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Alaska Statutes Title 44. State Government § 44.88.850. Cook Inlet reserve-based lending account

Current as of January 01, 2025 | Updated by Findlaw Staff

(a) The Cook Inlet reserve-based lending account is established in the revolving fund. The account consists of money or assets deposited into the account by the authority and contributions from other sources.

(b) The authority may use money in the account to make one or more reserve-based loans to fund oil and gas development projects the authority considers necessary to increase oil and gas production from the Cook Inlet sedimentary basin. The authority may, as a term of the loan, accept an ownership share in the project funded by the loan. If the authority accepts an ownership share as a term of the loan, the ownership share must be in the form of a carried interest that does not obligate the authority to contribute to the development costs of the project. The authority may make a loan under this section only

(1) to a legal entity in compliance with state and federal laws;

(2) if the loan applicant provides a written waiver permitting the authority to access or obtain copies of the loan applicant's confidential records that are in possession of the Department of Natural Resources or the Department of Revenue; information provided to the authority under this section shall be kept confidential by the authority unless disclosure is authorized by the loan applicant or borrower;

(3) if the authority obtains an independent study performed by an experienced, qualified expert that confirms the valuation of the loan security and the capacity of the loan to support the oil and gas development project and to cause or increase the commercial production of oil or gas from the Cook Inlet sedimentary basin;

(4) if the Regulatory Commission of Alaska determines, under AS 42.05.141(h), that the sale price in a gas sales agreement for gas produced through a project partially or fully funded by a loan under this section does not exceed a just and reasonable immediate delivery price for gas;

(5) if the authority determines that the sales price for oil and gas produced through a project partially or fully funded by a loan under this section is reasonable and in the best interests of residents of the state.

(c) The authority may request assistance from the Department of Revenue under AS 44.25.020(a)(5) or the Department of Natural Resources under AS 44.37.020(d) to execute this section.

(d) The authority may accept an overriding royalty interest in a lease for which a loan has been extended under (b) of this section if, as a term of the loan, the overriding royalty interest is subject to prior approval by the Department of Natural Resources. The authority may only have the overriding royalty interest transferred to the authority if the borrower defaults.

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Cite this article: FindLaw.com - Alaska Statutes Title 44. State Government § 44.88.850. Cook Inlet reserve-based lending account - last updated January 01, 2025 | https://codes.findlaw.com/ak/title-44-state-government/ak-st-sect-44-88-850/

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