Oil exploration incentive bill passes House

Petroleum News Alaska Staff

House Bill 307, sponsored by Rep. Hugh Fate, R-Fairbanks, passed the House of Representatives unanimously Feb. 20.

The bill extends the state's exploration incentive credit program for three years, until 2007.

“Alaska’s economic health is closely tied to the production of oil and gas, so it is in the best interests of the people for the state to encourage private industry to continue searching for new petroleum deposits,” Fate said in a statement.

Under the exploration incentive program the Division of Oil and Gas may grant credit against state royalties or taxes to oil and gas companies who agree to share seismic information or drilling core samples with the state.

“The Nenana Basin in the Interior is the kind of prospective gas field where incentives could play a decisive role in spurring development,” Fate said. “There’s an extremely high potential for finding deep natural gas in this area. Of course, you can only find gas in commercial quantities by actually drilling, but that’s just the kind of outcome this bill seeks to support.”

HB 307 moves next to the Senate for consideration.