109th CONGRESS
2d Session
H. R. 5649
To provide for exploration, development, and production activities
for mineral resources on the outer Continental Shelf, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
June 20, 2006
Ms. HARRIS introduced the following bill; which was referred to the Committee
on Resources
A BILL
To provide for exploration, development, and production activities
for mineral resources on the outer Continental Shelf, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the `Coastal Economic and Environmental Protection
Act'.
SEC. 2. POLICY.
It is the policy of the United States that--
(1) adjacent States are required by the circumstances to commit significant
resources in support of exploration, development, and production activities
for mineral resources on the outer Continental Shelf, and it is fair and
proper for a portion of the receipts from such activities to be shared
with Adjacent States and their local coastal governments;
(2) the existing laws governing the leasing and production of the mineral
resources of the outer Continental Shelf have reduced the production of
mineral resources, have preempted Adjacent States from being sufficiently
involved in the decisions regarding the allowance of mineral resource
development;
(3) the national interest is served by granting the Adjacent States more
options related to whether or not mineral leasing should occur in the
outer Continental Shelf within their Adjacent Zones;
(4) transportation of oil from a leased tract might reasonably be foreseen,
under limited circumstances, to have the potential to adversely affect
resources near the coastline if the oil is within 50 miles of the coastline,
but such potential to adversely affect such resources is likely no greater,
and probably less, than the potential impacts from tanker transportation
because tanker spills usually involve large releases of oil over a brief
period of time; and
(5) among other bodies of inland waters, the Great Lakes, Long Island
Sound, Delaware Bay, Chesapeake Bay, Albemarle Sound, San Francisco Bay,
and Puget Sound are not part of the outer Continental Shelf, and are not
subject to leasing by the Federal Government for the exploration, development,
and production of any mineral resources that might lie beneath them.
SEC. 3. DEFINITIONS UNDER THE OUTER CONTINENTAL SHELF LANDS ACT.
Section 2 of the Outer Continental Shelf Lands Act (43 U.S.C. 1331) is amended--
(1) by amending paragraph (f) to read as follows:
`(f) The term `affected State' means the Adjacent State.';
(2) by striking the semicolon at the end of each of paragraphs (a) through
(o) and inserting a period;
(3) by striking `; and' at the end of paragraph (p) and inserting a period;
(4) by adding at the end the following:
`(r) The term `Adjacent State' means, with respect to any program, plan,
lease sale, leased tract or other activity, proposed, conducted, or approved
pursuant to the provisions of this Act, any State the laws of which are
declared, pursuant to section 4(a)(2), to be the law of the United States
for the portion of the outer Continental Shelf on which such program, plan,
lease sale, leased tract or activity appertains or is, or is proposed to
be, conducted. For purposes of this paragraph, the term `State' includes
Puerto Rico and the other Territories of the United States.
`(s) The term `Adjacent Zone' means, with respect to any program, plan,
lease sale, leased tract, or other activity, proposed, conducted, or approved
pursuant to the provisions of this Act, the portion of the outer Continental
Shelf for which the laws of a particular Adjacent State are declared, pursuant
to section 4(a)(2), to be the law of the United States.
`(t) The term `miles' means statute miles.
`(u) The term `coastline' has the same meaning as the term `coast line'
as defined in section 2(c) of the Submerged Lands Act (43 U.S.C. 1301(c)).
`(v) The term `Neighboring State' means a coastal state having a common
boundary at the coastline with the Adjacent State.'; and
(5) in paragraph (a), by inserting after `control' the following: `or
lying within the United States exclusive economic zone adjacent to the
Territories of the United States'.
SEC. 4. DETERMINATION OF ADJACENT ZONES AND PLANNING AREAS.
Section 4(a)(2)(A) of the Outer Continental Shelf Lands Act (43 U.S.C. 1333(a)(2)(A))
is amended in the first sentence by striking `, and the President' and all
that follows through the end of the sentence and inserting the following:
`The lines extending seaward and defining each State's Adjacent Zone, and
each OCS Planning Area, are as indicated on the maps for each outer Continental
Shelf region entitled `Alaska OCS Region State Adjacent Zone and OCS Planning
Areas', `Pacific OCS Region State Adjacent Zones and OCS Planning Areas'
, `Gulf of Mexico OCS Region State Adjacent Zones and OCS Planning Areas',
and `Atlantic OCS Region State Adjacent Zones and OCS Planning Areas', all
of which are dated September 2005 and on file in the Office of the Director,
Minerals Management Service.'.
SEC. 5. ADMINISTRATION OF LEASING.
Section 5 of the Outer Continental Shelf Lands Act (43 U.S.C. 1334) is amended
by adding at the end the following:
`(k) Voluntary Partial Relinquishment of a Lease- Any lessee of a producing
lease may relinquish to the Secretary any portion of a lease that the lessee
has no interest in producing and that the Secretary finds is geologically
prospective. In return for any such relinquishment, the Secretary shall
provide to the lessee a royalty incentive for the portion of the lease retained
by the lessee, in accordance with regulations promulgated by the Secretary
to carry out this subsection. The Secretary shall publish final regulations
implementing this subsection within 365 days after the date of the enactment
of the Coastal Economic and Environmental Protection Act.
`(l) Natural Gas Lease Regulations- Not later than July 1, 2007, the Secretary
shall publish a final regulation that shall--
`(1) establish procedures for entering into natural gas leases;
`(2) ensure that natural gas leases are only available for tracts on the
outer Continental Shelf that are wholly within 125 miles of the coastline
within an area withdrawn from disposition by leasing on the day after
the date of enactment of the Coastal Economic and Environmental Protection
Act;
`(3) provide that natural gas leases shall contain the same rights and
obligations established for oil and gas leases, except as otherwise provided
in the Coastal Economic and Environmental Protection Act;
`(4) provide that, in reviewing the adequacy of bids for natural gas leases,
the value of any crude oil estimated to be contained within any tract
shall be excluded;
`(5) provide that any crude oil produced from a well and reinjected into
the leased tract shall not be subject to payment of royalty, and that
the Secretary shall consider, in setting the royalty rates for a natural
gas lease, the additional cost to the lessee of not producing any crude
oil; and
`(6) provide that any Federal law that applies to an oil and gas lease
on the outer Continental Shelf shall apply to a natural gas lease unless
otherwise clearly inapplicable.'.
SEC. 6. GRANT OF LEASES BY SECRETARY.
Section 8 of the Outer Continental Shelf Lands Act (43 U.S.C. 1337) is amended--
(1) in subsection (a)(1) by inserting after the first sentence the following:
`Further, the Secretary may grant natural gas leases in a manner similar
to the granting of oil and gas leases and under the various bidding systems
available for oil and gas leases.';
(2) by adding at the end of subsection (b) the following: `The Secretary
may issue more than one lease for a given tract if each lease applies
to a separate and distinct range of vertical depths, horizontal surface
area, or a combination of the two. The Secretary may issue regulations
that the Secretary determines are necessary to manage such leases consistent
with the purposes of this Act.';
(3) in subsection (p)(2)(B)--
(A) by striking `27' and inserting `50'; and
(B) by striking `15' and inserting `200';
(4) by adding at the end the following:
`(1) RIGHT TO PRODUCE NATURAL GAS- A lessee of a natural gas lease shall
have the right to produce the natural gas from a natural gas leased tract
if the Secretary estimates that the discovered field has at least 40 percent
of the economically recoverable Btu content of the field contained within
natural gas and such natural gas is economical to produce.
`(2) RIGHT TO PRODUCE CRUDE OIL- A lessee of a natural gas lease may produce
crude oil from the lease unless the Governor and the legislature of the
Adjacent State object to such production within 180 days after receipt
of written notice from the lessee of intent to produce crude oil from
the lease. If the leased tract is located within 50 miles of the nearest
point on the coastline of a Neighboring State, the Governor and legislature
of the Neighboring State shall also receive such notice and have the right
to object to such production within 180 days after receipt of such notice.
`(3) ESTIMATES OF BTU CONTENT- The Secretary shall make estimates of the
natural gas Btu content of discovered fields on a natural gas lease only
after the completion of at least one exploration well, the data from which
has been tied to the results of a three-dimensional seismic survey of
the field. The Secretary may not require the lessee to further delineate
any discovered field prior to making such estimates.
`(4) TRANSPORTATION OF CRUDE OIL- If an Adjacent State or any applicable
Neighboring State does not object to production of crude oil from a natural
gas lease, the lessee shall be permitted to transport the crude oil from
the leased tract through Adjacent State waters, and Neighboring State
waters if applicable, to facilities onshore in the Adjacent State, and
Neighboring State if applicable, unless the lessee agreed to other arrangements
with the Adjacent State or Neighboring State, or both.
`(5) REPURCHASE OF CERTAIN NATURAL GAS LEASES- Upon request of the lessee
and certification by the Secretary of the Interior that a natural gas
lease contains all or part of a commercial oil and gas discovery that
is not allowed to be produced because it does not meet the standard set
in paragraph (1), the Secretary of the Treasury shall repurchase the lease
by issuance of a check or electronic payment from OCS Receipts to the
lessee in full compensation for the repurchase. The Secretary shall recoup
from the State and local governments any funds previously shared with
them that were derived from the repurchased lease. Such recoupment shall
only be from the State and local governments' shares of OCS receipts that
are payable after the date of repurchase.
`(6) AMOUNT OF COMPENSATION- Repurchase compensation for each lease repurchased
under the authority of this section shall be in the amount of the lesser
of the original bonus bid paid for the lease or, if the lessee is not
the original lessee, the compensation paid by the current lessee to obtain
its interest in the lease. In addition, the lessee shall be compensated
for any expenses directly attributable to the lease that the lessee incurs
after acquisition of its interest in the lease to be repurchased, including
rentals, seismic acquisition costs, drilling costs, and other reasonable
expenses on the lease, including expenses incurred in the repurchase process,
to the extent that the lessee has not previously been compensated by the
United States for such expenses. The lessee shall not be compensated for
general overhead expenses or employee salaries.
`(7) PRIORITY RIGHT TO OBTAIN FUTURE OIL AND GAS LEASE- The lessee, or
a designee of the lessee, of a repurchased natural gas leased tract shall
have the right to repurchase such tract as an oil and gas lease, on a
noncompetitive basis, by repaying the amount received by the lessee if
the tract is made available for lease under an oil and gas lease within
30 years after the repurchase.
`(8) DEFINITION OF NATURAL GAS- For purposes of a natural gas lease, natural
gas means natural gas and all substances produced in association with
gas, including, but not limited to, hydrocarbon liquids (other than crude
oil) that are obtained by the condensation of hydrocarbon vapors and separate
out in liquid form from the produced gas stream.
