SB 243: "An Act establishing a requirement of an annual offer of land for oil and gas leases if the land was the subject of a best interest finding and if revision of that best interest finding for that land is not justified; deleting from the Alaska Land Act a limitation on the reoffer of land for oil and gas leases when the land was previously offered; and amending laws relating to oil and gas leasing to authorize a program of areawide leasing for land not subject to exploration licensing and to modify provisions relating to disposals based on best interest findings."
00SENATE BILL NO. 243 01 "An Act establishing a requirement of an annual offer of land for oil and gas 02 leases if the land was the subject of a best interest finding and if revision of 03 that best interest finding for that land is not justified; deleting from the Alaska 04 Land Act a limitation on the reoffer of land for oil and gas leases when the 05 land was previously offered; and amending laws relating to oil and gas leasing 06 to authorize a program of areawide leasing for land not subject to exploration 07 licensing and to modify provisions relating to disposals based on best interest 08 findings." 09 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 10 * Section 1. AS 38.05.035(a) is amended to read: 11 (a) The director shall 12 (1) have general charge and supervision of the division and may 13 exercise the powers specifically delegated to the director; may employ and fix the 14 compensation of assistants and employees necessary for the operations of the division;
01 and is the certifying officer of the division, with the consent of the commissioner, and 02 may approve vouchers for disbursements of money appropriated to the division; 03 (2) manage, inspect, and control state land and improvements on it 04 belonging to the state and under the jurisdiction of the division; 05 (3) execute laws, rules, regulations, and orders adopted by the 06 commissioner; 07 (4) prescribe application procedures and practices for the sale, lease, 08 or other disposition of available land, resources, property, or interests [INTEREST] 09 in them, including disposal of interests in land under areawide oil and gas leasing 10 authorized under AS 38.05.180(dd) for an area in which areawide leasing has been 11 authorized; 12 (5) prescribe fees or service charges, with the consent of the 13 commissioner, for any public service rendered; 14 (6) under the conditions and limitations imposed by law and the 15 commissioner, issue deeds, leases, or other conveyances disposing of available land, 16 resources, property, or [ANY] interests in them; 17 (7) have jurisdiction over state land, except that land acquired by the 18 Alaska World War II Veterans Board and the Agricultural Loan Board or the 19 departments or agencies succeeding to their respective functions through foreclosure 20 or default; to this end, the director possesses the powers and, with the approval of the 21 commissioner, shall perform the duties necessary to protect the state's rights and 22 interest in state land, including the taking of all necessary action to protect and enforce 23 the state's contractual or other property rights; 24 (8) [REPEALED 25 (9)] maintain such records as the commissioner considers necessary, 26 administer oaths, and do all things incidental to the authority imposed; the following 27 records and files shall be kept confidential upon request of the person supplying the 28 information: 29 (A) the name of the person nominating or applying for the sale, 30 lease, or other disposal of land by competitive bidding; 31 (B) before the announced time of opening, the names of the
01 bidders, and the amounts of the bids; 02 (C) all geological, geophysical, and engineering data supplied, 03 whether or not concerned with the extraction or development of natural 04 resources; 05 (D) except as provided in AS 38.05.036, cost data and financial 06 information submitted in support of applications, bonds, leases, and similar 07 items; 08 (E) applications for rights-of-way or easements; 09 (F) requests for information or applications by public agencies 10 for land that [WHICH] is being considered for use for a public purpose; 11 (9) [(10)] account for the fees, licenses, taxes, or other money received 12 in the administration of this chapter, including the sale or leasing of land, identify their 13 source, and promptly transmit them to the proper fiscal department after crediting them 14 to the proper fund; receipts from land application filing fees and charges for copies of 15 maps and records shall be deposited immediately in the general fund of the state by 16 the director; 17 (10) [(11)] select and employ or obtain at reasonable compensation 18 cadastral, appraisal, or other professional personnel the director considers necessary for 19 the proper operation of the division; 20 (11) [(12)] be the certifying agent of the state to select, accept, and 21 secure by whatever action is necessary in the name of the state, by deed, sale, gift, 22 devise, judgment, operation of law, or other means any land, of whatever nature or 23 interest, available to the state; and be the certifying agent of the state, to select, accept, 24 or secure by whatever action is necessary in the name of the state any land, or title or 25 interest to land available, granted, or subject to being transferred to the state for any 26 purpose [; 27 (13) REPEALED 28 (14) REPEALED]. 