
foundation for any U.S. Arctic policy or management decision.
    Given the limited amount of time here today, I cannot do 
the region, the people, or the issues justice, so I 
respectfully request that you refer to our written testimony 
for very specific recommendations on strengthening Alaska's 
offshore oil and gas program and enhancing vessel traffic in 
the Bering Strait--not the traffic, the safety of the traffic 
in the Bering Strait and Arctic Ocean. Thank you.
    [The prepared statement of Ms. Huffines follows:]

 Prepared Statement of Eleanor Huffines, Manager, U.S. Arctic Program, 
                       The Pew Charitable Trusts
    Chairman Begich, thank you for the invitation to participate in 
today's hearing. My name is Eleanor Huffines, and I am testifying in my 
capacity as the Manager of the U.S. Arctic program for The Pew 
Charitable Trusts.
    The Pew Charitable Trusts applies a rigorous, analytical approach 
to improve public policy, inform the public, and stimulate civic life. 
Pew's U.S. Arctic program promotes science and community-based 
conservation that reduces risks to the Arctic from climate change and 
industrial development, including oil and gas activities, commercial 
fishing, and industrial shipping. The program works closely with 
scientists, Alaska Natives, the U.S. government, local communities, and 
conservation groups to achieve key policy goals for protecting the 
health of the Arctic ecosystem.
    You have invited me here today to discuss two broad topics: first, 
industry and Federal preparedness for Arctic offshore oil and gas 
development, as well as what lessons can be drawn from Shell's 2012 
drilling season; second, the challenges and opportunities that an 
increase in Arctic activity and development present for environmental 
and natural resources stewardship.
    As an initial matter, Pew is grateful for your continued focus on 
and attention to the Arctic. Alaska's Arctic waters are unlike other 
areas of the ocean. Sea ice covers the northern Bering, Chukchi, and 
Beaufort seas for much of the year. The region is subject to severe 
weather, but it is also remarkably productive. Fish and wildlife--
including a wide variety of marine mammals and seabirds--make extensive 
use of Arctic waters. The Bering Strait in particular is a vital 
migration corridor for many species. Residents of Arctic communities 
have lived an irreplaceable way of life that has existed and endured 
across thousands of years. They are an integral part of the region's 
rich ecosystem.
    Arctic marine waters face more acute changes than other ocean 
regions. The Arctic is warming at twice the rate of the rest of the 
planet \1\and will almost certainly be one of the first regions 
substantially impacted by ocean acidification. The warming is having 
immediate, compounded effects on Arctic people and ecosystems, 
including coastal erosion, altered weather patterns, and loss of 
important habitat. The most dramatic of these impacts is the incredible 
loss of Arctic sea ice. Arctic communities rely on sea ice for hunting, 
fishing, and other activities necessary for survival. Sea ice also 
serves as a platform for birthing seals, feeding walruses, roaming 
polar bears, and other Arctic life. The loss of sea ice cover opens the 
Arctic to an expansion of industrial activities that, unless sensibly 
regulated, will further threaten the region.
---------------------------------------------------------------------------
    \1\ James A. Screen, Ian Simmonds. The central role of diminishing 
sea ice in recent Arctic temperature amplification. Nature, 2010; 464 
(7293): 1334 Available at: http://www.nature.com/nature/journal/v464/
n7293/full/nature09051.html
---------------------------------------------------------------------------
    The challenges posed by these changes are immense, and they call 
for a more cooperative and forward-thinking approach than has been 
employed in the past. The current approach, in which some individual 
agencies consider approval of projects in isolation and without full 
consideration of the projects' cumulative impacts, or how they fit into 
a broader conservation or development strategy, is not adequate. In a 
July 13, 2012, letter to President Obama, you and Senator Murkowski 
rightly urged the administration to develop a comprehensive U.S. Arctic 
strategy to better address the challenges and opportunities facing the 
region.
I. Core Elements of a Comprehensive U.S. Arctic Policy
    The future of U.S. Arctic waters need not be an endless battle over 
perceived trade-offs between culture, environment, and economics. 
Instead, careful planning and management can reduce losses and increase 
gains wherever possible, providing a better overall outcome than the 
single-minded pursuit of one goal to the exclusion of other interests. 
Sound economic development can support cultural programs. Environmental 
oversight can reduce the likelihood of accidents, simultaneously 
avoiding catastrophic costs and severe environmental damage. The 
cultural tradition of respect for hunted animals is a strong 
conservation ethic that benefits the ecosystem, including its human 
inhabitants.
    Developing a plan that addresses the multiple needs and aspirations 
of cultural, environmental, and economic interests requires the 
involvement of more than just one organization or even one sector. 
Including the full range of human activities and their interactions 
within the environment creates the opportunity to assess and address 
multiple stressors already present or projected to start or increase, 
including climate change, offshore energy, vessel traffic, and 
fisheries.
    Core elements to a comprehensive U.S. Arctic Policy should include 
but not be limited to the following principles:

    A. Ensure local communities have a meaningful voice in decision-
making.

    Arctic indigenous residents have valuable knowledge about their 
home and its resources that can help inform planning and decision-
making. Their experience and their traditional way of life--passed down 
through untold generations--have given them great knowledge of their 
environment and the species with which they share it.
    Gathering and using traditional knowledge will require both a 
precautionary and adaptive approach. The Federal Government should make 
a better effort to ensure that traditional knowledge truly informs the 
decision-making process in the Arctic environment. To be meaningful, 
traditional knowledge should be incorporated before committing to 
management decisions that may adversely affect subsistence resources. 
Arctic peoples' ocean-based subsistence activities are central to their 
culture and sense of identity. In this context--where a management 
mistake could have cascading effects that jeopardize subsistence and 
cultural traditions--extra caution, such as the consideration of 
deferrals, is warranted.
    In the end, residents of the Arctic must live with the consequences 
of Arctic policy and management decisions. For all these reasons, the 
Federal Government must ensure meaningful opportunities for 
participation by local communities, governments, tribes, co-management 
organizations, Alaska Native Claims Settlement Act (ANCSA) 
corporations, and similar Alaska Native organizations. The Federal 
Government is required to consult fully with Alaska Native tribes on a 
government-to-government basis. Any governance framework needs to 
incorporate consultation well in advance of management and include a 
strategy for sharing information and providing feedback about 
indigenous resident's concerns.

    B. Protect ecosystem health important for a subsistence way of 
life; safeguard areas of the ocean important for maintaining ecosystem 
integrity and function.

    Subsistence resources have long provided a source of healthy food 
for Arctic communities. Subsistence foods are high in nutritional value 
and protect against health problems such as high blood pressure, 
obesity, diabetes, and cardiovascular disease. Subsistence hunting is 
an important aspect of the Inupiaq and Yup'ik culture. Negative impacts 
to subsistence resources, such as reduced abundance or contaminated 
habitats, could decrease food security, encourage consumption of store-
bought foods with less nutritional value, and deteriorate the cultural 
fabric of Alaska Native communities. Thus, when industrial activities 
adversely affect subsistence resources, they also harm the people who 
value those resources. For many residents of the Arctic, there is a 
direct connection between the continued health of the marine 
environment and the health of their food supply, their culture, and 
themselves. The Federal Government must take a careful look at 
potential impacts to subsistence resources and show its commitment 
towards ensuring these resources are protected.
    Areas within an ecosystem are not equal in ecological terms; some 
areas contribute disproportionately to ecosystem structure and 
functioning, including use by human populations. Important ecological 
areas may include areas of the ocean that are used for subsistence 
purposes; have distinguishing ecological characteristics; are important 
for maintaining habitat heterogeneity or the viability of a species; or 
contribute disproportionately to an ecosystem's health, including its 
productivity, biodiversity, functioning, structure, or resilience. 
Among scientists, there is general consensus that time and/or place 
restrictions designed to protect high value habitat are one of the most 
effective means of reducing potential impacts and disturbance. The 
current understanding of ecological functioning in the Chukchi, 
Beaufort, and Bering seas indicates that a number of sensitive marine 
habitats are especially important to the region's ecological 
functioning. The Federal Government needs to undertake a process to 
identify and protect these habitats.

    C. Science must guide decision-making.

    To make informed management decisions, it will be critical to have 
a better understanding of the cumulative effects of climate change, 
ocean acidification, and industrial stresses on the marine and 
terrestrial environments, and how these stresses interact with one 
another to affect the ecosystems, species, and people of the region. 
Developing a vigorous and lasting research and monitoring program is 
essential to generate reliable information, including trends, and 
reduce the degree of uncertainty in our knowledge of Arctic ecosystems.
    Perfect knowledge, like zero risk, is unattainable. Nonetheless, 
some standards can be applied. The ability to assess impacts requires 
sufficient knowledge about an ecosystem to be able to identify 
functional relationships between species and the physical environment. 
As climate change alters patterns in the Arctic, we also need to be 
able to anticipate changes and plan accordingly to develop procedures 
for adjusting policies and regulations in light of new information.
    There have been significant advancements in the past two years, 
both in information and data gathered and in commitments to further 
cooperate to bolster science and understanding of ocean and coastal 
resources in the Arctic. These advancements include the Interagency 
Arctic Research Policy Committee (IARPC) Fiscal Year 2013-2017 Arctic 
Research Plan, the Pacific Marine Arctic Regional Synthesis of the 
Northern Bering, Chukchi, and Beaufort seas (PacMARS) and the Synthesis 
of Arctic Research (SOAR).
    Yet despite these efforts, the Arctic marine environment remains a 
difficult place to study and understand. It is cold, remote, and 
covered with sea ice for over half the year. Conditions vary greatly 
from one year to the next, making it difficult to generalize from the 
results of a single field season or to detect patterns across multiple 
years. And now the Arctic is undergoing rapid and profound 
environmental change due to global warming. This new information must 
be integrated with existing scientific and traditional understanding 
developed over past decades to develop an improved understanding of 
present and future conditions.
    Senate Bill 272, ``The Arctic Research, Monitoring, and Observing 
Act of 2013,'' offers several solutions to these challenges:

   First, the bill calls for the establishment of a permanent 
        Arctic science program to conduct research, monitoring, and 
        observing activities in the region--both to promote productive 
        and resilient ecosystems and to facilitate effective natural 
        resource management.

   Second, it proposes funding a merit-based grant program to 
        support new scientific research and field-work in the Arctic.

   Third, it would fund and support long-term ocean observing 
        systems and monitoring programs in the Arctic Ocean, Bering 
        Sea, and North Pacific.

    If Congress passes Senate Bill 272 and it is implemented 
effectively, the bill's provisions could form the backbone of a long-
term, integrated research and monitoring program for the Arctic--
something that Pew has long advocated.
II. Strengthening Alaska's Offshore Oil and Gas Program
    Pew believes that decisions about whether, where, and how oil and 
gas activities are conducted in the U.S. Arctic Ocean must be based on 
sound scientific information, thoughtful planning, and with the full 
involvement of the people most affected. A balanced and careful 
approach to offshore development in the Arctic must account for 
environmental protection and for the social, cultural, and subsistence 
needs of Alaskan communities.
    The Federal Government can take steps now to ensure that offshore 
Arctic development is done as safely and sustainably as possible.
    First, it must incorporate world-class, Arctic-specific safety, 
spill prevention, and response standards into Federal regulations that 
apply to every company operating in the region. These standards should 
account for the area's remote location, lack of infrastructure, and 
unique operating conditions due to the severe and changing climate. 
Equipment and techniques used in temperate waters are simply not 
transferable to the Arctic.
    The Federal Government must also protect areas that are 
biologically important or used for hunting and fishing by indigenous 
communities. The local communities should have a voice on what kind of 
development is appropriate, where it should take place, and what 
safeguards are needed. Alaska Natives' traditional knowledge and 
concerns should be a critical piece of any decisions about development 
in the Arctic. Regional Citizens' Advisory Councils provide one model 
for citizen engagement and oversight of development of Arctic energy 
resources.
    The Federal Government should recognize that for science and 
conservation to guide decision-making, a long-term monitoring program 
must be put in place and sustained to assess the cumulative effects of 
multiple, interacting stresses. Such stresses include changes in 
climate, plus noise and pollution from vessel traffic and drilling 
operations, which can disrupt habitat, migration patterns, and 
communications for whales and other marine mammals.
A. Lessons Learned and the Need for Arctic Specific Standards
    In the wake of the Deepwater Horizon blowout in the Gulf of Mexico, 
the United States, along with other Arctic countries such as Canada and 
Greenland, examined whether existing regulatory standards for arctic 
oil and gas exploration and development were sufficient to prevent a 
similar disaster and whether there was capability to respond to a major 
oil spill in ice-infested waters. The United States commissioned a 
committee, the Ocean Energy Safety Committee (OESC), to examine current 
Department of the Interior (DOI) regulations for Outer Continental 
Shelf (OCS) oil and gas exploration, development, and production 
operations and make recommendations.
    The Ocean Energy Safety Committee concluded that there is a need to 
modernize DOI regulations to include Arctic-specific standards for oil 
spill prevention, safety, containment, and response preparedness in the 
Arctic OCS, among other recommendations that more broadly applied to 
all OCS operations. On January 25, 2013, Ocean Energy Safety Committee 
Chairman Dr. Tom Hunter submitted the Committee's formal 
recommendations to the Department of the Interior for consideration and 
action. Pew supports the Ocean Energy Safety Committee's 
recommendations.
    Also in January of this year, Secretary Salazar launched an 
expedited assessment of Shell's 2012 Alaska offshore drilling program 
after a Shell oil rig ran aground near Alaska's Kodiak Island on New 
Year's Eve. The KULLUK was on its way to the Pacific Northwest from its 
Arctic drilling site when its tow vessel lost power, the towlines 
broke, and the rig hit the rocks.
    It wasn't the drilling season's sole mishap. Both the KULLUK and a 
second rig, the NOBLE DISCOVERER, are now being towed to Asia for 
inspection and repairs. A U.S. Coast Guard investigation of the NOBLE 
DISCOVERER found 16 violations of safety and pollution-control 
regulations. A U.S. Department of Justice criminal investigation is now 
under way based on the violations.
    But the issues go beyond any single accident or oil company. The 
KULLUK ran aground in the Gulf of Alaska only 50 miles from the closest 
U.S. Coast Guard station, yet the current targets for drilling lie 
1,000 miles farther north in the Arctic Ocean. Helicopters, planes, and 
vessels were on hand to evacuate the crew of the KULLUK and assist in 
the salvage. But farther north, there are no major ports, airports, or 
roads. Hurricane-force winds, subzero temperatures, shifting sea ice, 
and long periods of fog and darkness could shut down a rescue operation 
or spill response altogether.
    On March 14, 2013, Secretary Salazar announced the findings of the 
review. Pew supports DOI's seven key findings and recommendations. 
Specifically:

  1.  All phases of an offshore Arctic program--including preparations, 
        drilling, maritime, and emergency response operations--must be 
        integrated and subject to strong operator management and 
        government oversight.

