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Bill addresses Alaska shallow gas issues House Bill 395 takes away DNR’s authority to override municipal land-use laws for coalbed methane development Larry Persily Petroleum News Government Affairs Editor
Regislation introduced in the Alaska House looks to address many of the concerns raised by Kenai Peninsula and Matanuska-Susitna Borough residents fearful of potential coalbed methane development in their neighborhoods.
“We got together and said, ‘What are the problems we need to solve,’” said Homer Rep. Paul Seaton. “We tried to address all of the problems without swinging the pendulum too far back.”
House Bill 395 would go back and repeal a provision adopted by the Legislature last year that gave the Department of Natural Resources — in cases of coalbed methane development — the authority to override municipal land-use laws.
“To my mind, it was a real sea change,” said Seaton, who voted last session against final passage of the measure, House Bill 69.
In addition to ensuring local control, this year’s eight-page bill would allow the state to regulate drilling to protect underground water sources, increase public notice requirements of leases, set up a public forum process for resolving residents’ complaints and set rental payments to property owners for use of their land by shallow gas developers. Sponsors don’t want to hurt development The bill’s four co-sponsors are not against development of Alaska’s coalbed methane reserves, but rather want to cure “real problems” without ruining what could be a source of natural gas for residential and commercial users throughout Southcentral Alaska, said Seaton, a Republican.
Republican Reps. John Harris of Valdez, Bill Stoltze of Chugiak and Carl Gatto of Palmer are the other co-sponsors of House Bill 395. Stoltze and Gatto, like Seaton, are freshmen legislators. Harris is co-chairman of the House Finance Committee.
This year’s measure was introduced Jan. 23 and referred to four committees for hearings and possible amendments: Oil and Gas, Resources, Judiciary and Finance. No hearings were scheduled as of Jan. 28.
Alaskans have spent the past six months asking a lot of questions about water quality, developer access to their property and potential damages to their property from drilling for coalbed methane — ever since residents realized last summer that the state had leased more than 250,000 acres near Homer and throughout the Matanuska-Susitna Borough for coalbed methane exploration. Land access a real issue Many residents were surprised to learn that although they owned the surface rights to their land, the state owned the subsurface rights and had leased the property to companies exploring for shallow gas.
“It was important to all of us that the message sent by our constituents concerning public property rights and water quality were addressed in this bill,” said Harris, who along with Gatto and Stoltze co-sponsored last year’s House Bill 69 that led to much of the controversy.
In addition to repealing the Department of Natural Resources’ Division of Oil and Gas authority to override municipal land-use laws, the bill proposes:
• Allowing the Alaska Oil and Gas Conservation Commission to regulate shallow gas drilling to protect water quality by requiring the re-injection of coal seam dewatering flow to depths below any known sources of drinking water or wells used for farming.
• Calling on the commission to set up a public forum process for resolving complaints about health, safety and environmental issues at exploration and development sites. The bill also would require the agency to set up a procedure whereby residents could petition the commission to act on a complaint if the public forum process fails to settle the issue.
• Requiring the Department of Natural Resources to publish notices of shallow gas lease applications in at least two newspapers in the lease area over a two-week period, with notices also going to each municipality and community council in the area. Much of the criticism of the Kenai Peninsula leases near Homer came after the department failed to publish a notice of lease applications in either Homer newspaper.
• Requiring additional notices in at least two newspapers in the area before the department may issue a coalbed methane lease.
• Setting the rental payment to property owners at $300 per month for each wellhead and $600 a month for each compressor station on their land. Existing statute does not specify how much rent, if any, developers must pay property owners for installing equipment on their property.
• Requiring property line setbacks for compressor station installations, and requiring developers to take “reasonable and appropriate measures” to reduce compressor noise. In addition to requiring that property owners and developers negotiate setbacks and noise reduction efforts, the bill also says property owners may not “unreasonably withhold” their agreement.
• Requiring developers in some cases to prove to the state that access to private land is “reasonably necessary or convenient” to reach the lease area.
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