>> these are big planes with bombs and the open of the cargo door and they just throw them out. if they were aiming for you in poverty be the safest place you could be.

but what it does is it creates this environment of fear. every time you hear the sound of those engines, it takes about five minutes for them to get there and they circle. every time you are the sound everyone runs and runs to the hills. it creates fear to keep them from doing anything, really, their ability to do anything. they are there without any protection. one of the roads we went up had recently, was taken by the north and then the splm father which would. a lot of dead bodies along the side of the road. in one village where we heard the missile attack, they were standing there holding signs saying stop attacking us, stop. these people, every single day of their lives have to deal with fear, not just of the future in terms of starving to death, but actually actively being killed.

the majority of what we're here to do, you know, i'm here to talk about the dangers of these people particularly, and the specifics are that the exact same people who did this and are for are the people that are doing this again. and the science as the ambassador said, are ominously similar to what happened in darfur. that's a problem. that's what brings us cause, pause. >> i gather you have a video. are you going to show that? i beg your pardon? [inaudible] >> okay, i think it's important. i heard your description. i think it would be helpful to the committee. i mean, that's as firsthand as it gets, but it's your choice. [inaudible] >> how long is it? let's do that.

♪ >> look over here. see all the kids over there. >> yesterday at 10:30 a.m., a tiny village where everyone is hiding. there's unexploded bomb.

this is where it hit yesterday. here, here, and here. they were hiding in there. this was yesterday? you're a very brave boy.

>> do you know who is attacking you? does she know? >> so this isn't a war of retaliation. this is simply trying to clear people out, ethnicity.

>> this is a protection. we talk all the time about the responsibility to protect somebody. right here is a ground zero of that responsibility. >> he says he wants muslims to have the freedom to go to the mosque. he says he wants to have christians the freedom to go to church.

>> well, i'm glad we did show that. glad you brought that, and i think was an important part of the testimony. and so i appreciate it very, very much you bringing that before the committee, those images are obviously powerful, important. and i think underscores what has been said here today. if i could just ask you, and then we will go around here, you listed a number of things, george, you thought were immediate steps. what you think is the most compelling, important, immediate step either the united states or together with the international community, we can do that would have an impact? >> senator, there's a fairly popular feeling that this shutting off of oil by the south is damaging to both, and there's very good arguments for that. you could argue that if it was a

united states and we were at war with canada and sending them oil and they were buying bombs with it we would probably stop, but the truth of the matter is, what we really need to do is, we can take this moment and engage with china i think for the first time. i've gone to china and tried the version of hey, you've got an olympics coming, maybe wouldn't be so good if you are supporting the attacks in darfur. that doesn't really work, you'll the people, often does a. there are economic reasons to do this for both of us and seems to me that we could use this opportunity, this window of opportunity, before it's too late by sendi h sending a high l envoy. and 50 believe we should, absolutely focus on where their money is. because they are spending a lot of it, and they're hiding a lot of. even if we can't present, the

transparency itself, we've seen how that works in other countries during the arab spring. when you find out how much money they actually have taken from the own people and hid in banks, that tends to creates insurgents inside. so i think those are the two major steps that can be done. that's our belief. you know, there are many others. >> senator lugar? >> george, i noted out as you gave your first testimony, the envoy to china, and banking, sanctions, or however we disrupt at least what is the normal wealth. start that with iran and for good reason, and we have some experience this with north korea. and those cases it was because of nuclear devices they even had or they were developing. but one could argue that this is equally serious for different reasons. and the diplomacy with china is, as you suggested, unfortunately

not humanitarian, although that ought to be mention. but with chinese the oil is important and they're prepared to fight for it eventually if they can't get it. so we have somebody to talk to there. i want someone to and osha idea as i hope the administration might pick up on the testimony and some the things we have today. likewise, mr. chairman, although it is as you say far-fetched, to think of an alternative pipeline in a short period of time, perhaps it is not a pipe dream to think about it fundamentally with regard to south sudan. this could be repeated, even if we move through one crisis. and it seems to me that in terms of our humanitarian effort, it also might become stranded on an investment effort to see really what is best involved

potentially in such an alternative. so i just wanted to pick up that suggestion as one that may be fundamental to the economics of it down the trail, and a follow up at least to the temporary or the immediate measures that we have to take. so i think all three of you again for your testimony, and for your very practical suggestions a policy that i think are very useful. thank you, mr. chairman. >> senator menendez? >> thank you, mr. chairman. i want to thank all of you for your insights, and while you're at, mr. clooney, in terms of seeking a practical economic leverage for a were the result is i think what is trying to elicit from our previous panel, how is it that we influenced the behavior of others who can influence today in. and in that respect is someone who has led sanctions here on iran, i actually believe that we can, in fact, use leverage in a

way, in this case, for a worthwhile humanitarian purpose. and when the chinese have such an investment that is not being productive, it seems to me, how we work with the chinese to both get them to understand their own economic interests, if nothing else, and at the same time look at that as the opportunity for how do we ratchet down, you talked about the accounts. we do that quite often. i hope the president might even look at the possibility of an executive order during the verses waiting for us legislative to respond. might be possible under his ability. we would have to look under the treasury department. but i hope that we will take some of the insights that you talked about, which is how do we create the leverage to change the on the ground reality. and i think when the chinese

have a multibillion-dollar investment that is not being productive, when you can create economic consequences that will move people to a different course of actions, out of pure necessity when they don't do it for a higher calling. i think those are the ways in which we are going to actually change the realities on the ground. so as someone who's been in that advocate here, sanctions for different purpose, i think they can work especially when we can multilateral lies them. but often the united states has to leave in order to get the rest of the will to follow. so i appreciate his insights and i hope our friends at the state department are listening and we could take it into action. i certainly will be looking forward to doing that as one of the things. >> thank you very much. i know that ambassador lyman and administrative are still here are listening and then no that they also talk to and worked closely with john pendergrast and george clooney so that

hopefully i'm confident we will follow-up with this. senator corker? >> i just want to thank again for the attention that you bring to this issue, and serving the reality that we've seen here through this production this morning. and you know, those of us who traveled to countries like this just cannot bring the attention to it that people like you can, so thank you for the. i thank you for the suggestions you may, not only here but in the back room, and hopefully we will follow-up on those. but again, thank you very much. it's very moving. and to mr. prendergast, while you're here, since there has been some discussion about the satellite centennial project, i wonder if you might just take a minute or so to explain to the rest of us into the others here exactly how that works and how that might be utilized in conflict areas like this. >> thank you, senator. is a partnership between digital

globe are choosing satellite imagery company, harvard, and a project to take, and it was george's idea, frankly, that we wanted to try to drive attention to deterring war crimes before they happen rather than bemoaning the fact as yours and to create capacity, this is what happened over the last year, we have soldiers in a particular area, we have air assets being moved into position, attack helicopters and other things and we know the target with some of the signals intelligence where areas are being targeted and we can raise the alarm bells that particular people are vulnerable, and we need to have action. and if there is an action taken and the attacks do happen, at least we have the visual evidence, empirical evidence, to be able to present to the

international court, others, for hopeful prosecution in the future. >> i know the first panel acknowledged that this was a useful tool. are their ongoing discussions between you and the state department and other agencies of our government to utilize this more fully? >> it's very important for us to say, to footnote george assessment that the administration policy and strategy is the right one. we support very strongly ambassador lyman is a special envoy, inc. he is doing an important job so we're in touch on some because want to be supportive of the administration. by the way, which is a very bipartisan strategy, and has been to the last three administrations on sudan. and, of course, congressman payne was sort of the incubators of this bipartisan effort. so we wanted to know him as well, and raise. but i think there's few opportunities right now, just a little fine point on what this moment does present with a

cutoff of the oil come is that president obama will need very soon. this is a chance to put this issue high on the radar screen of the two leaders to talk about how specifically the united states and china can forge this kind of partnership were talking about. ambassador lyman and others already having conversation so again were not telling somebody something they don't know. i think having a high level real strong endorsement of the need to deepen the partnership would be helpful. and also, senator kerry coming going to qatar to talk to the a mere. a number of countries are being these guys out. it's easier for them to commute to be a tragedy if they're getting credits our soft launch which will never pay back from middle eastern countries. so for president obama to call qatar and say this isn't the right time, hold and use it as

leverage for a deal, a conference a deal that addresses all these problems. and, finally, on the lot of leverage that united states has, we have plenty of sanctions. as everyone knows. we're not enforcing them. so getting treasury department the foreign assets control, the capacity to enforce, having a couple of people on the staff full time chasing those assets, as george said, even if we can't presoaking any other country to freeze them, but exposing them, what was the root of the explosion of popular sentiment during the arab spring? it was popular resentment against all this corruption. all these guys packing his oil wells into private accounts into international companies to invest in, we can still find that money and exposing even if we can't freeze it them. >> mr. clooney, mr. prendergast

