[House Report 106-377]
[From the U.S. Government Publishing Office]



106th Congress                                            Rept. 106-377
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 2

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



 
          METHANE HYDRATE RESEARCH AND DEVELOPMENT ACT OF 1999

                                _______
                                

October 18, 1999.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______


  Mr. Young of Alaska, from the Committee on Resources, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 1753]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Resources, to whom was referred the bill 
(H.R. 1753) to promote the research, identification, 
assessment, exploration, and development of methane hydrate 
resources, and for other purposes, having considered the same, 
report favorably thereon with an amendment and recommend that 
the bill as amended do pass.
    The amendment is as follows:
    Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Methane Hydrate Research and 
Development Act of 1999''.

SEC. 2. DEFINITIONS.

  In this Act:
          (1) Contract.--The term ``contract'' means a procurement 
        contract within the meaning of section 6303 of title 31, United 
        States Code.
          (2) Cooperative agreement.--The term ``cooperative 
        agreement'' means a cooperative agreement within the meaning of 
        section 6305 of title 31, United States Code.
          (3) Director.--The term ``Director'' means the Director of 
        the National Science Foundation.
          (4) Grant.--The term ``grant'' means a grant awarded under a 
        grant agreement, within the meaning of section 6304 of title 
        31, United States Code.
          (5) Institution of higher education.--The term ``institution 
        of higher education'' means an institution of higher education, 
        within the meaning of section 1201(a) of the Higher Education 
        Act of 1965 (20 U.S.C. 1141(a)).
          (6) Methane hydrate.--The term ``methane hydrate'' means a 
        methane clathrate that--
                  (A) is in the form of a methane-water ice-like 
                crystalline material; and
                  (B) is stable and occurs naturally in deep-ocean and 
                permafrost areas.
          (7) Secretary.--The term ``Secretary'' means the Secretary of 
        Energy, acting through the Assistant Secretary for Fossil 
        Energy.
          (8) Secretary of commerce.--The term ``Secretary of 
        Commerce'' means the Secretary of Commerce, acting through the 
        Administrator of the National Oceanic and Atmospheric 
        Administration.
          (9) Secretary of defense.--The term ``Secretary of Defense'' 
        means the Secretary of Defense, acting through the Secretary of 
        the Navy.
          (10) Secretary of the interior.--The term ``Secretary of the 
        Interior'' means the Secretary of the Interior, acting through 
        the Director of the United States Geological Survey and the 
        Director of the Minerals Management Service.

SEC. 3. METHANE HYDRATE RESEARCH AND DEVELOPMENT PROGRAM.

