Alaska oil and gas laws can be found in Title 31 and Title 38 of Alaska Statutes.  Pursuant to Alaska Stat. § 31.05.005, an independent quasi-judicial agency, the Alaska Oil and Gas Conservation Commission, is established composed of three commissioners appointed by the governor and confirmed by the legislature in joint session.

Powers and Duties of the Commission

Pursuant to Alaska Stat. § 31.05.030, the powers and duties of the commission are:

• The commission has jurisdiction and authority over all persons and property, public and private, necessary to carry out the purposes and intent of this statute.
• The commission should investigate to determine whether or not waste exists or is imminent, or whether or not other facts exist which justify or require action by it.
• The commission should adopt regulations and orders and take other appropriate action to carry out the purposes of this statute.
• The commission may require:

1. identification of ownership of wells, producing leases, tanks, plants, and drilling structures;
2. the making and filing of reports, well logs, drilling logs, electric logs, lithologic logs, directional surveys, and all other subsurface information on a well for which a permit to drill has been issued by the commission.
3. the drilling, casing, and plugging of wells in a manner that will prevent the escape of oil or gas out of one stratum into another, the intrusion of water into an oil or gas stratum, the pollution of fresh water supplies by oil, gas, or salt water, and prevent blowouts, cavings, seepages, and fires;
4. the furnishing of a reasonable bond with sufficient surety conditions for the performance of the duty to plug each dry or abandoned well or the repair of wells causing waste;
5. the operation of wells with efficient gas-oil and water-oil ratios, and may fix these ratios;
6. the gauging or other measuring of oil and gas to determine the quality and quantity of oil and gas;
7. every person who produces oil or gas in the state to keep and maintain for a period of five years in the state complete and accurate records of the quantities of oil and gas produced, which should be available for examination by the commission at all reasonable times;
8. the measuring and monitoring of oil and gas pool pressures;
9. the filing and approval of a plan of development and operation for a field or pool to prevent waste, ensure a greater ultimate recovery of oil and gas, and protect the correlative rights of persons owning interests in the tracts of land affected.

• The commission may regulate[i]:

1. the drilling, producing, and plugging of wells;
2. the perforating, fracture simulation, and chemical treatment of wells;
3. the spacing of wells;
4. the disposal of salt water, nonpotable water, and oil field wastes;
5. the contamination or waste of underground water;
6. the quantity and rate of the production of oil and gas from a well or property;
7. the underground injection of gas for purposes of storage;

• The commission may classify a well or a specific portion of a well as an exploratory, development, service, or stratigraphic test well and may classify a development well as an oil or gas well.
• When the commission finds sufficient likelihood of an unexpected encounter of oil, gas, or other hazardous substance as a result of well drilling in an area of the state, the commission may, by regulation, designate the area and specify a depth in the area as one in which wells or any boring into the soil in excess of the specified depth but not otherwise are subject to the regulations and requirements adopted.
• The commission may take all actions necessary to allow the state to acquire primary enforcement responsibility for the control of underground injection related to the recovery and production of oil and natural gas and the control of underground injection in Class I wells.
• The commission should accept written plans submitted by lessees.
• For exploration and development operations involving nonconventional gas, the commission should regulate hydraulic fracturing in nonconventional gas wells to ensure protection of drinking water quality and regulate the disposal of wastes produced from the operations;
• The commission should certify to the Department of Natural Resources the volume of oil production from a field or platform.

To encourage exploration for oil and gas on state land, the commissioner may issue exploration licenses.  The commissioner may limit the exploration licenses to exploration for and recovery of gas only.  The commissioner may not issue an exploration license on land that is held under an existing coal lease that has an active permit for exploration or mining unless the licensee is also the lessee of that land[ii].

Regulation of Operations

Pursuant to Alaska Stat. § 31.05.090, a person should apply for and receive a permit from the commission before drilling:

• a well in search of oil or gas;
• a well in support of the recovery or production of oil or gas;
• an underground injection well for the purpose of gas storage; or
• an underground injection well for which the state has acquired primary enforcement responsibility.

Alaska Stat. § 31.05.100 provides that for the prevention of waste, to protect and enforce the correlative rights of lessees in a pool, and to avoid the augmenting and accumulation of risks arising from the drilling of an excessive number of wells, or the reduced recovery which might result from too small a number of wells, the commission should, after a hearing, establish a drilling unit or units for each pool.

Civil Actions

Whenever it appears that a person is violating or threatening to violate any provision of this statute, or any regulation or order of the commission, the commission should bring suit against that person in the superior court of the judicial district where the violation occurs or is threatened, to restrain the person from continuing the violation or from carrying out the threat of violation[iii].  In the suit, the court has jurisdiction to grant to the commission, without bond or otherwise undertaking, such prohibitory and mandatory injunctions as the facts warrant.

Penalties

A person who violates a provision of this statute, a regulation adopted under this statute, or an order, stipulation, or term of a permit issued by the commission is liable for a civil penalty of not more than $ 100,000 for the initial violation and not more than $ 10,000 for each day thereafter on which the violation continues[iv].

Further, a person who knowingly commits an act for the purpose of evading a provision of this statute, a regulation adopted under this statute, or an order, stipulation, or term of a permit issued by the commission is guilty of a class A misdemeanor.

Additionally, the commission may impose a civil penalty for each 1,000 cubic feet of natural gas flared, vented, or otherwise determined to be waste.  The penalty should be twice the fair market value of the natural gas at the point of waste.

Leases

Valuable mineral deposits in land belonging to the state should be open to exploration, development, and the extraction of minerals.  All land, together with tide, submerged, or shoreland, to which the state holds title to or to which the state may become entitled, may be obtained by permit or lease for the purpose of exploration, development, and the extraction of minerals[v].

[i] Alaska Stat. § 31.05.030.

[ii] Alaska Stat. § 38.05.132.

[iii] Alaska Stat. § 31.05.160.

[iv] Alaska Stat. § 31.05.150.

[v] Alaska Stat. § 38.05.135.