and mr. temin, thank you very much. appreciated. >> senator cardin, i just know that it's just about 11:40 and three votes started we have about 15 minutes, something like that. >> i will limit myself to two and half minutes to make this point. first again, thank you all for what you are doing. let me just underscore the point on sanctions. you're absolutely right. sanctions are important they can be enforced international. the united states has to show the leadership. has to not only enforce the sanctions but use it as a high priority on their diplomacy with other countries to enforce a. but you're right on acid issue. they are, the united states, can have a major impact because these world leaders are hiding their money. and they come across u.s. banks. so we can have an effective remedy you. some of us have joined together with a bill to do with human rights violators in russia that

we believe shouldn't get the privileges of our banking system. and we think that would be an effective way to bring them to justice. bashir was indicted as a war criminal but there was an arrest warrant issued force arrest by the international criminal court in march of '09. he is a known abuser of human rights and has violated international standards. defense minister arrest warrant was issued this month for his arrest. so these are criminals. so i think we're on a very high authority to impose a type of financial sanctions which could have a major impact. the government should not be afforded legitimacy of the international community when their leaders are scheduled to be at the hague, to stand up for what, the crimes they have committed. so i just really wanted to urge

us to keep this focus. we cannot allow under our watch another darfur humanitarian crisis to emerge in the same region of the world. so thank you again spent i don't want you to feel rushed, what we're going to do, senator coons is gone over, i'm going to go rental income right back so we can keep continuity. take your full-time. >> well then, would you like to respond what i said? i will give you a chance to respond. i think your message, mr. clooney, about the importance of international respect for sanctions and denying the banking. the individuals make the decision so we can deny bashir the opportunity to hide his wealth that they will have major impact. >> i think it would. i think, the secret to this is

just tightening the noose around khartoum. around people are charged with war crimes. they shouldn't be allowed to have, you know, money sucked in the malaysian bank which is what's going on. we need to be up to track it down and find. they're also using that money to buy weapons to hurt innocent people. it is a cowardly act, what we saw while we were there. these are not, these were not acts of war. is a war crimes and they are funding it, and they're not funny at simply with sudanese pounds. something chasing the money is a very big issue, not just to stop the actual ask themselves but to put pressure on them internally. you know, omar al-bashir in his home has five tanks surrounding and pointed out. that's not a very secure, you know, leader, quite honestly. and so we feel as if the more

you expose his corruption, the more, the more inclined the people in khartoum would be to perhaps have someone else lead their country. >> senator lugar pointed out in his opening statement the transparency built the two of us worked on to require the oil companies, mineral companies to disclose their contracts or we could at least try to track the money. we know that the sudanese government has received a lot of income from oil wealth over the years, and when the good part of that has been diverted. it's not going to the people. so tracking that money, tracking that wealth would have a major impact on the comfort of their leaders. and it's something that the united states can do. this is something -- doesn't require a lot of countries to work with us. we are the major banking center of the world. we get funded to go along with us, we can do an awful lot in this area without worrying about

china or worrying about russia which it sometimes don't always follow our lead on the human rights fund. i will handed off. >> thank you. i will be briefed also. mr. clooney, when i went to darfur three years ago, one of the tools that have been used to cause the destruction and the fear and division was gender-based violence against women, primarily. is that going on now as will? >> in the camps we were visiting that was a very big issue still. again, these are the exact same patterns we saw in darfur. we saw it happen last your we were in abyei. we saw it used, employed again here in the new the mountains. absolute there was no question about. john, to want to say something? >> only that it is still happening in darfur, even though the attention has gone away, there still are massive atrocity been committed against of a

population. when we talk about a holistic solution in sudan, we need to talk about the with all of these problems comprehensively that we been coming back to this committee over and over again to talk about, rather than stove piping them individually and playing into the hands of khartoum which wants to divide the international community about these various problems. >> on that point, ms. lundberg mentioned the possibility of an agreement, the union, arab league and african union proposed if al-bashir signed, is there any fear he would do the same thing in kordofan that he is done in darfur bike is kicking ngo's out indiscriminate trying to disrupt the aid speak with i think the comment of sudan learned its own version of a lesson in darfur by allowing international aid agencies to comment our going into the crisis and to become in fact

what is there evasive said at the outset of the mentor operations in the nuba mounds in blue nile, we're not allowing any witnesses and. so there are no aid groups operate now. so it isn't access crisis for all those people at the clock ticks towards the raining season. so on the first instance, and ambassador lyman and usaid and others have worked for hard and trying to get an access agreement so that working behind the african union and arab league and u.n. proposal, and so that's really where the attention needs to be on, and it's to stop the use of starvation as a nuclear weapon of war, that's a war crime and it just must be ended. >> thanks to all of you for your advocacy and i will turn it over to senator udall. >> thank you very much. thank you, senator isakson. i can't tell you how important it is, i think, for george, for you and john, took on over there and brought these images back.

and i think chairman kerry was right in saying we should play them and have them up on the screen, because i think as painful as they are to see them, the thing that this does is allow all of the american people and people around the world to really get engaged with us and say, we don't want this to happen again. one of the things that you have mentioned is, and that's what i wanted to question a little bit on, and i think john mentioned this and we're willing to hear from both of you, the idea that satellite sentinel could be used by prosecutors, i was a former prosecutor so i kind of relish the idea of having bad guys that know something is going to be done to them, i mean something at the hague, it's going to come

down on them. have you visited prosecutors at the hague? are the interested in your technology? have you talked to them about the kinds of things that may be, could be utilized to strengthen cases and those kind of things? because if there's anything after that's going to prevent this from happening again and other places in the world, is that people know we have an international justice system that will work and eventually bring people like you described george, just terribly murderous individuals, bring them to justice. >> well, i will let you talk about the hague for a second. i do want to say one thing. there's an interesting thing that happens when you get involved in the spirit you think that the many people know, then it will stop. your assumption is that everyone just doesn't know. and the truth is even when you know, it doesn't stop.

it requires a constant drip of information. it requires you to keep piling it on. and sometimes that means that it is not going to be effective in stopping it, but at the very least it will be used later as evidence in a trial. we are trying to continually, you know, we would like to use this information as the security council because a lot of the times what happens if the security council is someone, we know the players, will veto any raising of the mandate of protection because they will say well, this is just rabble inviting. well, we have imagery that shows, we got the images yesterday that show a plane flying over the top, plumes of smoke where it has bombed innocent villagers. that's not rabble inviting. so our hope is not just to use

it at the hague but our hope is to try to use it as something to pry the security council towards raising the mandate from a six to seven, you know, trying to move that alone. john can speak about talking with the hague. >> yes. the current international criminal court mandate is only involves darfur, crimes committed in darfur. so basically as the arrest warrants have been issued for three of the key regime leaders, they are greeted international with a lot of skepticism. there's still a number of governments that read a lot of this evidence as manufactured, and there's still a lot of divisions internationally about whether the crimes are as terrible as they were alleged to have been. so part of the purpose of having this satellite sentinel project is to create airtight evidence

for future arrest warrants and prosecutions based on the crimes that are being committed now, which are the same kinds of crimes by the same people orchestrating them as is the case in darfur gratuitous greeting that evidentiary base for future prosecutions, and we hope that at least the three that have already been indicted what i succumb to justice someday. >> could you, i know that their others involved with you that are your partners in this, as you may want to just mention them in terms of who's worked with you and -- >> on these satellite sentinel project? >> yes. >> the biggest gift would that was the satellite themselves, digital globe, really out of for no other reason than the goodness of the heart donated millions of dollars worth of imagery. it's hard to explain how important that is, because there's only really one satellite company in that area that can do this for us.

