This bill amends Alaska's oil and gas royalty rates by introducing new provisions for leases issued for land south of 68 degrees North latitude, where commercial production of oil or gas begins between July 1, 2025, and January 1, 2036. Under the new subsections added to AS 38.05.180, lessees will pay a royalty of three percent for qualified new gas and 6.25 percent for qualified new oil, with these rates applicable for a period of ten years following the commencement of production or until a commercial quantity is shipped out of state. Definitions for "qualified new gas" and "qualified new oil" are provided, specifying conditions under which these classifications apply.

Additionally, the bill establishes a one percent royalty rate for gas produced from leases north of 68 degrees North latitude that is liquefied or used in the liquefaction process, contingent upon the lessee selling the gas to a publicly owned utility or a regulated utility at a discounted rate. This royalty rate will also apply for ten years following the first commercial use of liquefied natural gas or until a commercial quantity is shipped out of state. The bill repeals certain existing provisions and sets an expiration date for the new subsections in 2046, with the act taking effect immediately.

Statutes affected:
HB0015A, AM HB 15, introduced 01/10/2025: 38.05.180