2020-01-27                     House Journal                      Page 1474
HB 220                                                                                                                        
HOUSE BILL NO. 220 by the House Rules Committee by request of                                                                   
the Governor, entitled:                                                                                                         
                                                                                                                                
     "An Act relating to geothermal resources; relating to the definition                                                       
     of 'geothermal resources'; and providing for an effective date."                                                          
                                                                                                                                
was read the first time and referred to the Resources and Finance                                                               
Committees.                                                                                                                     
                                                                                                                                
The following fiscal note(s) apply:                                                                                             
                                                                                                                                
1.  Zero, Dept. of Commerce, Community, & Economic Development                                                                  
2.  Zero, Dept. of Natural Resources                                                                                            
3.  Fiscal, Dept. of Natural Resources                                                                                          
                                                                                                                                

2020-01-27                     House Journal                      Page 1475
The Governor's transmittal letter dated January 21 follows:                                                                     
                                                                                                                                
"Dear Speaker Edgmon:                                                                                                           
                                                                                                                                
Under the authority of Article III, Section 18, of the Alaska                                                                   
Constitution, I am transmitting a bill revising statutes related to the                                                         
State's geothermal resources.                                                                                                   
                                                                                                                                
This bill removes obstacles for exploration and development of                                                                  
Alaska's geothermal resources. Current law provides companies only                                                              
two to three years to prove a commercial discovery, which then allows                                                           
the company to apply for a more long-term lease. The bill increases                                                             
the time available for exploration to five years to better account for the                                                      
time needed to complete an exploration program. The bill more clearly                                                           
defines what constitutes geothermal resources available for lease. It                                                           
reclassifies the current permit system as a license system similar to                                                           
that for oil and gas exploration. The bill's proposed five-year                                                                 
exploration license term in the bill allows explorers more time to                                                              
conduct background research, acquire surface use permits, and                                                                   
perform the field work necessary to locate a resource and produce the                                                           
data necessary to convert a license to a lease.                                                                                 
                                                                                                                                
This bill also nearly doubles the maximum acreage a person may have                                                             
under lease for geothermal projects from 51,200 acres to 100,000                                                                
acres, to account for the tendency of geothermal resources to be                                                                
dispersed over large areas. The proposed acreage increase in the bill                                                           
will attract greater interest in geothermal resources because developers                                                        
will have a greater opportunity to explore the appropriate area to                                                              
delineate geothermal systems. With enactment of this measure, our                                                               
state will continue to responsibly manage our natural resources in a                                                            
manner to provide maximum benefits to our citizens through                                                                      
development of needed energy sources.                                                                                           
                                                                                                                                
I urge your prompt and favorable action on this measure.                                                                        
                                                                                                                                
Sincerely,                                                                                                                      
/s/                                                                                                                             
Mike Dunleavy                                                                                                                   
Governor"