so they been an incredible partner to us, and continue to be. the evidence that we pick up, we have gotten shots of mass graves. we have shots of take movement and troop movement and all those things. remembering and understand that part of the recent this can work is because of the topography. you know, this would be as effective in the congo because it's hard to see from the sky, with all the trees. harvard, then, of course, what you get the imagery you have to have an analysis of it. and so there's a team at the the harvard unitarian initiative that is dedicated to come in real time analyzing the imagery, producing independent nonpartisan reports about what they're seeing and what they are accessing these images to mean, and then those reports get put out and we try to generate attention around them and

ordered again, to act as a deterrent. >> and they stay up all night working. they are young people and they're just doing it, all heart, those good kids, they're great. >> thank you very much. it has been very, very helpful. >> thanks, senator udall. i think you have time to get over there. senator coons? >> thank you, chairman kerry, and thank you for your disciplined and engaged leadership on sudan ever going to sing today, for all you have done, to continue to sustained attention and engagement on the challenging issues around content that al qaeda thank you for testament for your for every hard-working is a and to george, john andrew johnson, thank you for what you've done to get so much focus engagement and effective attention on the challenge to managing issues in darfur, in the nuba mounds azure is so pointedly demonstrate the and the challenges that we face in teaching people in paying

attention to send the very real challenges of bringing peace and feldman to south sudan, and to the whole region. later today, senator isakson and i as chair and ranking minority on the africans the subcommittee will be joined by senators durbin and wicker introducing a resolution or consideration by the senate that specifically supports the efforts that all of you have talked about today, it calls for the government of sudan to allow indeed an unrestricted humanitarian access to south kordofan, blue nile and other conflict areas. and calls on sudan and splm to mutually in the conflict. that is one of many things we should be doing to continue what has long been a bipartisan tradition of engagement leadership on these issues. george w. close by referencing the focus they have all my. the energetic young people who process the images from the satellite project. just in the past few weeks we've seen a flood of interest in joseph kony through the 202012

campaign. you have both been very effective in kitty americans of folks around the world to pay attention to a great american crisis at a remote corner of the were. what advice do you have for all of us who want to sustain engaged americans of folks more broadly in actually continue to be concerned about the humanitarian crisis such as exist in darfur, such as emerging in the nuba mountains, such as in the jungles of the drc and with joseph kony? how do we keep young people, people of all ages, excited and engaged? it's rare we have millions of people calling for more of america's engagement with africa. what do we do at this from? >> john will have some ideas. he's been doing this a lot longer than i have. i would say that we're going to fail a lot. we will fail in our attempt to help people in these very

difficult regions and we will fail a lot and trying to keep attention in a certain area, because other news stories are going to bump us all. there's going to be in arab spring and we're not going to be paying attention to what happens. and a lot of these people use that as a moment to do some pretty terrible things. the trick is going to be, in sustaining it, is to be able to find a moment that you can point to and say, this is a turning point, quarterback, and let's amplify it. and finding several of those a year to be able to keep it up, you can't have a constant drip everyday on television because no one would care, quite honestly. there is not just donor fatigue. there is misery fatigue, and people get tired of it at some point. so our job is to find those moments. it's 100 days before these people vote for their own, for a referendum for their own state,

so let's make it, let's focus on that. there's an election, let's focus on the. a brand-new state, let's focus. there's a good possibility of people starving to death in the next couple of months, so let's focus on it is a part of our job is to try to picture all those news cycles, find areas that we can keep it up. but young people, and church groups, have been the real, they've been doing all the hard work force. they have been carrying this thing for years. they were driving darfur forever. they have been keeping the message up. they have been fund-raising. they have been keeping the pressure on, quite honestly, on all of us in this room. and so i wouldn't worry too much about the sustainability inside the hearts of all of these young people and all of these church groups, because that just continues. it's just more about finding moments that we can draw

attention to try to move the pen forward a little bit. and i find that to be the issue. >> the only footnote i would add is the good news is this is such a bipartisan venture and, therefore, we don't have real opponents here, except for just in different are often ignorant we just don't know. so the thing that i find exciting about the first 10 years of 21st century of activism is the chance through social media and other form to create real partnerships between all these wonderful nongovernmental organizations that are working so diligently on these issues, they partner with groups in africa. just remember, it's on the front lines where africans in places like sudan and congo and northern uganda have been doing most of the work to try to resolve these problems. we can all just coming on the margins and try to help them. so the coalition and the partnerships they create, then

the partnerships that are created here in washington between those ngos and members of congress like yourself, senators, who have taken stands one time after another for supporting positive engagement in the world by the united states, that helps stiffen the spine and give local support to the administration, whatever party is in power. and for president obama, the way he engaged in advance of the referendum in latter half of 2010, every sudanese, south sudanese person we talked to said that was perhaps the most important, along with giant support, the most important aspect, international aspect of getting a free and fair and peaceful referendum in 2011. so it's that chain that starts on the ground, in the region with african human rights activists and others, women groups and others, struggling to try to get the word out about their situation. partnering with ngos who then give support to the administration, republican or

democrat, to actually engage positively. when i start in the '80s into this kind of stuff, that kind of thing didn't happen. so is a very exciting moment, and having george, frankly, can make that larger, having the invisible children video despite all the different opinions about it, it just makes this kind of a partnership even more real and possible. >> if i could just in closing, mr. chairman, george and john, i'm grateful for your sustained engagement in this. there are lots of secrets of all backgrounds. there's lots of -- who keep doing the hard work on the ground, engaging to bring information to the light, helping make the world aware of these crises. and this has been a bipartisan effort across the bush of ministration, the obama administration, both folks onside to the aisle. the one challenge is sustaining support for america's use of diplomatic and develop the resources around the world. the united states has a lot of

power, military, diplomatic, developmental. but sustained investment that makes possible what administrative and marketing, what administered by medicine, make sure that the resources, to living this sort of sustaining investment in providing the framework for peace, for progress, for develop, that is something that is very hotly contested in congress just in the past year, and so i would urge folks who may paying attention or tuning in to these issues for the first time to realize that does some of which there are sharp disagreement. i think we should continue to invest 1% of america's total budget in making sure that we've got the resources to be an effective voice for justice and for progress in these parts of the worker i'm grateful for you to bring these things to light and processing our engagement in these parts of the world. thank you, mr. chairman. >> i want to thank as chairman, i would want to thank you for your tremendous commitment and your children's as chair of the

subcommittee. i think it's been terrific. senator shaheen? >> thank you. thank you all very much for being here. i want to just follow in a little bit of senator coons questions about how to sustain the interest and action that will help bring that international pressure to make a difference in south sudan, and whether you're contemplating or anyone you know of is contemplating this, stop kony video. i know you referenced at a whether or otherwise get more people engaged in this issue because clearly that kind of energy can really make a difference. and for any of the three of you. >> well, it was funding, we've landed yesterday and we're gone for eight days and during that time the kony video sort of hit. by the time within f1 was asking us about anna delano what happened.

look, it's an incredibly effective tool like john faulkner, social media can be a very big deal now. and youtube and twitter and all those elements are a way to keep young people involved. we're going to put the videos, the things that we got that we put together, we will make that available to people. sudan in general has an infrastructure that's a lot stronger than most places for charitable organizations. there have been church groups and student groups for a long time who have been working in these areas. so in some ways it doesn't go away. unicode in some ways it is that sustained, already sustained. our job is ample fight as much as we possibly can, and we will continue to do that. understand that in an election year, political will is by the most important thing you can get. what i think is so terrific

about being here today is that this is truly one subject matter that both sides, not only agree on, but have actively worked hard on. and have had some success on and had some failures on, and understand one another. so this takes a little less political will. this one is one where you don't come off on the wrong side doing the right thing. and so, we feel, we feel heartened by the idea that senator kerry and senator lugar, and the both of them have worked very hard on the subject matter. we feel heartened that this is something that is not polarizi polarizing. and so yes unique political will and we will continue to push as much as we can to get as many people as we can involved, because the latter is, the harder it is for these people to commit atrocities. but we also thank you here for

your sustained involvement, and know that not only to we appreciate it, we're also very well aware that you will continue. >> you know, i think you all, including the first the committee very important point about the fact that this is a bipartisan effort and that it needs to be, and that's been very important. i do think, as senator coons pointed out, that the public support for international assistance and our foreign aid budget, which is important to addressing what happens on the ground in sudan is not always that bipartisan, and not always as robust. so i guess i would urge, thing about social media is getting people to act my thinking about

how to address that foreign aid peace as part of the action from because that's ghana going to be critical as we sustain the efforts that we need to make on the ground. so thank you all very much. >> thank you, senator shaheen. couple quick questions. jonathan, you've talked about this political reforms in the north and the potential of election 2015 or trying to make a difference. just very quickly, if you can, how do you see that -- these guys are not exact reforms, number one, they're not exactly listening to anybody. how do you envision that? >> thank you, mr. chairman. it's an uphill battle but i don't want to be pollyanna about this. but it is also an unprecedented time in sudan's history. a third of their country just voted almost unanimously to leave.

