State, Dept. of Natural Resources v. Alaskan Crude Corporation

MAASSEN, Justice.

I. INTRODUCTION

An oil and gas lessee conducted drilling activity on the last day of the lease term; the lease provided that such activity would extend the term. Two days later, however, the Department of Natural Resources (DNR) sent the lessee a notice that his lease had expired. The lessee suspended drilling activities and asked DNR to reconsider its decision and reinstate the lease.

DNR reinstated the lease several weeks later. The lessee, however, contended that the reinstatement letter added new and unacceptable conditions to the lease, and he pursued administrative…