SB 104 — An Act relating to geothermal resources; relating to the definition of 'geothermal resources'; and providing for an effective date.

32-GS1618\I32-GS1618\A CS FOR SENATE BILL NO.

104(RES)104 IN THE LEGISLATURE OF THE STATE OF ALASKA THIRTY-SECOND LEGISLATURE - FIRST SESSION BY THE SENATE RESOURCESRULES COMMITTEE Referred:BY REQUEST OF THE GOVERNOR Introduced:

Finance3/10/21 Sponsor(s):Referred:

SENATEResources, RULESFinance COMMITTEE BY REQUEST OF THE GOVERNOR A BILL FOR AN ACT ENTITLED "An Act relating to geothermal resources;

A prospecting license or lease is not required under this section to explore for, develop, or use geothermal resources if the geothermal resource is intended for domestic, noncommercial, or small-scale SB0104BSB0104A -1- CSSBSB 104(RES)104 New Text Underlined [DELETED TEXT BRACKETED] 32-GS1618\I32-GS1618\A industrial use [WHEN TITLE TO THE SURFACE PARCEL IS HELD BY A PERSON OTHER THAN THE STATE, THAT PERSON SHALL HAVE A PREFERENTIAL RIGHT TO A GEOTHERMAL PROSPECTING PERMIT OR LEASE FOR THE AREA UNDERLYING THE SURFACE PARCEL.

A holder of a prospecting license [PERMIT] has the right, after completion of an agreed-onagreed-upon work commitment [UPON THE SHOWING OF A DISCOVERY OF GEOTHERMAL RESOURCES IN COMMERCIAL QUANTITIES] and the submission of an exploration [A DEVELOPMENT] plan acceptable to the commissioner, to convert the license [PERMIT] to a noncompetitive lease at a royalty rate under (g) of this section.

At the discretion of the commissioner, CSSBSB 104(RES)104 -2- SB0104BSB0104A New Text Underlined [DELETED TEXT BRACKETED] 32-GS1618\I32-GS1618\A competitive lease sales may be by oral or sealed bid, on the basis of a cash bonus, profit share, or royalty share.

(i) The commissioner may require a lessee of a geothermal resource to operate under a unit agreement that prescribes the conditions under which the lessee shallmust operate.

(j) When determined by the commissioner determines a geothermal lease to be in the public interest, the commissioner may approveauthorize a lessee and the lessee's representative, together with each other or jointly or severally with another lessee, to collectively adopt or operate under a unit agreement.

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(6) "geothermal resources" means the natural heat of the earth and energy, in whatever form, below the surface of the earth present in, resulting from, created by, or that may be extracted from the natural heat,heat; and all minerals in solution or other products obtained from naturally heated fluids, brines, associated gases, and steam, in whatever form, found below the surface of the earth;

and all minerals in solution or other products obtained from naturally heated fluids, brines, associated gases, and steam, in whatever form, found below the surface of the earth;

(5) "geothermal resources" means the natural heat of the earth and energy, in whatever form, below the surface of the earth present in, resulting from, created by, or that may be extracted from the natural heat,heat; and all minerals in solution or other products obtained from naturally heated fluids, brines, associated gases, and steam, in whatever form, found below the surface of the earth;

and all minerals in solution or other products obtained from naturally heated fluids, brines, associated gases, and steam, in whatever form, found below the surface of the earth;

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(a) Except as provided in (b) of this section, this Act applies to a license or lease for a geothermal resource issuedentered into on or after the effective date of secs.

(b) An application made under AS 38.05.181(c),38.05.181(c) as that subsectionis readpending beforewith the effectiveDepartment date of Natural Resources on March 1, 2021, is considered to be an application under AS 38.05.181(c), as amended by sec.

3 of this Act, that is pending with the Department of Natural Resources on March 1, 2021, is considered to be an application under AS 38.05.181(c), as amended by sec.

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