Section 38.05.720 - Transition from enhanced oil recovery operations to carbon storage operations(a) A lessee under AS 38.05.180 shall acquire a carbon storage lease before engaging in carbon storage activity that is not associated with enhanced oil or gas recovery.(b) At the commissioner's discretion, the commissioner may issue a carbon storage lease to a lessee under AS 38.05.180 if the lessee is in compliance with regulations adopted under AS 41.06.185(b). The commissioner may consider the qualifications and abilities of the lessee to meet the commercial requirements of a carbon storage lease and whether issuance of the lease is in the best interests of the state.(c) A carbon storage lease issued under this section must include (1) commercial terms acceptable to the department that satisfy the requirements of AS 38.05.705(c)(3);(2) the agreements required under AS 38.05.710(h);(3) any other condition or obligation the commissioner considers necessary or that is required by regulation.(d) Before a carbon storage lease issued under this section may be transferred or assigned to an entity that is not the responsible party under the existing oil and gas lease under AS 38.05.180, the assuming party must provide financial assurance acceptable to the department that the obligations of the lease can be met.(e) The department may adopt regulations that allow all or part of a lease issued under AS 38.05.180 to be transitioned to a lease under this section upon the receipt of a permit issued under AS 41.06.185.Added by SLA 2024, ch. 23,sec. 21, eff. 10/29/2024.