  2.  Arctic offshore operations must be well-planned, fully ready, and 
        have clear objectives in advance of the drilling season.

  3.  Operators must maintain strong, direct management and oversight 
        of their contractors.

  4.  Operators must understand and plan for the variability and 
        challenges of Alaskan conditions.

  5.  Respect for and coordination with local communities is essential.

  6.  Continued strong coordination across government agencies also is 
        essential.

  7.  Industry and government must develop an Arctic-specific offshore 
        model for oil and gas development.

    The Department of Interior findings reinforce the importance of 
taking a regionally specific approach to offshore oil and gas 
exploration the Arctic. The Federal Government must recognize and 
account for the unique challenges of this region, which holds energy 
potential, but where issues like environmental and climate conditions, 
limited infrastructure, and the subsistence needs of North Slope 
communities demand specialized planning and consideration.
C. Arctic Standards for Oil Spill Prevention and Response
    The Ocean Energy Safety Advisory Committee (OESC) recommendations 
and Department of Interior's (DOI) review represent a welcome first 
step toward identifying safety and systems failures in Alaska's 
offshore drilling program. Only by taking additional steps to 
strengthen Federal review and regulation of these operations, however, 
can the Federal Government show its commitment to responsible Arctic 
Ocean development.
    Common operating practices and Arctic-specific standards should be 
established and met before any operator is approved to explore or 
develop. Examples of Arctic specific standards for oil spill prevention 
and response include but are not limited to:

    1. Purpose Built Polar Class Drilling Rigs and Associated Support 
Vessels--DOI should require drilling rig performance standards for 
Arctic OCS operations. These standards should include rigs that are 
built-for-purpose and meet Polar Class,\2\ or equivalent,\3\ standard 
and third party audits of the rig before it is used. The drilling rig 
is a critical component of a safe drilling program; however, DOI 
regulations do not currently include Arctic-specific criteria for rigs 
used in exploration drilling.
---------------------------------------------------------------------------
    \2\ International Association of classification Societies, 
Requirements Concerning Polar Class (2011).
    \3\ International Maritime Organization, Guidelines for Ships 
Operating in Arctic Ice-Covered Waters (2010).
---------------------------------------------------------------------------
    The situation of most concern is a late season well blowout that 
requires drilling to continue into late fall-early winter ice, which 
will require Polar Class rigs. While the plan may be to avoid 
interaction with the ice by implementing an ice monitoring and rig 
retreat plan, drilling rig retreat will not be an option when a blowout 
occurs and relief well rig must remain in position to drill a relief 
well in the weather and ice conditions that may be present.
    This recommendation is consistent with the International Maritime 
Organization's (IMO) Guidelines for Ships Operating in Arctic Ice-
Covered Waters; the Canada National Energy Board (NEB) Filing 
Requirements for Offshore Drilling in the Canadian Arctic,\4\ and with 
the National Commission on the BP Deepwater Horizon Oil Spill 
recommendations, where the Commission recommended the safety and 
environmental management system requirements for drilling to include 
third party audits.\5\
---------------------------------------------------------------------------
    \4\ Canada National Energy Board (NEB), Filing Requirements for 
Offshore Drilling in the Canadian Arctic, 2011, page 27.
    \5\ National Commission on the BP Deepwater Horizon Oil Spill and 
Offshore Drilling Report, Recommendation A3 (January 11, 2011) 
(recommending that the safety and environmental system requirements for 
drilling be expanded to include third-party audits at three to five 
year intervals and certification).
---------------------------------------------------------------------------
    Additionally, operators should be required to provide a sufficient 
number of Polar Class and icebreaking vessels in the U.S. Arctic Ocean 
region to support safe operation, provide towing assistance, and to 
support source control and spill response operations. These vessels 
should include a sufficient number of shallow draft vessels capable of 
operating in ice-infested waters.

    2. Seasonal Drilling Restrictions--DOI's regulations should also 
include seasonal drilling limitations for periods when oil spill 
response is not possible in the Arctic. More specifically, Arctic 
offshore operations drilling through hydrocarbon bearing zones should 
be limited to periods of time when the drilling rig and its associated 
oil spill response system is capable of working and cleaning up a spill 
in Arctic conditions, minus the time required to drill a relief well 
before ice encroaches on the drill site and the time required to clean 
up the spilled oil from the last day that a spill could occur.
    Drilling restrictions that limit OCS offshore operations in the 
Arctic to summer periods ensures there is sufficient time left in the 
operating season to cap a blown out well, drill a relief well, and 
clean up spilled oil in open water, thereby providing a critical margin 
of safety in the proposed plan. Seasonal drilling restrictions, with 
these specific components, are not included in existing regulations.
    Routine drilling operations that extend to the very last day that 
it is safe to drill do not allow time to respond to a well control 
event before winter conditions set in and equipment must leave the 
Chukchi and Beaufort seas because it becomes unsafe to operate in ice, 
freezing conditions, and darkness. A spill in the Chukchi and Beaufort 
seas not contained by freeze-up could continue unabated through the 
winter could have catastrophic long-lasting consequences.
    There are no specific regulations requiring operators to follow 
seasonal drilling limitations for Arctic operations. Although DOI 
effectively applied seasonal drilling limits to Shell's 2012 Chukchi 
Sea OCS Drilling Project \6\, similar limits have not been imposed on 
all projects. For example, DOI did not apply seasonal drilling limits 
to Shell's 2012 Beaufort Sea OCS Drilling Project allowing drilling and 
relief well operations to be scheduled into dangerous multi-year ice 
conditions of October, November and early December. Therefore, there is 
a need to establish standards that would be applied consistently across 
all projects.
---------------------------------------------------------------------------
    \6\ ``BOEM Issues Conditional Approval for Shell 2012 Chukchi Sea 
Exploration Plan'' http://www.boem.gov/BOEM-Newsroom/Press-Releases/
2011/press12162011.aspx

    3. Capping and Containment System and Relief Rig Located in the 
Arctic and Rapidly Deployed--DOI's regulations should also mandate the 
requirement to have an Arctic well capping and containment system and 
an Arctic relief well rig located in the Arctic to provide immediate 
oil spill source control capability. More specifically, Arctic oil and 
gas operators should own, or have on contract, a relief well rig and 
capping and containment system that is capable of being onsite and 
ready to commence operations within 24 hours.
    The capping and containment system should be built to arctic 
engineering specifications. The system should include Polar Class 
vessels to ensure it can remain onsite during ice conditions that may 
be encountered during the entire period of operation. Additionally, the 
system should be staffed by trained and qualified personnel with Arctic 
experience who are capable of completing a well control operation in 
Arctic conditions. Finally, the system should be subject to independent 
third party expert review and an arctic engineering expert, prior to 
the drilling season.
    The Arctic relief well rig should be capable of drilling a relief 
well at the proposed location for the period of time required to 
complete the relief well. The Arctic design should be equivalent to, or 
more robust, than the rig used to drill the original well requiring 
relief well assistance. The relief well rig must be a second rig. The 
operator cannot assume that the primary drilling rig where the well 
blowout occurred is capable of moving away from the well blowout and 
drilling its own relief well. The period of time required for relief 
well drilling should be defined as the period between the first day the 
well is spudded and when the well is plugged, abandoned, and secured 
with at least two well control barriers, plus an additional period of 
at least 60 days or longer if indicated by a site-specific analysis. 
Both Canada and Greenland have a two-rig drilling policy and required 
that a relief well rig be located in the same area of drilling at the 
same time.\7\,\8\
---------------------------------------------------------------------------
    \7\ Canada National Energy Board (NEB), Filing Requirements for 
Offshore Drilling in the Canadian Arctic, 2011.
    \8\ Government of Greenland, Bureau of Minerals and Petroleum, 
Approval of up to 7 (Seven) Exploration Wells in Accordance with 
Section 15 of Licences 2002/15, 2005/06, 2008/11 and 2011/16, Cairn 
Energy License Approval Letter, May 2011
---------------------------------------------------------------------------
    DOI regulations do not currently require a capping and containment 
system or a designated relief well rig. In the Arctic, there is a very 
limited time window to drill a relief well. The size of a worst-case 
well blowout and the amount of oil spilled into the environment will be 
a function of the time required to transport a relief well rig to the 
drilling site and drill the relief well. While well capping may arrest 
the blowout prior to drilling a relief well, this is not always the 
case.

    4. Adequate Trained Personnel and Equipment to Respond to a Spill 
in Arctic Conditions--Arctic response equipment, including mechanical 
and in-situ burning materials, and training standards should be 
established to ensure there is sufficient in-region capability to 
respond to the oil spill in Arctic conditions.
    The OSRP should include evidence that the operator either owns, or 
has under contract, adequate in-region Arctic-grade equipment and 
personnel trained and qualified to operate that equipment and capable 
of cleaning up the entire spill.
    Arctic-grade equipment should include, but not be limited to: 
Arctic-grade skimmers, ice-boom, viscous oil pumps, winterization 
enclosures and heating systems to protect equipment and prevent 
freezing, systems to thaw frozen equipment, Polar Class vessels 
(icebreakers, storage and recovery vessels), shallow draft vessels 
capable of operating in ice-infested water and able to provide 
nearshore response access, landing craft capable of accessing remote 
shores where docks are not present, and cold-weather Personnel 
Protective Equipment.
    Personnel should have training and qualifications in arctic 
mechanical response, in-situ burning, and deployment and operation, and 
vessel captains and pilots should have experience navigating in the 
Arctic.
    DOI regulations do not currently require any specific standards for 
Arctic mechanical response equipment or training. Canada, by 
comparison, requires that an operator demonstrate, including field 
exercises in arctic conditions, that its oil spill response equipment 
and personnel are trained and equipped to work in the Arctic.\9\
---------------------------------------------------------------------------
    \9\ Canada National Energy Board (NEB), Filing Requirements for 
Offshore Drilling in the Canadian Arctic, 2011, pages 22-23.

