All of these issues are raised and are being pressed, but none have been answered satisfactorily in our judgment. We believe it would be premature and unwise to authorize deepwater port development absent the development, to the satisfaction of the Congress particularly, of an adequate information base, institutional structure, and feel for the real answers to those issues and their relationship to coordinated national energy policy.

Senator HOLLINGS. Do you expect a national agency, Mr. Hallman, to be developed that will have that feel, as you describe it? That is the millennium. I would like that, too. When would that occur?

Mr. HALLMAN. We are very much in favor of establishing at the Federal level or vesting authority at the Federal level in some agency or new agency or interagency task force to coordinate and review in a comprehensive way all the issues that we believe are involved in deepwater port development and a commitment to it. It may be that Congress would select an existing agency or it may be -I think we prefer to have a new agency established with some criteria for how it will go about its business.

Senator HOLLINGS. You would prefer a new agency?

Mr. HALLMAN. Our present feeling is that no single existing agency possesses all the elements which we believe ought to be in the mandate of the agency that coordinates policy planning for deepwater port development and other development for offshore facilities. These agencies were not established to deal with the deepwater port development problem or related series of energy policy.

To move away from that point for a second, the environmental organizations are also, Senator Hollings, very concerned about the many environmental problems which deepwater port development poses. We need not detail them here, but they give us great pause; and we believe are additional reasons for going very slow and cautiously proceeding with any deepwater port development.

The existence of these substantial unresolved issues, the lack of any coordinated planning approach presently at the Federal level, and the substantial environmental problems that are on the horizon, and the need for a comprehensive coastal zone management approach lead the environmental groups to the conclusion-and I think it is a carefully reasoned judgment-that no deepwater port development ought to proceed pending the development of an adequate information base and the institutional capacity to deal with these problems.

Now, as the Governor of Louisiana made clear this morning and as you have pointed out in discussing the problems with Chairman Train, deepwater port development is imminent in terms of the private sector. There are private proposals for going forward off virtually every coast. There are also proposals to develop powerplant facilities and airports in offshore areas.

If such projects are able to proceed without the benefit of the kind of coordinated planning approach that we believe is essential, it will render impossible any kind of a rational approach to coastal zone management. Therefore we believe that it is necessary to take steps now to prevent startup of deepwater port projects until a coordinated planning capability is developed.

Now, with that general context in mind, let me briefly run down nine principles that we believe ought to be reflected in deepwater port development policy, assuming that the resolution of the threshold, fundamental issues lead to this.

The first principle, which reflects our basic caution, is that any initial development ought to be limited. Specifically, on by a limited number of ports should be authorized. There is substantial evidence that supports this judgment. All of the Government studies which we are aware emphasize that only one, two or at most three deepwater ports would be necessary from an energy demand standpoint. Given this evidence and the many unresolved issues, we believe that any initial authorization should limit the number of ports to be developed and perhaps should be restricted to a single pilot project.

A second principle we believe ought to be seriously considered is a requirement for approval by the Congress of specific commitments to deepwater port proposals and to the general location. This would be a general authorization by Congress by specific projects. Deepwater port development is of national as well as State interest, and we believe that serious consideration should be given to having the general commitment to specific area developments made by Congress.

A third principle relates to the role of States in development of deepwater ports. We believe that the States at this time ought to have the authority to disapprove deepwater port proposals off their shores. However, we have attempted to adopt a reasoned approach to this problem and recommend two bases for disapproval by a State. We are not necessarily supporting a general veto for some unknown or unsupported reasons. We believe a State veto should be tied into environmental considerations. The conditions are set forth in our testimony.

We also strongly believe that decisions to disapprove deepwater port proposes should be available to the public in written form, with the conclusions and findings clearly set forth, and that the decision should be subject to judicial review.

Senator HOLLINGS. That third principle would almost dovetail with the first, making them limited. Other than perhaps Texas and Louisiana, do you know of any other States interested in superports? This is a very, very extensive paper and it shows a lot of work and a lot of thought has been given to it. In preparing this presentation, what has been your information relative to the interest of the several States in the east and west coast?

Mr. HALLMAN. In addition to the LOOP project in Louisiana and the Seadock project in Texas, we are aware and I think we mentioned in our testimony, that the Massachusetts Port Authority is now considering development of a deepwater port off the State of Massachusetts.

Senator HOLLINGS. Massachusetts is interested in it?

Mr. HALLMAN. That is our understanding.

Mr. GREENBERG. There are also concrete plans, as you may know, for development of a deepwater port off the Delaware coast by a private consortium of oil companies known as the Delaware Bay Transportation Co., although the States of Delaware and New Jersey have expressed opposition to deepwater port development.

Sana #dista. Ezense me. Go ahead. What is the fourth principal

Mr Haramas. The State approval was three. The fourth is that why whethe of regulation that is established ought to be uniform in thurt the same standards apply and same agency administer the liSensing and certification authority for the territorial waters as well ** for waters beyond the territorial limits. You could have a situaBen where one agency approves proposals within the territorial limite and anotluse agency exercises authority for proposals on the ConAusual Shelf. We believe uniform regulation is essential and ultimately will enable more effective protection of the environment. This fifth principle relates to the establishment of a single coordinating apney at the Federal level.

