Governor Mike Dunleavy signed Senate Bill (“SB”) 155 amending Alaska’s mineral tenure statutes, effective April 30, 2020. The legislation addresses issues regarding qualification to hold state mining claims, location of claims, statements of annual labor, and automatic abandonment of mining claims. The amendments and additions to the statutes clarify a number of issues and assure that state mining claims are not deemed abandoned without due process.
SB 155 amends AS 38.05.190 to clarify who may hold exploration and mining rights. As amended, the law expressly authorizes limited liability companies qualified to do business in Alaska and registered trusts to acquire and hold state mining claims. Previously, it was not clear that these types of entities could hold claims, or what effect such ownership may have on the claims. The amendments include a notice and cure process by which the Department of Natural Resources (“DNR”) may void a mining interest if a qualification defect is not cured within 90 days after notice. The requirement that an owner be a citizen of the United States or a business entity organized in the United States, with limited exceptions, remains in the statute.
Amendments to AS 38.05.195 clarify the rights obtained pursuant to an MTRSC (meridian, township, range, section, and claim) location. As amended, the law expressly states that “a valid MTRSC location establishes rights to deposits of minerals in or on all state land within the quarter section or quarter-quarter section that is open to claim staking at the time of location.” Any land within the staked quarter section or quarter-quarter section that is not available will be automatically excluded from the claim. While this had been the standard practice since the MTRSC system was enacted in 2000, questions had arisen recently about the effectiveness of an MTRSC location on a quarter or quarter-quarter section on which not all of the land was open and available for location.
Annual Statements of Labor
The most extensive changes made by SB 155 are to the statutes addressing annual labor. AS 38.05.210 has long required that labor be performed, or improvements be made annually on or for the benefit of each mining claim and a statement of annual labor be recorded by November 30. None of that has changed. However, SB 155 removes any ambiguity regarding content of the statement by adding eight specific pieces of information that the statement must contain. The new requirements are that the statement include (1) both the claim name and the serial number for each claim, and (2) the total amount of work required for the assessment work year. In addition, the requirement that the statement include the names and addresses of all owners has been changed to the name and mailing address of one owner designated to receive notices.
The most significant change is the deletion of the language that effected an automatic abandonment for failure to file a statement of annual labor that accurately set forth the essential facts. Now, a statement, even a previously filed statement, can be corrected or amended at any time, so long as DNR has not acted to invalidate the claim. If DNR determines that a statement is deficient, it must send written notice to the owner and provide 90 days for the owner to correct the deficiency. If the owner fails to correct the deficiency, DNR may declare the mineral interest invalid. However, DNR may not declare a mineral interest invalid based on a deficiency in a statement of annual labor recorded more than five years ago.
SB 155 also clarifies what constitutes labor. SB 155 provides nine categories of work performed or improvements made that are directly related to exploring for, developing, or producing minerals, which now qualify as labor. The most significant changes to what qualifies as labor are (1) performing reclamation activities under an approved plan, and (2) transporting workers and equipment in the state to or from a mining site.
The new law took effect immediately and DNR has begun the process of developing implementing regulations. Public comments on the scoping notice are due by June 12. The public notice can be found here.