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Hearing of the Senate Energy and Natural Resources Committee Subject: Impacts of Climate Change on Energy Infrastructure

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Location: Washington D.C.

BREAK IN TRANSCRIPT

SEN. MARY LANDRIEU (D-LA): I would just like to welcome Ted who's just been a tremendous advocate for not only the expansion of Port Fourchon and energy infrastructure to bring to this nation the oil and gas resources that we need to keep this economy moving. But I think he's been a great advocate for the restoration of the coast and I thank you, Ted and look forward to your testimony.

I also want to say to Dr. Burkett, it's wonderful to see you, Virginia. She served our state so well in the capacity of secretary of Wildlife and Fisheries and is now serving the nation in a broader capacity. So I want to welcome both witnesses with Louisiana roots.

MS. BURKETT: Thank you

BREAK IN TRANSCRIPT

SEN. LANDRIEU: Thank you. I'd like to start with just showing some graphs if I could, some charts that I think might put some of this in perspective. If you could hold up the -- this is the toe of the boot, I guess -- if Louisiana is shaped like a boot, this is the toe of the boot, and just to orient the committee members, this is Port Fourchon. Tom, if you could point to that. That's Port Fourchon right there. Now it's just a spit of land, I guess, 100 miles or so down that bayou. The bayou's about 100 miles Ted right from La Fourche, but you can see that -- I mean it's a -- you can't see the road there but the Highway 1 starts there and goes all the way up. Actually, does the highway already run to Canada, all the way up? We don't know. We think it might go all the way up through the country.

MR. FALGOUT: It's called the longest street in the world.

SEN. LANDRIEU: Yeah. And -- but it starts there. It's two lanes and it basically sits at sea level now. We have been trying to get the federal government and the state of Louisiana to recognize the significance of this particular road to connect Port Fourchon which 20 percent or 25 percent of the energy of the country comes through. If this small little port is shut down, it has huge impacts as has been outlined. And Mr. Chairman, for the life of me, I can't understand how the country can invest in, you know, the Big Dig in Boston and other -- you know, in projects and not realize that lifting this particular road, either with general fund dollars, which is one option. But, the other option that we've provided, which makes a lot of sense is using a portion of the taxes generated by the industry that uses this port -- not additional taxes, but the revenues, which is what revenue-sharing was all about.

The other thing that this graph shows is, the red it the potential or real land loss that's occurring. We are -- have a project, Tom, if you'd point to Morganza, to the Gulf, to protect some of this infrastructure. This is Houma right here. We're trying to get a levee built right here. And we have now several lawsuits pending and some problems with -- although the Congress has taken action to build this levee, we've been trying to get this done for 40 years, and it's just one thing after another.

Now, I want to put up the next poster to show you where the infrastructure is because -- the next one, not this one. Well, actually, no this one's the right one -- I wish I could do this talking into the mike. But the "Rs" are where the refineries are. And you'll notice the big refineries are not on the coast, they're up because they know to move away from the coast for protection. So they're not on the beach is what I'm trying to explain. We don't build refineries on the beach, but we're building them where they need to be. The Mississippi River is that blue line -- blue squirly line. They have to be where with a source of water. You have to be by a source of water to build a refinery. So the industry is doing a pretty good job of siting their refineries where they need to be.

The little "Fs" are little infrastructure that is defined as, sort of, other petrochemical infrastructure. But as you can see, this is the infrastructure necessary to move oil and gas. These are pipelines. They only exist beneath Louisiana, Texas and Mississippi. This -- there's nothing like this off the coast of Florida or in the west or on the East Coast or on the West Coast. This is the infrastructure that is laid down. Now we have two choices. We can protect this or we can move it. Both are expensive, but I'd suggest protecting it is less expensive than moving it because, first, there's no other place in the country you can move it to. And the resources are here. And if you put wind out in the -- if you put wind out in the west, you're going to have to have an infrastructure grid that sort of looks like the Caesar pipelines, and in facilities that can transport -- generate and transport the energy.