29 * Sec. 2. AS 38.05.035(e) is amended to read: 30 (e) Upon a written finding that the interests of the state will be best served, 31 the director may, with the consent of the commissioner, approve contracts for the sale,
01 lease, or other disposal of available land, resources, property, or interests in them. In 02 [, AND, IN] addition to the conditions and limitations imposed by law, the director 03 may impose additional conditions or limitations in the contracts as the director 04 determines, with the consent of the commissioner, will best serve the interests of the 05 state. The preparation and issuance of the written finding by the director is subject to 06 the following: 07 (1) with the consent of the commissioner and subject to the director's 08 discretion, either for a specific proposed disposal of available land, resources, or 09 property, or of an interest in them, or for a disposal under AS 38.05.180(dd) of land, 10 resources, or property, or an interest in them, the director, in the written finding, 11 (A) shall establish the scope of the administrative review on 12 which the director's determination is based, and the scope of the written finding 13 supporting that determination; the scope of the review and finding may address 14 only reasonably foreseeable, significant effects of the uses proposed to be 15 authorized by the disposal; 16 (B) may limit the scope of an administrative review and finding 17 for a proposed disposal to 18 (i) applicable statutes and regulations; 19 (ii) the facts pertaining to the land, resources, or 20 property, or interest in them, that the director finds are material to the 21 determination and that are known to the director or knowledge of which 22 is made available to the director during the administrative review; and 23 (iii) issues that, based on the statutes and regulations 24 referred to in (i) of this subparagraph, on the facts as described in (ii) 25 of this subparagraph, and on the nature of the uses sought to be 26 authorized, the director finds are material to the determination of 27 whether the proposed disposal will best serve the interests of the state; 28 [AND] 29 (C) may, if the project for which the proposed disposal is 30 sought is a multiphased development, limit the scope of an administrative 31 review and finding for the specific proposed disposal to the applicable statutes
01 and regulations, facts, and issues identified in (B)(i) - (iii) of this paragraph that 02 pertain solely to a discrete phase of the project when 03 (i) the only uses to be authorized by the specific 04 proposed disposal are part of that discrete phase; 05 (ii) the department's approval is required before the next 06 phase of the project may proceed; and 07 (iii) the department describes its reasons for a decision 08 to phase and conditions its approval to ensure that any additional uses 09 or activities proposed for that or any later phase of the project will 10 serve the best interests of the state; and 11 (D) may, if the proposed disposal of interests in land occurs 12 under an areawide oil and gas lease authorized under AS 38.05.180(dd) for 13 an area in which areawide leasing has been authorized, include within the 14 scope of the administrative review and finding the entirety of the area in 15 which areawide leasing has been authorized; 16 (2) the director shall discuss in the written finding prepared and issued 17 under this subsection the reasons that each of the following was not material to the 18 director's determination that the interests of the state will be best served: 19 (A) facts pertaining to the land, resources, or property, or an 20 interest in them other than those that the director finds material under (1)(B)(ii) 21 of this subsection; and 22 (B) issues based on the statutes and regulations referred to in 23 (1)(B)(i) of this subsection and on the facts described in (1)(B)(ii) of this 24 subsection; 25 (3) a written finding for an oil and gas lease sale under AS 38.05.180 26 is subject to (g) of this section; 27 (4) a contract for the sale, lease, or other disposal of available land or 28 an interest in land is not legally binding on the state until the commissioner approves 29 the contract but, if the appraised value is not greater than $50,000 in the case of the 30 sale of land or an interest in land, or $5,000 in the case of the annual rental of land 31 or interest in land, the director may execute the contract without the approval of the