`(r) Removal of Restrictions on Joint Bidding in Certain Areas of the Outer
Continental Shelf- Restrictions on joint bidders shall no longer apply to
tracts located in the Alaska OCS Region. Such restrictions shall not apply
to tracts in other OCS regions determined to be `frontier tracts' or otherwise
`high cost tracts' under final regulations that shall be published by the
Secretary by not later than 365 days after the date of the enactment of
the Coastal Economic and Environmental Protection Act.';
(5) by striking subsection (a)(3)(A) and redesignating the subsequent
subparagraphs as subparagraphs (A) and (B), respectively;
(6) in subsection (a)(3)(A) (as so redesignated) by striking `In the Western'
and all that follows through `the Secretary' the first place it appears
and inserting `The Secretary'; and
(7) effective October 1, 2006, in subsection (g)--
(A) by striking all after `(g)', except paragraph (3);
(B) by striking the last sentence of paragraph (3); and
SEC. 7. DISPOSITION OF RECEIPTS.
Section 9 of the Outer Continental Shelf Lands Act (43 U.S.C. 1338) is amended--
(1) by designating the existing text as subsection (a);
(2) in subsection (a) (as so designated) by inserting `, if not paid as
otherwise provided in this title' after `receipts'; and
(3) by adding the following:
`(b) Treatment of OCS Receipts From Tracts Completely Within 100 Miles of
the Coastline-
`(1) DEPOSIT- The Secretary shall deposit into a separate account in the
Treasury the portion of OCS Receipts for each fiscal year that will be
shared under paragraphs (2), (3), and (4).
`(2) PHASED-IN RECEIPTS SHARING-
`(A) Beginning October 1, 2005, the Secretary shall share OCS Receipts
derived from the following areas:
`(i) Lease tracts located on portions of the Gulf of Mexico OCS Region
completely beyond 4 marine leagues from any coastline and completely
within 125 miles of any coastline that are available for leasing under
the 2002-2007 5-Year Oil and Gas Leasing Program in effect prior to
the date of the enactment of the Coastal Economic and Environmental
Protection Act.
`(ii) Lease tracts in production prior to October 1, 2005, completely
beyond 4 marine leagues from any coastline and completely within 125
miles of any coastline located on portions of the OCS that were not
available for leasing under the 2002-2007 5-Year OCS Oil and Gas Leasing
Program in effect prior to the date of the enactment of the Coastal
Economic and Environmental Protection Act.
`(iii) Lease tracts for which leases are issued prior to October 1,
2005, located in the Alaska OCS Region completely beyond 4 marine
leagues from any coastline and completely within 125 miles of the
coastline.
`(B) The Secretary shall share the following percentages of OCS Receipts
from the leases described in subparagraph (A) derived during the fiscal
year indicated:
`(i) For fiscal year 2006, 6.0 percent.
`(ii) For fiscal year 2007, 7.0 percent.
`(iii) For fiscal year 2008, 8.0 percent.
`(iv) For fiscal year 2009, 9.0 percent.
`(v) For fiscal year 2010, 12.0 percent.
`(vi) For fiscal year 2011, 15.0 percent.
`(vii) For fiscal year 2012, 18.0 percent.
`(viii) For fiscal year 2013, 21.0 percent.
`(ix) For fiscal year 2014, 24.0 percent.
`(x) For fiscal year 2015, 27.0 percent.
`(xi) For fiscal year 2016, 30.0 percent.
`(xii) For fiscal year 2017, 33.0 percent.
`(xiii) For fiscal year 2018, 36.0 percent.
`(xiv) For fiscal year 2019, 39.0 percent.
`(xv) For fiscal year 2020, 42.0 percent.
`(xvi) For fiscal year 2021, 45.0 percent.
`(xvii) For fiscal year 2022 and each subsequent fiscal year, 50.0
percent.
`(C) The provisions of this paragraph shall not apply to leases that
could not have been issued but for section 5(k) of this Act or section
6(2) of the Coastal Economic and Environmental Protection Act.
`(3) IMMEDIATE RECEIPTS SHARING- Beginning October 1, 2005, the Secretary
shall share 50 percent of OCS Receipts derived from all leases located
completely beyond 4 marine leagues from any coastline and completely within
125 miles of any coastline not included within the provisions of paragraph
(2).
`(4) RECEIPTS SHARING FROM TRACTS WITHIN 4 MARINE LEAGUES OF ANY COASTLINE-
Beginning October 1, 2005, the Secretary shall share 75 percent of OCS
Receipts derived from all leases located completely or partially within
4 marine leagues from any coastline.
`(5) ALLOCATIONS- The Secretary shall allocate the OCS Receipts deposited
into the separate account established by paragraph (1) that are shared
under paragraphs (2), (3), and (4) as follows:
`(A) BONUS BIDS- Deposits derived from bonus bids from a leased tract,
including interest thereon, shall be allocated at the end of each fiscal
year as follows:
`(i) 87.5 percent to the Adjacent State.
`(ii) 6.25 percent into the Treasury, which shall be allocated to
the account established by section 14 of the Coastal Economic and
Environmental Protection Act.
`(iii) 5 percent into the account established by section 23 of the
Coastal Economic and Environmental Protection Act.
`(iv) 1.25 percent into the account established by section 26 of the
Coastal Economic and Environmental Protection Act.
`(B) ROYALTIES- Deposits derived from royalties from a leased tract,
including interest thereon, shall be allocated at the end of each fiscal
year as follows:
`(i) 87.5 percent to the Adjacent State and any other producing State
or States with a leased tract within its Adjacent Zone within 125
miles of its coastline that generated royalties during the fiscal
year, if the other producing or States have a coastline point within
300 miles of any portion of the leased tract, in which case the amount
allocated for the leased tract shall be--
`(I) one-third to the Adjacent State; and
`(II) two-thirds to each producing State, including the Adjacent
State, inversely proportional to the distance between the nearest
point on the coastline of the producing State and the geographic
center of the leased tract.
`(ii) 6.25 percent into the Treasury, which shall be allocated to
the account established by section 14 of the Coastal Economic and
Environmental Protection Act;
`(iii) 5 percent into the account established by section 23 of the
Coastal Economic and Environmental Protection Act; and
`(iv) 1.25 percent into the account established by section 26 of the
Coastal Economic and Environmental Protection Act.
`(c) Treatment of OCS Receipts From Tracts Partially or Completely Beyond
125 Miles of the Coastline-
`(1) DEPOSIT- The Secretary shall deposit into a separate account in the
Treasury the portion of OCS Receipts for each fiscal year that will be
shared under paragraphs (2) and (3).
`(2) PHASED-IN RECEIPTS SHARING-
`(A) Beginning October 1, 2005, the Secretary shall share OCS Receipts
derived from the following areas:
`(i) Lease tracts located on portions of the Gulf of Mexico OCS Region
partially or completely beyond 125 miles of any coastline that are
available for leasing under the 2002-2007 5-Year Oil and Gas Leasing
Program in effect prior to the date of enactment of the Coastal Economic
and Environmental Protection Act.
`(ii) Lease tracts in production prior to October 1, 2005, partially
or completely beyond 125 miles of any coastline located on portions
of the OCS that were not available for leasing under the 2002-2007
5-Year OCS Oil and Gas Leasing Program in effect prior to the date
of enactment of the Coastal Economic and Environmental Protection
Act.
`(iii) Lease tracts for which leases are issued prior to October 1,
2005, located in the Alaska OCS Region partially or completely beyond
125 miles of the coastline.
`(B) The Secretary shall share the following percentages of OCS Receipts
from the leases described in subparagraph (A) derived during the fiscal
year indicated:
`(i) For fiscal year 2006, 6.0 percent.
`(ii) For fiscal year 2007, 7.0 percent.
`(iii) For fiscal year 2008, 8.0 percent.
`(iv) For fiscal year 2009, 9.0 percent.
`(v) For fiscal year 2010, 12.0 percent.
`(vi) For fiscal year 2011, 15.0 percent.
`(vii) For fiscal year 2012, 18.0 percent.
`(viii) For fiscal year 2013, 21.0 percent.
`(ix) For fiscal year 2014, 24.0 percent.
`(x) For fiscal year 2015, 27.0 percent.
`(xi) For fiscal year 2016, 30.0 percent.
`(xii) For fiscal year 2017, 33.0 percent.
`(xiii) For fiscal year 2018, 36.0 percent.
`(xiv) For fiscal year 2019, 39.0 percent.
`(xv) For fiscal year 2020, 42.0 percent.
`(xvi) For fiscal year 2021, 45.0 percent.
`(xvii) For fiscal year 2022 and each subsequent fiscal year, 50.0
percent.
`(C) The provisions of this paragraph shall not apply to leases that
could not have been issued but for section 5(k) of this Act or section
6(2) of the Coastal Economic and Environmental Protection Act.
`(3) IMMEDIATE RECEIPTS SHARING- Beginning October 1, 2005, the Secretary
shall share 50 percent of OCS Receipts derived on and after October 1,
2005, from all leases located partially or completely beyond 125 miles
of any coastline not included within the provisions of paragraph (2).
`(4) ALLOCATIONS- The Secretary shall allocate the OCS Receipts deposited
into the separate account established by paragraph (1) that are shared
under paragraphs (2) and (3) as follows:
`(A) BONUS BIDS- Deposits derived from bonus bids from a leased tract,
including interest thereon, shall be allocated at the end of each fiscal
year as follows:
`(i) 87.5 percent to the Adjacent State.
`(ii) 6.25 percent into the Treasury, which shall be allocated to
the account established by section 14 of the Coastal Economic and
Environmental Protection Act.
`(iii) 5 percent into the account established by section 23 of the
Coastal Economic and Environmental Protection Act.
`(iv) 1.25 percent into the account established by section 26 of the
Coastal Economic and Environmental Protection Act.
`(B) ROYALTIES- Deposits derived from royalties from a leased tract,
including interest thereon, shall be allocated at the end of each fiscal
year as follows:
`(i) 87.5 percent to the Adjacent State and any other producing State
or States with a leased tract within its Adjacent Zone partially or
completely beyond 125 miles of its coastline that generated royalties
during the fiscal year, if the other producing State or States have
a coastline point within 300 miles of any portion of the leased tract,
in which case the amount allocated for the leased tract shall be--
`(I) one-third to the Adjacent State; and
`(II) two-thirds to each producing State, including the Adjacent
State, inversely proportional to the distance between the nearest
point on the coastline of the producing State and the geographic
center of the leased tract.