I want to show you what this supports. This infrastructure supports this distribution system in the country. This is the gas distribution system for the nation, and it basically comes out of Louisiana. So that infrastructure that I just showed you supports the distribution of gas that comes all around, and the only other trunk even close to the trunk that we have, as you can see from Canada, is a large amount of gas coming from Canada. The other part of this comes from here.

And so, I just want to conclude not by a question, but just by saying, Mr. Chairman, when Doctor Burkett, who studied this her whole life, says that between Mobile and Galveston, we're predicting a two- to four-foot sea rise basically because of subsidence of our land and, of course, the rising temperature of the water, that this is truly an emergency right now. And that is why Senator Sessions and others of us are trying to lead this effort on America's energy coast to explain that it's not just for the people of Alabama, Mississippi and Louisiana that this is a problem for, it's a problem for the whole country.

So, in conclusion, spending a little bit of money to build levies, to raise these highways, to do smart siting of these facilities is going to save us billions of dollars in the long run. And we believe that we're generating the funding right now to do that, which is what revenue-sharing and coastal impact assistance was all about. In my final minute, I'd just like to add a word or two.

MR. FALGOUT: I guess a logical question would be, why not move Port Fourchon further inland where the refineries are and not have to protect the coast? That is not what Port Fourchon does. Port Fourchon is the intermodal hub where everything changes mode of transportation. And that has to be on the Gulf of Mexico for the most efficient transportation that's out there. If you move Port Fourchon inland 30 or 40 miles, that means 270 large vessels a day that go to this port, bringing these widgets and gadgets back, have to do this 30 or 40 mile stretch further inland, burning more fossil fuels, causing more erosion, doing huge environmental impact. We have to sustain a place on the Gulf of Mexico to do this transfer, and this is your best option.

BREAK IN TRANSCRIPT

SEN. LANDRIEU: Thank you. I'd like to start with just showing some graphs if I could, some charts that I think might put some of this in perspective. If you could hold up the -- this is the toe of the boot, I guess -- if Louisiana is shaped like a boot, this is the toe of the boot, and just to orient the committee members, this is Port Fourchon. Tom, if you could point to that. That's Port Fourchon right there. Now it's just a spit of land, I guess, 100 miles or so down that bayou. The bayou's about 100 miles Ted right from La Fourche, but you can see that -- I mean it's a -- you can't see the road there but the Highway 1 starts there and goes all the way up. Actually, does the highway already run to Canada, all the way up? We don't know. We think it might go all the way up through the country.

MR. FALGOUT: It's called the longest street in the world.

SEN. LANDRIEU: Yeah. And -- but it starts there. It's two lanes and it basically sits at sea level now. We have been trying to get the federal government and the state of Louisiana to recognize the significance of this particular road to connect Port Fourchon which 20 percent or 25 percent of the energy of the country comes through. If this small little port is shut down, it has huge impacts as has been outlined. And Mr. Chairman, for the life of me, I can't understand how the country can invest in, you know, the Big Dig in Boston and other -- you know, in projects and not realize that lifting this particular road, either with general fund dollars, which is one option. But, the other option that we've provided, which makes a lot of sense is using a portion of the taxes generated by the industry that uses this port -- not additional taxes, but the revenues, which is what revenue-sharing was all about.

The other thing that this graph shows is, the red it the potential or real land loss that's occurring. We are -- have a project, Tom, if you'd point to Morganza, to the Gulf, to protect some of this infrastructure. This is Houma right here. We're trying to get a levee built right here. And we have now several lawsuits pending and some problems with -- although the Congress has taken action to build this levee, we've been trying to get this done for 40 years, and it's just one thing after another.

Now, I want to put up the next poster to show you where the infrastructure is because -- the next one, not this one. Well, actually, no this one's the right one -- I wish I could do this talking into the mike. But the "Rs" are where the refineries are. And you'll notice the big refineries are not on the coast, they're up because they know to move away from the coast for protection. So they're not on the beach is what I'm trying to explain. We don't build refineries on the beach, but we're building them where they need to be. The Mississippi River is that blue line -- blue squirly line. They have to be where with a source of water. You have to be by a source of water to build a refinery. So the industry is doing a pretty good job of siting their refineries where they need to be.