  (a) In General.--
          (1) Commencement of program.--Not later than 180 days after 
        the date of enactment of this Act, the Secretary, in 
        consultation with the Secretary of Commerce, the Secretary of 
        Defense, the Secretary of the Interior, and the Director, shall 
        commence a program of methane hydrate research and development.
          (2) Designations.--The Secretary, the Secretary of Commerce, 
        the Secretary of Defense, the Secretary of the Interior, and 
        the Director shall designate individuals to carry out this 
        section.
          (3) Meetings.--The individuals designated under paragraph (2) 
        shall meet not later than 120 days after the date on which all 
        such individuals are designated and not less frequently than 
        every 120 days thereafter to--
                  (A) review the progress of the program under 
                paragraph (1); and
                  (B) make recommendations on future activities to 
                occur subsequent to the meeting.
  (b) Grants, Contracts, Cooperative Agreements, Interagency Funds 
Transfer Agreements, and Field Work Proposals.--
          (1) Assistance and coordination.--The Secretary may award 
        grants or contracts to, or enter into cooperative agreements 
        with, institutions of higher education and industrial 
        enterprises to--
                  (A) conduct basic and applied research to identify, 
                explore, assess, and develop methane hydrate as a 
                source of energy;
                  (B) assist in developing technologies required for 
                efficient and environmentally sound development of 
                methane hydrate resources;
                  (C) undertake research programs to provide safe means 
                of transport and storage of methane produced from 
                methane hydrates;
                  (D) promote education and training in methane hydrate 
                resource research and resource development;
                  (E) conduct basic and applied research to assess and 
                mitigate the environmental impacts of hydrate degassing 
                (including both natural degassing and degassing 
                associated with commercial development); and
                  (F) develop technologies to reduce the risks of 
                drilling through methane hydrates.
          (2) Competitive merit-based review.--Funds made available 
        under paragraph (1) shall be made available based on a 
        competitive merit-based process.
  (c) Consultation.--The Secretary shall establish an advisory panel 
consisting of experts from industry, institutions of higher education, 
and Federal agencies to--
          (1) advise the Secretary on potential applications of methane 
        hydrate;
          (2) assist in developing recommendations and priorities for 
        the methane hydrate research and development program carried 
        out under subsection (a)(1); and
          (3) report to the Congress within 2 years after the date of 
        the enactment of this Act, or at such later date as the 
        Secretary considers advisable, on the impact on global climate 
        change from methane hydrate extraction and consumption.
  (d) Limitations.--
          (1) Administrative expenses.--Not more than 5 percent of the 
        amount made available to carry out this section for a fiscal 
        year may be used by the Secretary for expenses associated with 
        the administration of the program carried out under subsection 
        (a)(1).
          (2) Construction costs.--None of the funds made available to 
        carry out this section may be used for the construction of a 
        new building or the acquisition, expansion, remodeling, or 
        alteration of an existing building (including site grading and 
        improvement and architect fees).
  (e) Responsibilities of the Secretary.--In carrying out subsection 
(b)(1), the Secretary shall--
          (1) facilitate and develop partnerships among government, 
        industry, and institutions of higher education to research, 
        identify, assess, and explore methane hydrate resources;
          (2) undertake programs to develop basic information necessary 
        for promoting long-term interest in methane hydrate resources 
        as an energy source;
          (3) ensure that the data and information developed through 
        the program are accessible and widely disseminated as needed 
        and appropriate;
          (4) promote cooperation among agencies that are developing 
        technologies that may hold promise for methane hydrate resource 
        development; and
          (5) report annually to Congress on accomplishments under this 
        section.

SEC. 4. AMENDMENTS TO THE MINING AND MINERALS POLICY ACT OF 1970.

  Section 201 of the Mining and Minerals Policy Act of 1970 (30 U.S.C. 
1901) is amended--
          (1) in paragraph (6)--
                  (A) in subparagraph (F), by striking ``and'' at the 
                end;
                  (B) by redesignating subparagraph (G) as subparagraph 
                (H); and
                  (C) by inserting after subparagraph (F) the 
                following:
                  ``(G) for purposes of this section and sections 202 
                through 205 only, methane hydrate; and'';
          (2) by redesignating paragraph (7) as paragraph (8); and
          (3) by inserting after paragraph (6) the following:
          ``(7) The term `methane hydrate' means a methane clathrate 
        that--
                  ``(A) is in the form of a methane-water ice-like 
                crystalline material; and
                  ``(B) is stable and occurs naturally in deep-ocean 
                and permafrost areas.''.

SEC. 5. AUTHORIZATION OF APPROPRIATIONS.

  There are authorized to be appropriated to the Secretary of Energy to 
carry out this Act--
          (1) $5,000,000 for fiscal year 2000;
          (2) $11,000,000 for fiscal year 2001;
          (3) $11,000,000 for fiscal year 2002;
          (4) $12,000,000 for fiscal year 2003; and
          (5) $12,000,000 for fiscal year 2004.
Amounts authorized under this section shall remain available until 
expended.

SEC. 6. SUNSET.

  Section 3 of this Act shall cease to be effective after the end of 
fiscal year 2004.