    5. Equipment Tests and Drills in Arctic Conditions--DOI's 
regulations should also include Arctic offshore field tests to verify 
spill response tactics and strategies prior to OCS operations. Oil and 
gas operators should be required to conduct field tests prior to 
conducting OCS operations to verify that arctic spill response 
techniques, equipment, and methodologies will be effective and are the 
best available technology for use in the Arctic environment. Field 
tests should be conducted in the environments they plan to operate in 
and in areas where a spill from their operations could reach. Each 
tactic and strategy relied upon in an oil spill response plan should be 
field-tested and verified as a viable oil spill removal strategy prior 
to conducting OCS operations where there is a risk of spilling 
significant oil.
    Equipment that has not been tested in Arctic conditions already 
including mechanical equipment and capping and containment systems 
should be physically tested in the arctic conditions that the applicant 
may need to use the system in prior to the drilling season and proven 
to be successful and reliable for the intended purpose.
    There are currently no requirements for operators, or the Oil Spill 
Removal Organizations (OSROs) they utilize, to field test and verify 
that its proposed ``on-paper'' tactics and strategies are efficient and 
effective in the Arctic prior to starting drilling operations.
    To verify that Arctic oil spill response techniques, equipment, and 
methodologies will be adequate and effective in an actual response, 
operators should plan for and conduct field tests in a range of Arctic 
conditions, including broken ice.
D. Need for More Comprehensive Review of Alaska's Offshore Program
    The previous recommendations address one narrow aspect of Alaska's 
offshore oil and gas program: oil spill prevention and response 
standards specific to the Department of Interior. As part of the 
government's commitment to developing Alaska's energy resources 
cautiously and subject to the highest safety and environmental 
standards, all Federal agencies with oversight responsibilities must 
thoroughly review standards for other aspects of the offshore program.
    Federal agencies should also make information available to the 
public in a timely fashion and on a proactive basis. Relatively simple 
steps--like publishing letters, approvals, and data on agency websites 
and committing to accepting public comments on spill response plans--
would go a long way toward building trust and improving public 
participation in the decision-making process.
    At stake is not only the safety of workers, but also a rich and 
complex ecosystem found nowhere else in the United States. The Arctic 
Ocean is home to bowhead whales, walruses, polar bears, and other 
magnificent marine mammals as well as millions of migratory birds. A 
healthy ocean is important for the continuation of hunting and fishing 
traditions practiced by Alaska Native communities for time immemorial.
III. Enhance Vessel Traffic Safety Through the Bering Strait and in the 
        Arctic Ocean
    The Bering Strait is the gateway in and out of the western Arctic 
Ocean for migrating marine mammals and seabirds. A mere 50 nautical 
miles at its narrowest point, this exceptional place provides habitat 
and migrating routes for beluga and bowhead whales; more than 50 
species of seabirds and their massive breeding colonies; ringed, 
spotted and bearded seals; walrus; and forage fish such as arctic cod 
and arctic char. Indigenous Arctic communities have subsisted and 
nurtured a culture intertwined intimately with these waters and 
resources for thousands of years.
    The Bering Strait is already experiencing increasing vessel 
traffic, and that trend is expected to continue and accelerate in the 
future. The growth in Arctic marine operations is due in large part to 
natural resource development within the region and the Arctic's growing 
economic ties to the global economy. At a meeting in Nome on vessel 
traffic, U.S. Coast Guard Commander James Houck noted that 480-plus 
vessels transited the Bering Strait in 2012.\10\ Ships include tankers, 
cargo ships, container ships, tugs, offshore supply vessels, landing 
craft, fishing vessels, passenger vessels, offshore drill ships, oil 
spill response vessels, and cruise ships of various sizes. While vessel 
activity is light compared to other regions of the world, the capacity 
to provide aid and support for these vessels is extremely limited.
---------------------------------------------------------------------------
    \10\ CMDR Houck presentation: http://seagrant.uaf.edu/conferences/
2013/bering-strait-maritime/program.php
---------------------------------------------------------------------------
    Vessels navigating these narrow passages pose numerous threats. 
They may discharge oil, waste, or ballast water that contains invasive 
species. Marine mammals are susceptible to vessel noise, which could 
alter their behavioral and migratory patterns. Vessels could strike 
marine mammals such as the slow-moving bowhead whale, particularly 
during twice-yearly migration times when the majority of the Western 
Arctic population moves through this corridor. They may have an 
accident, lose steerage or become grounded-posing a threat or danger to 
personnel aboard. Also of real concern is the potential for interfering 
with subsistence activities and/or compromising the safety of hunters, 
some of whom travel 100 miles from shore in small boats. Lastly, vessel 
traffic may disrupt ecosystem integrity and function, which is vital to 
indigenous Arctic communities; a healthy ecosystem supports the marine 
mammals and fish populations that ensure a strong subsistence way of 
life.
    Given the cultural, ecological, and economic importance of the 
region, the consequences of an accident are considerable. We are at a 
critical point at which to begin developing an appropriate standard of 
care for vessel traffic in the region. Local communities should be 
actively involved and play a leadership role with other stakeholders in 
this effort. It cannot be emphasized enough that any mandatory or 
voluntary measures should be developed with the involvement of the 
tribal governments, regional Alaska Native non-profit organizations, 
co-management organizations, and ANCSA corporations.
    Below are some concepts and ideas that should be further explored 
to enhance vessel traffic safety:
A. Improve and Update Tools to Enhance Safer Voyage Planning
    As a first step to help prevent accidents, mariners should have 
access to accurate and updated information.

    1. Update Nautical Charts--Hydrographic charting in the Bering 
Strait and Arctic Ocean are inadequate and those that exist are 
outdated, with the majority of charting occurring prior to 1970.\11\ In 
a recent report the U.S. Committee on the Marine Transportation System 
stated that ``less than one percent of navigationally significant 
Arctic waters have been surveyed with modern technology to determine 
depths and depict hazards to navigation.'' \12\
---------------------------------------------------------------------------
    \11\ LT Matt Forney, NOAA, Office of Coast Survey, presentation at 
the Bering Strait Maritime Symposium. Feb. 2013. http://
seagrant.uaf.edu/conferences/2013/bering-strait-maritime/program.php
    \12\ U.S. Committee on the Marine Transportation System, ``U.S. 
Arctic Marine Transportation System: Overview and Priorities for Action 
2013.'' (2013). Available at: http://www.cmts.gov/downloads/
CMTS_Draft_Arctic_MTS_Overview_and_Priorities_Paper_for_Public_Co
mment-Feb2013.pdf

    2. Improve Forecasting--Weather, sea ice, and sea state are 
critical elements to safe voyage planning in Arctic waters. This 
information, however, is not widely available. Improving forecasting is 
listed amongst the top priorities in the National Oceanic and 
Atmospheric Administration's Arctic Vision and Strategy.\13\
---------------------------------------------------------------------------
    \13\ Priorities include: forecast sea ice, strengthen foundational 
science to understand and detect Arctic climate and ecosystem changes, 
improve weather and water forecasts and warnings, enhance international 
and national partnerships, improve stewardship and management of ocean 
and coastal resources in the Arctic, and advance resilient and healthy 
Arctic communities and economies. Available at: http://
www.arctic.noaa.gov/docs/NOAAArctic_V_S_2011.pdf

    3. Add and Supplement Community Information in the Coast Pilot--
NOAA's Office of Coast Survey issues the Coast Pilot, a series of 
nautical books that provide information that is difficult to show on a 
nautical chart. Topics covered include, for example, currents, tide and 
water levels, weather, sea ice, dangers, and routes.\14\ Coastal 
communities should be consulted regarding what information to add. They 
have knowledge from traveling local waters, often farther offshore than 
most mariners in the lower latitudes, and could help further safe 
routes and hazards not currently included in the most recent edition. 
Communities may, for example, want to include local VHF channels for 
mariners to communicate and/or additional information on seasonal 
species migrations or important seasons when communities will be on the 
water.
---------------------------------------------------------------------------
    \14\ Office of Coast Survey, United States Coast Pilot. http://
www.nauticalcharts.noaa.gov/nsd/cpdownload.htm

    4. Require Additional and Continued Research, Monitoring and 
Observation--Balanced management of Arctic waters will require more 
complete information about species and ecosystem functioning, followed 
by continued monitoring and observation of key species and processes. 
This information will not only benefit resource management but also 
vessel traffic management to better facilitate safe shipping. As 
traffic increases and the climate changes, ongoing input from local 
communities and scientific information will be important to measure and 
mitigate impacts.
B. Implement Measures to Mitigate Marine Impacts from Vessel Traffic
    Mandatory measures to regulate vessels through the Bering Strait 
may need to go through a lengthy, international process. Voluntary 
measures, however, are achievable in the short term and have been 
effective in other areas of the United States. Listed below are 
examples of measures, some of which have been discussed by the U.S. 
Coast Guard \15\ that could be utilized to reduce impacts from 
increasing vessel traffic in the Bering Strait and Arctic Ocean.
---------------------------------------------------------------------------
    \15\ CMDR Houck, ``Rules of the Road--A Bering Strait Overview'', 
presentation at the Bering Strait Maritime Symposium. Feb. 2013. http:/
/seagrant.uaf.edu/conferences/2013/bering-strait-maritime/program.php

    1. Shipping Lanes--Shipping lanes are designed to confine vessel 
traffic to specific areas. This helps create regular traffic patterns 
while avoiding potentially dangerous locations or culturally or 
environmentally sensitive areas. Shipping lanes also help avoid 
accidents because vessels follow expected routes. This measure is 
commonly used in narrow straits and areas of vessel congestion such as 
harbor entrances. Shipping lanes also ensure that vessels maintain a 
safe distance offshore in case a problem affects maneuverability. This 
gives the vessel's crew time to make repairs, set anchor, or get 
---------------------------------------------------------------------------
assistance before drifting aground.

    2. Areas To Be Avoided (ATBAs)--If shipping lanes tell vessel where 
to go, ``areas to be avoided'' tell mariners where they should never 
go. These areas may be designated because of marine hazards, such as 
shoals or strong currents. They may also be designated for 
environmental and cultural reasons. In a remote region such as the 
Bering Strait, ``areas to be avoided'' may also be used to keep 
sufficient space between vessels and shorelines to reduce the chance 
that a disabled vessel drifts ashore before help can arrive.

    3. Vessel speed--For some hazards, including ship-to-ship 
collisions and ship strikes of whales, vessel speed is a crucial factor 
in the damage that may occur. For example, whales are far less likely 
to be killed by large vessels (cargo ships, tankers, large cruise 
liners) traveling 12 knots or slower than by large vessels moving 
faster.\16\ In areas with limited maneuvering room for avoiding 
hazards, speed restrictions can greatly reduce impacts and risks. 
Vessel speed can be monitored using commercially available vessel 
tracking devices. Vessel speed restrictions are being used, in concert 
with routing measures, in the northeast Atlantic to help reduce ship 
strikes of the endangered North Atlantic Right Whale.\17\
---------------------------------------------------------------------------
    \16\ Gende, S. et al., ``A Bayesian approach for understanding the 
role of ship speed in whale-ship encounters'' 2011. Ecological 
Applications, 21(6), pp.2232-2240.
    \17\ NOAA Fisheries, Office of Protected Species: ``Reducing Ship 
Strikes to North Atlantic Right Whales'' http://www.nmfs.noaa.gov/pr/
shipstrike/

    4. Ship Reporting (Automated Vessel Tracking, Reporting Location to 
Local Hunters, Reporting Hazards Such As Sea Ice or Marine Mammals)--
Most vessels now are required to have automatic tracking systems on 
board (Automated Information Systems, or AIS), which allow their 
progress to be monitored. Reporting systems may create an additional 
requirement to announce when the vessel enters and leaves designated 
areas or enters and exits a shipping lane. (This can be automated.) 
Additional communication requirements could include, for example, 
making an announcement on local radio channels in case there are 
hunters out in boats, or checking with a local communication center 
upon arriving within radio range of that location, or describing 
hazards, such as sea ice or marine mammal aggregation, to other 
vessels.
    Current AIS technology allows for ``watchdog'' alarms to be 
triggered when vessels cross a line of demarcation or enter a specific 
area. The information on the vessel can be automatically transmitted to 
other vessels, government agencies, and other entities. The U.S. Coast 
Guard monitors vessel movements and can identify ships that appear to 
be having trouble of some kind. This can help a timely emergency 
response. The AIS can also be used to inform vessels that they are 
outside shipping lanes or to transmit safety or other information as 
needed. In some places such as the Malacca Strait, these systems have 
received extensive funding from the shippers themselves. In the Bering 
Strait region and coastal areas of the Beaufort and Chukchi seas, if 
receiving equipment is made available, AIS also can be used by local 
communities to track vessel movement to help ensure the safety of 
subsistence hunting boats and other small craft used locally.
C. Enhance Emergency Preparedness
    1. Increase Spill Response Planning and Capability--Spill response 
planning and capacity should be met by professional oil spill removal 
organizations and enhanced community capability. Communities should be 
equipped and trained to use spill response equipment and aid in 
protecting shoreline resources. Regional Citizens' Advisory Councils 
can provide communities with a structure to review spill response 
planning, as well as train and practice responding to oil spills. Non-
tank vessels should be required to have approved vessel response plans. 
These response plans will require increase capacity along the coasts. 
Oil Spill Removal Organization (OSROs) capacity should be enhanced to 
meet this demand.