they're under an unprecedented economic stress right now. there are signs of internal dissent within the leadership that we haven't seen much in the past. and so those are things that could add up to some sort of change. as i said, there's not a lot of evidence of it so far. and i'm not certain it's going to be. but i also think that the alternatives are ugly. and particularly some of the talk about regime change through violence would be quite violent. >> well, i agree with you. and certainly in the conversations i've had in khartoum with members of the government, we tried to make the point that this really is a major opportunity for them to kind of move in a different direction. i'd worry that the threesome that has been well many are, linked to darfur, that is sort of a servant of power for the moment seems to be moving in a

totally different direction. but that frankly makes all of this much more compelling. and so we really need to refocus in a lot of ways. if i could ask both john and george quickly, southern kordofan, you made it very ultimately clear here today, compelling about the need to deal with the food supply. to avoid a disaster. but the long run here, i believe blue nile and southern kordofan need political solution. what did people share with you, what's the vision that you come back with or that they expressed to you about that political solution for those two areas? >> well, i think that the difference is that the people of the nuba mountains and blue nile learn from darfur if they allow their region to be some of the isolated and still fight for a

bilateral deal between the government of sudan and them for some kind of regional autonomy or something, in the long run is unsustainable. there needs to be a deal that addresses the problem. the big root cause of the palm incident in which is a problem, as john was talking about, is a problem of governance in the center. so for the first time we really have seen in the north, in sudan, a broader effort, armed and unarmed, because you're the sudan revolutionary front which is sort of formed an association with the number of these armed groups, and by the way, for the first time all the darfur actors who were so divided during the darfur specific negotiations are now under the same umbrella and working together. and then a number of unarmed groups of their own objectives. but the bottom line is, people want to see a demographic -- democratic transformation. that's one of the things that

the united states can be helpful in providing support to some of the unarmed groups that are struggling every day to try to figure out a way civil society groups and faith-based groups and kindred groups and women's organizations are struggling to find a way to help build for the democratic transformation. that kind of support, and another discussion is internal and administration, they haven't resulted like how can we be helpful here? i think dubya a lot of things to do in that regard to be able to help foster and facilitate and empower some of the sudanese groups themselves to assert more definitively their democratic rights and their future. >> well, we have now stored on a second though, and this is only a 10 minute though, so we're going to be compelled here i think in this round to try to wrap up.

but i think we're at that point anyway. let me say to you, john and george, how much we really appreciate what you have done here. i think this is a tremendous example of best citizen activism. and, obviously, george, you have lent your celebrity and stardom to this initiative, which has its risks. but it also is critical to the ability to be able to get people to focus sometimes. we all wish it were otherwise, but it's not. and we thank you for being prepared, nevertheless, to choose engaged, spontaneously take eight days and go over there, and you know, not without its risks, i might add. i was an activist before a king or, you know, -- before i came

here. and i'm proud to have people on this many who feel the same way. so i can tell you that we are going to absolutely stay focused on this, continue to work with you, do everything we can to try to leverage the outcome that would all like to see. i am an optimist, but i have learned around your not to be, you know, naïve about it. but i still do believe, as a tractable as some of his looks, and i think ambassador lyman believes this, too, or he wouldn't stay at this, there is a pathway, there's an avenue. but we need to increase the leverage. we do need to reach out to china, panama, saudi arabia, and others, and get them to share some of this sense of urgency. and, frankly, humanitarian compelling rationale that is not

always high on the agenda in some part of the world. i think we can have greater impact here. into a large measure i think your sense of timing about when those moments are that you need to kind of push again is important and well taken. so i express the gratitude of a lot of people, but i don't want to get ashy about it because we have a lot of work to do. there's a long way to go. at this has been helpful, and i just would say to you and others who follow this and are interested in it, and i hope the sudan embassy, i've have no doubt if only. i hope omar al-bashir realizes that there's no easy out, there's no way here that we're going to not continue to stay engaged and involved. we have a roadmap. we thought we could have moved on some components of this. regrettably blue nile and south

kordofan evidence behavior made it impossible to do that. so it's really his choice, their choice. they will decide to some measure where we're going to go. we are prepared to offer open opportunities to go in a different direction. and i know that president obama and the folks, you know, his security advisers and others, and secretary clinton, are greatly focus on this. you'll have an opportunity to meet and talk with them in the next few days, and all of us need to work as we have in a very cooperative, i think across party lines, across branches of government lines, just in a constructive way to try to get the job done. so thank you for helping us today to do our job better, and we appreciate your efforts. if i could ask everybody here, just let the witnesses sort of

comeback and ambassador and administrator, but we thank you all for coming. we keep the record open until one week the close of business wednesday, march 21. we stand adjourned. [inaudible conversations] >> [inaudible conversations]

>> [inaudible conversations] >> [inaudible conversations]

>> coming out next, a senate hearing on oil and gas drilling. and at 9:30 a.m. eastern, the u.s. senate convenes with live coverage here on c-span2. senators are expected to consider legislation of stock option things for medium-sized businesses, and to judicial nominations. >> you're watching c-span2 with politics and public affairs. we? feature live coverage of the u.s. senate. on week nights watch key public policy events. and every week in the lives nonfiction authors and books on book tv. you can see past programs and get our schedules at our website. you can join in on the conversation on social media sites.

>> if there's anything that concerns the american family today, it's this. our government hasn't caught up with the new facts of american family life. families have change, so why can't washington? new facts, moms working. nearly 65% of all mothers are working. part-time, full-time, all of the time. keeping the family together, making ends meet, making america more prosperous, working mothers need affordable day care and the pay they deserve. too often, they can get either. >> this saturday maryland senator barbara mikulski will become the longest-serving female member in congressional history with nearly 13,000 days in congress you will surpass the record held by massachusetts republican representative edith rogers who served in the house from 1925-1960. watch senator mikulski speeches from the senate floor, and other

c-span appearances, all archived and searchable online at the c-span video library. >> one year ago, the fukushima nuclear power plant in japan meltdown after an earthquake and tsunami hit northern japan. today, the senate environment and public works committee looks at the safety of nuclear reactors in the u.s. you can see the hearing live on c-span at 10 a.m. today. and then at 1 p.m. eastern, defense and foreign policy analysts discuss the u.s. national security interests around the globe and the role of national security issues in the 2012 presidential elections. that's also live on c-span. >> this morning over on c-span3, senator tom coburn talks about his proposal to make sure medicare remains solvent. senator coburn, a medical doctor, is speaking at the

hudson institute in washington. his remarks are live at 8:30 a.m. eastern. a little later in the morning, fbi director robert mueller testifies before a senate subcommittee about the fbi's proposed budget for next year. that's life on c-span3, starting at 10 a.m. eastern. >> representatives of the energy and interior departments testified on capitol hill wednesday about energy production and the administration's 2013 budget request. that request cuts $200 million from offshore oil and gas development. this is an hour and a half. >> good morning. i want to welcome our witnesses to the subcommittee's oversight

hearing on federal offshore and onshore energy development program for the department of the interior. on behalf of the members of the interior subcommittee i would like to welcome our panel. thank everyone for joining us here today. before us where the honorable robert abbey, the honorable tommy beaudreau, and the honorable james watson, director of the fear of safety and environmental enforcement. gentlemen, thank you. ..

>> as i know that many of my colleagues on pote sides of the -- both sides of the iewl -- aisle will agree, we've convened this additional hearing today. making sure that the right resources and policies are in place for safe and responsible energy development on public lands is a significant part of this subcommittee's jurisdiction. and the three agencies that we have before the subcommittee today all play a huge role in insuring the success of the president's all-of-the-above energy strategy by overseeing both conventional and renewable energy development on federal lands and waters. we must insure that these three agencies have the right resources and staffing in place to perform their inspections and enforcement duties. that is why i think it's important to start with an overview of where these agencies are in terms of their fiscal year 2013 budget request.

