| 1 | 1 | | |
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| 2 | 2 | | HB0015a -1- HB 15 |
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| 3 | 3 | | New Text Underlined [DELETED TEXT BRACKETED] |
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| 4 | 4 | | |
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| 5 | 5 | | 34-LS0214\N |
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| 7 | 7 | | |
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| 8 | 8 | | |
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| 10 | 10 | | |
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| 11 | 11 | | HOUSE BILL NO. 15 |
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| 12 | 12 | | |
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| 13 | 13 | | IN THE LEGISLATURE OF THE STATE OF ALASKA |
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| 14 | 14 | | |
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| 15 | 15 | | THIRTY-FOURTH LEGISLATURE - FIRST SESSION |
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| 16 | 16 | | |
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| 17 | 17 | | BY REPRESENTATIVE RAUSCHER |
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| 18 | 18 | | |
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| 19 | 19 | | Introduced: 1/10/25 |
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| 20 | 20 | | Referred: Prefiled |
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| 21 | 21 | | |
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| 22 | 22 | | |
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| 23 | 23 | | A BILL |
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| 24 | 24 | | |
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| 25 | 25 | | FOR AN ACT ENTITLED |
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| 26 | 26 | | |
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| 27 | 27 | | "An Act relating to royalty rates and payments for certain oil and gas; and providing 1 |
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| 28 | 28 | | for an effective date." 2 |
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| 29 | 29 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 3 |
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| 30 | 30 | | * Section 1. AS 38.05.180 is amended by adding new subsections to read: 4 |
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| 31 | 31 | | (mm) Notwithstanding and in lieu of a requirement in the leasing method 5 |
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| 32 | 32 | | chosen of a minimum fixed royalty share or the royalty provision of a lease, for leases 6 |
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| 33 | 33 | | issued for land south of 68 degrees North latitude from which commercial production 7 |
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| 34 | 34 | | of oil or gas begins after July 1, 2025, and before January 1, 2036, the lessee shall pay 8 |
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| 35 | 35 | | a royalty of three percent for qualified new gas and 6.25 percent for qualified new oil, 9 |
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| 36 | 36 | | unless payment is lower under another subsection of this section. A royalty rate in this 10 |
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| 37 | 37 | | subsection applies until the earlier of 11 |
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| 38 | 38 | | (1) 10 years following the commencement of commercial production; 12 |
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| 39 | 39 | | or 13 |
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| 40 | 40 | | (2) the date on which a commercial quantity of oil or gas produced by 14 34-LS0214\N |
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| 41 | 41 | | HB 15 -2- HB0015a |
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| 42 | 42 | | New Text Underlined [DELETED TEXT BRACKETED] |
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| 43 | 43 | | |
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| 44 | 44 | | the lessee from land south of 68 degrees North latitude is shipped out of the state. 1 |
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| 45 | 45 | | (nn) In (mm) of this section, 2 |
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| 46 | 46 | | (1) "qualified new gas" means gas produced from 3 |
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| 47 | 47 | | (A) a field or pool that the commissioner determines has not 4 |
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| 48 | 48 | | previously produced gas for commercial sale before January 1, 2025; 5 |
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| 49 | 49 | | (B) a field or pool that the commissioner determines has not 6 |
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| 50 | 50 | | produced gas during the preceding six months but that has previously produced 7 |
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| 51 | 51 | | gas; or 8 |
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| 52 | 52 | | (C) a well that did not exist on January 1, 2026, if the 9 |
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| 53 | 53 | | commissioner determines that production of that gas from the field or pool 10 |
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| 54 | 54 | | from an existing well was not feasible; 11 |
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| 55 | 55 | | (2) "qualified new oil" means oil produced from 12 |
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| 56 | 56 | | (A) a field or pool that the commissioner determines has not 13 |
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| 57 | 57 | | previously produced oil for commercial sale before January 1, 2025; 14 |
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| 58 | 58 | | (B) a field or pool that the commissioner determines has not 15 |
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| 59 | 59 | | produced oil during the preceding one year but that has previously produced 16 |
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| 60 | 60 | | oil; or 17 |
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| 61 | 61 | | (C) a well that did not exist on January 1, 2026, if the 18 |
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| 62 | 62 | | commissioner determines that production of that oil from the field or pool from 19 |
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| 63 | 63 | | an existing well was not feasible. 20 |
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| 64 | 64 | | (oo) Notwithstanding and in lieu of a requirement in the leasing method 21 |
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| 65 | 65 | | chosen of a minimum fixed royalty share, or the royalty provision of a lease or an 22 |
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| 66 | 66 | | existing royalty settlement agreement, for gas that is produced from leases that include 23 |
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| 67 | 67 | | land north of 68 degrees North latitude and that is later liquefied or used in the 24 |
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| 68 | 68 | | liquefaction or transportation process, the lessee shall pay a royalty rate of one percent 25 |
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| 69 | 69 | | if the lessee agrees to sell the gas to a publicly owned utility or a utility regulated 26 |
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| 70 | 70 | | under AS 42.05 at a rate that reflects the discounted royalty rate provided under this 27 |
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| 71 | 71 | | subsection. The royalty rate under this subsection applies until the earlier of either 28 |
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| 72 | 72 | | (1) 10 years following the first commercial use of liquefied natural gas 29 |
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| 73 | 73 | | receiving the royalty rate under this subsection; or 30 |
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| 74 | 74 | | (2) the date on which a commercial quantity of liquefied natural gas 31 34-LS0214\N |
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| 75 | 75 | | HB0015a -3- HB 15 |
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| 76 | 76 | | New Text Underlined [DELETED TEXT BRACKETED] |
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| 77 | 77 | | |
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| 78 | 78 | | produced from the lease receiving the royalty rate under this subsection is shipped out 1 |
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| 79 | 79 | | of the state. 2 |
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| 80 | 80 | | * Sec. 2. AS 31.05.030(i); AS 38.05.180(f)(5), and 38.05.180(dd) are repealed. 3 |
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| 81 | 81 | | * Sec. 3. AS 38.05.180(mm) and 38.05.180(nn) are repealed January 1, 2046. 4 |
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| 82 | 82 | | * Sec. 4. This Act takes effect immediately under AS 01.10.070(c). 5 |
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