PERMIAN BASIN PETROLEUM MUSEUM HOSTS NATURAL RESOURCES PUBLIC HEARING
MIDLAND - The Texas Senate Natural Resources Committee held a public hearing Wednesday, April 19, 2000 at the Permian Basin Museum in Midland. The committee is traveling the state to hear from the public on various areas of study issued by Lt. Governor Rick Perry. Upon conclusion of the hearings, all the information will be available in a report. The report will be used to create legislation to be considered by the 77th Legislature, which convenes in January of 2001.
Member of the committee include Senators J.E.'Buster' Brown of Lake Jackson serving as chair, Ken Armbrister of Victoria serving as vice-chair, Gonzalo Barrientos of Austin, Teel Bivins of Amarillo, Tom Haywood of Wichita Falls, Eddie Lucio Jr. of Brownsville, and Bill Ratliff of Mount Pleasant.
The public hearing began with welcoming remarks from Dr. Tulsi Dyal Singh, President of the Board of Trustees for the Permian Basin Museum. Midland County Judge William C. (Bill) Morrow addressed the committee, thanking the members for their interest in the Midland area.
The first topic discussed was the future of the Texas oil and gas industry. Texas Railroad Commissioner Charles Matthews gave a visual presentation on natural gas production and the amounts needed by the electric utility industry. Matthews testified that Texas has large natural gas reserves in the ground and a shortage in storage above ground. Another problem facing Texas is a shortage of qualified workers during a period of increasing demand for natural gas. Matthews wants legislation to ensure that Texas is able to fully participate in the opportunities available in the area of natural gas.
John Hurstell testified representing Entergy. He discussed the growing demand for natural gas and stated that the increase is related to the demand for electricity. Hurstell expects an oversupply in many regions due to the number of energy-efficient plants coming on-line replacing the older less efficient plants. Hurstell said power sector demand is a primary driver to current price pressure but an economic downturn could result in a significant reduction in demand for natural gas.
Mike Green, representing TXU (formerly known as Texas Utilities), testified about the new power plants and the natural gas pipelines. Green testified that eighteen new Independent Petroleum Producers (IPPs), with almost 15,000 megawatts of capacity are planned for North Texas, needing up to 2.5 bcf (billion cubic feet) of pipeline capacity.
Clayton Williams testified about the plugging of wells. Williams urged the committee to be very cautious about requiring these wells to be plugged.
Jack Rathbone, Executive Vice-President of Operations for Titan Exploration, testified about the future of the oil and gas industry and the impact on the Permian Basin. Rathbone said the oil industry is in a major state of change, with global and regional competitors. He says there is reason for optimism since the world needs more oil and gas. Rathbone testified there are still opportunities for regional players. The Permian Basin has regional advantages and the demand will increase the need for workers, capital, and technology.
Dr. Vince Matthews, Director of the Center for Energy and Economic Diversification (CEED) testified about local issues relating to the oil and gas industry. Dr. Matthews used a visual presentation showing the geographic location of the Permian Basin, which extends through much of West Texas and into southeastern New Mexico. Dr. Matthews testified that the Permian Basin area still has a long way to go to recover from low oil prices; the area has fundamentally changed, there are more independents.
Morris Burns, representing the Permian Basin Petroleum Association, testified that the Permian Basin produces 10% of all the oil produced in the United States. Burns thanked the committee for passing the oil severance tax relief legislation during the last legislative session. Burns also discussed water use by the oil and gas industry; he said that his industry uses only 1% of the fresh water used in Texas for flushing the wells.
Public testimony on the future of Texas' oil and gas industry was heard from Dario Chapa, State Director of LULAC (League of United Latin American Citizens). Chapa testified that his group was concerned about the impact the oil and gas industry has on public university funding and jobs. Other public testimony was taken from Kirk Edwards, and Bob Landreth, an independent oil and gas operator.
The committee then began hearing about Texas' groundwater resources. The first invited witness to testify was Scott Carlson of the Metropolitan Water Company. Harvey Everheart testified representing Mesa Underground Water Conservation District. Everheart gave a visual presentation about groundwater management problems. Areas of concern included the definition of small wells, livestock wells, and hydrocarbon water sales.
Scott Holland testified representing Irion County Water Conservation District. Allan Lange, General Manager of Lipan-Kickapoo Water Conservation District testified. Lee Arrington testified representing the South Plains Underground Water Conservation District. Arrington asked the committee to support local control.
Public testimony regarding Texas' groundwater resources was heard from Bob Steakley, a beef producer in Ector County. Steakley testified the importance of maintaining clean drinking water for future Texans. Other testimony was heard from Bill Ivington of Sierra Blanca.
Public testimony about the storage and disposal options for low-level radioactive waste was heard from Bill Clayton representing Envirocare. Envirocare wants to locate a low-level radioactive waste facility in West Texas. Testimony was heard against the Envirocare facility location from Kathy Fausett of Ward County, Francis Sage representing the Big Bend Sierra Club, Kay Rankin of Monahans, and Laura Burnette of Ward County. Clark Lindley of Pecos spoke about the facility and which agency would oversee the permitting process. Lindley expressed his desire that only one facility be permitted to ensure that West Texas not become a radioactive dump area. Donald Howell of Ward County also testified against locating the facility in his county. Howell talked about the instability of the underground formations in West Texas and the harshness of weather. He does not believe the proposed structure will withstand the weather.
Michael Woodward testified representing Waste Control Specialists. Woodward's group operates the disposal site in Andrews County. Karen Keeves of the Amarillo area testified against locating a low-level radioactive waste storage facility in West Texas. Keeves discussed the long half-life of the elements involved in nuclear production and waste, and the epidemic that could be created with the misplacement of one atom. Jose Osuna of Pyote testified about the devaluation of real estate near a nuclear waste facility. Julie Everett of Crane County testified about the ability of local governments in dealing with problems relating to the nuclear waste. Everett feels that local authorities are not prepared to deal with problems involved with transportation issues and weather related problems. Senator Brown advised the witness that as part of the compact agreement, funds must go to local governments for training and emergency efforts.
The committee plans to hold another hearing in Dallas on April 20, 2000.