for the offshore perspective -- [inaudible] for a total of $222 million. the president's request also continues the inspection fee program that congress established last year and proposes to collect $65 million to offset the appropriations request. the budget request also includes a total program level for the bureau of ocean and energy management of $164.1 million, that's a $3 million increase or approximately 2%. finally, the budget includes a program level of $173.3 million for the pure low of land management's -- bureau of land management's can -- [inaudible] the budget request also includes a new $48 million inspection p fee program similar to the one we enacted last year for scee --

bsee that will offset the request. how these fees would be used to strengthen energy development on blm lands. we're also going to take a look at the progress being made to better process permits and efforts that these agencies have made to recruit, hire engineers and inspection personnel. since the deep water horizon incident less than two years ago, major reforms have been made to the way the interior department oversees the permitting processes. i understand that concerns are being raised about whether the administration's acting quickly enough to exploit our offshore energy reserves. yet it's also important to note that lease sales are underway and permits have, in fact, been approved since the incident including 325 deepwater permits and an additional 116 shallow water permits approved in the

gulf of mexico as of monday, march 12th. i think the administration must strike the balance between speed of processing and insure that energy is drilled responsibly and safely especially in the context of the largest oil spill in our nation's history. the same could also be said to making sure we are addressing onshore energy development. i look forward to discussing efforts to improve the bureau of land management's inspection process as particularly related to the rise and use of hydraulic fracking on public lancz. i'd like -- lands. i'd like to recognize senator murkowski. >> thank you, mr. chairman. welcome to our witnesses, appreciate all that each of you do. it was nice to visit with you, director beaudreau, it's always nice to have an alaskan at the helm. clearly understand what we're faces with with so many of these

issues. welcome to each of you. as americans face steeply rising energy costs, it's important that this subcommittee insure that the agencies that sit before us today have the resources that they need and the right policies that are in place to maximize production in an environmentally responsible manner. a thurm of new authorities were included in last year's interior bill that i hope will give your agencies the tools necessary to improve the pace of permitting and increase our domestic production. for example, operators were authorized, and 50% of these collections must be used to expedite the development of the ocs. authority was also given to pay higher salaries for certain create call job positions in order to address the problems with high or sufficient -- hire sufficient personnel. finally, the responsibility for

reviewing air quality issues in the arctic ocs was transferred from the epa to boem to deal with the egregious permitting delays, almost six years, um, in one case. i'd like to hear from all of you today about how these new authorities are being utilized and whether you believe that you've got the tools that you need to improve the pace of permitting and increase production both on and offshore. improving the department's performance is particularly important to he in light of recent doi reports that indicate that while overall production domestically is at an all-time high, that it's not necessarily the case on federal lands and waters. the news recently reported the production of natural gas declined by 11% in fy-11 and oil production declined by 14%, clearly a result of the moratorium put in place in the

gulf of mexico following the deepwater horizon. so i'd like to explore what the current pace of permitting is in the gulf, how many drilling rigs are operating, whether improvements have been made to improve and accelerate the approval of exploration plans and drilling permits. i think there's a difference of opinion out there between the department and the industry on whether or not things are improving. so i'd like to hear your perspective on that. the crepe si -- discrepancy between private and federal lands concerns me as i look at the new policies proposed in the fy-13 budget that will make leasing on federal lands less competitive. when companies have the option on large new reserves on state and private lands whether it's north dakota or texas or for natural gas, i question the wisdom of proposals to increase federal onshore royalty rates, put in place new inspection and drilling fees and charge a fee

on the so-called nonproducing leases. it seems to me that this is just taking us in a direction that will make our federal lands less competitive, and we may see a continued trend of more investment fleeing to the state side and private lands or possibly even to other countries. again, thank the witnesses for joining us and for the work that they do within their respective agencies and look forward to the questions. >> thank you, senator murkowski. i just have to point something out. mr. beaudreau is from alaska, but his father's from rhode island, so that is the shrewdest appointment ever made or the luckiest -- [laughter] appointment ever made, and only time will tell. >> i'm sure he also has ties to montana as well. >> if not, bought a cabin there. senator tester, do you have any comments? >> i would, and thank you, chairman reid and ranking member murkowski, for holding this hearing today, and i want to welcome bob abbey and

mr. beaudreau and mr. watson to the hearing. i want to say just a few quick words about the 2013 department of interior budget. first, there's been a lot of talk about oil and gas leasing and development in the u.s. and the need to reduce our dependence on foreign oil, and i firmly believe we do need to reduce our dependence on foreign oil. sending $1 billion a day to countries who don't like us much hasn't done much good in enhancing our national security. but i think it's important we don't confuse reducing our dependence on foreign oil with reducing prices at the pump. we all know the price of gasoline isn't just about supply and demand factors, and the talking point of drill baby drill isn't getting us those desired results. drilling is up. there are more drilling rigs in the united states than anywhere in the world. we're producing more than we have in the last eight years,

consumption domestically is down, but we are facing competition from china for oil, and that is driving the world price as well as speculators adding as much as 56 cents a gallon at the pump. there is no magic bullet. in montana energy production is fueling our economy, literally with the boxen field we're producing nearly 500,000 barrels a day. montana's a part of that expanding domestic energy solution, but it isn't just about extracting traditional fuels from public lands. we need to put just as much effort into those leasing and approvals of those projects to secure our energy future, and i look forward to visiting with each one of you today, in particular you, bob, about getting more rethink bl energy up -- renewable energy up and running. i look forward to visiting with you throughout this hearing and

hearings to come, and once again i want to thank chairman reed and ranking member murkowski for holding this hearing. >> thank you very much, senator. gentlemen, your statement's part of the record, so you may be free to summarize your comments and, mr. abbey, please, begin. >> thank you, mr. chairman and members of the committee. it's always a pleasure to appear before you and today to discuss the president's fiscal year 2013 energy and minerals budget request for the bureau of land management. in the interest of time, i will keep my opening remarks quite brief. the blm is responsible for managing over 245 million acres of public lands, primarily in the 12 western states as well as approximately 700 million acres of onshore subsurface -- [inaudible] nationwide. the unique multiple use management of public lands includes livestock grazing, outdoor recreation and conservation of that muchal,

his -- natural, historical, cultural and other important resources. america's public lands provide resources that are critical to the nation's energy security and will continue to play an important role in domestic energy production and mineral development for decades to come. our management of public land resources and protection of public land value results in extraordinary economic benefits to local communities and this nation. it is estimated the blm's management of public lands contributed more than $20 billion to the national economy and supports more than 550,000 american jobs. blm's fiscal year 2013 budget proposal reflects the administration's efforts to maximize public benefits while recognizing the reality of the current fiscal situation. the new energy frontier initiative recognizes the value of environmentally sound, scientifically grounded

development of renewable and conventional energy resources. they continue to play a critical role in meeting the nation's energy needs producing 43% of $41% of the nation's coal, 13% of natural gas and 5% of the domestically-produced oil. during 2011 the blm held 32 onshore oil and gas lease sales. onshore mineral leasing revenues are estimated to be $4.4 in 2013. the 2013 budget strengths the oil and gas inspection capability through the a proposed fee on oil and fashion producers similar to the fees now charged for offshore inspections. collection of these fees is consistent with the principle that users of the public lands pay for both the cost of use authorizations and for providing for oversight activities. this fee will generate an

estimated $48 million to improve safety and production inspections for oil and gas operations. president obama, secretary salazar and this congress have stressed the critical importance of renewable energy to the nation's energy security, job creation and long-term economic development. to date, secretary salazar has approved 29 commercial-scale renewable energy projects on public lands, and these include 16 solar, five wind and eight geothermal projects that represent more than 6500 megawatts and 12,500 jobs. the blm's 2013 budget propose as $5 million increase for these efforts, and we do intend to reach our goal of -- [inaudible] of renewable energy production in 2013. finally, the budget proposes legislative initiatives to reform hard rock mining,

remediate abandoned mines and encourage diligent development of nonproducing oil and gas leases. mr. chairman, members of the committee, again, thank you for this time. >> thank you very much, director abbey. director beaudreau? >> [inaudible] >> could you put your microphone on, please? >> my apologies. thank you, chairman reed, ranking member murkowski and senator tester. thank you for the opportunity to appear today to discuss the president's fiscal year 2013 budget request for the bureau of ocean energy management. is and for the opportunity to provide these brief opening remarks. as we know, the deepwater horizon rig explosion and oil spill in the gulf of mexico spurred the administration to undertake the most aggressive and comprehensive reforms to offshore oil and gas regulation in united states' history. central to these reforms are the structural changes we have made to federal oversight including the establishment of new, independent agencies with

clearly-defined missions to provide effective management and strong safety oversight of the development of our shared offshore energy and mineral resources. simply put, boem is responsible for overseeing the environmentally and economically-responsible development of our country's offshore, conventional and renewable resources. this includes promoting responsible offshore oil and gas development as well as renewable energy projects such as offshore wind. boem's decision making must closely consider the resource potential of regions on the outer continental shelf, the critical role offshore energy plays in the mix of resources necessary to meet the nation's energy demands, the significance of offshore oil and gas to the economy and employment, and the vital need for environmental protection and responsible stewardship. these are priorities and values shared by everyone in this room. this budget request is designed