                          Purpose of the Bill

    The purpose of H.R. 1753 is to promote the research, 
identification, assessment, exploration and development of 
methane hydrate resources.

                  Background and Need for Legislation

    Methane hydrates are a temperature- and pressure-sensitive 
chemical mixture of water and methane gas that can exist as a 
stable, crystalline (ice) form above the normal freezing point 
of water. Other gases, such as propane, are also found in 
hydrate form, but the predominant gas is usually methane. The 
hydrate chemical structure is conducive to the storage of large 
volumes of gas. A single unit of hydrate, when heated and 
depressurized, can release up to 160 times its volume in gas.
    Sediments under the pressure of hundreds of meters of water 
in the oceanic continental shelf of the United States are 
thought to contain significant deposits of methane hydrates. 
Significant hydrate deposits have also been identified at 
shallower depths in the permafrost areas of the Alaskan North 
Slope. The cold climate in this region allows hydrates to 
remain stable at depths as shallow as 200 meters. The hydrate-
bearing sediments in both permafrost and coastal areas may be 
several hundred meters thick. In addition to the solid-
crystalline hydrate deposits, free methane gas is often 
encountered below sediments containing hydrates because the 
hydrate layers can act as a geologic trap for the gas. Natural, 
catastrophic release of hydrates has been implicated by 
scientists as leading to regional instability of the sea floor, 
resulting in large-scale submarine landslides and slumps. The 
sudden, large-scale degassing of hydrates related to these 
events could also release vast amounts of methane into the 
oceans and atmosphere. Methane is considered to be ten times 
more potent than carbon dioxide as a greenhouse gas; thus, 
large releases could potentially contribute to climate change.
    Preliminary estimates of U.S. methane hydrate resources in 
1997 using information from the Ocean Drilling Program suggest 
reserves of approximately 200,000 trillion cubic feet of gas, 
which is over a hundred times greater than the estimated 1,400 
trillion cubic feet of conventional gas resources.
    H.R. 1753 is intended to stimulate research and development 
efforts of the federal government in partnership with industry 
and academia to shorten the time frame in which methane 
hydrates are expected to contribute directly to our domestic 
energy supply. Furthermore, the benefits of such research and 
development efforts will very likely be first applied in 
technology enhancements for conventional petroleum exploration 
and production, i.e., reduction of hazards which methane 
hydrates represent today to outer continental shelf oil and gas 
operators who may penetrate gas hydrate zones in the course of 
drilling deeper targets. Thus, the Committee believes the 
expenditures authorized in this bill will be repaid to the 
Nation in the form of increased energy independence through 
utilization of this special form of the ``fuel of the future.''

                            Committee Action

    H.R. 1753 was introduced on May 11, 1999, by Congressman 
Michael Doyle (D-PA). The bill was referred to the Committee on 
Science, and additionally to the Committee on Resources. Within 
the Committee on Resources, the bill was referred to the 
Subcommittee on Energy and Mineral Resources. On May 25, 1999, 
the Subcommittee held a hearing on the bill. Mr. Doyle 
testified in support of the bill and the potential for methane 
hydrates to contribute to the Nation's future energy needs. The 
Principal Deputy Assistant Secretary for Fossil Energy, Mr. 
Robert Kripowitz, and Dr. Timothy Collet from the United States 
Geological Survey testified for the Administration in strong 
support of the bill. Other witnesses included representatives 
from the National Science Foundation, and the Directors of the 
three Marine Minerals Research Institutes.
    On June 17, 1999, the Full Resources Committee met to 
consider the bill. The Subcommittee on Energy and Mineral 
Resources was discharged from further consideration of the bill 
was unanimous consent. Congresswoman Barbara Cubin (R-WY) 
offered an en-bloc amendment to add the Secretary of Commerce, 
acting through the Director of the National Oceanographic and 
Atmospheric Administration, in a consultative role, as well as 
add the Minerals Management Service to the section defining the 
Secretary of the Interior's consultative role with the 
Secretary of Energy. The latter provision more directly 
incorporates the involvement of the Marine Minerals Research 
Institutes. The amendment also required the Secretary of Energy 
to establish an advisory committee of experts from industry, 
academia and federal agencies. Lastly, the amendment revised 
the authorization for appropriations in the bill to coincide 
with the most recent recommendations of the President's Council 
of Advisors on Science and Technology. The amendment was 
adopted by a voice vote. Congressman Jay Inslee (D-WA) offered 
an amendment to direct the Secretary of Energy to report to 
Congress within one year on the effect of methane hydrate 
production on global climate change. Mrs. Cubin offered an 
amendment to the Inslee amendment to extend the time for the 
report to two years. The Cubin amendment was adopted by voice 
vote and the Inslee amendment, as amended, was adopted by voice 
vote. The bill as amended was then ordered favorably reported 
to the House of Representatives by voice vote.

