Carbon Storage
In 2024, legislation was enacted to allow the State to lease its pore space for underground carbon storage projects. The principal statutes authorizing this program are found under Title 38, Chapter 5, Article 15A, Carbon Storage Exploration Licenses; Leases (AS 38.05.700 - AS 38.05.795).
The program is designed to first allow for exploration licensing, which is modeled after the oil and gas exploration license program. A license grants an exclusive right to explore a defined area for reservoirs suitable for underground carbon storage. It does not permit on-the-ground exploration activities, such as collecting seismic surveys, constructing drill pads, or drilling of wells, which are subject to various federal, state, and local authorizations. During the exploration term, a license holder may apply for a carbon storage facility permit from the Alaska Oil & Gas Conservation Commission (AS 41.06.105 - AS 41.06.210). Upon receiving a facility permit, the land under license may be converted to a lease (AS 38.05.715). The carbon storage lease will authorize the use of the State's pore space for underground carbon storage.
Regulations for implementing these statutes are in development. You may review the draft regulations on the Online Public Notice System. Please note that the regulations may change from the draft form before the final regulations are adopted by the Lieutenant Governor. Final regulations will be published on the Online Public Notice System and here on this website.
Please note this program is distinct from the Carbon Offset Program, which authorizes the Department of Natural Resources to use the state's surface resources, such as forests, for tradable carbon offset credits. For more information about that program, please visit their website within the Office of Project Management & Permitting.
The State of Alaska has significant potential for using its pore space as a carbon storage resource. Half of royalty revenue received by the Department of Natural Resources from carbon storage will be deposited in the Alaska Permanent Fund (AS 37.13.010(a)(2)). Stay tuned to this page for more information and developments of this program.