to provide boem with the resources necessary to advance our equipment to a comprehensive energy strategy that encourages safe and responsible domestic oil and gas exploration and development as well as pushes forward with the development of offshore wind and other clean renewable energy resources. the resources we have requested will allow boem to continue pursuing our priorities which include, one, finalizing and implementing the next five-year offshore oil and gas leasing program which as proposed will include 15 potential lease sales and make available more than 75% of the undiscovered but recoverable oil and gas resources offshore of the united states. two, conducting the rigorous scientific and environmental analyses that are necessary at all stages of the offshore energy development process. last december we held the first lease sale following the spill

which was one of the most successful in the history of the western gulf of mexico. we will hold a consolidated lease sale for the central gulf of mexico on june 20th. planning included rigorous analyses of available information concerning the environmental effects of the deepwater horizon oil spill. three, we continue to conduct efficient and thorough reviews of offshore exploration and development plans under the new, heightened standards which includes site-specific assessments on every deepwater exploration and development man. four, we've implemented innovative lease terms that insure that the american taxpayer receives fair return and provides strong incentives for industry to diligently develop their leaseholdings offshore to meet our energy needs. finally, we are on the forefront of or renewable energy resources. over the next year and beyond, we expect to issue a thurm of commercial -- a number of

commercial leases. boem is focused on its mission to help the united states secure its energy future through responsible development of conventional and renewable offshore energy. thank you and thank this committee for its continuing support of our mission and our effort. >> thank you very much, director watson, please. >> good morning, chairman reed, ranking member murkowski, senator tester. thank you. i'm pleased to appear before you for the first time as director of bsee and discuss the tremendous strides we have made as well as our vision for the agency. we provide safety and environmental oversight of offshore oil and gas operations on the outer continental shelf and leading positive changes in the culture of operations. our near-term goal is to restore america's confidence that offshore operations can be carried out safely and responsibly and without the tragic human and ecological costs that occurred as a result of the deepwater horizon

tragedy. in the long term, our goal is to set standards and build capacity for offshore safety assurance throughout this country and also to be the world leader for safe offshore operations. the key to our success is the employees of bsee. over the past three months, i have met our employees from all of our offices. they have made it clear to me that they believe in and are passionate in our mission. they're unmatched in their knowledge of the offshore industry and are making the best use of the resources at their disposal to advance the can cause of safety. overseeing safety and environmental performance on is the scs includes drill canning -- ocs includes drilling permits. a lot of attention has been paid to our permitting pace, and i sympathize with the people who depend on these permits for the jobs. the same people who were so negatively impacted by the deepwater horizon tragedy in some cases. permitting is an essential part

of our process. we issue permits only safely and responsibly. they're meeting all of the enhanced safety standards, and they can respond effectively in the event of a worst case discharge. by working closely with the industry, we have significantly decreased the amount of time it takes to approve a permit and have issued hundreds of deepwater and shallow water permits over this past year. however, those who believe the pace of permit should be automatically the same rig mothering the lessons of that disaster. i will commit to rooting out inefficiencies and making the permitting process straightforward and understandable, but not at the expense of safety. when coupled with increasing hiring and training of engineers, scientists, inspectors and other personnel, these efforts will further enhance the permitting process and improve safe and responsible operations on the ocs. we've made a tremendous amount of progress since our formation.

in my written testimony, i provided examples of how we spent the time focused on hiring new personnel, enacting safety reforms, improving our permitting process and completing the reorganization of mms. thanks again for this opportunity to testify. i look forward to answering your questions. >> thank you very much, director watson. we'll initiate six minute rounds, give my colleagues a chance. i anticipate at least one or two rounds. we have very many questions. let me begin with director beaudreau. by the way, thank you, gentlemen, all for your excellent testimony. but, director beaudreau, you mentioned accelerating the approval of offshore wind marley along the atlantic -- particularly along the atlantic coast. we have made some significant investment in terms of preparing kwan set point, one of our former navy bases as potential site for fabrication. we have applications for a state project in state waters, we have

an application for a project offshore in federal waters. we've also done a lot of planning. the special area management plan which has drawn nationwide attention is one of the best sort of comprehensive approaches to evaluating offshore potential in areas of development and, again, it's been recognized nationally. but we seem to be falling behind other states in materials of approvals -- in terms of approvals. the next big step for us is the release of the draft environmental assessment, and can you give us an indication when that environmental assessment will be completed? >> yes, sir. you're absolutely correct about the work that the state of rhode island has done to promote the development of offshore energy. that work will feed and has fed directly into boem's process in evaluating the wind energy area and the shared area between

massachusetts and rhode island, what we call the area of mutual interest. one example is the samp which was a comprehensive environmental assessment that is relative to our process in evaluating the area. that analysis and the good scientific work sponsored by the state of rhode island will feed directly into our environmental assessment as will all of the work that the state task force has done. it helped us define what the ferrell in conflicts -- potential conflicts might be including a particular area of sensitivity both environmentally and for fishing interests. in light of all of that work, work already done by my be agency and work done by the state of rhode island, we anticipate issuing a draft of the environmental assessment this spring, late this spring. >> be one of the reasons it's

critical of getting the ea out is it looks like august of this year, 2012, is, we hope, the time where the final environmental assessment will be issued which would put us back on track with only the other state -- some of the other states along the atlantic coast. and if that's the case, would allow us to really begin a leasing process at the end of the calendar year 2012 or early in 201. and, again, the fear is if we don't, we just fall behind. that's not just a question of where the towers go in the water, it's also a question of sort of the land side operations where they might be, you know, situated. so i would urge you, again, to expedite as secretary salazar has committed, expedite this draft da can and then with similar speed finalize the environmental assessment so we

can begin the leasing process. >> yes, sir. this is absolutely a high priority for the secretary and for my agency. >> let me just turn and, again, i anticipate a second round, but to director watson. as we last year included for your agency, bsee, the inspection fee program. can you tell us what improvements you're making with these fees? i think director abbey said it very well in terms of the proposed fees this year, it makes sense to, basically, help defray the cost of inspections and review that immediately rebound to the benefit of the drillers because they're the ones who presumably get quicker ea priewfls -- approvals, better inspection, better protection for their environment and less problems down the road. so can you comment, director, about how you're insuring these fees are being used well and

wisely? >> yes, sir. the fees are focused on our safety program, primarily our field operations and our permitting operations. the expense of these operations is mostly in the cost of our work force. we're increasing the size of that work force at a pretty steep rate for a small agency. we have already increased the numbers of inspections, inspectors by a significant thurm. we started at about 55, and i think we're up to 91 now. we're headed up over 100 into about the 150 range that we're going to need for inspectors. and as you increase your number of inspections, you also need helicopters to get those

inspectors offshore which are costly as well. and turning to the permit side, we are adding almost 100 engineers. these are people who are plan reviewers for the information that's submitted to get a permit, and they are a combination of structural engineers, petroleum engineers and some geophysicists and geologists to review those permitting applications. so we are still challenged to bring those people into the work force, but we have an aggressive outreach program. we did get some incentives for hiring these people in the 2012 appropriations which will be very valuable. and so i'm optimistic about that program. >> just a quick -- because my time has expired -- is the initial feedback from the industry positive terms of a more expeditious permitting process, a better sense of the

professionalism and skill of the inspections? is that what you're sensing? >> well, my experience is the industry is looking at the bottom line, how quickly can they get a permit, um, and -- but they are also focused on the competencies of our people. i haven't heard any disparaging remarks about our competencies. on the permitting side, i think there's been a combination of efforts by the industry to provide more comprehensive, better prepared applications than say a year ago, and in the bsee side, i think we're also better at doing these new safety standards, at reviewing it. and the numbers kind of bear this out. just between last march and september our average was about 97 days to get a permit process. that was the average. and then between september and today it's gone down to 62 days.