`(ii) 6.25 percent into the account established by section 14 of the
Coastal Economic and Environmental Protection Act.
`(iii) 5 percent into the account established by section 23 of the
Coastal Economic and Environmental Protection Act.
`(iv) 1.25 percent into the account established by section 26 of the
Coastal Economic and Environmental Protection Act.
`(d) Transmission of Allocations-
`(1) IN GENERAL- Not later than 90 days after the end of each fiscal year,
the Secretary shall transmit--
`(A) to each State two-thirds of such State's allocations under subsections
(b)(5)(A)(i), (b)(5)(B)(i), (c)(4)(A)(i), and (c)(4)(B)(i) for the immediate
prior fiscal year;
`(B) to coastal county-equivalent and municipal political subdivisions
of such State a total of one-third of such State's allocations under
subsections (b)(5)(A)(i), (b)(5)(B)(i), (c)(4)(A)(i), and (c)(4)(B)(i),
together with all accrued interest thereon; and
`(C) the remaining allocations under subsections (b)(5) and (c)(4),
together with all accrued interest thereon.
`(2) ALLOCATIONS TO COASTAL COUNTY-EQUIVALENT POLITICAL SUBDIVISIONS-
The Secretary shall make an initial allocation of the OCS Receipts to
be shared under paragraph (1)(B) as follows:
`(A) 25 percent shall be allocated based on the ratio of such coastal
county-equivalent political subdivision's population to the coastal
population of all coastal county-equivalent political subdivisions in
the State.
`(B) 25 percent shall be allocated based on the ratio of such coastal
county-equivalent political subdivision's coastline miles to the coastline
miles of all coastal county-equivalent political subdivisions in the
State as calculated by the Secretary. In such calculations, coastal
county-equivalent political subdivisions without a coastline shall be
considered to have 50 percent of the average coastline miles of the
coastal county-equivalent political subdivisions that do have coastlines.
`(C) 25 percent shall be allocated to all coastal county-equivalent
political subdivisions having a coastline point within 300 miles of
the leased tract for which OCS Receipts are being shared based on a
formula that allocates the funds based on such coastal county-equivalent
political subdivision's relative distance from the leased tract.
`(D) 25 percent shall be allocated to all coastal county-equivalent
political subdivisions having a coastline point within 300 miles of
the leased tract for which OCS Receipts are being shared based on the
relative level of outer Continental Shelf oil and gas activities in
a coastal political subdivision compared to the level of outer Continental
Shelf activities in all coastal political subdivisions in the State.
The Secretary shall define the term `outer Continental Shelf oil and
gas activities' for purposes of this subparagraph to include, but not
be limited to, construction of vessels, drillships, and platforms involved
in exploration, production, and development on the outer Continental
Shelf; support and supply bases, ports, and related activities; offices
of geologists, geophysicists, engineers, and other professionals involved
in support of exploration, production, and development of oil and gas
on the outer Continental Shelf; pipelines and other means of transporting
oil and gas production from the outer Continental Shelf; and processing
and refining of oil and gas production from the outer Continental Shelf.
For purposes of this subparagraph, if a coastal county-equivalent political
subdivision does not have a coastline, its coastal point shall be the
point on the coastline closest to it.
`(3) ALLOCATIONS TO COASTAL MUNICIPAL POLITICAL SUBDIVISIONS- The initial
allocation to each coastal county-equivalent political subdivision under
paragraph (2) shall be further allocated to the coastal county-equivalent
political subdivision and any coastal municipal political subdivisions
located partially or wholly within the boundaries of the coastal county-equivalent
political subdivision as follows:
`(A) One-third shall be allocated to the coastal county-equivalent political
subdivision.
`(B) Two-thirds shall be allocated on a per capita basis to the municipal
political subdivisions and the county-equivalent political subdivision,
with the allocation to the latter based upon its population not included
within the boundaries of a municipal political subdivision.
`(e) Investment of Deposits- Amounts deposited under this section shall
be invested by the Secretary of the Treasury in securities backed by the
full faith and credit of the United States having maturities suitable to
the needs of the account in which they are deposited and yielding the highest
reasonably available interest rates as determined by the Secretary of the
Treasury.
`(f) Use of Funds- A recipient of funds under this section may use the funds
for one or more of the following:
`(1) To reduce in-State college tuition at public institutions of higher
learning and otherwise support public education, including career technical
education.
`(2) To make transportation infrastructure improvements.
`(4) To promote and provide for--
`(A) coastal or environmental restoration;
`(B) fish, wildlife, and marine life habitat enhancement;
`(C) waterways maintenance;
`(D) shore protection; and
`(E) marine and oceanographic education and research.
`(5) To improve infrastructure associated with energy production activities
conducted on the outer Continental Shelf.
`(6) To fund energy demonstration projects and supporting infrastructure
for energy projects.
`(7) For any other purpose as determined by State law.
`(g) No Accounting Required- No recipient of funds under this section shall
be required to account to the Federal Government for the expenditure of
such funds, except as otherwise may be required by law. However, States
may enact legislation providing for accounting for and auditing of such
expenditures. Further, funds allocated under this section to States and
political subdivisions may be used as matching funds for other Federal programs.
`(h) Effect of Future Laws- Enactment of any future Federal statute that
has the effect, as determined by the Secretary, of restricting any Federal
agency from spending appropriated funds, or otherwise preventing it from
fulfilling its pre-existing responsibilities as of the date of enactment
of the statute, unless such responsibilities have been reassigned to another
Federal agency by the statute with no prevention of performance, to issue
any permit or other approval impacting on the OCS oil and gas leasing program,
or any lease issued thereunder, or to implement any provision of this Act
shall automatically prohibit any sharing of OCS Receipts under this section
directly with the States, and their coastal political subdivisions, for
the duration of the restriction. The Secretary shall make the determination
of the existence of such restricting effects within 30 days of a petition
by any outer Continental Shelf lessee or producing State.
`(i) Definitions- In this section:
`(1) COASTAL COUNTY-EQUIVALENT POLITICAL SUBDIVISION- The term `coastal
county-equivalent political subdivision' means a political jurisdiction
immediately below the level of State government, including a county, parish,
borough in Alaska, independent municipality not part of a county, parish,
or borough in Alaska, or other equivalent subdivision of a coastal State,
that lies within the coastal zone.
`(2) COASTAL MUNICIPAL POLITICAL SUBDIVISION- The term `coastal municipal
political subdivision' means a municipality located within and part of
a county, parish, borough in Alaska, or other equivalent subdivision of
a State, all or part of which coastal municipal political subdivision
lies within the coastal zone.
`(3) COASTAL POPULATION- The term `coastal population' means the population
of all coastal county-equivalent political subdivisions, as determined
by the most recent official data of the Census Bureau.
`(4) COASTAL ZONE- The term `coastal zone' means that portion of a coastal
State, including the entire territory of any coastal county-equivalent
political subdivision at least a part of which lies, within 75 miles landward
from the coastline, or a greater distance as determined by State law enacted
to implement this section.
`(5) BONUS BIDS- The term `bonus bids' means all funds received by the
Secretary to issue an outer Continental Shelf minerals lease.
`(6) ROYALTIES- The term `royalties' means all funds received by the Secretary
from production of oil or natural gas, or the sale of production taken
in-kind, from an outer Continental Shelf minerals lease.
`(7) PRODUCING STATE- The term `producing State' means an Adjacent State
having an Adjacent Zone containing leased tracts from which OCS Receipts
were derived.
`(8) OCS RECEIPTS- The term `OCS Receipts' means bonus bids and royalties.'.
SEC. 8. REVIEW OF OUTER CONTINENTAL SHELF EXPLORATION PLANS.
Subsections (c) and (d) of section 11 of the Outer Continental Shelf Lands
Act (43 U.S.C. 1340) are amended to read as follows:
`(c) Plan Review; Plan Provisions-
`(1) Except as otherwise provided in this Act, prior to commencing exploration
pursuant to any oil and gas lease issued or maintained under this Act,
the holder thereof shall submit an exploration plan (hereinafter in this
section referred to as a `plan') to the Secretary for review which shall
include all information and documentation required under paragraphs (2)
and (3). The Secretary shall review the plan for completeness within 10
days of submission. If the Secretary finds that the plan is not complete,
the Secretary shall notify the lessee with a detailed explanation and
require such modifications of such plan as are necessary to achieve completeness.
The Secretary shall have 10 days to review a modified plan for completeness.
Such plan may apply to more than one lease held by a lessee in any one
region of the outer Continental Shelf, or by a group of lessees acting
under a unitization, pooling, or drilling agreement, and the lessee shall
certify that such plan is consistent with the terms of the lease and is
consistent with all statutory and regulatory requirements in effect on
the date of issuance of the lease. The Secretary shall have 30 days from
the date the plan is deemed complete to conduct a review of the plan.
If the Secretary finds the plan is not consistent with the lease and all
such statutory and regulatory requirements, the Secretary shall notify
the lessee with a detailed explanation of such modifications of such plan
as are necessary to achieve compliance. The Secretary shall have 30 days
to review any modified plan submitted by the lessee. The lessee shall
not take any action under the exploration plan within the 30-day review
period, or thereafter until the plan has been modified to achieve compliance
as so notified.
`(2) An exploration plan submitted under this subsection shall include,
in the degree of detail which the Secretary may by regulation require--
`(A) a schedule of anticipated exploration activities to be undertaken;
`(B) a description of equipment to be used for such activities;
`(C) the general location of each well to be drilled; and
`(D) such other information deemed pertinent by the Secretary.
`(3) The Secretary may, by regulation, require that such plan be accompanied
by a general statement of development and production intentions which
shall be for planning purposes only and which shall not be binding on
any party.
`(d) Plan Revisions; Conduct of Exploration Activities-
`(1) If a significant revision of an exploration plan under this subsection
is submitted to the Secretary, the process to be used for the review of
such revision shall be the same as set forth in subsection (c) of this
section.
`(2) All exploration activities pursuant to any lease shall be conducted
in accordance with an exploration plan or a revised plan which has been
submitted to and reviewed by the Secretary.'.
SEC. 9. RESERVATION OF LANDS AND RIGHTS.
