Section 38.05.710 - License procedures(a) To apply for a carbon storage exploration license under AS 38.05.705, an applicant shall submit to the commissioner a proposal that (1) identifies the specific area to be subject to the license;(2) proposes minimum work commitments;(3) proposes commercial terms applicable to a carbon storage lease that satisfy the requirements of AS 38.05.705(c)(3);(4) demonstrates the applicant's ability to assume responsibility of a carbon storage lease;(5) describes how the applicant meets the minimum qualifications for a licensee under applicable regulations; and(6) includes an attestation of the applicant's ability to perform the requirements of (2) - (4) of this subsection.(b) The commissioner shall publish notice of a proposal received under (a) of this section. The notice must include a solicitation for competing proposals. The commissioner shall send a copy of the published notice to each lessee under AS 38.05.135 - 38.05.181 within one-half mile of the area proposed for the exploration license. Any person may submit a competing proposal, including a proposal for the authorization of subsurface storage of oil or gas under AS 38.05.180(u), under the process established by the commissioner in regulation. The regulations must require that a competing proposal be submitted not later than 90 days after the commissioner's notice is published.(c) After the period for submission of competing proposals has passed, the commissioner shall issue a written finding determining whether issuance of a carbon storage exploration license is in the best interests of the state. If the commissioner determines that issuance of a carbon storage exploration license is in the best interests of the state, the finding must (1) describe the limitations, stipulations, and conditions of the license and any changes to the conditions detailed in the proposal submitted under (a) of this section, or a competing proposal, that are required before issuance of the exploration license;(2) set out the commercial terms required for the eventual conversion of the exploration license into a carbon storage lease;(3) if there are competing proposals from multiple applicants, identify which applicants are qualified for the issuance of the exploration license and include information about the competitive bid process as set out in (e) of this section; and(4) include a copy of the exploration license to be issued and the form of lease that will be used for any portion of the exploration license area that is later converted to a lease under AS 38.05.715.(d) If the commissioner determines that issuance of a carbon storage exploration license is in the best interests of the state and that only one applicant is qualified for a license, the applicant may accept or reject the exploration license, as limited or conditioned by the terms of the finding made under (c) of this section and in the form of lease attached to the finding, not later than 30 days after the date the finding was issued. The applicant shall accept or reject the issuance of the carbon storage exploration license in writing. If an applicant fails to respond within 30 days after the finding was issued, the commissioner shall consider the applicant's failure to respond as a rejection of the license.(e) If the commissioner determines that issuance of a carbon storage exploration license is in the best interests of the state and that more than one applicant is qualified for a license, the commissioner shall issue a request for competitive sealed bids, under procedures adopted by regulation, to determine which qualified applicants will receive a license. If the commissioner determines that a competitive bid process is necessary, the best interest finding made under (c) of this section must include notice that the commissioner intends to request competitive bids.(f) The commissioner shall establish in regulation the criteria for the assessment of competitive bids under (e) of this section and for the determination of a successful bidder.(g) If a lessee under AS 38.05.135 - 38.05.181 in the area covered by a proposed carbon storage exploration license participates in a competitive bid process under (e) of this section and is not the successful bidder, before issuing the license, the commissioner shall provide the lessee an opportunity to match the successful bid. If the lessee matches the successful bid, the commissioner shall issue a carbon storage exploration license to the lessee.(h) A carbon storage exploration license issued under this section and a carbon storage lease under AS 38.05.715 or 38.05.720 must include (1) a covenant from the licensee or lessee not to unreasonably interfere with the rights of a lessee under AS 38.05.135 - 38.05.181; and(2) a clause by which the licensee or lessee indemnifies the state for any unreasonable interference the licensee or lessee might cause to the rights of a lessee under AS 38.05.135 - 38.05.181.(i) When notice is required under this section, the department shall follow the requirements for notice under AS 38.05.945(b) and (c).Added by SLA 2024, ch. 23,sec. 21, eff. 10/29/2024.