01 commissioner; 02 (5) public notice requirements relating to the sale, lease, or other 03 disposal of available land or an interest in land for oil and gas proposed to be 04 scheduled in the five-year oil and gas leasing program under AS 38.05.180(b) or in 05 an areawide oil and gas leasing program under AS 38.05.180(dd), are as follows: 06 (A) before a public hearing, if held, or in any case not less than 07 180 days before the sale, lease, or other disposal of available land or an interest 08 in land, the director shall make available to the public a preliminary written 09 finding that states the scope of the review established under (1)(A) of this 10 subsection and includes the applicable statutes and regulations, the material 11 facts and issues in accordance with (1)(B) of this subsection, and information 12 required by (g) of this section, upon which the determination that the sale, 13 lease, or other disposal will serve the best interests of the state will be based; 14 the director shall provide opportunity for public comment on the preliminary 15 written finding for a period of not less than 60 days; 16 (B) after the public comment period for the preliminary written 17 finding and not less than 90 days before the sale, lease, or other disposal of 18 available land or an interest in land for oil and gas, the director shall make 19 available to the public a final written finding that states the scope of the review 20 established under (1)(A) of this subsection and includes the applicable statutes 21 and regulations, the material facts and issues in accordance with (1) of this 22 subsection, and information required by (g) of this section, upon which the 23 determination that the sale, lease, or other disposal will serve the best interests 24 of the state is based; 25 (6) before a public hearing, if held, or in any case not less than 21 days 26 before the sale, lease, or other disposal of available land, property, resources, or 27 interests in them other than a sale, lease, or other disposal of available land or an 28 interest in land for oil and gas under (5) of this subsection, the director shall make 29 available to the public a written finding that, in accordance with (1) of this subsection, 30 sets out the material facts and applicable statutes and regulations and any other 31 information required by statute or regulation to be considered upon which the
01 determination that the sale, lease, or other disposal will best serve the interests of the 02 state was based; however, a written finding is not required before the approval of 03 (A) a contract for a negotiated sale authorized under 04 AS 38.05.115; 05 (B) a lease of land for a shore fishery site under AS 38.05.082; 06 (C) a permit or other authorization revocable by the 07 commissioner; 08 (D) a mineral claim located under AS 38.05.195; 09 (E) a mineral lease issued under AS 38.05.205; 10 (F) a production license issued under AS 38.05.207; 11 (G) an exempt oil and gas sale under AS 38.05.180(d) of 12 acreage previously offered in a sale [THAT WAS HELD WITHIN THE 13 PREVIOUS FIVE YEARS] if the sale was subject to a written best interest 14 finding, unless the commissioner determines that new information has become 15 available that justifies a revision of the best interest finding; [OR] 16 (H) a lease sale under AS 38.05.180(w) of acreage previously 17 offered in a sale [THAT WAS HELD WITHIN THE PREVIOUS FIVE 18 YEARS] if the sale was subject to a best interest finding, unless the 19 commissioner determines that new information has become available that 20 justifies a revision of the best interest finding; or 21 (I) an oil or gas lease sale in an area that is part of an 22 areawide lease under AS 38.05.180(dd) within an area in which areawide 23 leasing has been authorized if the lease sale was subject to a best interest 24 finding for the area or if the area that is to be made part of the areawide 25 lease includes two or more areas for which best interest findings have been 26 prepared; however, if the commissioner determines that new information 27 has become available that justifies a revision of the best interest finding, 28 the commissioner shall prepare a new best interest finding for the area 29 taking into consideration the new information; 30 (7) the director shall include in 31 (A) a preliminary written finding, if required, a summary of