The little "Fs" are little infrastructure that is defined as, sort of, other petrochemical infrastructure. But as you can see, this is the infrastructure necessary to move oil and gas. These are pipelines. They only exist beneath Louisiana, Texas and Mississippi. This -- there's nothing like this off the coast of Florida or in the west or on the East Coast or on the West Coast. This is the infrastructure that is laid down. Now we have two choices. We can protect this or we can move it. Both are expensive, but I'd suggest protecting it is less expensive than moving it because, first, there's no other place in the country you can move it to. And the resources are here. And if you put wind out in the -- if you put wind out in the west, you're going to have to have an infrastructure grid that sort of looks like the Caesar pipelines, and in facilities that can transport -- generate and transport the energy.

I want to show you what this supports. This infrastructure supports this distribution system in the country. This is the gas distribution system for the nation, and it basically comes out of Louisiana. So that infrastructure that I just showed you supports the distribution of gas that comes all around, and the only other trunk even close to the trunk that we have, as you can see from Canada, is a large amount of gas coming from Canada. The other part of this comes from here.

And so, I just want to conclude not by a question, but just by saying, Mr. Chairman, when Doctor Burkett, who studied this her whole life, says that between Mobile and Galveston, we're predicting a two- to four-foot sea rise basically because of subsidence of our land and, of course, the rising temperature of the water, that this is truly an emergency right now. And that is why Senator Sessions and others of us are trying to lead this effort on America's energy coast to explain that it's not just for the people of Alabama, Mississippi and Louisiana that this is a problem for, it's a problem for the whole country.

So, in conclusion, spending a little bit of money to build levies, to raise these highways, to do smart siting of these facilities is going to save us billions of dollars in the long run. And we believe that we're generating the funding right now to do that, which is what revenue-sharing and coastal impact assistance was all about. In my final minute, I'd just like to add a word or two.

BREAK IN TRANSCRIPT

SEN. LANDRIEU: Thank you. I'd like to start with just showing some graphs if I could, some charts that I think might put some of this in perspective. If you could hold up the -- this is the toe of the boot, I guess -- if Louisiana is shaped like a boot, this is the toe of the boot, and just to orient the committee members, this is Port Fourchon. Tom, if you could point to that. That's Port Fourchon right there. Now it's just a spit of land, I guess, 100 miles or so down that bayou. The bayou's about 100 miles Ted right from La Fourche, but you can see that -- I mean it's a -- you can't see the road there but the Highway 1 starts there and goes all the way up. Actually, does the highway already run to Canada, all the way up? We don't know. We think it might go all the way up through the country.

MR. FALGOUT: It's called the longest street in the world.

SEN. LANDRIEU: Yeah. And -- but it starts there. It's two lanes and it basically sits at sea level now. We have been trying to get the federal government and the state of Louisiana to recognize the significance of this particular road to connect Port Fourchon which 20 percent or 25 percent of the energy of the country comes through. If this small little port is shut down, it has huge impacts as has been outlined. And Mr. Chairman, for the life of me, I can't understand how the country can invest in, you know, the Big Dig in Boston and other -- you know, in projects and not realize that lifting this particular road, either with general fund dollars, which is one option. But, the other option that we've provided, which makes a lot of sense is using a portion of the taxes generated by the industry that uses this port -- not additional taxes, but the revenues, which is what revenue-sharing was all about.

The other thing that this graph shows is, the red it the potential or real land loss that's occurring. We are -- have a project, Tom, if you'd point to Morganza, to the Gulf, to protect some of this infrastructure. This is Houma right here. We're trying to get a levee built right here. And we have now several lawsuits pending and some problems with -- although the Congress has taken action to build this levee, we've been trying to get this done for 40 years, and it's just one thing after another.

Now, I want to put up the next poster to show you where the infrastructure is because -- the next one, not this one. Well, actually, no this one's the right one -- I wish I could do this talking into the mike. But the "Rs" are where the refineries are. And you'll notice the big refineries are not on the coast, they're up because they know to move away from the coast for protection. So they're not on the beach is what I'm trying to explain. We don't build refineries on the beach, but we're building them where they need to be. The Mississippi River is that blue line -- blue squirly line. They have to be where with a source of water. You have to be by a source of water to build a refinery. So the industry is doing a pretty good job of siting their refineries where they need to be.

