Section 11 AAC 03.026 - Provisions applicable to royalty contracts(a) Within 10 days after receiving written notice from a royalty purchaser of its intent to renegotiate price, as provided for by the terms of that purchaser's state royalty contract, or within 10 days after giving a royalty purchaser written notice of the state's intent to renegotiate price, as provided for by the terms of that purchaser's state royalty contract, or before the adoption of any material amendment to a royalty contract which appreciably reduces the consideration received by the state, the commissioner will publish notice of the intent to renegotiate price or amend the contract in a newspaper of general statewide circulation. In addition, the commissioner will, in the commissioner's discretion, publish notice by radio, television, or other electronic media. The notice will include(1) a summary of information pertinent to the royalty contract, including quantity, current price, and termination date;(2) a statement indicating where copies of the contract may be obtained; and(3) a statement that any person may file written comments on the notice with the commissioner within 30 days after publication of the notice.(b) In establishing or renegotiating the price of a royalty oil contract, the commissioner will obtain a price at least equal to the volume-weighted average of the current reported netback prices filed by the lessees for royalty purposes for those filing periods applicable to the term of the disposition, plus field costs, if any, incurred by the royalty share. In establishing or renegotiating the price of a royalty gas contract, the commissioner will obtain a price at least equal to the price that would have been received had the gas been taken in-value, plus field costs, if any, incurred by the royalty share, unless the commissioner determines that a lower price for the royalty gas would best serve the state's interest.(c) The commissioner will submit to the legislature for approval any material amendment to a royalty contract which appreciably reduces the consideration received by the state.Eff. 8/8/84, Register 91; am 12/15/84, Register 92; am 9/28/85, Register 95; am 5/22/93, Register 126Before Register 126, 1993, 11 AAC 03.026 appeared as 11 AAC 03.091. The history of the section under its former number is included in the history note for 11 AAC 03.026.
Authority:AS 38.05.020
AS 38.05.182
AS 38.05.183