Section 12 of the Outer Continental Shelf Lands Act (43 U.S.C. 1341) is
amended--
(1) in subsection (a) by adding at the end the following: `The President
may partially or completely revise or revoke any prior withdrawal made
by the President under the authority of this section. The President may
not revise or revoke a withdrawal that was initiated by a petition from
a State and approved by the Secretary of the Interior under subsection
(h). A withdrawal by the President may be for a term not to exceed 10
years. In considering a potential withdrawal under this subsection, to
the maximum extent practicable the President shall accommodate competing
interests and potential uses of the outer Continental Shelf.';
(2) by adding at the end the following:
`(g) Option to Petition for Leasing Within Certain Areas of the Outer Continental
Shelf-
`(1) PROHIBITION AGAINST LEASING-
`(A) PROHIBITION PRIOR TO JULY 1, 2012- Except as otherwise provided
in this subsection, prior to July 1, 2012, the Secretary shall not offer
for leasing for oil and gas, or for natural gas, any area withdrawn
from disposition by leasing in the Atlantic OCS Region or the Pacific
OCS Region, or the Gulf of Mexico OCS Region Eastern Planning Area,
as depicted on the map referred to within this paragraph, under the
`Memorandum on Withdrawal of Certain Areas of the United States Outer
Continental Shelf from Leasing Disposition', 34 Weekly Comp. Pres. Doc.
1111, dated June 12, 1998, or any area not withdrawn under that Memorandum
that is included within the Gulf of Mexico OCS Region Eastern Planning
Area as indicated on the map entitled `Gulf of Mexico OCS Region State
Adjacent Zones and OCS Planning Areas' or within the Florida Straits
Planning Area as indicated on the map entitled `Atlantic OCS Region
State Adjacent Zones and OCS Planning Areas', both of which are dated
September 2005 and on file in the Office of the Director, Minerals Management
Service.
`(B) PROHIBITION FROM AND AFTER JULY 1, 2012- Except as otherwise provided
in this subsection, from and after July 1, 2012, the Secretary shall
not offer for leasing for oil and gas, or for natural gas, any area
not available for leasing under subparagraph (A) located within 125
miles of the coastline.
`(2) REVOCATION OF WITHDRAWAL- The provisions of the `Memorandum on Withdrawal
of Certain Areas of the United States Outer Continental Shelf from Leasing
Disposition', 34 Weekly Comp. Pres. Doc. 1111, dated June 12, 1998, are
hereby revoked and are no longer in effect regarding any areas included
within the Gulf of Mexico OCS Region Central Planning Area as indicated
on the map entitled `Gulf of Mexico OCS Region State Adjacent Zones and
OCS Planning Areas' dated September 2005 and on file in the Office of
the Director, Minerals Management Service. The 2002-2007 5-Year Outer
Continental Shelf Oil and Gas Leasing Program is hereby amended to include
the areas added to the Gulf of Mexico OCS Region Central Planning Area
by this Act to the extent that such areas were included within the original
boundaries of proposed Lease Sale 181. The amendment to such leasing program
includes two sales in such additional areas, one of which shall be held
in January 2007 and one of which shall be held in June 2007. The Final
Environmental Impact Statement prepared for this area for Lease Sale 181
shall be deemed sufficient for all purposes for each lease sale in which
such area is offered for lease during the 2002-2007 5-Year Outer Continental
Shelf Oil and Gas Leasing Program without need for supplementation. Any
tract only partially added to the Gulf of Mexico OCS Region Central Planning
Area by this Act shall be eligible for leasing of the part of such tract
that is included within the Gulf of Mexico OCS Region Central Planning
Area, and the remainder of such tract that lies outside of the Gulf of
Mexico OCS Region Central Planning Area may be developed and produced
by the lessee of such partial tract using extended reach or similar drilling
from a location on a leased area.
`(3) PETITION FOR LEASING-
`(A) IN GENERAL- The Governor of the State, upon concurrence of its
legislature, may submit to the Secretary a petition requesting that
the Secretary make available any area that is within the State's Adjacent
Zone, included within the provisions of paragraph (1), and that (i)
is greater than 25 miles from any point on the coastline of a Neighboring
State for the conduct of offshore leasing, pre-leasing, and related
activities with respect to natural gas leasing; or (ii) is greater than
50 miles from any point on the coastline of a Neighboring State for
the conduct of offshore leasing, pre-leasing, and related activities
with respect to oil and gas leasing. The Adjacent State may also petition
for leasing any other area within its Adjacent Zone if leasing is allowed
in the similar area of the Adjacent Zone of the applicable Neighboring
State, or if not allowed, if the Neighboring State, acting through its
Governor, expresses its concurrence with the petition. The Secretary
shall only consider such a petition upon making a finding that leasing
is allowed in the similar area of the Adjacent Zone of the applicable
Neighboring State or upon receipt of the concurrence of the Neighboring
State. The date of receipt by the Secretary of such concurrence by the
Neighboring State shall constitute the date of receipt of the petition
for that area for which the concurrence applies. A petition for leasing
any part of the Alabama Adjacent Zone that is a part of the Gulf of
Mexico Eastern Planning Area, as indicated on the map entitled `Gulf
of Mexico OCS Region State Adjacent Zones and OCS Planning Areas' which
is dated September 2005 and on file in the Office of the Director, Minerals
Management Service, shall require the concurrence of both Alabama and
Florida.
`(B) LIMITATIONS ON LEASING- In its petition, a State with an Adjacent
Zone that contains leased tracts may condition oil and gas, or natural
gas, new leasing for tracts within 25 miles of the coastline by--
`(i) requiring a net reduction in the number of production platforms;
`(ii) requiring a net increase in the average distance of production
platforms from the coastline;
`(iii) limiting permanent surface occupancy on new leases to areas
that are more than 10 miles from the coastline;
`(iv) limiting some tracts to being produced from shore or from platforms
located on other tracts; or
`(v) other conditions that the Adjacent State may deem appropriate
as long as the Secretary does not determine that production is made
economically or technically impracticable or otherwise impossible.
`(C) ACTION BY SECRETARY- Not later than 90 days after receipt of a
petition under subparagraph (A), the Secretary shall approve the petition,
unless the Secretary determines that leasing the area would probably
cause serious harm or damage to the marine resources of the State's
Adjacent Zone. Prior to approving the petition, the Secretary shall
complete an environmental assessment that documents the anticipated
environmental effects of leasing in the area included within the scope
of the petition.
`(D) FAILURE TO ACT- If the Secretary fails to approve or deny a petition
in accordance with subparagraph (C) the petition shall be considered
to be approved 90 days after receipt of the petition.
`(E) AMENDMENT OF THE 5-YEAR LEASING PROGRAM- Notwithstanding section
18, within 180 days of the approval of a petition under subparagraph
(C) or (D), the Secretary shall amend the current 5-Year Outer Continental
Shelf Oil and Gas Leasing Program to include a lease sale or sales for
the entire area covered by the approved petition, unless there are,
from the date of approval, fewer than 12 months remaining in the current
5-Year Leasing Program in which case the Secretary shall include the
areas covered by the approved petition within lease sales under the
next 5-Year Leasing Program. For purposes of amending the 5-Year Program
in accordance with this section, further consultations with States shall
not be required. The environmental assessment performed under the provisions
of the National Environmental Policy Act of 1969 to assess the effects
of approving the petition shall be sufficient to amend the 5-Year Leasing
Program.
`(h) Effect of Other Laws- Adoption by any Adjacent State of any constitutional
provision, or enactment of any State statute, that has the effect, as determined
by the Secretary, of restricting either the Governor or the Legislature,
or both, from exercising full discretion related to subsection (g) or (h),
or both, shall automatically (1) prohibit any sharing of OCS Receipts under
this Act with the Adjacent State, and its coastal political subdivisions,
and (2) prohibit the Adjacent State from exercising any authority under
subsection (h), for the duration of the restriction. The Secretary shall
make the determination of the existence of such restricting constitutional
provision or State statute within 30 days of a petition by any outer Continental
Shelf lessee or coastal State.'.
SEC. 10. OUTER CONTINENTAL SHELF LEASING PROGRAM.
Section 18 of the Outer Continental Shelf Lands Act (43 U.S.C. 1344) is
amended--
(1) in subsection (a), by adding at the end of paragraph (3) the following:
`The Secretary shall, in each 5-year program, include lease sales that
when viewed as a whole propose to offer for oil and gas or natural gas
leasing at least 75 percent of the available unleased acreage within each
OCS Planning Area. Available unleased acreage is that portion of the outer
Continental Shelf that is not under lease at the time of the proposed
lease sale, and has not otherwise been made unavailable for leasing by
law.';
(2) in subsection (c), by striking so much as precedes paragraph (3) and
inserting the following:
`(c)(1) During the preparation of any proposed leasing program under this
section, the Secretary shall consider and analyze leasing throughout the
entire Outer Continental Shelf without regard to any other law affecting
such leasing. During this preparation the Secretary shall invite and consider
suggestions from any interested Federal agency, including the Attorney General,
in consultation with the Federal Trade Commission, and from the Governor
of any coastal State. The Secretary may also invite or consider any suggestions
from the executive of any local government in a coastal State that have
been previously submitted to the Governor of such State, and from any other
person. Further, the Secretary shall consult with the Secretary of Defense
regarding military operational needs in the outer Continental Shelf. The
Secretary shall work with the Secretary of Defense to resolve any conflicts
that might arise regarding offering any area of the outer Continental Shelf
for oil and gas or natural gas leasing. If the Secretaries are not able
to resolve all such conflicts, any unresolved issues shall be elevated to
the President for resolution.
`(2) After the consideration and analysis required by paragraph (1), including
the consideration of the suggestions received from any interested Federal
agency, the Federal Trade Commission, the Governor of any coastal State,
any local government of a coastal State, and any other person, the Secretary
shall publish in the Federal Register a proposed leasing program accompanied
by a draft environmental impact statement prepared pursuant to the National
Environmental Policy Act of 1969. After the publishing of the proposed leasing
program and during the comment period provided for on the draft environmental
impact statement, the Secretary shall submit a copy of the proposed program
to the Governor of each affected State for review and comment. The Governor
may solicit comments from those executives of local governments in the Governor's
State that the Governor, in the discretion of the Governor, determines will
be affected by the proposed program. If any comment by such Governor is
received by the Secretary at least 15 days prior to submission to the Congress
pursuant to paragraph (3) and includes a request for any modification of
such proposed program, the Secretary shall reply in writing, granting or
denying such request in whole or in part, or granting such request in such
modified form as the Secretary considers appropriate, and stating the Secretary's
reasons therefor. All such correspondence between the Secretary and the
Governor of any affected State, together with any additional information
and data relating thereto, shall accompany such proposed program when it
is submitted to the Congress.'; and
(3) by adding at the end the following:
`(i) Projection of State Adjacent Zone Resources and State and Local Government
Shares of OCS Receipts- Concurrent with the publication of the scoping notice
at the beginning of the development of each 5-year outer Continental Shelf
oil and gas leasing program, or as soon thereafter as possible, the secretary
shall--
`(1) provide to each Adjacent State a current estimate of proven and potential
oil and gas resources located within the State's Adjacent Zone; and
`(2) provide to each Adjacent State, and coastal political subdivisions
thereof, a best-efforts projection of the OCS Receipts that the Secretary
expects will be shared with each Adjacent State, and its coastal political
subdivisions, using the assumption that the unleased tracts within the
State's Adjacent Zone are fully made available for leasing, including
long-term projected OCS Receipts. In addition, the Secretary shall include
a macroeconomic estimate of the impact of such leasing on the national
economy and each State's economy, including investment, jobs, revenues,
personal income, and other categories.'.