    2. Deep Water Port and Emergency Towing Capacity--There are no 
major ports in western Alaska or along the Arctic coastline. There 
should be additional emergency towing systems available along the 
Bering Strait coast as well as on the North Slope. A deep water port in 
the Northern Bering Sea could provide a place to station a tug to 
assist distressed vessels.
D. Foster International Cooperation
    The Bering Strait's international jurisdiction should not prevent 
the United States from taking careful, preventative measures to reduce 
and also prepare for an emergency. In the long term, however, it is 
important that the United States continue to foster a cooperative 
relationship with Russia and work towards a mutual set of measures to 
help manage this narrow strait.
    The Arctic Council's Search and Rescue Agreement is a good step 
towards ensuring international cooperation in these shared waters. 
Additionally, the United States should continue to play a leadership 
role in the development of a mandatory Polar Code at the International 
Maritime Organization. The Polar Code is an important tool, setting 
international standards for vessels fit to travel in Arctic waters. In 
addition to vessel design and strength, however, measures should be 
included that set baseline standards for discharge, waste, noise and 
light pollution, and interaction with marine mammals.
    Pew strongly supports ratification of the U.N. Convention on the 
Law of the Sea. The oceans have been called, ``the last global 
commons,'' and their sustained global health can best be maintained by 
a stable, universally accepted convention that promotes the key 
interests of the United States, its allies and its trading partners. 
Ratification would ensure our ability to participate in interpreting 
and applying the convention to the changing realities of the global 
maritime environment and preserves our ability to protect our domestic 
interests, including our extended continental shelf claims.
IV. Conclusion
    The United States is in the unique and privileged position of being 
an Arctic nation. This privilege brings with it national obligations. 
We must ensure that strategy, policies, and adequate Federal resources 
are in place today in order to effectively manage and prepare for these 
challenges tomorrow. The consequences of losing a treasure like the 
Arctic are simply unacceptable.

    Senator Begich. Thank you very much, and you did have some 
good suggestions in your written testimony, so I appreciate 
that. Thank you.
    What I'd like to now ask is Matt Ganley, Vice President of 
Bering Straits Native Corporation. Matt?

           STATEMENT OF MATT GANLEY, VICE PRESIDENT,

                RESOURCES AND EXTERNAL AFFAIRS,

               BERING STRAITS NATIVE CORPORATION

    Mr. Ganley. On behalf of the shareholders and the Board of 
Directors of Bering Straits Native Corporation, which I will 
refer to as BSNC, just to shorten things, I thank you for the 
opportunity to present testimony related to developments in 
Alaska's Arctic waters.
    I am Matt Ganley, Vice President of Resources and External 
Affairs for Bering Straits Native Corporation. I have worked in 
Western Alaska, Northwest Alaska for the past 30 years, the 
last 20 of those years with Bering Straits Native Corporation.
    Bering Straits Native Corporation is a regional corporation 
established pursuant to ANCSA or the Alaska Native Claims 
Settlement Act of 1971. The region encompasses the Seward 
Peninsula and adjacent waters, including Sledge Island, King 
and Diomede Islands, and the shorelines of two seas, as well as 
the whole shoreline of Norton Sound. Seventeen villages are 
within the BSNC regional organization.
    Traveling north to south along the shoreline, we have 
Shishmaref on the Chukchi Sea; Wales and Diomede on Bering 
Strait; Teller and Brevig Mission on the eastern boundary of 
Port Clarence; Nome on the Bering Sea; then further east to 
Solomon, Golovin, Koyuk, and south to Shaktoolik, Unalakleet, 
Stebbins and St. Michael, all within Norton Sound.
    Recent developments, including diminished sea ice, 
increased vessel traffic through the Northern Sea Route and 
Northwest Passage, and oil and gas exploration in the Beaufort 
and Chukchi, including Russian waters to the West, have rapidly 
brought the Bering Straits region into sharp focus. Though 
certainly challenging, we view these developments with concern 
as well as guarded optimism.
    Over the past 2 years, agencies and organizations have held 
meetings to discuss numerous topics related to increased 
shipping and vessel traffic in the northern waters. From one 
gathering to the next, I watched as the anxiety level has risen 
among participants at these meetings who are attending as 
representatives from the coastal communities in Bering Straits. 
Discussions and reports detailing spill and disaster response 
needs, increased traffic-related exploration, as well as the 
potential for offshore oil development, have not addressed a 
glaring gap between the information scenarios presented and the 
utility of that information for the resident stakeholders.
    Strategies, however, have been developed. Specifically, I 
will refer to a state program called the Geographic Response 
Strategy, which, if implemented in a material sense, would 
place the tools and expertise in the hands of the communities 
to respond at a local level to fuel spills and unanticipated 
discharges near shore marine waters. Staging of the necessary 
hardware in communities, combined with the proper training, 
would provide communities with an investment in what is 
occurring in their neighborhoods. It would also give 
communities an active role in protecting their subsistence 
resource base, the very thing that the residents are the most 
anxious about.
    I offer the GRS as an example because it highlights 
something that the BSNC has been emphasizing in recent 
discussions related to the Arctic ports. There is no single 
location or, for that matter, response plan that is going to 
fulfill the many needs facing industry, government, or the 
residents of the Arctic. The extent of the coastline, the lack 
of intermodal transportation, the extreme environment, and the 
relative absence of sufficiently deep water require a non-
centralized, modular approach to infrastructure development in 
the Arctic. Rather than focus on a single port-for-port 
development with the intent of constructing the Arctic port, we 
encourage agencies, planners and government, both state and 
Federal, to promulgate rules that encourage private 
development, as well as the public-private partnerships 
discussed in the recent port studies.
    It would also be prudent when legislation is developed to 
be certain that, one, not all of the resources are invested for 
political expediency at one location; and two, that the options 
available for port development, particularly in the private 
sector, are not unnecessarily restricted through new or 
additional administrative regimes.
    Since its creation in 1971 with the passage of the Alaska 
Native Claims Settlement Act, BSNC has endeavored to anticipate 
what would occur in the region with regards to resource 
development and commerce. This was the underlying intent of 
ANCSA and the corporate structure imposed by the Act.
    BSNC selected the lands located at Point Spencer, commonly 
known as Point Clarence in 1976 pursuant to Section 14(h)(8) of 
ANCSA, and we subsequently prioritized this tract 10 years ago. 
It was selected with the understanding that the BSNC would 
accept conveyance at such time as it became available. Until 
2010, the year that the Coast Guard decommissioned the Loran 
facility, Port Clarence served as an important link in the 
communication navigation system for Alaska's waters. We have 
been working with the Coast Guard and have had initial 
discussions with the Department of Natural Resources to 
determine the most expedient manner to have the property 
conveyed to BSNC to fulfill the corporation's ANCSA 
entitlement.
    As we all know, there are currently no adequate staging, 
support, and disaster response facilities in the area of Bering 
Strait, and BSNC intends to utilize this property for 
infrastructure development that will positively benefit the 
shipping safety, search and rescue capability, security, and 
economic development in the region. It will also provide jobs 
and economic opportunities in one of the most economically 
depressed areas in the United States. We believe Port Clarence 
can be responsibly developed in partnership with private 
industry to meet the needs of marine safety and national 
security throughout Alaska's northern Arctic waters.
    Thank you, Senator, for allowing this testimony.
    [The prepared statement of Mr. Ganley follows:]

   Prepared Statement of Matt Ganley, Vice President, Resources and 
          External Affairs, Bering Straits Native Corporation
    On behalf of the Shareholders and Board of Directors of Bering 
Straits Native Corporation (BSNC), I thank Senator Begich for the 
opportunity to present testimony related to developments in Alaska's 
Arctic Waters. I am Matt Ganley, Vice President of Resources and 
External Affairs for Bering Straits Native Corporation and have worked 
in western and northwest Alaska for the past 30 years-the last 20 of 
those years with Bering Straits Native Corporation.
    Bering Straits Native Corporation is the regional corporation 
established by the Alaska Native Claims Settlement Act of 1971. Our 
region encompasses the Seward Peninsula and adjacent waters, including 
Sledge, King and Diomede Islands, and the shorelines of two Seas as 
well the whole shoreline of Norton Sound. Seventeen villages are within 
the BSNC regional organization. Most of the communities lie along the 
coastline: from Shishmaref on the Chukchi Sea; Wales and Diomede 
(Inalik) in Bering Strait; Teller and Brevig Mission on the eastern 
boundary of Port Clarence; Nome on the Bering Sea; then further east to 
and Solomon, Golovin, Koyuk, and south to Shaktoolik, Unalakleet, 
Stebbins and St. Michael on eastern Norton Sound.
    Recent developments, including diminished sea ice, increased vessel 
traffic through the Northern Sea Route and Northwest Passage, and oil 
and gas exploration in the Beaufort and Chukchi (including Russian 
waters to the west), have rapidly brought the region into sharp focus. 
Though certainly challenging, we view these developments with concern 
as well as guarded optimism.
    Over the past two years agencies and organizations have held 
meetings to discuss numerous topics related to increased shipping and 
vessel traffic in Northern waters. From one gathering to the next I 
have watched as the anxiety level has risen among participants at the 
meetings who are attending as representatives from the coastal 
communities of Bering Strait. Discussions and reports detailing spill 
and disaster response needs, increased traffic related to exploration 
as well as the potential for offshore oil development have not 
addressed a glaring gap between the information and scenarios 
presented, and the utility of that information for the resident 
stakeholders. Strategies have been developed-specifically the 
Geographic Response Strategies report-which, if implemented in a 
materiel sense, would place the tools and expertise in the hands of the 
communities to respond at the local level to fuel spills and 
unanticipated discharges in near shore marine waters. Staging of the 
necessary hardware in the communities, combined with proper training 
would provide communities with an investment in what is occurring in 
their neighborhoods. It would also give communities an active role in 
protecting their subsistence resource base: the very thing our 
residents are most anxious about.
    I offer the GRS example because it highlights something that BSNC 
has been emphasizing in recent discussions related to Arctic ports. 
There is no single port location or, for that matter, response plan 
that is going to fulfill the many needs facing industry, government and 
residents in the Arctic. The extent of the coastline, the lack of 
intermodal transportation, the extreme environment, and the relative 
absence of sufficiently deep water require a non-centralized, modular 
approach to infrastructure development in the Arctic. Rather than focus 
on a single point for port development with the intent of constructing 
The Arctic Port, we encourage agencies, planners and government (State 
and Federal) to promulgate rules that encourage private development as 
well as the public-private partnerships discussed in recent Port 
Studies. It would also be prudent when legislation is developed, to be 
certain that 1) Not all of the resources are invested, for political 
expediency, at one location and 2) that the options available for port 
development, particularly in the private sector are not unnecessarily 
restricted, through new or additional administrative regimes.
    Since its creation in 1971 with the passage of the Alaska Native 
Land Claims Settlement Act, BSNC has endeavored to anticipate what 
would occur in our region with regards to resource development and 
commerce. This was the underlying intent of ANCSA and the corporate 
structure imposed by that Act. BSNC selected the lands located on Point 
Spencer, commonly known as Port Clarence in 1976 (case file number 
AKFF023051), pursuant to Section 14(h)(8) of the Alaska Native Claim 
Settlement Act, and subsequently prioritized this tract of 
approximately 2300 acres. It was selected with the understanding that 
BSNC would accept conveyance at such time as it became available. Until 
2010, the year that USCG decommissioned the Loran facility, Port 
Clarence served as an important link in the communication and 
navigation system for Alaska's waters. We have been working with the 
USCG and have had initial discussions with the State Department of 
Natural Resources to determine the most expedient manner to have the 
property conveyed to BSNC to fulfill our corporation's ANCSA 
entitlement.
    There are currently no adequate staging, support, and disaster 
response facilities in the area of Bering Strait and BSNC intends to 
utilize this property for infrastructure development that will 
positively benefit the safety, security, and economic development of 
the region. It will also provide jobs and economic opportunities to one 
of the most economically depressed areas in the United States. We 
believe Port Clarence can be responsibly developed in partnership with 
private industry to meet the needs of marine safety and national 
security in Alaska's Arctic waters.

    Senator Begich. Thank you very much. And again, I'll have 
questions for several of you.
    The next person is Jack Omelak, Alaska Nanuuq Commission 
Executive Director.
    Thank you very much, Jack, for being here.