01 agency and public comments, if any, obtained as a result of contacts with other 02 agencies concerning a proposed disposal or as a result of informal efforts 03 undertaken by the department to solicit public response to a proposed disposal, 04 and the department's preliminary responses to those comments; and 05 (B) the final written finding a summary of agency and public 06 comments received and the department's responses to those comments. 07 * Sec. 3. AS 38.05.180(b) is amended to read: 08 (b) The commissioner shall biennially prepare and, between the first and the 09 15th day of the first regular session of each legislature, notify the legislature of the 10 availability of 11 (1) a five-year proposed oil and gas leasing program consisting of a 12 schedule of proposed lease sales and specifying as precisely as practicable the location 13 of tracts proposed to be offered for oil and gas leasing during the calendar year in 14 which the proposed program is made available to the legislature and the following four 15 calendar years; and 16 (2) a proposed areawide oil and gas leasing program. 17 * Sec. 4. AS 38.05.180(d) is amended to read: 18 (d) The commissioner 19 (1) shall annually offer to issue oil and gas leases of the acreage 20 previously offered in a sale if the previous sale was subject to a written best 21 interest finding unless the commissioner determines that new information has 22 become available that justifies a revision of the best interest finding for the area 23 proposed to be leased; 24 (2) may issue oil and gas leases in an area that has not been included 25 in a leasing program submitted, in accordance with (b) of this section, to the legislature 26 if the land to be leased 27 (A) [(1)] was previously subject to a valid state or federal oil 28 and gas lease; 29 (B) [(2)] is contiguous to land already under state, federal or 30 private lease and the commissioner makes a written finding, after hearing, that 31 leasing of the land would result in a substantial probability of early evaluation
01 and development of the land to be leased; 02 (C) [(3)] is adjacent to land owned or controlled by another 03 party on which a discovery of commercial quantities of oil or gas has been 04 made, and the commissioner finds, after hearing, that there is a reasonable 05 probability that the land to be leased contains oil or gas in communication with 06 the oil or gas discovered on the land of the other party; 07 (D) [(4)] is adjacent to land included in the federal five-year 08 Outer Continental Shelf leasing program under 43 U.S.C. 1344, and the 09 commissioner makes a written finding, after hearing, that coordinated or 10 simultaneous leasing with the federal government is in the public interest; or 11 (E) [(5)] is the subject of an oil and gas exploration license 12 issued under AS 38.05.131 - 38.05.134. 13 * Sec. 5. AS 38.05.180(w) is amended to read: 14 (w) Notwithstanding any other provisions of this section, land that [WHICH] 15 has been offered for lease [WITHIN THE PREVIOUS FIVE YEARS] and that 16 [WHICH] received no bids at competitive sale or for which a [NO] bid was not 17 accepted may be, at the discretion of the commissioner, immediately offered for lease, 18 under regulations adopted by the commissioner, upon terms appearing most 19 advantageous to the state; however, noncompetitive leasing is prohibited. The 20 commissioner shall establish a royalty determined to be in the public interest but not 21 less than 12 1/2 percent. A lease must provide for payment to the state or rental but 22 need not adhere to the rental schedule in (n) of this section nor to the 5,760-acres-per- 23 lease limitation in (m) of this section. The lease term may not exceed 10 years, except as 24 provided in (o) of this section. 25 * Sec. 6. AS 38.05.180 is amended by adding a new subsection to read: 26 (dd) For land described in AS 38.05.131(b) to which the provisions of the oil 27 and gas exploration licensing program do not apply, the director, with the approval of 28 the commissioner, shall establish a program of areawide oil and gas leasing. The 29 program shall operate within each area in which oil and gas exploration licensing is 30 not authorized. Under the authority granted in this subsection, 31 (1) when the commissioner identifies tracts for inclusion in the
01 proposed lease sale, the commissioner shall include at a minimum all of the tracts 02 reasonably believed by the commissioner to cover the entirety of an oil or gas reservoir 03 sought to be developed; 04 (2) the issuance and continuance in effect of a lease, or of any 05 assignment or other transfer of a lease, under this subsection must be conditioned upon 06 compliance with regulations adopted to implement this subsection. 07 * Sec. 7. REVISOR OF STATUTES TO REVISE REFERENCES. Due to the deletion 08 of repealed paragraphs in AS 38.05.035(a) by sec. 1 of this Act, the revisor of statutes shall 09 amend cross-references to the affected paragraphs in AS 38.05.035(a) that appear in the 10 following statues: AS 38.05.133(e), 38.05.180(j)(6)(B), 38.05.275(c), and AS 41.09.010(d).