SEC. 11. COORDINATION WITH ADJACENT STATES.
Section 19 of the Outer Continental Shelf Lands Act (43 U.S.C. 1345) is
amended--
(1) in subsection (a) in the first sentence by inserting `, for any tract
located within the Adjacent State's Adjacent Zone,' after `government';
and
(2) by adding the following:
`(f)(1) No Federal agency may permit or otherwise approve, without the concurrence
of the Adjacent State, the construction of a crude oil or petroleum products
(or both) pipeline within the part of the Adjacent State's Adjacent Zone
that is not available by law for oil and gas or natural gas leasing, except
that such a pipeline may be approved to pass through such Adjacent Zone
if at least 50 percent of the production projected to be carried by the
pipeline within its first 10 years of operation is from areas of the Adjacent
State's Adjacent Zone.
`(2) No State may prohibit the construction within its Adjacent Zone or
its State waters of a natural gas pipeline that will transport natural gas
produced from the outer Continental Shelf. However, an Adjacent State may
prevent a proposed natural gas pipeline landing location if it proposes
two alternate landing locations in the Adjacent State, acceptable to the
Adjacent State, located within 50 miles on either side of the proposed landing
location.'.
SEC. 12. ENVIRONMENTAL STUDIES.
Section 20(d) of the Outer Continental Shelf Lands Act (43 U.S.C. 1346)
is amended--
(1) by inserting `(1)' after `(d)'; and
(2) by adding at the end the following:
`(2) For all programs, lease sales, leases, and actions under this Act,
the following shall apply regarding the application of the National Environmental
Policy Act of 1969:
`(A) Granting or directing lease suspensions and the conduct of all
preliminary activities on outer Continental Shelf tracts, including
seismic activities, are categorically excluded from the need to prepare
either an environmental assessment or an environmental impact statement,
and the Secretary shall not be required to analyze whether any exceptions
to a categorical exclusion apply for activities conducted under the
authority of this Act.
`(B) The environmental impact statement developed in support of each
5-year oil and gas leasing program provides the environmental analysis
for all lease sales to be conducted under the program and such sales
shall not be subject to further environmental analysis.
`(C) Exploration plans shall not be subject to any requirement to prepare
an environmental impact statement, and the Secretary may find that exploration
plans are eligible for categorical exclusion due to the impacts already
being considered within an environmental impact statement or due to
mitigation measures included within the plan.
`(D) Within each OCS Planning Area, after the preparation of the first
development and production plan environmental impact statement for a
leased tract within the Area, future development and production plans
for leased tracts within the Area shall only require the preparation
of an environmental assessment unless the most recent development and
production plan environmental impact statement within the Area was finalized
more than 10 years prior to the date of the approval of the plan, in
which case an environmental impact statement shall be required.'.
SEC. 13. REVIEW OF OUTER CONTINENTAL SHELF DEVELOPMENT AND PRODUCTION
PLANS.
Section 25 of the Outer Continental Shelf Lands Act (43 U.S.C. 1351(a))
is amended to read as follows:
`SEC. 25. REVIEW OF OUTER CONTINENTAL SHELF DEVELOPMENT AND PRODUCTION
PLANS.
`(a) Development and Production Plans; Submission to Secretary; Statement
of Facilities and Operation; Submission to Governors of Affected States
and Local Governments-
`(1) Prior to development and production pursuant to an oil and gas lease
issued on or after September 18, 1978, for any area of the outer Continental
Shelf, or issued or maintained prior to September 18, 1978, for any area
of the outer Continental Shelf, with respect to which no oil or gas has
been discovered in paying quantities prior to September 18, 1978, the
lessee shall submit a development and production plan (hereinafter in
this section referred to as a `plan') to the Secretary for review.
`(2) A plan shall be accompanied by a statement describing all facilities
and operations, other than those on the outer Continental Shelf, proposed
by the lessee and known by the lessee (whether or not owned or operated
by such lessee) that will be constructed or utilized in the development
and production of oil or gas from the lease area, including the location
and site of such facilities and operations, the land, labor, material,
and energy requirements associated with such facilities and operations,
and all environmental and safety safeguards to be implemented.
`(3) Except for any privileged or proprietary information (as such term
is defined in regulations issued by the Secretary), the Secretary, within
30 days after receipt of a plan and statement, shall--
`(A) submit such plan and statement to the Governor of any affected
State, and upon request to the executive of any affected local government;
and
`(B) make such plan and statement available to any appropriate interstate
regional entity and the public.
`(b) Development and Production Activities in Accordance With Plan as Lease
Requirement- After enactment of the Coastal Economic and Environmental Protection
Act, no oil and gas lease may be issued pursuant to this Act in any region
of the outer Continental Shelf, unless such lease requires that development
and production activities be carried out in accordance with a plan that
complies with the requirements of this section. This section shall also
apply to leases that do not have an approved development and production
plan as of the date of enactment of the Coastal Economic and Environmental
Protection Act.
`(c) Scope and Contents of Plan- A plan may apply to more than one oil and
gas lease, and shall set forth, in the degree of detail established by regulations
issued by the Secretary--
`(1) the general work to be performed;
`(2) a description of all facilities and operations located on the outer
Continental Shelf that are proposed by the lessee or known by the lessee
(whether or not owned or operated by such lessee) to be directly related
to the proposed development, including the location and size of such facilities
and operations, and the land, labor, material, and energy requirements
associated with such facilities and operations;
`(3) the environmental safeguards to be implemented on the outer Continental
Shelf and how such safeguards are to be implemented;
`(4) all safety standards to be met and how such standards are to be met;
`(5) an expected rate of development and production and a time schedule
for performance; and
`(6) such other relevant information as the Secretary may by regulation
require.
`(d) Completeness Review of the Plan-
`(1) Prior to commencing any activity under a development and production
plan pursuant to any oil and gas lease issued or maintained under this
Act, the lessee shall certify that the plan is consistent with the terms
of the lease and that it is consistent with all statutory and regulatory
requirements in effect on the date of issuance of the lease. The plan
shall include all required information and documentation required under
subsection (c).
`(2) The Secretary shall review the plan for completeness within 30 days
of submission. If the Secretary finds that the plan is not complete, the
Secretary shall notify the lessee with a detailed explanation of such
modifications of such plan as are necessary to achieve completeness. The
Secretary shall have 30 days to review a modified plan for completeness.
`(e) Review for Consistency of the Plan-
`(1) After a determination that a plan is complete, the Secretary shall
have 120 days to conduct a review of the plan, to ensure that it is consistent
with the terms of the lease, and that it is consistent with all such statutory
and regulatory requirements applicable to the lease. The review shall
ensure that the plan is consistent with lease terms, and statutory and
regulatory requirements applicable to the lease, related to national security
or national defense, including any military operating stipulations or
other restrictions. The Secretary shall seek the assistance of the Department
of Defense in the conduct of the review of any plan prepared under this
section for a lease containing military operating stipulations or other
restrictions and shall accept the assistance of the Department of Defense
in the conduct of the review of any plan prepared under this section for
any other lease when the Secretary of Defense requests an opportunity
to participate in the review. If the Secretary finds that the plan is
not consistent, the Secretary shall notify the lessee with a detailed
explanation of such modifications of such plan as are necessary to achieve
consistency.
`(2) The Secretary shall have 120 days to review a modified plan.
`(3) The lessee shall not conduct any activities under the plan during
any 120-day review period, or thereafter until the plan has been modified
to achieve compliance as so notified.
`(4) After review by the Secretary provided for by this section, a lessee
may operate pursuant to the plan without further review or approval by
the Secretary.
`(f) Review of Revision of the Approved Plan- The lessee may submit to the
Secretary any revision of a plan if the lessee determines that such revision
will lead to greater recovery of oil and natural gas, improve the efficiency,
safety, and environmental protection of the recovery operation, is the only
means available to avoid substantial economic hardship to the lessee, or
is otherwise not inconsistent with the provisions of this Act, to the extent
such revision is consistent with protection of the human, marine, and coastal
environments. The process to be used for the review of any such revision
shall be the same as that set forth in subsections (d) and (e).
`(g) Cancellation of Lease on Failure to Submit Plan or Comply With a Plan-
Whenever the owner of any lease fails to submit a plan in accordance with
regulations issued under this section, or fails to comply with a plan, the
lease may be canceled in accordance with section 5(c) and (d). Termination
of a lease because of failure to comply with a plan, including required
modifications or revisions, shall not entitle a lessee to any compensation.
`(h) Production and Transportation of Natural Gas; Submission of Plan to
Federal Energy Regulatory Commission; Impact Statement- If any development
and production plan submitted to the Secretary pursuant to this section
provides for the production and transportation of natural gas, the lessee
shall contemporaneously submit to the Federal Energy Regulatory Commission
that portion of such plan that relates to the facilities for transportation
of natural gas. The Secretary and the Federal Energy Regulatory Commission
shall agree as to which of them shall prepare an environmental impact statement
pursuant to the National Environmental Policy Act of 1969 (42 U.S.C. 4321
et seq.) applicable to such portion of such plan, or conduct studies as
to the effect on the environment of implementing it. Thereafter, the findings
and recommendations by the agency preparing such environmental impact statement
or conducting such studies pursuant to such agreement shall be adopted by
the other agency, and such other agency shall not independently prepare
another environmental impact statement or duplicate such studies with respect
to such portion of such plan, but the Federal Energy Regulatory Commission,
in connection with its review of an application for a certificate of public
convenience and necessity applicable to such transportation facilities pursuant
to section 7 of the Natural Gas Act (15 U.S.C. 717f), may prepare such environmental
studies or statement relevant to certification of such transportation facilities
as have not been covered by an environmental impact statement or studies
prepared by the Secretary. The Secretary, in consultation with the Federal
Energy Regulatory Commission, shall promulgate rules to implement this subsection,
but the Federal Energy Regulatory Commission shall retain sole authority
with respect to rules and procedures applicable to the filing of any application
with the Commission and to all aspects of the Commission's review of, and
action on, any such application.'.