         STATEMENT OF JACK OMELAK, EXECUTIVE DIRECTOR,

              ALASKA NANUUQ COMMISSION AND MEMBER,

                 ARCTIC MARINE MAMMAL COALITION

    Mr. Omelak. Can everybody hear me?
    Senator Begich. Yes.
    Mr. Omelak. First of all, good morning, Senator Begich. 
It's a pleasure to meet you. I appreciate the opportunity to 
testify on this behalf.
    My name is Jack Omelak. I am the Executive Director of the 
Alaska Nanuuq Commission. We represent 15 coastal villages from 
Kaktovik to St. Lawrence Island in the domestic and 
international management of polar bears.
    Recently, the Alaska Nanuuq Commission took part in the 
formation of the Arctic Marine Mammal Coalition. The members of 
this coalition include the Alaska Nanuuq Commission, the Alaska 
Eskimo Whaling Commission, the Eskimo Walrus Commission, the 
Alaska Beluga Whale Committee, and the Ice Seal Committee. We 
primarily represent the groups through the Bering Strait into 
the Beaufort Sea.
    I'd just like to speak briefly. I'm going to go ahead and 
abridge my verbal presentation. I've given you a complete 
written testimony. But I'd like to speak briefly on some points 
of concern to the groups in regards to the increasing traffic 
through the Straits.
    Of course, our concerns are about the potential impacts in 
regards to our long-term food security. That's primarily the 
reason why we decided to come together and form the AMMC. Our 
goal as this coalition is to speak more efficiently as a 
unified voice. We all know about how difficult it is to reach 
stakeholders. This is one of the primary reasons why we decided 
such an agency should be formed, to increase the communication 
between local stakeholders and people such as yourself.
    So in 2012, in September, we got together and met, formed 
the coalition, and then sent a letter to the U.S. Coast Guard 
17th District making recommendations on vessel management 
measures as part of the process to develop the port access 
route study. A copy of this letter is also attached to my 
written testimony.
    So the main points that we agreed to in this letter was 
that we felt it would be necessary to establish areas to be 
avoided, protecting the subsistence use areas of coastal 
communities. We also think we need to deploy receivers and 
computer monitors in villages so that residents can track 
vessels using the AIS system which was spoken to earlier.
    Ship strikes on whales, especially bowheads, are very 
serious concerns to residents of our whaling communities. For 
this reason, we would like to see recommendations for speed 
restrictions for vessels transiting the Bering and the Anadyr 
Straits during the spring and fall migratory periods.
    To protect marine mammals during biologically important 
activities, we would like to see recommendations for speed 
restrictions and possible diversionary measures in the presence 
of feeding marine mammals. I'd like to note here that these 
recommendations for speed restrictions and diversionary 
measures is patterned after mitigation measures in the Alaska 
Eskimo Whaling Commission's Open Water Season Conflict 
Avoidance Agreement.
    This new coalition's work is focused primarily on 
commercial traffic vessels, but I think it's relevant to state 
that the oil and gas operators working in the Arctic have been 
willing to adhere to these measures during vessel transit for 
many years.
    Also, to maintain the health of our waters, we feel very 
strongly that commercial vessels should be required to treat 
the Bering, Chukchi and Beaufort Seas as zero discharge zones 
for ballast water and vessel waste.
    Given the lack of infrastructure and the relatively limited 
Coast Guard presence, providing emergency response training and 
equipment to our coastal communities should be part of any 
program aimed at emergency response in the Arctic.
    And finally, Senator, we all know that it's absolutely 
critical that funding for these types of issues are addressed.
    We're committed to the safety and well-being of our 
residents, our subsistence resources, as well as the many 
humans transiting our ocean now and in the future.
    I'm pleased to report that on January 30 of this year, the 
Arctic Marine Mammal Coalition received a response to our 
letter from Admiral Ostebo. The Admiral's letter offers several 
very helpful recommendations for opportunities to pursue the 
types of management measures we have recommended. The Admiral 
also expressed interest in further collaboration with our 
communities and our coalition. We're grateful for this response 
and intend to pursue on behalf of our subsistence hunters both 
the Coast Guard's recommendations and the Admiral's offer of 
further collaborations. This letter is attached to my comments.
    Thank you again, Senator, for the opportunity, and on 
behalf of the marine mammal hunters of our Arctic coastal 
communities, I'd like to express our sincere gratitude for your 
recognition of the fact of allowing us to be here to give 
testimony today. Thank you.
    [The prepared statement of Mr. Omelak follows:]

 Prepared Statement of Jack Omelak, Executive Director, Alaska Nanuuq 
         Commission and Member, Arctic Marine Mammal Coalition
    Good morning, Senator Begich. Thank you for the opportunity to 
speak here today.
    My name is Jack Omelak. I am the Executive Director of the Alaska 
Nanuuq Commission. The ANC is a member of the newly formed Arctic 
Marine Mammal Coalition, or AMMC. The members of the AMMC are the five 
principal marine mammal hunter groups from the Bering Straits Region 
north through the Beaufort Sea. Those are: the ANC, the Alaska Eskimo 
Whaling Commission, the Eskimo Walrus Commission, the Alaska Beluga 
Whale Committee, and the Ice Seal Committee.
    I would like to speak briefly on points of concern to our hunter 
groups as we observe the ever-increasing numbers of large oceangoing 
vessels in our coastal waters. These concerns extend, as well, to the 
many large vessels transiting our waters that are out of sight of our 
coastal communities. Our concerns about the potential adverse impacts 
of this increasing traffic to our subsistence resources, the ecosystem 
of our waters, and our longterm food security led our groups to come 
together. Our goal as a coalition is to speak with one voice on the 
need for rational management of this traffic, both domestically and 
internationally.
    On September 20, 2012, the members of the AMMC sent a letter to the 
U.S. Coast Guard's 17th District, making recommendations on vessel 
management measures as part of the process to develop a Port Access 
Route Study. A copy of this letter is attached to my written testimony.
    To touch briefly on the main points agreed to by the members of the 
AMMC and set forth in that letter:

   It will be necessary to establish Areas To Be Avoided, to 
        protect the subsistence use areas of our coastal communities. 
        One very important area is to the west of St. Lawrence Island.

   We need to deploy receivers and computer monitors in our 
        villages so that residents can track vessels, using the 
        Automated Information System.

     The ability to monitor vessel movements and 
            communicate with ships will be important in helping us to 
            protect subsistence hunting opportunities.

     The communications centers set up along the Beaufort 
            and Chukchi Sea coasts by oil and gas operators are logical 
            places to begin deployment of AIS monitoring equipment.

   Ship strikes on whales, especially bowhead whales, are a 
        very serious concern to the residents of our whaling 
        communities. For this reason, we would like to see 
        recommendations for speed restrictions for vessels transiting 
        the Bering and Anadyr Straits during the spring and fall 
        migratory periods.

   To protect marine mammals during biologically important 
        activities, we would like to see recommendations for speed 
        restrictions and possible diversionary measures in the presence 
        of feeding whales, walrus, seals, and polar bears. We also 
        would like to see similar restrictions near any aggregations of 
        these same species.

   I would like to note here that this recommendation for speed 
        restrictions and diversionary measures is patterned after 
        mitigation measures in the Alaska Eskimo Whaling Commission's 
        Open Water Season Conflict Avoidance Agreement. The AMMC's work 
        is focused primarily on commercial vessel traffic. But it is 
        significant that the oil and gas operators working in the 
        Arctic have been willing to adhere to these measures during 
        vessel transit for many years.

   To maintain the health of our waters, we feel very strongly 
        that commercial vessels should be required to treat the Bering, 
        Chukchi, and Beaufort Seas as zero discharge zones for ballast 
        water and vessel waste.

   Given the lack of infrastructure and limited Coast Guard 
        presence, providing emergency response training and equipment 
        to our coastal communities should be part of any program aimed 
        at emergency response in the Arctic.

   And finally, Senator, as you know all too well, funding for 
        these initiatives will be critical to their success and to the 
        safety and wellbeing of our residents and our subsistence 
        resources, as well as the many humans transiting our ocean, now 
        and in the future.

    I am pleased to report that on January 30th of this year, the AMMC 
received a response to our letter from Admiral Ostebo of the 17th Coast 
Guard District. The Admiral's letter offers several very helpful 
recommendations for opportunities to pursue the types of management 
measures we have recommended. The Admiral also expressed an interest in 
further collaboration with our communities and our coalition. We are 
grateful for this response and intend to pursue, on behalf of our 
subsistence hunters, both the Coast Guard's recommendations and the 
Admiral's offer of further collaboration.
    I have attached the Admiral's letter to my comments.
    Thank you, again, Senator for giving me the opportunity to speak 
here today. On behalf of the marine mammal hunters of our arctic 
coastal communities, I would like to expression our appreciation for 
your recognition of the fact that the issues discussed here go to the 
heart of our survival. And I would like to personally thank you for 
allowing our hunters' voice to be heard in this public forum.
                                 ______
                                 
                       U.S. Department of Homeland Security
                                            Juneau, AK, 30 JAN 2013
United States Coast Guard
Commander Seventeenth District

Dear Arctic Marine Mammal Coalition Members:

    I would like to provide a response to your letter of September 20, 
2012, which included a variety of questions and concerns regarding 
vessel operations in Arctic waters. I fully understand the importance 
of your concerns, and hope that you recognize this understanding 
through our ongoing Coast Guard efforts to engage with Tribes, Alaska 
Native Organizations, and other groups and residents of the Arctic 
region.
    As you noted in your letter, we have been working to obtain input 
for the International Maritime Organization (IMO) Polar Code revision, 
as well as the Bering Strait Port Access Routing Study (PARS). It is 
important to note the role that the Coast Guard's 17th District plays 
in both of these initiatives as they are not quite the same. Coast 
Guard Headquarters in Washington, DC serves as the ``action office'' 
that is responsible both for soliciting input for the IMO Polar Code 
initiative as well as eventually promulgating any resulting regulations 
that are developed.
    In contrast, District 17 in Alaska has the lead role in completing 
the Bering Strait PARS. Once completed, the PARS study recommendations 
will need several additional levels of approval within the Federal 
Government before it can be considered for adoption at the IMO. We 
continue to work with other Federal agencies on topics of importance in 
the Arctic, and I will also forward this letter to those relevant 
agencies for specific items noted below that are under their 
jurisdiction. Due to the range of issues in your letter, I will 
specifically address each item below for clarity:

  1.  Migration and Vessel Transit Routes near Saint Lawrence Island: 
        The Coast Guard does anticipate that Areas to be Avoided (ATBA) 
        will be included as PARS study recommendations, although the 
        precise locations and sizes are still being developed. In 
        addition to minimizing impacts to marine mammals, Areas to be 
        Avoided also provide additional response time in the event that 
        a vessel becomes disabled and may drift aground. The Coast 
        Guard understands the rationale for your input to route all 
        traffic to the east of St. Lawrence Island, but the commercial 
        traffic in this area includes vessels destined for both the 
        United States and Russia, including a significant amount of 
        traffic that runs along both the US/Russian maritime border and 
        along the Russian Coast. Routing more traffic to the East of 
        St. Lawrence Island will add significant distance to some 
        transits and we do not have a good sense yet if this type of 
        ship routing scheme would be supported by the Russian 
        Federation or at the IMO.

  2.  Open Water Transits in the Beaufort/Chukchi 35 Miles Offshore to 
        Avoid Open-Leads: The Coast Guard is familiar with the 
        subsistence uses in these areas, as well as other initiatives 
        such as the Conflict Avoidance Agreement, that are in place to 
        mitigate impacts. Amplifying information regarding the specific 
        types of vessels that this type of measure would apply to would 
        be very useful. There are instances in some locations where 
        Areas to be Avoided are established to provide a ``buffer 
        zone'' this wide, or even wider for certain types of vessels, 
        such as tank vessels carrying petroleum products. We request 
        clarification if your recommendation is intended to include all 
        destinational traffic, such as research vessels, or tugs/barges 
        delivering supplies to coastal villages. Please keep in mind 
        that most IMO approved ship routing measures are not mandatory, 
        and if overly cumbersome routing measures are adopted, there is 
        the possibility that vessels will elect not to participate.

     The Coast Guard does believe that there is a need for an enhanced 
        level of governance regarding the issues associated with 
        growing levels of marine traffic throughout Arctic waters. In 
        many other areas of the country, Harbor Safety Committees have 
        been established that bring together stakeholders from 
        industry, the Coast Guard, Ports, other government agency 
        representatives, and stakeholders that represent local 
        interests. This might be a future alternative that the AMMC 
        would like to consider and help establish. The Coast Guard 
        would be very willing to participate in a project of this 
        nature if initiated by the AMMC or other stakeholders.

  3.  Avoiding Marine Mammal Feeding Areas: The measures you list, 
        where vessels reduce speed and/or divert away from marine 
        mammals are part of the commonly accepted practices for 
        managing vessel interactions with these species. ``Takes'' of 
        marine mammals by vessels operating in U.S. territorial waters 
        under both the Endangered Species Act (ESA) and the Marine 
        Mammal Protection Act (MMPA) are liberally defined and include 
        vessel operations which disrupt feeding behavior patterns, so 
        laws and regulations are already in place to deal with vessels 
        that fail to take appropriate actions upon encountering 
        aggregations of or feeding marine mammals.

  4.  10 Knot Seasonal Speed Restrictions in the Anadyr and Bering 
        Straits: The Coast Guard understands the rationale for 
        additional protections during times when whale migrations 
        occur. We are also well aware that ship strikes are of 
        particular concern for the Bowhead Whale, based on many 
        conversations in which your members have imparted traditional 
        knowledge on the topic. Based on our conversations with our 
        headquarters staff who routinely work with the IMO, we believe 
        that an attempt to impose a vessel speed limit through an 
        international instrument will not likely be successful, as the 
        IMO does not recognize speed restrictions as an accepted ship 
        routing measure. In locations elsewhere in the country where 
        speed restrictions have been imposed, those regulations were 
        promulgated by NOAA's National Marine Fisheries Service, and 
        not the Coast Guard. We will continue to work with NOAA as our 
        PARS process continues and forward your comments to the 
        appropriate office here in Juneau. Please also keep in mind 
        that before any recommendations resulting from PARS are 
        forwarded to IMO, the recommendations will also undergo a 
        review under the National Environmental Policy Act which will 
        include consultations with NOAA and USFWS under both the MMPA 
        and Section 7 of the ESA.

  5.  Bering, Chukchi, and Beaufort Sea Discharge Zones: We have 
        submitted your letter to Coast Guard Headquarters for addition 
        to the docket for the Polar Code initiative. .