                      Section-by-Section Analysis


Section 1. Short title

    Section 1 is the short title of the bill.

Section 2. Definitions

    Section 2 defines nine terms as used in the bill.

Section 3. Methane hydrate research and development program

    Section 3 outlines the development of the methane hydrate 
research and development program; provides for the awarding of 
grants, contracts, cooperative agreements, interagency funds 
transferagreements, and field work proposals; limits the amount 
of administrative funds to 5 percent of the amount to carry out the 
section, and prohibits the use of funds for building costs.

Section 4. Amendments to the Mining and Minerals Policy Act

    Section 4 amends the Mining and Minerals Policy Act of 1970 
to provide that the Marine Minerals Research Institutes may 
legitimately be funded to perform gas hydrates studies by 
defining methane hydrates as a ``mineral.''

Section 5. Authorization of appropriations

    Section 5 authorizes federal appropriations for methane 
hydrate research at increasing levels from $5 million in fiscal 
year 2000 to $12 million in fiscal year 2004. These authorized 
levels are consistent with the levels recommended by the 
President's Council of Advisors on Science and Technology 
through 2003. The $12 million authorized for 2004 is a 
projected level consistent with the level for 2003.

            Committee Oversight Findings and Recommendations

    Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII of the Rules of the House of Representatives, the 
Committee on Resources' oversight findings and recommendations 
are reflected in the body of this report.

                   Constitutional Authority Statement

    Article I, section 8 and Article IV, section 3 of the 
Constitution of the United States grant Congress the authority 
to enact this bill.

                  Federal Advisory Committee Statement

    The functions of the proposed advisory committee authorized 
by this bill are not currently being nor could they be 
performed by one or more agencies, an advisory group already in 
existence or by enlarging the mandate of an existing advisory 
committee.

                    Compliance With House Rule XIII

    1. Cost of Legislation.--Clause 3(d)(2) of rule XIII of the 
Rules of the House of Representatives requires an estimate and 
a comparison by the Committee of the costs which would be 
incurred in carrying out this bill. However, clause 3(d)(3)(B) 
of that rule provides that this requirement does not apply when 
the Committee has included in its report a timely submitted 
cost estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 402 of the 
Congressional Budget Act of 1974.
    2. Congressional Budget Act.--As required by clause 3(c)(2) 
of rule XIII of the Rules of the House of Representatives and 
section 308(a) of the Congressional Budget Act of 1974, this 
bill does not contain any new budget authority, spending 
authority, credit authority, or an increase or decrease in 
revenues or tax expenditures.
    3. Government Reform Oversight Findings.--Under clause 
3(c)(4) of rule XIII of the Rules of the House of 
Representatives, the Committee has received no report of 
oversight findings and recommendations from the Committee on 
Government Reform on this bill.
    4. Congressional Budget Office Cost Estimate.--Under clause 
3(c)(3) of rule XIII of the Rules of the House of 
Representatives and section 403 of the Congressional Budget Act 
of 1974, the Committee has received the following cost estimate 
for this bill from the Director of the Congressional Budget 
Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, July 9, 1999.
Hon. Don Young,
Chairman, Committee on Resources,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1753, the Methane 
Hydrate Research and Development Act of 1999.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Kathleen 
Gramp.
            Sincerely,
                                          Barry B. Anderson
                                    (For Dan L. Crippen, Director).
    Enclosure.