SEC. 14. FEDERAL ENERGY NATURAL RESOURCES ENHANCEMENT FUND ACT OF 2006.
(a) Findings- The Congress finds the following:
(1) Energy and minerals exploration, development, and production on Federal
onshore and offshore lands, including bio-based fuel, natural gas, minerals,
oil, geothermal, and power from wind, waves, currents, and thermal energy,
involves significant outlays of funds by Federal and State wildlife, fish,
and natural resource management agencies for environmental studies, planning,
development, monitoring, and management of wildlife, fish, air, water,
and other natural resources.
(2) State wildlife, fish, and natural resource management agencies are
funded primarily through permit and license fees paid to the States by
the general public to hunt and fish, and through Federal excise taxes
on equipment used for these activities.
(3) Funds generated from consumptive and recreational uses of wildlife,
fish, and other natural resources currently are inadequate to address
the natural resources related to energy and minerals development on Federal
onshore and offshore lands.
(4) Funds available to Federal agencies responsible for managing Federal
onshore and offshore lands and Federal-trust wildlife and fish species
and their habitats are inadequate to address the natural resources related
to energy and minerals development on Federal onshore and offshore lands.
(5) Receipts derived from sales, bonus bids, and royalties under the mineral
leasing laws of the United States are paid to the Treasury through the
Minerals Management Service of the Department of the Interior.
(6) None of the receipts derived from sales, bonus bids, and royalties
under the minerals leasing laws of the United States are paid to the Federal
or State agencies to examine, monitor, and manage wildlife, fish, air,
water, and other natural resources related to natural gas, oil, and mineral
exploration and development.
(b) Purposes- It is the purpose of this section to--
(1) establish a fund for the monitoring and management of wildlife and
fish, and their habitats, and air, water, and other natural resources
related to energy and minerals development on Federal onshore and offshore
lands;
(2) make available receipts derived from sales, bonus bids, and royalties
from onshore and offshore gas, mineral, oil, and any additional form of
energy exploration and development under the laws of the United States
for the purposes of such fund;
(3) distribute funds from such fund each fiscal year to the Secretary
of the Interior and the States; and
(4) use the distributed funds to secure the necessary trained workforce
or contractual services to conduct environmental studies, planning, development,
monitoring, and post-development management of wildlife and fish and their
habitats and air, water, and other natural resources that may be related
to bio-based fuel, gas, mineral, oil, wind, or other energy exploration,
development, transportation, transmission, and associated activities on
Federal onshore and offshore lands, including, but not limited to--
(A) pertinent research, surveys, and environmental analyses conducted
to identify any impacts on wildlife, fish, air, water, and other natural
resources from energy and mineral exploration, development, production,
and transportation or transmission;
(B) projects to maintain, improve, or enhance wildlife and fish populations
and their habitats or air, water, or other natural resources, including
activities under the Endangered Species Act of 1973;
(C) research, surveys, environmental analyses, and projects that assist
in managing, including mitigating either onsite or offsite, or both,
the impacts of energy and mineral activities on wildlife, fish, air,
water, and other natural resources; and
(D) projects to teach young people to live off the land.
(c) Definitions- In this section:
(1) ENHANCEMENT FUND- The term `Enhancement Fund' means the Federal Energy
Natural Resources Enhancement Fund established by subsection (d).
(2) STATE- The term `State' means the State government agency primarily
responsible for fish and wildlife trust resources within a State.
(d) Establishment and Use of Federal Energy Natural Resources Enhancement
Fund-
(1) ENHANCEMENT FUND- There is established in the Treasury a separate
account to be known as the `Federal Energy Natural Resources Enhancement
Fund'.
(2) FUNDING- The Secretary of the Treasury shall deposit in the Enhancement
Fund--
(A) such sums as are provided by sections 9(b)(5)(A)(ii), 9(b)(5)(B)(ii),
9(c)(4)(A)(ii), and 9(c)(4)(B)(ii) of the Outer Continental Shelf Lands
Act, as amended by this Act;
(B)(i) during the period of October 1, 2006, through September 30, 2015,
0.5 percent of all sums paid into the Treasury under section 35 of the
Mineral Leasing Act (30 U.S.C. 191), and
(ii) beginning October 1, 2015, and thereafter, 2.5 percent of all sums
paid into the Treasury under section 35 of the Mineral Leasing Act (30
U.S.C. 191); and
(C)(i) during the period of October 1, 2006, through September 30, 2015,
0.5 percent of all sums paid into the Treasury from receipts derived
from bonus bids and royalties from other mineral leasing on public lands,
and
(ii) beginning October 1, 2015, and thereafter, 2.5 percent of all sums
paid into the Treasury from receipts derived from bonus bids and royalties
from other mineral leasing on public lands.
(3) INVESTMENTS- The Secretary of the Treasury shall invest the amounts
deposited under paragraph (2) and all accrued interest on the amounts
deposited under paragraph (2) only in interest bearing obligations of
the United States or in obligations guaranteed as to both principal and
interest by the United States.
(4) PAYMENT TO SECRETARY OF THE INTERIOR-
(A) IN GENERAL- Beginning with fiscal year 2007, and in each fiscal
year thereafter, one-third of amounts deposited into the Enhancement
Fund, together with the interest thereon, shall be available, without
fiscal year limitations, to the Secretary of the Interior for use for
the purposes described in (b)(4).
(B) WITHDRAWALS AND TRANSFER OF FUNDS- The Secretary of the Treasury
shall withdraw such amounts from the Enhancement Fund as the Secretary
of the Interior may request, subject to the limitation in (A), and transfer
such amounts to the Secretary of the Interior to be used, at the discretion
of the Secretary of the Interior, by the Minerals Management Service,
the Bureau of Land Management, and the United States Fish and Wildlife
Service for use for the purposes described in subsection (b)(4).
(A) IN GENERAL- Beginning with fiscal year 2007, and in each fiscal
year thereafter, two-thirds of amounts deposited into the Enhancement
Fund, together with the interest thereon, shall be available, without
fiscal year limitations, to the States for use for the purposes described
in (b)(4).
(B) WITHDRAWALS AND TRANSFER OF FUNDS- Within the first 90 days of each
fiscal year, the Secretary of the Treasury shall withdraw amounts from
the Enhancement Fund and transfer such amounts to the States based on
the proportion of all receipts that were collected the previous fiscal
year from Federal leases within the boundaries of each State and each
State's outer Continental Shelf Adjacent Zone as determined in accordance
with section 4(a) of the Outer Continental Shelf Lands Act (43 U.S.C.
1333(a)), as amended by this Act.
(C) USE OF PAYMENTS BY STATE- Each State shall use the payments made
under subparagraph (B) only for carrying out projects and programs for
the purposes described in (b)(4).
(D) ENCOURAGE USE OF PRIVATE FUNDS BY STATE- Each State shall use the
payments made under subparagraph (B) to leverage private funds for carrying
out projects for the purposes described in (b)(4).
(e) Limitation on Use- Amounts available under this section may not be used
for the purchase of any interest in land.
(1) IN GENERAL- Beginning in fiscal year 2008 and continuing for each
fiscal year thereafter, the Secretary of the Interior and each State receiving
funds from the Enhancement Fund shall submit a report to the Committee
on Energy and Natural Resources of the Senate and the Committee on Resources
of the House of Representatives.
(2) REQUIRED INFORMATION- Reports submitted to the Congress by the Secretary
of the Interior and States under this subsection shall include the following
information regarding expenditures during the previous fiscal year:
(A) A summary of pertinent scientific research and surveys conducted
to identify impacts on wildlife, fish, and other natural resources from
energy and mineral developments.
(B) A summary of projects planned and completed to maintain, improve
or enhance wildlife and fish populations and their habitats or other
natural resources.
(C) A list of additional actions that assist, or would assist, in managing,
including mitigating either onsite or offsite, or both, the impacts
of energy and mineral development on wildlife, fish, and other natural
resources.
(D) A summary of private (non-Federal) funds used to plan, conduct,
and complete the plans and programs identified in paragraphs (2)(A)
and (2)(B).
SEC. 15. TERMINATION OF EFFECT OF LAWS PROHIBITING THE SPENDING OF APPROPRIATED
FUNDS FOR CERTAIN PURPOSES.
All provisions of existing Federal law prohibiting the spending of appropriated
funds to conduct oil and natural gas leasing and preleasing activities for
any area of the outer Continental Shelf shall have no force or effect.
SEC. 16. OUTER CONTINENTAL SHELF INCOMPATIBLE USE.
(a) In General- No Federal agency may permit construction or operation (or
both) of any facility, or designate or maintain a restricted transportation
corridor or operating area on the Federal outer Continental Shelf or in
State waters, that will be incompatible with, as determined by the Secretary
of the Interior, oil and gas or natural gas leasing and substantially full
exploration and production of tracts that are geologically prospective for
oil or natural gas (or both).
(b) Exceptions- Subsection (a) shall not apply to any facility, transportation
corridor, or operating area the construction, operation, designation, or
maintenance of which is or will be--
(1) located in an area of the outer Continental Shelf that is unavailable
for oil and gas or natural gas leasing by operation of law;
(2) used for a military readiness activity (as defined in section 315(f)
of Public Law 107-314; 16 U.S.C. 703 note); or
(3) required in the national interest, as determined by the President.
SEC. 17. REPURCHASE OF CERTAIN LEASES.
(a) Authority to Repurchase and Cancel Certain Leases- The Secretary of
the Interior shall repurchase and cancel any Federal oil and gas, geothermal,
coal, oil shale, tar sands, or other mineral lease, whether onshore or offshore,
if the Secretary finds that such lease qualifies for repurchase and cancellation
under the regulations authorized by this section.
(b) Regulations- Not later than 365 days after the date of the enactment
of this Act, the Secretary shall publish a final regulation stating the
conditions under which a lease referred to in subsection (a) would qualify
for repurchase and cancellation, and the process to be followed regarding
repurchase and cancellation. Such regulation shall include, but not be limited
to, the following:
(1) The Secretary shall repurchase and cancel a lease after written request
by the lessee upon a finding by the Secretary that--
(A) a request by the lessee for a required permit or other approval
complied with applicable law, except the Coastal Zone Management Act
of 1972 (16 U.S.C. 1451 et seq.), and terms of the lease and such permit
or other approval was denied;
(B) a Federal agency failed to act on a request by the lessee for a
required permit, other approval, or administrative appeal within a regulatory
or statutory time-frame associated with the requested action, whether
advisory or mandatory, or if none, within 180 days; or
(C) a Federal agency attached a condition of approval, without agreement
by the lessee, to a required permit or other approval if such condition
of approval was not mandated by Federal statute or regulation in effect
on the date of lease issuance, or was not specifically allowed under
the terms of the lease.