  6.  Vessel-Subsistence Hunter Communications: Regulations such as the 
        Bridge to Bridge Radiotelephone Act and communications 
        equipment carriage requirements promulgated under the Safety of 
        Life at Sea Convention (SOLAS) already ensure that nearly all 
        commercial vessels maintain and use VHF marine band radios in 
        order to facilitate safe vessel operations worldwide. While the 
        Coast Guard is not currently contemplating an IMO sanctioned 
        vessel reporting system as part of the PARS recommendation, we 
        do believe that a voluntary set of practices, such as ships 
        making ``Securite'' calls to announce their presence at defined 
        points along their route would go a long way toward ensuring 
        that anyone engaged in subsistence activity could remain aware 
        of commercial vessels in the area through use of a VHF radio. 
        Any additional input on specific locations where vessel 
        Securite calls would be most beneficial would be appreciated.

  7.  Automatic Identification System (AIS): The Coast Guard generally 
        supports deployment of AIS systems as they enhance navigation 
        safety and provide the agency with enhanced awareness of what 
        is occurring in our maritime domain. These systems cost money, 
        however, and at some point, a balance point is reached where 
        the cost/benefit of deploying these systems on smaller vessels 
        may not be warranted. At present, the Coast Guard intends to 
        require AIS on all commercial vessels greater than 65 feet in 
        length. This is not to say that smaller vessels would be 
        prohibited from installing AIS. On the contrary, we would 
        encourage voluntary use of AIS on all vessels operating in the 
        region. The question of who has access to the AIS information 
        can also be contentious. Your comments will also be included in 
        the docket for the Polar Code.

  8.  Bering Strait Subsistence Impact Fund: The Bering Strait is an 
        international strait, so there are limits to the jurisdiction 
        that can be exerted over foreign vessels that enjoy the rights 
        of freedom of navigation outside 12 nautical miles, and 
        innocent passage through the Bering Strait within 12 nautical 
        miles of the coast. Thus, development of a management authority 
        with jurisdiction over all vessel traffic in the Bering Strait 
        or mandating Subsistence Impact Fund contributions would be 
        problematic. Additionally, establishing this type of fund is 
        outside the Coast Guard's authority.

  9.  Emergency Response Training and Equipment Funding: Funding for 
        emergency response equipment and training is available to 
        Alaska communities through grants to local government entities 
        from the Alaska Division of Homeland Security and Emergency 
        Management, which manages certain grant funds as available from 
        the U.S. Department of Homeland Security, Federal Emergency 
        Management Agency. We recommend that you work with local 
        community governments regarding this opportunity. More 
        information can be found on the Alaska Division of Homeland 
        Security and Emergency Management Website at: http://
        ww.ready.alaska.gov.

10.  Alaska Marine Mammal Observers: While the Coast Guard does enforce 
        laws pertaining to marine mammal observers, typically on board 
        fishing vessels, new requirements for marine mammal observers 
        are not within the Coast Guards regulatory purview. Your 
        comments will be forwarded to NOAA's National Marine Fisheries 
        Service.

    As discussed above, I recognize that increased maritime activity in 
the Arctic may have an impact on residents of the Arctic region. I 
appreciate your candid acknowledgement that the Bering Strait PARS and 
development of the Polar Code will not fully address every concern. You 
may rest assured that your concerns about impacts to subsistence are 
heard and understood, and that where possible, the Coast Guard will 
work within our processes to protect subsistence activities to the 
extent that these two policy tools allow. In those areas where the 
Coast Guard's jurisdictional role or responsibility is not exclusive, 
we will work our partnerships with other agencies to stress the 
importance of subsistence activities as decisions are made.
    Please feel free to contact me regarding further issues, or my 
Tribal Liaison, Ms. Sudie Hargis. Additionally, Commander James Houck 
of my Waterways Management Branch is the Action Officer for the Bering 
Strait PARS. He is available to discuss this particular initiative in 
greater detail.
            Sincerely,
                                          Thomas P. Ostebo,
                                                      Rear Admiral,
                                                      U.S. Coast Guard.
    Copy: Alaska Eskimo Whaling Commission
    Alaska Beluga Whale Committee
    Eskimo Walrus Commission
    Alaska Nanuuq Commission
    Ice Seal Committee