H.R. 1753--Methane Hydrate Research and Development Act of 1999

    Summary: H.R. 1753 would authorize appropriations for a new 
research and development program at the Department of Energy 
(DOE) on the use of methane hydrate as a source of energy. DOE 
would administer the program through grants, contracts, and 
cooperative agreements with universities and industrial 
enterprises. Deposits of methane hydrate occur in deep ocean 
and permafrost areas of the world and consist of methane-water 
ice-like crystalline material.
    CBO estimates that appropriating the specified amounts 
would increase discretionary spending by $41 million over the 
next five years. H.R. 1753 would not affect direct spending or 
receipts; therefore, pay-as-you-go procedures would not apply. 
The bill contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would not impose costs on state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 1753 is shown in the following table. 
For purposes of this estimate, CBO assumes that H.R. 1753 will 
be enacted before the end of fiscal year 1999, that the 
authorized amounts will be appropriated for each year, and that 
outlays will occur at the rate observed for similar existing 
programs. The costs of this legislation fall within budget 
fucntion 270 (energy).

----------------------------------------------------------------------------------------------------------------
                                                                       By fiscal year, in millions of dollars--
                                                                    --------------------------------------------
                                                                       2000     2001     2002     2003     2004
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION

Authorization level................................................        5       11       11       12       12
Estimated outlays..................................................        2        6       10       11       12
----------------------------------------------------------------------------------------------------------------

    Pay-as-you-go considerations: None.
    Intergovernmental and private-sector impact: H.R. 1753 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would not impose any costs on state, local, 
or tribal governments. State universities might benefit from 
research grants, contracts, or cooperative agreements provided 
through this bill.
    Previous CBO estimate: On March 9, 1999, CBO tarnsmitted a 
cost estimate for S. 330, the Methane Hydrate Research and 
development Act of 1999, as ordered reported by the Senate 
Committee on Energy and Natural Resources on March 4, 1999. 
Differences in the estimates are attributable to differences 
between the two bills. The Senate bill would authorize such 
sums as may be necessary for the program, which CBO estimated 
would total about $45 million over the next five years. H.R. 
1753 would specify authorizations totaling $41 million for 
these activities over the 2000-2004 period.
    Estimate prepared by: Kathleen Gramp.
    Estimate aproved by: Robert A. Sunshine, Deputy Assistant 
Director for Budget Analysis.

                    Compliance With Public Law 104-4

    This bill contains no unfunded mandates.

                Preemption of State, Local or Tribal Law

    This bill is not intended to preempt any State, local or 
tribal law.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

       SECTION 201 OF THE MINING AND MINERALS POLICY ACT OF 1970


SEC. 201. DEFINITIONS.

  In this title:
          (1)  * * *

           *       *       *       *       *       *       *

          (6) The term ``marine mineral resource'' means--
                  (A)  * * *

           *       *       *       *       *       *       *

                  (F) metal sulfides; [and]
                  (G) for purposes of this section and sections 
                202 through 205 only, methane hydrate; and
                  [(G)] (H) other marine resources that are 
                not--
                          (i) oil and gas;
                          (ii) fisheries; or
                          (iii) marine mammals.
          (7) The term ``methane hydrate'' means a methane 
        clathrate that--
                  (A) is in the form of a methane-water ice-
                like crystalline material; and
                  (B) is stable and occurs naturally in deep-
                ocean and permafrost areas.
          [(7)] (8) The term ``Secretary'' means the Secretary 
        of the Interior.

                                  
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