so it's right around two months right now, and i think we can probably make some more improvements. but as i said in my opening statement, i'm not about the number of days it take, i'm still about safety and environmental protection. >> thank you very much. senator murkowski. >> thank you, mr. chairman. gentlemen, thank you for your testimony this morning. i want to try to better understand some statistics that are out there. yesterday the president released his, or he discussed the one-year progress within the administration. he called it his blueprint for a secure energy future. and in that report he notes that oil production is up overall. that's a statement that has certainly been made. he doesn't disclose where that increased production comes from, whether it's on federal lands, private, state. um, i mentioned in my opening comments the department of interior's own numbers would seem to indicate that onshore oil production down 14% from

last year, offshore production down 17%, and yet yesterday when secretary l salazar commented on the president's blueprint, he stated the fact of the matter is we're producing more from public lands both oil and gas, both onshore as well as offshore than anytime in recent he were. so -- memory. so i'm trying to understand our data here because i think this is important. people really do want to understand what the situation here is in this country. so i guess we've got a situation where either the, um, data from department of interior is, is wrong, or it has not been communicated adequately or appropriately to the secretary. so the question that i have is who's right here? are we -- when you, when you peel this back, are we seeing an

increased production on federal lands, um, and offshore as well or not? >> let me take a stab at this, senator murkowski, and then others may contribute. no doubt the statistics would show that the u.s. oil and gas production is up, and last year more oil was produced in this country than at any time since 2003 -- >> and do we dissect that as -- >> i can. >> okay. >> and no doubt the aggressive development of shale oil and shale gas has led to a shift of private lands in the east and the south where there is less amount of federal mineral estate in those sections of the country. as far as natural gas, last year blm-managedre natural gas mineral estate than in decades. oil production was down somewhat last year. but we are moving forward again,

offering up additional parcels for leasing, we're processing more applications for permits to drill than in the past several years, and so we should see an increase in production of both oil on public lands as well as natural gas. but again -- >> so it is an accurate -- >> production was up. >> right. i'll grant you that. and i also recognize that where that natural gas production is coming from is primarily on the state and private side. but is it an accurate statement then to state that 14% onshore, a 14% decrease onshore from last year and offshore down 17% for oil? >> well, again, the statistics will speak for itself -- >> well, but this is where the con fusion is because the statistics are being used to suggest that there is this incredible increase in oil and

gas production. but we all know that you've got oil production, and you've got gas production, um, and we're seeing remarkable, remarkable opportunities with natural gas, within our shale formations. and that's good. i support that absolutely. what i'm trying to understand is whether or not our oil production offshore and onshore is up or down. >> the oil production from onshore federal minerals was down last year from previous years. i will say this, where the industry decides to produce or where they decide to develop is up to them. for example, we have approved 7,000 applications for permits to drill that are not being drilled. we have over 25 million acres of lands that we've leased that are not being developed. so it's -- >> well, and -- >> -- a decision that's being based by the market. >> i understand. and i will in, probably, my next

round here ask about some of those incentives or disincentives that we impose that kind of pushes the, those that are in the exploration and production business to go from federal lands to state lands. i want to ask very quickly, and this is to you, director abbey, i mentioned it to the secretary last week a couple different times. this relates to the legacy well situation in the alaska. for members of the committee, it's somewhat an interesting situation. back in about 40 years ago, um, there was, there was exploration by the government, by the navy primarily, in the national petroleum reserve. they drilled some 137 different wells looking around, and then moved on. the problem that we face is they moved on without properly abandoning and caring for those

wells. now decades afterwards we're having some of the case, collapse, we've got erosion issues coming in, and it's not only unsightly, but, um, it's an environmental scar. and it's something that has been difficult for alaskans to accept because on the one hand the standards for, for, um, the environmental standards are exceptionally high and, i think, appropriately so. we want to make sure that we're taking care of the land there. but on the federal government side they can come in, they can explore, they can leave, and their environmental responsibility is not attended to. if you were on the private side, you would be fined, you know, i think the fines that we're talking about could be in the realm of $40 million. the revenues that have been received from, um, from the national petroleum reserve alaska are certainly sufficient

to help clean this up, but we're on track for cleaning up these at about the rate of about one per year. it's going to take us another 135 years to clean it up which is certainly not acceptable. so i ask the secretary, um, and i would ask you, director abbey, whether or not we can get a commitment to be coordinating, um, twoan the blm -- between the blm and the alaska oil and gas conservation commission to not only provide the commission with an inventory of the exact number, the associated costs for plugging them and then a plan, an action plan so that we can have a reasonable level of assurance that we will move forward, that the government will move forward in keeping their commitment to alaska and to the land up there. >> well, my response would be similar to what the secretaries share with -- secretary's shared

with you. we're committed to identify where the highest priority needs are for cleanup. we have spent millions of dollars in cleaning up some of those legacy wells -- >> and they're expense f, we acknowledge be, yeah. >> very much expensive. this year we do have sufficient funds to clean up an additional three, but as you suggest and i will admit, that's a pretty slow progress toward dealing with the challenge that we face. >> we need to be working on this together, so i appreciate that. thank you, mr. chairman. >> thank you, senator murkowski. senator tester, please? >> yeah, thank you, mr. chairman. as i mentioned in my opening statement, the thurm of rigs operating in the u.s. this year is the highest number in probably eight or ten years. the u.s. has more rigs operating right now, and correct me if i'm wrong, than the rest of the world combined. our domestic production is at an all-time high.

um, and, you know, maybe the public lands is down some, and i want to get into that a little bit. um, but the fact is that, um, if it's up on state and private, we've got more rigs operating in the u.s. than the whole rest of the world combined and i talked to a person in montana today where they've got a bunch of permits and they can't get any rigs because they're all tied up, i don't know, you know, i just kind of want to get your perspective on all this. there's about 32 million acres of federal land that's leased right now. as you pointed out, i think there's 7,000 applications for permit to drill that have been issued and not drilled. can you give me, give me some insight into why that is, give me some insight into what you're seeing as trends on the federal lands. >> well, senator, be happy to. again, there's a lot of factors that come into play relative to a decision that would be made by

the industry on where they choose to drill. as it relates to the number of applications for permits to drill, we issued 4200 last year. that was above what the number that were submitted by the industry. we had a little backlog from the previous year, and we were able to address some of the backlog. but we issued 4200 applications for permits to drill last year. at the end of the year, we had over 7,000 that were not being drilled. as i mentioned, there are several factors for that. sometimes it's financing. another factor that comes into play is that the industry, the sales have chosen to drill elsewhere where it's more economical. but it is a choice that they have to make, it is a choice that they make every day. we are moving forward as expeditiously as possible to streamline our review processes without forsaking the need to insure safety as well as environmental diligence on these, on the drilling

operations. we're increasing our inspections for all drilling. but much of the easy plays are located right now on the private private -- [inaudible] >> okay. and this goes to, i think, senator murkowski's last question or last point, and that is that as we push to open up lands in a responsible way not sacrificing one resource for another, um, we also have to consider things like the casing, how it's cemented in and, quite frankly, i hope we're thinking about what happens when the well's usefulness is gone. i hope we're thinking about that up front. so can you give me some sort of idea on what the thought process to make sure ha this land's -- that this land's being leased responsibly and that the development is being done in the

responsible way so that we don't have a bunch of wrecks like senator more cow si ask -- murkowski was talking about? >> in 2009 when secretary salazar and i both came into our new positions, we inherited an onshore oil and gas program that was on the verge of collapse, and i say that because over 50% or close to 50% of all the parcels that were being offered for leasing were being protested or litigated. that's unacceptable. literally, hundreds of leases that have been awarded by the department of the interior, specifically the bureau of land management, were tied up in protest and litigation. and so the millions of dollars that we had collected from the oil and gas companies for their leases that they purchase were placed in suspense accounts until those protests and litigation could be resolved. again, that was unaccepted. the rules that were in place to govern the oil and gas operations and to insure production verification of the oil and gas that were being extracted from these public assets were over 20 years old.

technology had advanced significantly in that 20-year period. but no one was paying attention to updating those rules. we had epa and other fellow agencies criticizing the knee pa analysis that was being performed by the bureau of land management primarily as it related to air quality documents. we had other public land stakeholders criticizing the leasing everywhere and anywhere mentality that was going on at the time and, certainly, very much a part of the blm's culture. because there was concerns about the environmental damage that was being, that was occurring as a result of not doing a very good job of looking at these lands before we committed those lands through leasing. so we took it upon ourselves not to ignore the challenge or the problems, but to address them. and one of the ways that we have been able to address them is to insure that there's a better opportunity to look at these lands prior to committing them through leasing. we've done that through our leasing reforms.

the primary purpose for our leasing reform is to make sure that the lands that are going to be leasing or that we are going to be lease rg the right ones to lease, and they have the greatest chance to be developed in a timely manner. >> did you say that 50% of the leases when you took over were being either litigated or protested? is that what i heard you say in this answer? >> close to 50% -- >> so where are you at now? >> close to 50% of the parcels we were offering were -- >> okay. what -- >> at this point in time it's around 35%. >> okay. okay. my time is up. thank you, mr. chairman. >> thank you very much, senator tester. this is very, i think, useful line of questioning. just as director abbey points out, there are a incident number of leases -- significant number of leases that are capable of being drilled but not being drilled. those are the decisions of the private entrepreneurs and companies onshore.

offshore, mr. beaudreau s that the same situation where you have a significant number of leases already approved, and yet the drilling activities aren't commencing? >> yes. that's correct. there's a significant percentage of the leases that have been issued by the interior department offshore that are not currently subject to an exploration or development plan. and we've tried to develop both through our leasing process and postleasing processes to try to encourage prompt and diligent development of those leases to bring them into exploration, bring them into production. as director abbey indicated, there are a number of commercial factors that weigh into industry's decision about when and where to trillion. we're trying to line up our leasing process and our incentives to influence those decisions so that we can have prompt development.