    Senator Begich. Thank you very much. Thank you for your 
testimony. Thank all of you, all five of you, for your 
testimony.
    Let me start, if I can, Helen--I know, again, time 
restrictions on the VTC, so let me ask you a couple of quick 
questions. I'm going to note that you had mentioned on MTS 
services two things that were important, response services as 
well as information sharing. That's kind of one of the two 
priorities that you wanted to do. Keeping that in mind, under 
the sequestration, for all agencies that are being impacted, 
how does this or will this impact your ability to move forward 
in that arena, those specific issues? But also, will it impact 
other work you're trying to do around the Arctic analysis and 
information you are gathering?
    Ms. Brohl. Thank you, Mr. Chairman. Certainly, the 
limitation in funds has impacted the way in which you can 
address financial--for the entire national marine 
transportation system, as well as the Arctic MTS. In respect to 
MTS related to Federal agencies, they are addressing the ways 
in which they can make positive improvements under the limited 
funding.
    It is our hope that the CMTS report and the infrastructure 
investment work that we are doing under another integrated 
action team under the CMTS provides foundational information 
from which agencies or the White House can determine their 
priorities under the limited funding.
    Senator Begich. Let me ask you on the infrastructure, 
because we will have some additional questions here about 
infrastructure and ports, how--I know in Russia's case they are 
making some significant investments on the Northern Sea Route, 
establishing 10 rescue centers throughout the region. When you 
talk about the report and the work you are doing both with what 
we just talked about, the MTS, but also the other integrated 
agencies working together, do you see this as part of the need?
    I think Matt said it very clearly. It's not about 
necessarily one port or one super port. It's about kind of a 
sequence of resources available. Is that how DOT sees it, or 
can you give me a sense here? I know the report is still being 
worked on with other agencies, but give me your sense of how 
you see the infrastructure for the Arctic, not only from an oil 
and gas perspective but the shipping and other things that 
might be going on.
    Ms. Brohl. So, the CMTS is, obviously, interdepartmental, 
and while collectively we can make recommendations on 
priorities for infrastructure that we had mentioned, ultimately 
the individual departments must deal with it under their own 
prioritization and the normal Federal budget process.
    One of our goals in developing this report was really to 
collect all the information from all of the agencies and 
departments, all of the Federal policies, to have them in one 
spot in order to take that more holistic look, rather than just 
agency by agency. Ultimately, though, we hope that the White 
House work on a national strategy--excuse me--and Arctic 
strategy will help to reinforce those priorities from which a 
solid budget or a more holistic budget perhaps can be 
developed.
    Senator Begich. I know that----
    Ms. Brohl. I was going to say with regard to looking at 
what other nations are doing, we clearly looked through all the 
reports, the activities of the Arctic nations. It certainly 
informed our report by the basic information from which we 
determine what is the current and future trends for the Arctic. 
Certainly, we are aware of the infrastructure capabilities of, 
let's say, Russia with regard to icebreaking capabilities. But 
our report in particular is not an implementation plan. So we 
can't say exactly what percentage of dollars would go to the 
Arctic MTS, let alone the national MTS, as compared to 
individual priorities of respective agencies.
    We can tell you, though, that there is a real groundswell 
within the Federal Government to address this in a holistic 
manner. Our report has informed other Federal reports, 
including the Integrated Arctic Management Report that may have 
been mentioned by the Department of Interior. It's informing 
the strategic Arctic strategy being followed by the national 
security staff at the White House. It is complementary to the 
National Ocean Policy Implementation Plan.
    To get to your original point, there are restricted funds. 
There are lots of big issues to consider. We hope that our 
report provides enough basic information so that the powers 
that be can look at the whole, look at it as a system and 
prioritize accordingly.
    Senator Begich. So just to make sure I got this right, I 
know that Under Secretary Hayes is working on a broader Arctic 
policy for the White House and developing that through the 
Secretary's office and the Interior Department. Yours will feed 
into that to some degree, along with others, to develop this 
longer-range policy that will include infrastructure as a piece 
of it. Is that a fair statement?
    Ms. Brohl. Yes, sir.
    Senator Begich. Very good. Thank you very much.
    Let me move, if I can. Eleanor, thank you very much again 
for your recommendations in your written testimony. Give me a 
sense from your perspective as an NGO kind of looking and 
watching what is going on in the Arctic, do you think the 
relationship between the oil and gas industry and local 
communities has been adequate? And I will use Shell first, and 
that's the one that has kind of been on the ground the longest, 
I guess I would say. Others have been on the ground, but in 
Arctic development and engaging local communities. You think 
that's been adequate? Do you think there should be some 
standards that we need to implement in order to ensure that 
other companies do the same thing, or is that naturally 
happening because the pressures from local community groups 
really are putting the pressure on them? Tell me your sense of 
that.
    Ms. Huffines. Well, I can provide my sense, but I should 
say I obviously cannot speak for the communities of the 
hunters.
    Senator Begich. Don't worry, I'm going to ask Jack the same 
question.
    [Laughter.]
    Ms. Huffines. Right. I'll share my perspective----
    Senator Begich. If you answer wrong, Jack, I'll correct 
you.
    [Laughter.]
    Ms. Huffines. Jack, I hope you will correct me.
    I will share what I have learned from people and what they 
have shared with me. I think there are some positive steps. One 
of the challenges is that--one of the success stories has been 
the conflict avoidance agreement, but that is very specific to 
bowhead whales in the Beaufort. So I think that is a model that 
has been successful, and the whalers will tell you that there 
have been some positive changes from that.
    The difficulty is, as Jack mentioned, there are a great 
deal of very other important species for marine mammals, and 
for marine mammal subsistence hunters, and that doesn't get at 
the challenges of the migration through the Bering Strait and 
noise and cumulative effects. So I think there are models that 
have worked in isolated instances in isolated species, but 
looking more broadly at the cumulative effects of the traffic 
and more than one company in more than one sea, if you look at 
the Chukchi and the Beaufort and going through the Bering 
Strait, we have not yet been successful.
    I also say that every community is different, and so every 
community has different perspectives. Some people will say 
there has been success, and some people will say there hasn't 
been. So I would reference that additional species, cumulative 
effects, additional consultation is still needed.
    Senator Begich. Do you think what has been going on with 
the bowhead whale in the sense of the work with the whaling 
captains is a base model that can be used especially as we deal 
with shipping issues? Is that a model that might be utilized 
with shippers? And again, as an example of something that at 
least in the broader sense is working. There may be some fine-
tuning to be done.
    Ms. Huffines. Again, I would defer to Jack and the marine 
mammal co-management organizations. But I think as a model, it 
has at least produced some good mitigation measures. It hasn't 
addressed the broader issue of where in the ocean are 
subsistence areas, areas to be avoided in the broader context. 
That model addresses mitigation. It doesn't address the broader 
context of some places for resting and feeding critical habitat 
where there is no activity. So I think you need to do both 
mitigation and protection of some areas.
    Senator Begich. And I think I know the answer to this, so 
I'm just going to say it, and I think I know your answer, and 
that is thank you for mentioning S. 272. But I think on all 
research, a continual known funding stream is what is critical, 
because without it--this is kind of a statement. I think your 
acknowledgement will be yes, but without it you have these ups 
and downs in research. So you might set a pattern, have some 
money for it, and then 2 years later, through whatever act of 
Congress, we delete it, and now that research gets interrupted, 
which is really, when you are trying to do this long-term 
research on habitat, it's a longer-term view, not a 1-year plan 
or a 2-year plan. It's multi-year. So is that how you see it? I 
just want to make sure I'm on the same path.
    Ms. Huffines. No, I totally agree. I think one of the 
challenges, as the scientists will tell you, and they talked 
about this in the National Academy research project last week, 
is that in the Arctic in particular, there are varying seasons 
in varying years. So you really need a long-term monitoring, 
cumulative effects approach to really be successful in managing 
the resource.
    Senator Begich. That's one of your four points, correct?
    Ms. Huffines. Yes.
    Senator Begich. Yes. OK, good. Let me, if I can, I will 
move to Jack, and after I'm done I'll go to Matt.
    Jack, I want to follow up on that. Give me your 
perspective. I think your comments--and you had some good 
recommendations, and I think that's what triggered my thinking 
on this. My sense from your comments is that there is some 
activity going on with the whaling captains, but when you talk 
about the shipping corridor, there's not as much going on there 
with the shippers, and that's a glaring gap. Is that a fair 
statement?
    Mr. Omelak. Yes. Thank you, Senator. That's true. One of 
the things I wrote down here, it's relatively easy to sit up 
here and talk about things that are going wrong. It's much more 
difficult to provide solutions, but I'll give it a shot.
    [Laughter.]
    Senator Begich. Please come to Washington for a little 
while.
    [Laughter.]
    Mr. Omelak. Anyway, so we agree. There are other agencies 
who have taken the lead on this, and I think the reason why we 
decided to form this marine mammal coalition and model it sort 
of after the relationship that the AWC has is, as co-management 
agencies, we are sort of bound to this limited perspective of 
Federal and international resource management.
    So take, for instance, the Alaska Commission says we are 
concerned about increased shipping, development and its impacts 
on other things, and the Department of the Interior says that's 
something for the Department of Commerce. We take our issues to 
the Department of Commerce, and they say that's something for 
the Department of Interior.
    Senator Begich. I feel your pain.
    [Laughter.]
    Mr. Omelak. So we think this is an opportunity for the 
marine mammal coalition to address these broader impacts. The 
reason why this is so difficult is there are so many elements 
of society wrapped up into this international shipping. We 
haven't just got elements of culture, but economics as well, 
international relationships.
    So in this marine mammal coalition, we understand how key 
it is in these changing times that Federal and international 
agencies need to speak with groups that sort of are unified, 
because we can't reach everybody. So the messages--we're trying 
to break out of our rigid resource management strategies and 
address these broader issues. So we are going to follow the 
lead with the AWC. I hope I've answered your question.
    Senator Begich. You just made me think of something. I 
know, Helen, I told you I wouldn't ask you another question, 
but I'm wondering is your group connected with the U.S. 
committee on the marine transportation system that Helen is 
part of? Helen, do tap into this group at all, this new 
organization that has kind of been formed?
    Ms. Brohl. No, sir. We do not currently. We probably would 
tap through our member agencies such as NOAA or Department of 
Interior agencies. But I've made a note of it, including some 
of the other recommendations today. We are doing some strategic 
planning overall for the marine transportation system, and this 
is certainly information that I'll take back to those members.
    Senator Begich. That's good. I was trying to make a 
connection here, because it seems that you have done something, 
Jack, that is very unique in a way to bring all these different 
organizations together. I know from our office, we deal with 
them individually. They come in, and one group has one view, 
and one has another view, and having them in a coordinated 
effort, especially around the shipping issue, I think is going 
to be very beneficial for us as we move forward on marine 
transportation through the Bering Sea, as well as connected to 
the Arctic in the broader sense, the Beaufort and Chukchi. So I 
am very impressed with the group.
    I didn't mean to interrupt you, but you were about to say 
something additional.
    Mr. Omelak. I think there are two key points that I should 
mention. One, the Arctic marine mammal coalition was just 
formally established after ratification through our own 
agencies in December.
    Senator Begich. OK, so very new.
    Mr. Omelak. We did produce this document of September.
    And then second, we have begun the process--I think we've 
been working with the Coast Guard here.
    Senator Begich. Excellent. You can count on our ability and 
whatever we can do to help. I'm glad you've done this from the 
longer viewpoint.
    Because of time, Matt, let me ask you, I appreciate your 
comment regarding the idea of let's not make--I can't remember 
the exact words, but kind of a legislative fix versus pour it 
all into one port and hope it all works out. I think what I 
heard and gathered from your testimony is Port Clarence is one 
piece of the equation, but not the answer only by itself. But 
there is a sequence of ports that will ensure our ability to 
better manage the Bering Sea, and also, to be frank with you, 
to attract business to our shores rather than to the shores of 
Russia and elsewhere. Is that a fair statement?
    Mr. Ganley. Fair statement. I think there are a lot of 
environmental drivers there, too. The Strait itself, the ice-
free period is a bit longer, so it makes sense for something to 
be there. And then, of course, with the drilling in the Chukchi 
and Beaufort, we have to have facilities and infrastructure 
there for response and safety.
    Senator Begich. And if you can give me just a quick update, 
how is your--I know we attempted toward the end of the last 
session, trying to move forward on a land swap and arrangement 
with the Coast Guard and others. Can you give me a sense? Is 
that moving forward?
    Mr. Ganley. Yes. What we're doing now is we are in a 
discussion phase with the Coast Guard. We have opened up formal 
discussions. The concern, of course, is budget, with everybody. 
But the concern also is what is the mission of the Coast Guard 
in the future, and I think the Admiral touched on that today. 
He does see this increasing presence with oil exploration or 
without it, because of the shipping. So they need to be--I 
really don't want to speak for the Coast Guard, but I think the 
need there is to assure some footprint there. So we are 
discussing----
    Senator Begich. How to accomplish both.
    Mr. Ganley.--how to accomplish both. And from our 
standpoint at Bering Straits, safety is a huge issue. Response 
is a huge issue. There really isn't anything there now, and 
unless that land is brought in, into play in some way, and the 
only really expedient way to do that is conveyance of Bering 
Straits at this point in time, because we don't know what the 
budget is going to bring for other developments there.
    Senator Begich. Let me ask you, and you might have caught 
my comments to the legislature regarding port development, and 
we introduced a piece of legislation to put together an Arctic 
port development strategy with loan guarantees up to $3 billion 
worth, because we think the need is multifaceted in the Arctic 
and we can't just throw nickels and dimes at it and hope it all 
works out at the end of the day. We have to be robust about it.
    I challenged the state legislature, which, of course, I'm 
sure they were excited to hear from me on this, that they need 
to put some money on the table, and I suggested upwards of $2 
billion, because when you do these port developments, it's a 
combination of private sector money, equity, some free capital, 
grants, and reasonable-cost loans. Is that a fair statement of 
how we could manage this?
    I don't know how we build this network without some larger 
state participation. I know some legislators thought they were 
doing a lot with the last bond they did, and I supported the 
bond, but it seemed to be small in the big picture of what we 
need to do here, not just for the Bering Sea but all the other 
port activity throughout Alaska that is developing. These are 
not small projects.
    Mr. Ganley. No, these are not small projects. But I think 
the point needs to be made too here with Bering Straits' 
involvement, is that in discussions we thought, OK, as part of 
the ANCSA selection, this is going to be an important site. I 
think the elders, many of them that are gone now, knew this in 
the 1970s.
    Senator Begich. The elders had a lot of wisdom that we 
should have paid attention to.
    Mr. Ganley. I think if the property had been released 
longer ago by the Coast Guard, if it was in Bering Straits' 
hands at this point in time, there would be something occurring 
there now.
    Senator Begich. Some development would be happening.
    Mr. Ganley. There is enough interest on the part of 
industry to have the safeguards in place and have staging 
areas, and have lay-down yards. I think public funding, 
private-public partnerships, equity, these are all really--I 
mean, they are important long-range, but I think there is 
enough momentum here with what's going on in the Arctic. As I 
said about a year ago, industry moves quite a bit faster than 
government.
    Senator Begich. Even this building, one of the buildings in 
the UA campus----
    Mr. Ganley. Yes, and we are pursuing this. We think it is 
in the interest of the region and the Nation. And the shipping, 
I think we are in the same position as the Coast Guard. 
Regardless of oil development, the shipping is going to 
increase. We need to get things in place there that are going 
to be some economic advantages for the region. The region needs 
industry of some type, but also provide a safety net for what 
is occurring there as far as commerce goes.
    Senator Begich. Very good. Before I ask Ed, I have one 
quick question for you.
    Helen, your clock is about to expire, because I saw a one-
minute thing come up in front of us, and I want to just thank 
you in advance for being here. Thank you for participating. We 
will have probably some additional questions for you for the 
record.
    There we go. She was disconnected. I tried my best to be 
quick, but I have Senate-itis, which means everything is 
longer.
    [Laughter.]
    Senator Begich. But I thank her.
    Ed, last question for you. So you think with the Bering 
Straits, there needs to be now a Bering Straits vessel traffic 
control center?
    Mr. Page. I don't think----
    Senator Begich. That was a pretty broad, sweeping question, 
but do you think you have the capacity where you are and some 
tweaks need to be added to it?
    Mr. Page. The traditional vessel traffic center or vessel 
traffic monitoring centers or whatever around the country--
Houston, Los Angeles, San Francisco, what have you--it's much 
more engaged, talking to mariners back and forth, have radar 
coverage. And for much more active ports, L.A. Long Beach, have 
100,000 transits a year, versus maybe 1,000 here.
    But the fortunate thing is that technology moved so quickly 
over the last several years that some of the things I talked 
about as far as keeping aircraft from hitting ships in Kodiak, 
or sending automatic e-mails to the Park Service when a cruise 
ship exceeds the speed limit for a whale-protected area, which 
never happens now because it's like having a ticket issued the 
moment you do it at a traffic light or something like that.
    This technology of having alerts and alarms go off, and 
then through AIS can send a message back immediately through 
the program and say you are outside of the traffic lane, 
request advise, something along that nature, would have a 
dramatic positive impact on ensuring maritime traffic comports 
with whatever standards of care or traffic schemes or ATBAs and 
other risk reduction measures and environmental protection 
measures, all those. We have a higher level of compliance 
through technology than you ever could beforehand.
    Senator Begich. Let me say for all of you on this panel, I 
have to say that each one of you gave recommendations which, 
I've done a lot of different hearings, and sometimes you get 
the testimony, but it never leads, and then they say good luck. 
So I want to thank you all because you did give some very 
specific recommendations on technology, how to change some of 
the ways we operate; Helen, some of your ideas, and Eleanor, 
some of yours. Helen being online I think was important, 
because hearing this aspect of what we're talking about on a 
local level is important for us to deliver back to D.C. So I 
thank you all for your recommendations.
    Jack, let me say that, again, I want to echo, thank you for 
putting your organization together. It is helpful on many 
levels, from a policymaker, I can tell you from NGO's, from 
agencies to private sector, to know that there is a place and a 
point that you can go to that attempts to represent--I don't 
want to say always because I know how that goes. It's like 
telling the fishing community everyone speaks with one voice. 
That doesn't happen. As the Chair of this subcommittee, knowing 
that, of fisheries.
    But I want to thank you for doing that, and we look forward 
to your progression in that, and anything we can do to assist, 
we will be happy to do that.
    Thank you all very much. I appreciate the time, and we are 
adjourned. The record will be open for two more weeks for 
additional questions and comments.
    [Whereupon, at 12:03 p.m., the hearing was adjourned.]
                            A P P E N D I X

          Prepared Statement of Christopher M. Reddy, Ph.D., 
                  Woods Hole Oceanographic Institution
    Chairman Begich and Members of the Subcommittee:

    I am submitting this statement for the record to provide the 
Subcommittee with additional information regarding challenges 
associated with petroleum spills in Arctic waters. This statement 
reflects my personal professional views and does not represent those of 
the Woods Hole Oceanographic Institution.
    I am a Senior Scientist in the Department of Marine Chemistry and 
Geochemistry at the Woods Hole Oceanographic Institution in Woods Hole, 
Massachusetts. I principally investigate marine pollution and have 
published more than 125 peer-reviewed scientific journal articles and 
several book chapters on the chemistry of oil, how it interacts with 
the natural environment, and related subjects. I have studied or am 
studying the aftermaths of oil spills that occurred in 1969, 1974, 
1996, 2003, and two in 2007, as well as natural oil seeps off the coast 
of Santa Barbara, California, and for most of the last three years, the 
Deepwater Horizon oil spill. I am also investigating samples of 
sediments contaminated from the Exxon Valdez spill and leaking oil from 
a Japanese warship that sank in 1945.
Overlooked Factors
    Drilling for oil in the Arctic poses many challenges and a high 
probability for oil spills. We need to frame oil spills much like 
buying a house: It's ``location, location, location.'' The Arctic is a 
pristine, fertile, remote region that, if oiled, will be difficult and 
expensive to rescue and remediate. The volume released in a spill is 
only one factor in determining potential impacts. One must also include 
coastal geology, the organisms living within and outside the water 
column, water temperatures, and type of products spilled.
    Let me shine a spotlight on the latter two factors, which are often 
overlooked. First, let's consider temperature. After spills, a 
significant amount of the product evaporates. This is generally 
considered a good thing because it mitigates negative impacts. However, 
in colder temperatures, as in the Arctic, hydrocarbons floating on oil 
films will evaporate more slowly, allowing them to persist longer in 
the environment. In addition, each individual hydrocarbon has unique 
properties that drive how and whether it will evaporate or dissolve. I 
have calculated that colder air and water temperatures create the 
conditions for more oil to stay in the water, where it can damage and 
kill wildlife, rather than evaporate.
    Second, let's consider different types of products. Many people 
focus only on crude oil spills, such as the Exxon Valdez, during the 
recovery and transport of the product. But in the initial stages of 
exploration, I am more concerned about spills with diesel fuel, which 
drilling rigs, supply vessels, crew boats, cargo boats use for 
propulsion and machinery. Of course with reduced ice coverage, there 
will be an increase in commercial and cruise ship traffic.
    The volumes are not trivial; drilling rigs can carry as many as one 
million gallons. Smaller vessels carry closer to 50,000 to 500,000 
gallons. As the industry gets under way in the Arctic, high ship 
traffic poses high risk of diesel fuel spills and that risk will 
continue during operations. Only a few months ago, the Shell Alaska oil 
rig, the Kulluk, offered an example. On its way to Sitkalidak Island, 
it lost power and was dangerously close to running aground while 
carrying 150 thousand gallons of fuel and oil. Similarly, commercial 
and cruise ships can carry 500 thousand and 2 million gallons of fuel.
    Compared with the 13 million and 160 million gallons of crude oil 
released by the Exxon Valdez or Deepwater Horizon, respectively, some 
would discount spills of 50,000 to one million gallons of diesel fuel 
as trivial. This is a misinformed view. Here is why.
    My laboratory has studied three diesel fuel spills. The first 
occurred in 1969 when the barge Florida ran aground in Buzzards Bay, 
Massachusetts, causing a massive kill of fish, worms, crustaceans, and 
mollusks within a few days. Marsh grasses died in weeks. Because the 
spill happened in September, local residents referred to this disaster 
as ``Silent Autumn.'' In addition to these short-term effects, it took 
five to seven years for marsh grasses to begin to regrow after this 
spill. Forty years later, the effects of this spill persist, as crabs, 
grasses, and mussels are significantly impaired by residual diesel at 
the site of the spill, relative to non-oiled marshes in the bay.
    Another diesel fuel spill in 1974 several miles from the above 
spill resulted in massive erosion of the coastline due to the loss of 
marsh grasses and oil still detectable today. It is noteworthy that 
conventional wisdom, at the time of both of these spills, argued that 
the oil would be gone in days.
    The third diesel fuel spill is more recent: the barge North Cape, 
which ran aground off the coast of Rhode Island in 1996, in a confined 
coastal area with features similar to the Alaskan coastline. This spill 
caused the deaths of 10 million lobsters, 2,000 birds, and 20 million 
surf clams and the closure of 200 square miles of shellfishing beds for 
as long as five months.
    Crude oils spills are visually obvious but the very nature of this 
product allows it to be tracked and cleaned up more easily than diesel 
fuel. Crude oil can be boomed and skimmed, and crude oil-covered 
objects along shorelines can be removed. Diesel fuel, in contrast, is 
less viscous and harder to contain and recover. Once in the water, 
diesel fuel hydrocarbons are taken up by plants and animals and 
insinuated into ecosystems. Toxicity is always difficult to define, but 
in short, pound-for-pound, diesel fuel is significantly more lethal 
than crude oil with the potential to leave behind longer-lasting 
damage.
    Prior to Deepwater Horizon, oil spill research had taken a back 
seat to other priorities such as homeland security and climate change 
science. To some degree, it also has been a victim of its own success. 
Lessons learned and knowledge gained from the devastating Exxon Valdez 
spill--along with passage of the Oil Pollution Act of 1990 (OPA 90), 
which provides a wide framework for diminishing the chances of spills 
and assessing damages and restoring the environment after a spill--have 
led to a significantly decreased numbers of spills. For example, before 
Deepwater Horizon, the annual number of oil spills greater than 5,000 
gallons documented by the U.S. Coast Guard between 1991 to 2004 
decreased from 55 to 14, with none more than 1 million gallons.
    However, those lessons and that research did not prepare us for new 
and different potential problems of drilling in new and different 
areas, such as deep water. Research on the Deepwater Horizon, already 
done and to be done with BP settlement funds, will provide new 
knowledge and new mitigation strategies. But not all of that knowledge 
is transferrable to the Arctic. If we are to press ahead with drilling 
in the Arctic, as we did in deep water in the Gulf of Mexico, we should 
do our research before, not after, the fact. I recommend a greater 
sustained effort on Arctic research--starting with something as 
straightforward and basic as how spilled diesel fuel behaves in cold 
waters; where information is limited and based on spills in lower 
latitudes and warmer climes.
    Basic understanding of the chemical and physical behavior of 
spilled oils, from diesel fuel to crude and in warm and cold 
conditions, is critical to developing measures to combat spills. 
Laboratory experiments have their place, but it is more accurate to 
reproduce real-world conditions. Hence, I recommend that controlled 
spills be performed as the best means to understand how oil behaves in 
the Arctic. This has been a significant hurdle due to several polices, 
but if handled properly like several European countries, offers 
critical information for making the most well informed decisions and 
assessing damages post spill.
    I appreciate the opportunity to share my views with the 
Subcommittee and am available to discuss my recommendation or provide 
additional input upon request.
                                 ______
                                 
                           Alaska Eskimo Whaling Commission
                                   Eskimo Walrus Commission
                              Alaska Beluga Whale Committee
                                   Alaska Nanuuq Commission
                                         Ice Seal Committee

                                                 September 20, 2012

           Docket Numbers USCG-2012-0720 and USCG-2010-0833

Dear Sir or Madam:

    The undersigned federally-recognized and tribally authorized 
organizations: the Alaska Eskimo Whaling Commission, Alaska Beluga 
Whale Committee, Eskimo Walrus Commission, Ice Seal Committee, and 
Alaska Nanuuq (Polar Bear) Commission want to address the expected 
impacts of increased shipping traffic in the Arctic on our way of life 
and subsistence activities. Each of our organizations carries out co-
management responsibilities under the Marine Mammal Protection Act for 
our subject species pursuant to management agreements with Federal 
regulatory agencies.
    Our groups have come together to form a coalition (the Arctic 
Marine Mammal Coalition) to address shipping impacts with one voice. We 
have concluded that, unless effectively managed, increasing ship 
traffic in the northern Bering Sea, Bering Strait, Chukchi Sea, and 
Beaufort Sea (collectively ``Arctic waters'') has the very real 
potential to have significant adverse affects on marine mammals and 
subsistence activities which are vital to the health, safety, food 
security, and vitality of our communities.
    The Arctic waters are important foraging and breeding habitat for 
the marine mammals that have sustained the Yup'ik, St. Lawrence Island 
Yupik, and Inupiat cultures of the region for at least 2,000 years. 
While some of the species are hunted year-round, spring and summer 
hunting of northward migrating marine mammals has always been a 
particularly critical component of the food security, and continued 
survival, for the communities of the Bering Strait region and the 
Chukchi and Beaufort Seas. Bowhead whales, beluga whales, walruses, ice 
seals, and polar bears are all hunted during the spring and early 
summer. Late summer and fall hunting of migrating bowhead whales has 
also long been essential to the Beaufort Sea villages. Sea ice changes 
in recent decades have altered many of these subsistence practices, 
leading to the emergence of fall and winter bowhead whale hunting along 
the Chukchi Sea coast and at St. Lawrence Island in the Bering Sea. 
However, the importance of the subsistence practices themselves remains 
undeniable. Currently, during much of each.year, hunting vessels and 
marine mammals ply waters being increasingly used by large ocean-going 
vessels. Based on our long-standing and irreplaceable dependence on 
whales, walruses, seals, and polar bears, our primary concern is that 
increasing shipping traffic will reduce the availability of these 
animals, which continue to nurture the long-term health of our 
communities. Through the mitigation measures we suggest in this letter, 
we urge you to help us ensure that we do not bear the burden of risk 
from these new economic activities.
    In addition, we are concerned about the threat to human life posed 
by large vessels steaming through our traditional hunting areas, where 
we hunt in small, open boats that are not easily visible and lack radar 
or other safety devices. The frequency and close proximity of large 
vessels to small hunting boats increases the probability of a 
collision. Such a collision would almost certainly result in serious 
injuries or loss of life for the hunters. These unforgiving conditions 
in which we already operate out of necessity to find food demand that 
the U.S. Government support mandatory measures to ensure that the 
increase in vessel traffic in Arctic waters does not adversely affect 
our subsistence activities. As the Coast Guard is aware, these 
subsistence activities, and the marine mammals on which they depend, 
are protected under Federal law. 16 U.S.C. 1361 et seq.
    Our organizations support the ongoing efforts that the U.S. 
Government is participating in at the International Maritime 
Organization (IMO) to adopt a mandatory Polar Code, as well as the 
preliminary steps regarding vessel navigation being taken by the Coast 
Guard in beginning the Bering Strait Port Access Routing Study 
(BSPARS). We also support the Coast Guard's continuing dialog with the 
Russian Federation on these matters, and hope that the United States 
will continue to press the Russian Federation to adopt reciprocal 
measures to protect shared marine mammals and subsistence hunting 
throughout the region. In addition, our communities appreciate the U.S. 
leadership role in the IMO's adoption of a circular providing guidance 
on avoiding ship strikes on cetaceans (MEPC.1-Circ 674). We would like 
to see each of these efforts expanded to include mandatory measures to 
protect subsistence activities and resources in Arctic waters.
    In moving forward, we are fortunate to be able to draw on at least 
two prior experiences. In the North Atlantic, coordinated efforts among 
a wide array of stakeholders, government agencies, and the IMO greatly 
reduced the impacts on marine mammals from shipping. These efforts 
should be used to inform actions in the Bering Strait where there is 
the critical additional need of protecting the safety of subsistence 
hunters and their food security. The Alaska Eskimo Whaling Commission's 
(AEWC) twenty-seven years of experience working with the offshore oil 
and gas industry to successfully mitigate industrial threats to 
subsistence hunting for bowhead whales is similarly valuable. This 
experience culminated in the Conflict Avoidance Agreement (CAA), an 
important multi-use management process that has led to the industry-
funded annual practice of negotiating an agreement between oil and gas 
operators and the AEWC that allows subsistence whalers and offshore oil 
and gas developers to share Arctic waters. Successful traffic 
management provisions of the CAA have been adapted for use here and are 
set forth below.
    At the upcoming meeting of the IMO's Marine Environmental 
Protection Committee (MEPC), it is our understanding that environmental 
issues like voyage planning, underwater noise, marine mammal impacts, 
vessel discharges (both air and water), invasive species, and pollution 
response will all be considered. We are all agreed that environmental 
issues should be part of the mandatory Polar Code, and would like to 
see the U.S. Government advocate that MEPC support inclusion of 
mandatory provisions to address these environmental issues. In doing so 
it is important to note that changes in the environment affect 
subsistence resource distribution and thus our hunting practices, and 
also that changes in industry operations (for example an increase in 
traffic compared to prior years) can result in new or different 
measures being needed to protect subsistence hunters, so the U.S. 
Government should seek to include in the Polar Code, and any mandatory 
navigation measures, mechanisms to ensure regular consultation (ideally 
annual) between the U.S. Coast Guard and subsistence hunters to allow 
for adjustments to the measures when needed.
    We request that the U.S. Government support an ongoing dialogue to 
continually identify emerging issues related to shipping in an already 
rapidly changing environment, and the following specific 
recommendations regarding mitigation measures that should be made 
mandatory immediately:

  (1)  due to the presence of large number of marine mammals of several 
        species and subsistence hunting crews during spring and fall 
        migration, we recommend that international vessels should 
        transit to the east of St. Lawrence Island and at least 10 
        miles offshore during the migration;

  (2)  during periods of open water, vessels should transit at least 
        thirty five miles offshore in the Chukchi Sea and Beaufort Sea 
        to avoid the open-lead system and near-shore hunting;

  (3)  when operating in the presence of feeding whales, walrus, seals 
        and polar bears; and aggregations of these same species, 
        vessels should reduce speed to less than 10 knots and/or divert 
        away from the animals.

  (4)  all vessels transiting the Anadyr Strait and Bering Strait 
        should do so at no more than 10 knots from 1 April to 10 July 
        and 1 October to 1 December each year;

  (5)  The Bering, Chukchi, and Beaufort Seas should be zero discharge 
        zones;

  (6)  the Coast Guard should establish a communications scheme to 
        ensure that vessels transiting the area have a means of 
        communicating with subsistence hunters;

  (7)  all vessels greater than 30 feet should be required to carry and 
        report using an Automated Information System (AIS);

  (8)  all vessels transiting the Bering Strait should be required to 
        contribute to a fund, managed by this coalition, to support 
        ongoing efforts to assess and mitigate adverse impacts from 
        vessel transits upon subsistence;

  (9)  funding for emergency response training and equipment should be 
        provided to coastal communities to supplement search and rescue 
        or accident response capability in the Arctic; and

 (10)  Alaska marine mammal observers should be on all transiting 
        vessels greater than 30 feet in the region between Kaktovik and 
        St. Lawrence Island.

    We recognize that the IMO's and Coast Guard's guidance for the 
Polar Code and BSPARS, respectively, are primarily focused on vessel 
and personnel safety. Neither policy tool fully encompasses the 
environmental or cultural needs that are necessary to ensure continued 
health of our villages. Consequently, we urge the U.S. Government to 
conduct and respond to a gap analysis, in consultation with our 
coalition, of key issues raised during these discussions that fall 
outside of the Polar Code or BSPARS, but could be addressed under 
alternate policy tools, such as through a Particularly Sensitive Sea 
Area designation.
    We appreciate your patience while we worked to develop the 
necessary structure and organization in which to address these new 
challenges in our ancestral home. As noted above, each of our 
respective organizations has a cooperative agreement with Federal 
agencies regarding management of specific subsistence resources; these 
cooperative agreements include a consultation mechanism. Given the 
critical importance to our communities of the issues created by 
increased arctic shipping, we would like to engage, through this 
coalition, in an ongoing consultative process with the Coast Guard on 
these matters.
            Respectfully,
            
            
                                  
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