11 AAC 03.015. Taking royalty oil, gas, or associated substances in-kind

Royalty oil, gas, or associated substances taken in-kind as provided by AS 38.05.182 must be taken under the provision of the lease, including any amendments or supplements to the lease, which reserves the royalty to the state. If no such provision is in the lease, all or any portion of the state's share will, at the option of the commissioner, be taken in-kind in accordance with the following:

(1) 90 days written notice will be given to each lessee of the state's election to take the royalty products in-kind;

(2) after taking has actually commenced, the amount to be taken in-kind will, in the commissioner's discretion, be increased or decreased from time to time by

(A) not more than 10 percent, upon 30 days written notice to each lessee of record;

(B) greater than 10 percent, upon 90 days written notice; and

(3) the products must be delivered to the state or its designated purchaser free of charge at the point specified in the lease, for determination of the value of the royalty product as if the product to be taken were to be paid in money rather than taken in-kind; the condition of the product must be the same as the non-royalty share at the point of taking; the lessee shall, if necessary, furnish safe storage for the royalty share free of charge for the same duration and in the same manner as storage is provided for the non-royalty share.

History: Eff. 7/19/86, Register 99; am 5/22/93, Register 126

Authority: AS 38.05.020

AS 38.05.145

AS 38.05.180

AS 38.05.182

The Alaska Administrative Code was automatically converted to HTML from a plain text format. Every effort has been made to ensure its accuracy, but neither Touch N' Go Systems nor the Law Offices of James B. Gottstein can be held responsible for any possible errors. This version of the Alaska Administrative Code is current through June, 2006.

If it is critical that the precise terms of the Alaska Administrative Code be known, it is recommended that more formal sources be consulted. Recent editions of the Alaska Administrative Journal may be obtained from the Alaska Lieutenant Governor's Office on the world wide web. If any errors are found, please e-mail Touch N' Go systems at E-mail. We hope you find this information useful. Copyright 2006. Touch N' Go Systems, Inc. All Rights Reserved.