00                             SENATE BILL NO. 164                                                                         
01 "An Act prohibiting leases under the Right-of-Way Leasing Act on state land in or                                       
02 adjacent to the Beaufort Sea; and providing for an effective date."                                                     
03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
04    * Section 1.  AS 38.35 is amended by adding a new section to read:                                                 
05            Sec. 38.35.017.  Limitation on leases in or adjacent to the Beaufort Sea.  (a)                             
06       Consistent with and in furtherance of the statements of general state policy guiding                              
07       resource development set out in art. VIII, sec. 1, Constitution of the State of Alaska,                           
08       that the resources of the state be developed "by making them available for maximum                                
09       use consistent with the public interest" and in art. VIII, sec. 2, Constitution of the State                      
10       of Alaska, directing that provision shall be made by the legislature for "the utilization,                        
11       development, and conservation of all natural resources belonging to the State . . . for                           
12       the maximum benefit of its people," and consistent with and in furtherance of the                                 
13       general legislative declaration of policy for this chapter set out in AS 38.35.010, it is                         
14       the policy of this state that the overall strategy for development, use, and control of a                         
01       pipeline or pipelines to develop the state's substantial North Slope natural gas                                  
02       resources be directed                                                                                             
03                 (1)  to enhance the standard of living of state residents by                                            
04                      (A)  ensuring that, in conjunction with out-of-state market                                        
05            driven commercial demand for North Slope natural gas, state residents and                                    
06            businesses will have access, directly or indirectly, to that portion of the gas that                         
07            will meet the reasonably foreseeable in-state demands for it, including                                      
08            substitution of the North Slope natural gas for depleting gas reserves in                                    
09            Southcentral Alaska in order to maintain a vital domestic and industrial energy                              
10            source, and ensuring that the pipeline or pipelines for the transportation of                                
11            North Slope natural gas will be designed and located to be responsive to these                               
12            requirements;                                                                                                
13                      (B)  making the maximum contribution to the development of                                         
14            job opportunities in this state by providing direct short-term construction and                              
15            long-term operation- and maintenance-related employment on the pipeline or                                   
16            pipelines and by providing necessary support services; and                                                   
17                      (C)  adding significant long-term property value to the tax base                                   
18            of the state and local governments, thereby providing the means to support                                   
19            public education, public health, transportation, and other essential state and                               
20            local government projects and services;                                                                      
21                 (2)  to ensure that the design, location, and construction of a pipeline or                             
22       pipelines for delivery of North Slope natural gas to North American markets through                               
23       connection to the North American natural gas pipeline network enhance opportunities                               
24       for implementing gas deliveries using alternative technologies and the construction of                            
25       other pipelines to deliver North Slope natural gas to foreign and domestic markets; and                           
26                 (3)  to ensure construction of the pipeline or pipelines consistent with                                
27       careful protection of the state's natural environment, with minimum environmental                                 
28       degradation, to the greatest extent possible, and with protection of fish, wildlife, and                          
29       biotic resources for the use of persons who depend upon them by using available                                   
30       transportation infrastructure to initiate and complete project construction and                                   
31       maintenance and by avoiding duplication of facilities.                                                            
01            (b)  Consistent with the legislative policy and goals set out in (a) of this                                 
02       section, the commissioner may not grant a lease across state land that is in or adjacent                          
03       to the Beaufort Sea for pipeline right-of-way purposes to authorize construction and                              
04       operation of a natural gas pipeline following a "northern" or "over-the-top" route                                
05       running east from the North Slope to Canada's Mackenzie River Valley, then south to                               
06       link to existing pipeline networks to transport North Slope natural gas to North                                  
07       American markets.                                                                                                 
08            (c)  The limitation on leasing set out in (b) of this section does not apply on                              
09       and after the date on which a natural gas pipeline following a "southern" route that                              
10       parallels the Trans Alaska Pipeline System and the Alaska Highway to transport North                              
11       Slope natural gas to North American markets or Alaska tidewater for delivery to                                   
12       foreign and domestic markets has been completed and has begun operation.                                          
13    * Sec. 2.  This Act takes effect immediately under AS 01.10.070(c).