(2) A lessee shall not be required to exhaust administrative remedies
regarding a permit request, administrative appeal, or other required request
for approval for the purposes of this section.
(3) The Secretary shall make a final agency decision on a request by a
lessee under this section within 180 days of request.
(4) Compensation to a lessee to repurchase and cancel a lease under this
section shall be the amount that a lessee would receive in a restitution
case for a material breach of contract.
(5) Compensation shall be in the form of a check or electronic transfer
from the Department of the Treasury from funds deposited into miscellaneous
receipts under the authority of the same Act that authorized the issuance
of the lease being repurchased.
(6) Failure of the Secretary to make a final agency decision on a request
by a lessee under this section within 180 days of request shall result
in a 10 percent increase in the compensation due to the lessee if the
lease is ultimately repurchased.
(c) No Prejudice- This section shall not be interpreted to prejudice any
other rights that the lessee would have in the absence of this section.
SEC. 18. OFFSITE ENVIRONMENTAL MITIGATION.
Notwithstanding any other provision of law, any person conducting activities
under the Mineral Leasing Act (30 U.S.C. 181 et seq.), the Geothermal Steam
Act (30 U.S.C. 1001 et seq.), the Mineral Leasing Act for Acquired Lands
(30 U.S.C. 351 et seq.), the Weeks Act (16 U.S.C. 552 et seq.), the General
Mining Act of 1872 (30 U.S.C. 22 et seq.), the Materials Act of 1947 (30
U.S.C. 601 et seq.), or the Outer Continental Shelf Lands Act (43 U.S.C.
1331 et seq.), may in satisfying any mitigation requirements associated
with such activities propose mitigation measures on a site away from the
area impacted and the Secretary of the Interior shall accept these proposed
measures if the Secretary finds that they generally achieve the purposes
for which mitigation measures appertained.
SEC. 19. AMENDMENTS TO THE MINERAL LEASING ACT.
Section 17(g) of the Mineral Leasing Act (30 U.S.C. 226(g)) is amended to
read as follows:
`(g) Regulation of Surface-Disturbing Activities-
`(1) REGULATION OF SURFACE-DISTURBING ACTIVITIES- The Secretary of the
Interior, or for National Forest lands, the Secretary of Agriculture,
shall regulate all surface-disturbing activities conducted pursuant to
any lease issued under this Act, and shall determine reclamation and other
actions as required in the interest of conservation of surface resources.
`(2) SUBMISSION OF EXPLORATION PLAN; COMPLETION REVIEW; COMPLIANCE REVIEW-
`(A) Prior to beginning oil and gas exploration activities, a lessee
shall submit an exploration plan to the Secretary of the Interior for
review.
`(B) The Secretary shall review the plan for completeness within 10
days of submission.
`(C) In the event the exploration plan is determined to be incomplete,
the Secretary shall notify the lessee in writing and specify the items
or information needed to complete the exploration plan.
`(D) The Secretary shall have 10 days to review any modified exploration
plan submitted by the lessee.
`(E) To be deemed complete, an exploration plan shall include, in the
degree of detail to be determined by the Secretary by rule or regulation--
`(i) a drilling plan containing a description of the drilling program;
`(ii) the surface and projected completion zone location;
`(iii) pertinent geologic data;
`(iv) expected hazards, and proposed mitigation measures to address
such hazards;
`(v) a schedule of anticipated exploration activities to be undertaken;
`(vi) a description of equipment to be used for such activities;
`(vii) a certification from the lessee stating that the exploration
plan complies with all lease, regulatory and statutory requirements
in effect on the date of the issuance of the lease;
`(viii) evidence that the lessee has secured an adequate bond, surety,
or other financial arrangement prior to commencement of any surface
disturbing activity;
`(ix) a plan that details the complete and timely reclamation of the
lease tract; and
`(x) such other relevant information as the Secretary may by regulation
require.
`(F) Upon a determination that the exploration plan is complete, the
Secretary shall have 30 days from the date the plan is deemed complete
to conduct a review of the plan.
`(G) If the Secretary finds the exploration plan is not consistent with
all statutory and regulatory requirements in effect on the date of issuance
of the lease, the Secretary shall notify the lessee with a detailed
explanation of such modifications of the exploration plan as are necessary
to achieve compliance.
`(H) The lessee shall not take any action under the exploration plan
within a 30 day review period, or thereafter until the plan has been
modified to achieve compliance as so notified.
`(I) After review by the Secretary provided by this subsection, a lessee
may operate pursuant to the plan without further review or approval
by the Secretary.
`(3) PLAN REVISIONS; CONDUCT OF EXPLORATION ACTIVITIES-
`(A) If a significant revision of an exploration plan under this subsection
is submitted to the Secretary, the process to be used for the review
of such revision shall be the same as set forth in paragraph (1) of
this subsection.
`(B) All exploration activities pursuant to any lease shall be conducted
in accordance with an exploration plan that has been submitted to and
reviewed by the Secretary or a revision of such plan.
`(4) SUBMISSION OF DEVELOPMENT AND PRODUCTION PLAN; COMPLETENESS REVIEW;
COMPLIANCE REVIEW-
`(A) Prior to beginning oil and gas development and production activities,
a lessee shall submit a development and exploration plan to the Secretary
of the Interior. Upon submission, such plans shall be subject to a review
for completeness.
`(B) The Secretary shall review the plan for completeness within 30
days of submission.
`(C) In the event a development and production plan is determined to
be incomplete, the Secretary shall notify the lessee in writing and
specify the items or information needed to complete the plan.
`(D) The Secretary shall have 30 days to review for completeness any
modified development and production plan submitted by the lessee.
`(E) To be deemed complete, a development and production plan shall
include, in the degree of detail to be determined by the Secretary by
rule or regulation--
`(i) a drilling plan containing a description of the drilling program;
`(ii) the surface and projected completion zone location;
`(iii) pertinent geologic data;
`(iv) expected hazards, and proposed mitigation measures to address
such hazards;
`(v) a statement describing all facilities and operations proposed
by the lessee and known by the lessee (whether or not owned or operated
by such lessee) that shall be constructed or utilized in the development
and production of oil or gas from the leases areas, including the
location and site of such facilities and operations, the land, labor,
material, and energy requirements associated with such facilities
and operations;
`(vi) the general work to be performed;
`(vii) the environmental safeguards to be implemented in connection
with the development and production and how such safeguards are to
be implemented;
`(viii) all safety standards to be met and how such standards are
to be met;
`(ix) an expected rate of development and production and a time schedule
for performance;
`(x) a certification from the lessee stating that the development
and production plan complies with all lease, regulatory, and statutory
requirements in effect on the date of issuance of the lease;
`(xi) evidence that the lessee has secured an adequate bond, surety,
or other financial arrangement prior to commencement of any surface
disturbing activity;
`(xii) a plan that details the complete and timely reclamation of
the lease tract; and
`(xiii) such other relevant information as the Secretary may by regulation
require.
`(F) Upon a determination that the development and production plan is
complete, the Secretary shall have 120 days from the date the plan is
deemed complete to conduct a review of the plan.
`(G) If the Secretary finds the development and production plan is not
consistent with all statutory and regulatory requirements in effect
on the date of issuance of the lease, the Secretary shall notify the
lessee with a detailed explanation of such modifications of the development
and production plan as are necessary to achieve compliance.
`(H) The lessee shall not take any action under the development and
production plan within a 120 day review period, or thereafter until
the plan has been modified to achieve compliance as so notified.
`(5) PLAN REVISIONS; CONDUCT OF DEVELOPMENT AND PRODUCTION ACTIVITIES-
`(A) If a significant revision of a development and production plan
under this subsection is submitted to the Secretary, the process to
be used for the review of such revision shall be the same as set forth
in paragraph (4) of this subsection.
`(B) All development and production activities pursuant to any lease
shall be conducted in accordance with an exploration plan that has been
submitted to and reviewed by the Secretary or a revision of such plan.
`(6) CANCELLATION OF LEASE ON FAILURE TO SUBMIT PLAN OR COMPLY WITH APPROVED
PLAN- Whenever the owner of any lease fails to submit a plan in accordance
with regulations issued under this section, or fails to comply with a
plan, the lease may be canceled in accordance with section 31. Termination
of a lease because of failure to comply with a plan, including required
modifications or revisions, shall not entitle a lessee to any compensation.'.
SEC. 20. MINERALS MANAGEMENT SERVICE.
The bureau known as the `Minerals Management Service' in the Department
of the Interior shall be known as the `National Ocean Resources and Royalty
Service'.
SEC. 21. AUTHORITY TO USE DECOMMISSIONED OFFSHORE OIL AND GAS PLATFORMS
AND OTHER FACILITIES FOR MARICULTURE, ARTIFICIAL REEF, SCIENTIFIC RESEARCH,
OR OTHER USES.
(a) Short Title- This section may be cited as the `Rigs to Reefs Act of
2005'.
(b) In General- The Outer Continental Shelf Lands Act (43 U.S.C. 1301 et
seq.) is amended by inserting after section 9 the following:
`SEC. 10. USE OF DECOMMISSIONED OFFSHORE OIL AND GAS PLATFORMS AND OTHER
FACILITIES FOR MARICULTURE, ARTIFICIAL REEF, SCIENTIFIC RESEARCH, OR OTHER
USES.
`(a) In General- The Secretary shall issue regulations under which the Secretary
may authorize use of an offshore oil and gas platform or other facility
that is decommissioned from service for oil and gas purposes for culture
of marine organisms, an artificial reef, scientific research, or any other
use authorized under section 8(p).
`(b) Transfer Requirements- The Secretary shall not allow the transfer of
a decommissioned offshore oil and gas platform or other facility to another
person unless the Secretary is satisfied that the transferee is sufficiently
bonded, endowed, or otherwise financially able to fulfill its obligations,
including but not limited to--
`(1) ongoing maintenance of the platform or other facility;
`(2) any liability obligations that might arise;
`(3) removal of the platform or other facility if determined necessary
by the Secretary; and
`(4) any other requirements and obligations that the Secretary may deem
appropriate by regulation.
`(c) Plugging and Abandonment- The Secretary shall ensure that obligations
of a lessee regarding the plugging and abandonment of wells are unaffected
by implementation of this section.