The little "Fs" are little infrastructure that is defined as, sort of, other petrochemical infrastructure. But as you can see, this is the infrastructure necessary to move oil and gas. These are pipelines. They only exist beneath Louisiana, Texas and Mississippi. This -- there's nothing like this off the coast of Florida or in the west or on the East Coast or on the West Coast. This is the infrastructure that is laid down. Now we have two choices. We can protect this or we can move it. Both are expensive, but I'd suggest protecting it is less expensive than moving it because, first, there's no other place in the country you can move it to. And the resources are here. And if you put wind out in the -- if you put wind out in the west, you're going to have to have an infrastructure grid that sort of looks like the Caesar pipelines, and in facilities that can transport -- generate and transport the energy.

I want to show you what this supports. This infrastructure supports this distribution system in the country. This is the gas distribution system for the nation, and it basically comes out of Louisiana. So that infrastructure that I just showed you supports the distribution of gas that comes all around, and the only other trunk even close to the trunk that we have, as you can see from Canada, is a large amount of gas coming from Canada. The other part of this comes from here.

And so, I just want to conclude not by a question, but just by saying, Mr. Chairman, when Doctor Burkett, who studied this her whole life, says that between Mobile and Galveston, we're predicting a two- to four-foot sea rise basically because of subsidence of our land and, of course, the rising temperature of the water, that this is truly an emergency right now. And that is why Senator Sessions and others of us are trying to lead this effort on America's energy coast to explain that it's not just for the people of Alabama, Mississippi and Louisiana that this is a problem for, it's a problem for the whole country.

So, in conclusion, spending a little bit of money to build levies, to raise these highways, to do smart siting of these facilities is going to save us billions of dollars in the long run. And we believe that we're generating the funding right now to do that, which is what revenue-sharing and coastal impact assistance was all about. In my final minute, I'd just like to add a word or two.

BREAK IN TRANSCRIPT

SEN. LANDRIEU: And we're going to wrap up with this. I wanted to ask one final question, Miss Edgar.

This -- watching the destruction of Katrina and Rita on the electricity grid -- you talked about that in your testimony -- it occurred to me that we, after every storm season, put those poles back up, try to cut the trees a little more, and every season they go down again and everybody's electricity goes off. Is there any better way to do that? Are burying these lines possible, both from a cost effective manner -- and what do other countries do with their electricity grid distribution that are either in high wind areas or high storm areas?

MS. EDGAR: Senator, thank you for the question. One of the things that we have tried to do is look at the different geographical variations across our state, and certainly, undergrounding in some areas does make sense. It is, as we realize, often more expensive, but trying to look at those long-term community benefits and trying to assess where those costs and benefits will be is one of the things that our state has been looking at. We have made some regulatory changes to try to make undergrounding more cost effective where, indeed, it does look like it would have long-term benefits.

SEN. LANDRIEU: Okay. Is there anything anyone wants to add on the panel that you don't feel -- Mr. Drevna?

MR. DREVNA: Senator, if you don't mind, I'd just like to respond to your -- again, to your earlier comment about the, you know, the infrastructure, where we should get the money from. I think it's, you know -- I mean, with some trepidation I bring this up, but what the heck. You know, there's been a lot about oil industry profits these days, and if -- I don't think the American public knows, and maybe a lot of us in this room don't know, that one company who has made $40 billion last year, their taxes were 60 billion (dollars). So they paid more in taxes than profits, and they still employed high-paying jobs that had ripple effects on all towns across the country, as did the whole industry. So I think there's there's -- there's a story to be told there that, you know, there -- are the resources available out there to fix the problems. Absolutely. It's just the direction of where those resources go. And I applaud you and I urge you to continue to fight to get those resources where they belong.

SEN. LANDRIEU: Okay. Thank you very much. I want to thank the staff for putting a good hearing together, and thank all of our panelists. The meeting's adjourned. (Strikes gavel.)


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