>> thank you. director abbey, in the president's budget we've mentioned there is a request for additional onshore fees that'll be comparable to the increases that we've provided to bsee and that the directer is using, director watson, for improving his program. can you indicate how you can improve your program with these fees? >> i'd be happy to. and it's a -- thank you for the question. it is, as senator tester alluded to, it's important if we are going to be leasing these parcels of public lands for oil and gas development, that we have sufficient inspections to insure that it's being done responsibly. you know, we, it is our goal to inspect drilling operations that are considered a high risk, and those high risk operations are those with the most violations but, also, those that are producing the most volumes of gas or oil. we test for blowout preventer equipment, setting and be cementing casings, we also test

for plugging operations and well completion operations. um, the aadditional monies that we would get from the inspection fee would provide us sufficient funds to add another 46 inspectors to our work force that would, again, allow us another opportunity or greater opportunity to be on site when the drilling is actually taking place. >> well, thank you. one of the other complicating aspect is the the fact that the new technology, the fracking technology has raised at least issues which are being evaluated by state authorities, by other agencies. and it's, i would think, something that you are looking at more closely now in terms of your inspection program. is that accurate? >> it is. you know, fracking is not new by any means. about 90% of the bells that are being drilled today on public lands are using the fracking technology. so our inspections have always included looking at the the fracking operations as they were occurring.

but, again, the additional fees would provide us opportunities to be on site more often than where we are right now. >> the secretary's also indicated recently that his intention to raise the onshore royalty rate from 12.5 % to 18.75%, can you tell me how these rates, the present rate and the proposed rate, compare to state rates? because, or state rates is probably the comparable point. >> well, it varies somewhat. let me just suggest that our primary goal is to make sure that the american taxpayer's receiving a fair return for the assets that are being developed. that's the least that we can do. at the same time, as we go forward and we are, we have analyzed what some of the states or many of the states actually are charging relative to royalty for production that are occurring within our own state lands. we've also done some analysis of what some of the other countries have are charging royalties or

similar type of fees that are assessed oil and gas companies. even though our budget was based upon an assumption that an increase of royalties would go to 18.75% for both oil and natural gas, let me just reassure the members of this committee that that decision has not been reached. we're continuing to look at the full range of statistics that we have been able to compile, the analysis that we're continuing to perform prior to making any decision to increase the royalties for oil and gas production on these public lands. >> thank you very much. and i know senator murkowski's going to get is into this, and she's raised a very important question about the difference between production figures on private lands and public lands, and i think implicit in all your answers has been just there are commercial reasons why even though the lease is available, it's not being utilized.

can you kind of list three or four general sort of basic number of rigs, insufficient number of rigs, is it -- >> well, no doubt. i don't have the rigs, but i do know that the availability of rigs is an equation that comes into consideration by the companies relative to where they're going to be developing or drilling. let me just say right up front that it's quite, it is a lot cheaper to drill on private land than it is on public lands. all they have to do is cut a deal with the private landowner. when you come before, with a proposal to drill on public lands, there is a lot of factors that we do evaluate. again, we have to look as to the appropriateness of leasing certain parcels for oil and gas development or any particular use. we have to adhere to nepa. we have to adhere to consultation not only with native americans, but with the fish and wildlife service to insure that the proposals before us can be adequately mitigated.

so there are an awful lot of rules and regulations that the companies would have to adhere to, but each of those rules and regulations are intended to make sure that the production goes forward to the degree that it can be allowed as appropriate. but also the leasing reforms that we have applied is to provide greater certainty to the industries themselves that if they lease a parcel of land, that they're going to be able to develop that parcel of land. and i can tell you this 2009 that was not the case. >> thank you. my time has expired. senator murkowski, please. >> well, thank you, and i'll follow on because you, you've given me a little bit of assurance by saying that the decision has not been made on this issue of increasing the royalty rates onshore. you have stated, and rightly so, that it is more costly to develop on the public lands, and

so as we look to, to a royalty rate increase as has been suggested that, too, adds to that cost. and again to my earlier point, i think it causes developers to look to develop on state and in private before they would turn to our public lands. i do think it's important to recognize the study that was commissioned by the department to look at the royalty rate structures on our federal lands and compare them to other states as you've noted, to other countries. this is a -- there's a consensus coming out of the report that says that a rate increase is not warranted, they compare wyoming to other onshore shares, conclude wyoming's competitive edge is on shaky ground.

alberta is offering incentives through lower royalty rates that encourage development, so i really hope that the department is looking very critically at your own analysis and working to insure, again, that we are not putting, um, additional hurdles in place for development on federal lands, additional costs on top of the costs that are already in plus. in place. so i am glad to hear you make the statement that it has not been, um, a conclusion has not been reached. do you have any idea when you might make that determination where you're going with that? >> senator, we really don't or at least i don't at this point in time. i do know that we had conversations as recently as yesterday with the office of management and budget regarding proposed rules as it relates to royalty increases. um, you know, wyoming is doing

quite well. you cited that the study said they're losing their competitive edge. they're -- >> your study, not mine. [laughter] >> nonetheless, there are a lot of factors that we have taken into consideration relative to what we will ultimately propose for any royalty rate increase. i will say this, too, that the 12.5% royalty rate that's in place right now for both natural gas and oil has been in lace for decades -- in place for decades, so i do think it was prudent that we conducted this study, that we are doing the analysis to determine what is a fair return to the american taxpayer. >> let me ask you about the timeliness of where we are with ocs permitting, and i guess i'll bring you into the conversation, director watson. can you tell us how the department is doing with respect to hiring the additional personnel that you these to conduct the inspections and process the permits? as i mentioned in my statement,

um, in the last, in the last interior bill we moved forward the new fees to help with this effort, provide additional authorities to not only increase the level of competition, but really to try to get additional funds for those, those personnel responsibilities. where are we with that? i'm still hearing from folks that they feel that the agency, um, is still understaffed, and that is causing what they consider to be ongoing delays. where are we? >> we, we began with about 60 inspectors and a modest number of engineers that do the permitting. and we have a target that is based on where the industry is

projected to go in terms of the number of applications that we would expect to get plus all of the new standards that we've implemented and the workload that's required. and it comes out to you need about a total of 150 inspectors, and you need about 230 engineers. and so we are on a process of hiring inspectors and engineers in the area of inspectors, we've gone up from about 60 last year to 91 this year, and on the engineers we've added about 10%. so we're needing to administer. >> you've got a long ways to go. >> we do have a long way to go, but as you know, the appropriation just came out in december. um, it was vital that we had some ability to incentivize

those engineers to work for the u.s. government instead of for the oil companies. um, they're paid very well by the oil companies especially when the price of oil is what it is today. so we are in the process of implementing that pay incentive, and we also are doing some aggressive outreach to connect with new graduates from the engineering schools. we're even working with the american petroleum institute and other industry organizations to assist us with those people that may want to work for the government because of some of the benefits and perhaps some of the stability that we can provide, um, that the industry typically doesn't. so i'm optimistic. it'll take a couple of years for us to reach our goal, but i think we will make a big stride this year. >> well, as you all know, the

congressional intent was that part of these new fees be used to expand the capacity so that we could expedite the orderly development of offshore there, and i do appreciate the timelines, and i also recognize that we just can't snap our fingers and have these folks in place. but i -- you will be able to count on me to keep inquiring with you on a regular basis to see how we are doing not only in getting the bodies in these positions, but again, making sure that it's going towards the goal which is a more orderly and expedited processing for these ocs permits. so it's not only getting the bodies in, but making sure that we're seeing, um, seeing greater movement there. my time has expired, mr.

chairman. >> thank you very much, senator murkowski. senator tester. >> yeah, thank you, mr. chairman. i want to talk about fracking for a little bit. current complaint from the industry is there's too many cooks in the kitchen. the doe, usgs, epa are all in the process of studying fracking. i've heard there's maybe as many as ten agencies that are involved in the process. i think the budget gives 13 million to usgs. i think there's about 45 million for fracking research in total in the different budgets. um, duplication is something that i'm always worried about, people doing the same work in different agent is, and we can get a -- agencies, and we can get a little better bang for the buck. i just want to get your perspective on is there coordination between the agencies so there isn't overlapping research? >> again, dupe ri case is always a -- duplication is always a concern for all of us, i beli