Opinion ID: 1198963
Heading Depth: 3
Heading Rank: 1

Heading: Relevant statutes and regulations governing rights accruing to mineral locators

Text: Alaska Statute 38.05.185 establishes the basic framework for acquisition of rights to mineral interests held by the State. That statute further allows DNR to restrict the acquisition of those rights. See supra note 12. DNR thus may either close land to mineral location or restrict state land to mining under lease. A DNR regulation restricts mining on lands in which the State reserved mineral rights after their sale or lease to private parties. When Hayes staked his claims, that regulation read: This section constitutes the commissioner's finding, in accordance with AS 38.05.185(a), that selling, leasing, or otherwise disposing of any interest in land other than a locatable mineral interest, with the mineral rights reserved to the state, creates potential use conflicts requiring that mining be allowed only under written leases. If the land remains open to location, any location made on that land after the disposal is a leasehold location. Former 11 AAC 86.135(b) (am.5/18/90). [28] Any location made upon lands conveyed to a private party, with a mineral interest reserved to the State, is thus a leasehold location. One who makes a leasehold location, by prior discovery, location, and recording, receives a preference right to a lease. AS 38.05.205; 11 AAC 86.300 (1996). Under 11 AAC 86.305, the holder of such a preference right is required to apply for a lease from DNR in order to begin mining operations. By statute, [m]inerals may not be mined and marketed or used until a lease is issued, except for limited amounts necessary for sampling or testing. AS 38.05.205. If DNR rejects the lease application, the location is void. [29] 11 AAC 86.305(d) (1996).