By SUZANNE DOWNING
April 14, 2026 – The Alaska House on Monday rejected a Senate-warped version of House Bill 194, a bill requested by Gov. Mike Dunleavy that originally was a simple approval of the state’s sale of royalty oil to Marathon Petroleum’s Nikiski refinery. It was a routine agreement widely seen as beneficial to state revenues and in-state refining jobs.
But after the Senate added Sen. Forrest Dunbar’s massive new provision creating an income tax on numerous oil and gas producers and transporters, the House balked, voting 17-23 against concurring with the Senate’s amended version, formally rejecting the changes. The vote split largely along caucus lines, with minority Republicans but even some members of the majority opposing the Senate’s additions.
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The procedural vote came after an objection forced Rep. Alyse Galvin to participate despite her request to abstain due to a declared conflict of interest. Meanwhile, Rep. Chuck Kopp urged members to reject the Senate version, a recommendation that ultimately prevailed, with 17 voting to accept the changes, 23 voting to reject them.
Yea votes were: Ashley Carrick, Maxine Dibert, Bryce Edgmon, Ted Eischeid, Zack Fields, Neal Foster, Andrew Gray, Sara Hannan, Rebecca Himschoot, Ky Holland, Nellie Jimmie, Andy Josephson, Donna Mears, Genevieve Mina, Cal Schrage, Andi Story, Louise Stutes.
Nays were: Jamie Allard, Jeremy Bynum, Mia Costello, Julie Coulombe, Bill Elam, Robyn Frier, Alyse Galvin, Carolyn Hall, DeLena Johnson, Chuck Kopp, Kevin McCabe, Elexie Moore, David Nelson, Garret Nelson, Mike Prax, Justin Ruffridge, Dan Saddler, Rebecca Schwanke, Steve St. Clair, Will Stapp, Frank Tomaszewski, Jubilee Underwood, Sarah Vance.
The vote leaves the bill in limbo. While the House has formally asked the Senate to recede from its amendments, failing that, lawmakers could also move to a conference committee to attempt a compromise. Without further action before adjournment, the legislation is likely to die this session, leaving Marathon without an adopted contract.
The existing Marathon royalty contract is set to expire on July 31. The Department of Natural Resources has said the state needs about 100 days of lead time to nominate and schedule deliveries under a new contract. Without ratification, the state would likely default to taking its royalty in-value (receiving cash payments based on market prices) rather than delivering physical oil to Marathon.
The state would forgo the expected premium revenue from the in-kind sale (the extra $4–18 million over three years).Marathon may not need the contract at this time, according to state officials.
House Bill 194 was originally aimed at approving a royalty-in-kind agreement with Marathon Petroleum, but that plan has now been put on hold. According to state sources, the company recently signaled that shifting business conditions have led it to step back from pursuing the agreement for now.
State officials still view  royalty-in-kind arrangements as valuable tools, and discussions about potential future opportunities are ongoing. The company’s decision came shortly before the Senate took up the bill and was later communicated to House members.
With Marathon no longer moving forward at this time, the primary purpose behind HB 194 appears to have fallen away.
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