The sixth principle relates to economic regulation. Although this Be comwhat removed from environmental considerations we feel, as a matter of public policy, that the ownership, control, and the chacasse for us of deepwater port facilities ought to be subject to Covernment regulation. If only a few facilities are developed, these would be very scarce resources with monopoly profit potentials. We betioce that governmental regulation is necessary to protect the pubtip from possible economic abuse.

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make it much safer. From the studies just given by the previous testimony by Chairman Russell Train

Mr. HALLMAN. I did not mean to imply by these remarks that we necessarily support deepwater port development offshore or onshore. We do not at this time.

Senator HOLLINGS. Why wouldn't you? I notice you do not, but everybody seems to agree that the superport is environmentally more safe

Mr. HALLMAN. Well, there are other alternatives, Senator Hollings, that are on the drawing boards with respect to which a final answer has not been as to tradeoffs between those alternatives and deepwater port development.

For example, there is the transshipment possibility from foreign sources; that is, from the Bahamas and the Maritime Provinces of Canada. The transshipment alternative would avoid developing deepwater ports in the United States, but might raise other environmental problems.

Another possibility suggested in several studies is the development of a fleet of shallow-draft tankers. Such a fleet of shallow-draft tankers might also eliminate the demand for deepwater port development.

A third possibility is simply an increase in the conventional tanker fleet and coupled with this is a very important point-coupled with substantially increased traffic controls and new design features which, for the first time, would be available for environmental protection under the Ports and Waterways Safety Act. Such actions, can substantially reduce the environmental problems caused by tanker traffic.

These are some of the alternatives that we believe need further examination before we can necessarily say that deepwater ports offshore are the best way to go environmentally.

Senator HOLLINGS. All right, sir. Mr. Greenberg.

Mr. GREENBERG. Senator Hollings, as Mr. Hallman noted, we are in favor of development of a comprehensive scheme for regulation of offshore development. However, there are numerous aspects of S. 80 which we believe are valuable and ought to be incorporated in any comprehensive scheme. Similarly we have a number of suggestions and comments on contents of the bill.

First, we express strong support at this time for the central concept of the bill; that is, environmental certification for offshore development. A certification procedure is something that we believe is very important and should be included in any ultimate regulatory

scheme.

Senator HOLLINGs. What about licensing? Where would you put licensing?

Mr. GREENBERG. We believe at this point that licensing and certification might well be combined in one single agency, although I do not think we have reached a final determination with respect to that issue.

Senator HOLLINGS. What about the proposal that Mr. Train had -that it be in the Department of the Interior?

Mr. GREENBERG. Well, here again, I defer to what Mr. Hallman said earlier. It may be that a new agency should be established or

that an interagency task force should be developed which would control overall development of superports and it may be that the licensing and certification might best be placed in that new agency. I was going to get a little bit later to the problems with NOAA as such.

A second aspect of the bill for which we express strong support is the development of concrete criteria for environmental certification which are expressed legislation and provide guidance to the one or several administrative agencies which might be involved in deepwater port regulation.

Third, and this backs up what Mr. Hallman said, we believe that the concept of uniform regulation which is presently incorporated in S. 80-that is, giving responsibility to one agency to certify offshore structures, whether located within the territorial sea or on the Outer Continental Shelf and providing that the same certification standards are applicable to all structures, regardless of location -is very important for establishing a rational regulatory scheme. We also believe in this regard that the provisions currently made is S. 80 for compliance with other Federal laws and deference to higher State standards which may be developed are appropriate.

I will now turn to some specific aspects of S. 80 which we suggest might be improved.

First, with respect to NOAA, we are concerned that NOAA may not have the expertise to evaluate two essential aspects of deepwater port development. The first aspect is the landside effect of deepwater port development. As Mr. Train and Mr. Hallman have pointed out, building a port is only one aspect of the problem. If a superport is built on Delaware Bay or off Louisiana, there will be substantial landside impacts in terms of development of refineries, effects on population growth, and so forth. It is not clear to us that NOAA presently has the expertise to evaluate those kinds of landside impacts.

Senator HOLLINGS. What agency or department does?

Mr. GREENBERG. Well, here again, I think the authority may presently be split among various agencies with expertise in the area. I think the EPA has some expertise here. I think, fairly, the Department of Interior may have some expertise as well.

Second, with respect to the structure itself and the design of ships and the design of traffic control systems, it is not clear that NOAA has sufficient expertise in this area. We might suggest here that the Coast Guard, which has developed standards for traffic systems and which, under the Ports and Waterways Safety Act, is in the process of developing standards for design of ships which will enter U.S. ports, does have some expertise in this area which NOAA does not have.

A second aspect of the bill which we believe might appropriately be improved relates to operational regulation. The bill as presently drafted provides for a certification at the preconstruction stage, far in advance of any actual construction and certainly far in advance of any actual operation. It may be that as time passes, after the initial certification, the circumstances will change and it might be appropriate to provide for certification of the operational characteristics of the offshore facility at or just prior to the time it enters into

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