`(d) Potential to Petition to Opt-Out of Regulations- An Adjacent State
acting through a resolution of its legislature, with concurrence of its
Governor, may petition to opt-out of the application of regulations promulgated
under this section to platforms and other facilities located in the area
of its Adjacent Zone within 25 miles of the coastline. The Secretary is
authorized to except such area from the application of such regulations,
and shall approve such petition, unless the Secretary finds that approving
the petition would probably cause serious harm or damage to the marine resources
of the State's Adjacent Zone. Prior to acting on the petition, the Secretary
shall complete an environmental assessment that documents the anticipated
environmental effects of approving the petition.
`(e) Limitation on Liability- A person that had used an offshore oil and
gas platform or other facility for oil and gas purposes and that no longer
has any ownership or control of the platform or other facility shall not
be liable under Federal law for any costs or damages arising from such platform
or other facility after the date the platform or other facility is used
for any purpose under subsection (a), unless such costs or damages arise
from--
`(1) use of the platform or other facility by the person for development
or production of oil or gas; or
`(2) another act or omission of the person.
`(f) Other Leasing and Use Not Affected- This section, and the use of any
offshore oil and gas platform or other facility for any purpose under subsection
(a), shall not affect--
`(1) the authority of the Secretary to lease any area under this Act;
or
`(2) any activity otherwise authorized under this Act.'.
(c) Deadline for Regulations- The Secretary of the Interior shall issue
regulations under subsection (b) by not later than 180 days after the date
of the enactment of this Act.
(d) Study and Report on Effects of Removal of Platforms- Not later than
one year after the date of enactment of this Act, the Secretary of the Interior,
in consultation with other Federal agencies as the Secretary deems advisable,
shall study and report to the Congress regarding how the removal of offshore
oil and gas platforms and other facilities from the outer Continental Shelf
would affect existing fish stocks and coral populations.
SEC. 22. REPEAL OF REQUIREMENT TO CONDUCT COMPREHENSIVE INVENTORY OF OCS
OIL AND NATURAL GAS RESOURCES.
The Energy Policy Act of 2005 (Public Law 109-58) is amended--
(1) by repealing section 357 (119 Stat. 720; 42 U.S.C. 15912); and
(2) in the table of contents in section 1(b), by striking the item relating
to such section 357.
SEC. 23. ONSHORE AND OFFSHORE MINERAL LEASE FEES.
Notwithstanding any other provision of law, the Department of the Interior
is prohibited from charging fees applicable to actions on Federal onshore
and offshore oil and gas, coal, geothermal, and other mineral leases, including
transportation of any production from such leases, if such fees were not
established in final regulations prior to the date of issuance of the lease.
SEC. 24. LEASES FOR AREAS LOCATED WITHIN 125 MILES OF CALIFORNIA OR FLORIDA.
(a) Authorization to Cancel and Exchange Certain Existing Oil and Gas Leases;
Prohibition on Submittal of Exploration Plans for Certain Leases Prior to
June 30, 2012-
(1) AUTHORITY- Effective 180 days after the date of enactment of this
Act, the lessee of an existing oil and gas lease for an area located completely
within 125 miles of the coastline within the California or Florida Adjacent
Zones shall have the option, without compensation, of exchanging such
lease for a new oil and gas lease having a primary term of 5 years. For
the area subject to the new lease, the lessee may select any unleased
tract that is completely beyond 100 miles from the coastline of the Adjacent
State and is located within the same Adjacent State's Adjacent Zone as
the lease being exchanged, except that leases being exchanged within the
Florida Adjacent Zone may be exchanged for any unleased tract that is
completely beyond 100 miles from the coastline of Florida and is located
west of 86 degrees 41 minutes longitude.
(2) ADMINISTRATIVE PROCESS- The Secretary of the Interior shall establish
a reasonable administrative process through which a lessee may exercise
its option to exchange an oil and gas lease for a new oil and gas lease
as provided for in this section. Such exchanges, including the issuance
of new leases, shall not be considered to be major Federal actions for
purposes of the National Environmental Policy Act of 1969 (42 U.S.C. 4321
et seq.). Further, such exchanges conducted in accordance with this section
are deemed to be in compliance all provisions of the Outer Continental
Shelf Lands Act (43 U.S.C. 1331 et seq.). The Secretary shall issue a
new lease in exchange for the lease being exchanged notwithstanding that
the area that will be subject to the lease may be withdrawn from leasing
under the Outer Continental Shelf Lands Act or otherwise unavailable for
leasing under the provisions of any other law.
(3) OPERATING RESTRICTIONS- A new lease issued in exchange for an existing
lease under this section shall be subject to such national defense operating
restrictions on the OCS tract covered by the new lease as may be applicable
upon issuance.
(4) PRIORITY- The Secretary shall give priority in the lease exchange
process based on the amount of the original bonus bid paid for the issuance
of each lease to be exchanged. The Secretary shall allow leases covering
partial tracts to be exchanged for leases covering full tracts conditioned
upon payment of additional bonus bids on a per-acre basis as determined
by the average per acre of the original bonus bid per acre for the partial
tract being exchanged.
(5) EXPLORATION PLANS- Any exploration plan submitted to the Secretary
of the Interior after the date of the enactment of this Act and before
July 1, 2012, for an oil and gas lease for an area wholly within 125 miles
of the coastline within the California Adjacent Zone or Florida Adjacent
Zone shall not be treated as received by the Secretary until the earlier
of July 1, 2012, or the date on which a petition by the Adjacent State
for oil and gas leasing covering the area within which is located the
area subject to the oil and gas lease was approved.
(b) Further Lease Cancellation and Exchange Provisions-
(1) CANCELLATION OF LEASE- As part of the lease exchange process under
this section, the Secretary shall cancel a lease that is exchanged under
this section.
(2) CONSENT OF LESSEES- All lessees holding an interest in a lease must
consent to cancellation of their leasehold interests in order for the
lease to be cancelled and exchanged under this section.
(3) WAIVER OF RIGHTS- As a prerequisite to the exchange of a lease under
this section, the lessee must waive any rights to bring any litigation
against the United States related to the transaction.
(4) PLUGGING AND ABANDONMENT- The plugging and abandonment requirements
for any wells located on any lease to be cancelled and exchanged under
this section must be complied with by the lessees prior to the cancellation
and exchange.
(c) Existing Oil and Gas Lease Defined- In this section the term `existing
oil and gas lease' means an oil and gas lease in effect on the date of the
enactment of this Act.
SEC. 25. COASTAL IMPACT ASSISTANCE.
Section 31 of the Outer Continental Shelf Lands Act (43 U.S.C. 1356a) is
repealed.
SEC. 26. OIL SHALE AND TAR SANDS AMENDMENTS.
(a) Repeal of Requirement to Establish Payments- Section 369(o) of the Energy
Policy Act of 2005 (Public Law 109-58; 119 Stat. 728; 42 U.S.C. 15927) is
repealed.
(b) Treatment of Revenues- Section 21 of the Mineral Leasing Act (30 U.S.C.
241) is amended by adding at the end the following:
`(1) IN GENERAL- Notwithstanding the provisions of section 35, all revenues
received from and under an oil shale or tar sands lease shall be disposed
of as provided in this subsection.
`(2) ROYALTY RATES FOR COMMERCIAL LEASES-
`(A) INITIAL PRODUCTION- For the first 10 years after initial production
under each oil shale or tar sands lease issued under the commercial
leasing program established under subsection (d), the Secretary shall
set the royalty rate at not less than 1 percent nor more than 3 percent
of the gross value of production. However, the initial production period
royalty rate set by the Secretary shall not apply to production occurring
more than 15 years after the date of issuance of the lease.
`(B) SUBSEQUENT PERIODS- After the periods of time specified in subparagraph
(A), the Secretary shall set the royalty rate on each oil shale or tar
sands lease issued under the commercial leasing program established
under subsection (d) at not less than 6 percent nor more than 9 percent
of the gross value of production.
`(C) REDUCTION- The Secretary shall reduce any royalty otherwise required
to be paid under subparagraphs (A) and (B) under any oil shale or tar
sands lease on a sliding scale based upon market price, with a 10 percent
reduction if the monthly average price of NYMEX West Texas Intermediate
crude oil at Cushing, Oklahoma, (WTI) drops below $50 (in 2005 dollars)
for the month in which the production is sold, and an 80 percent reduction
if the monthly average price of WTI drops below $30 (in 2005 dollars)
for the month in which the production is sold.
`(3) DISPOSITION OF REVENUES-
`(A) DEPOSIT- The Secretary shall deposit into a separate account in
the Treasury all revenues derived from any oil shale or tar sands lease.
`(B) ALLOCATIONS TO STATES AND LOCAL POLITICAL SUBDIVISIONS- The Secretary
shall allocate 50 percent of the revenues deposited into the account
established under subparagraph (A) to the State within the boundaries
of which the leased lands are located, with a portion of that to be
paid directly by the Secretary to the State's local political subdivisions
as provided in this paragraph.
`(C) TRANSMISSION OF ALLOCATIONS-
`(i) IN GENERAL- Not later than the last business day of the month
after the month in which the revenues were received, the Secretary
shall transmit--
`(I) to each State two-thirds of such State's allocations under
subparagraph (B), and in accordance with clauses (ii) and (iii)
to certain county-equivalent and municipal political subdivisions
of such State a total of one-third of such State's allocations under
subparagraph (B), together with all accrued interest thereon; and
`(II) the remaining balance of such revenues deposited into the
account that are not allocated under subparagraph (B), together
with interest thereon, shall be transmitted to the miscellaneous
receipts account of the Treasury, except that until a lease has
been in production for 20 years 50 percent of such remaining balance
derived from a lease shall be paid in accordance with subclause
(I).
`(ii) ALLOCATIONS TO CERTAIN COUNTY-EQUIVALENT POLITICAL SUBDIVISIONS-
The Secretary shall under clause (i)(I) make equitable allocations
of the revenues to county-equivalent political subdivisions that the
Secretary determines are closely associated with the leasing and production
of oil shale and tar sands, under a formula that the Secretary shall
determine by regulation.
`(iii) ALLOCATIONS TO MUNICIPAL POLITICAL SUBDIVISIONS- The initial
allocation to each county-equivalent political subdivision under clause
(ii) shall be further allocated to the county-equivalent political
subdivision and any municipal political subdivisions located partially
or wholly within the boundaries of the county-equivalent political
subdivision on an equitable basis under a formula that the Secretary
shall determine by regulation.
`(D) INVESTMENT OF DEPOSITS- The deposits in the Treasury account established
under this section shall be invested by the Secretary of the Treasury
in securities backed by the full faith and credit of the United States
having maturities suitable to the needs of the account and yielding
the highest reasonably available interest rates as determined by the
Secretary of the Treasury.
`(E) USE OF FUNDS- A recipient of funds under this subsection may use
the funds for any lawful purpose as determined by State law. Funds allocated
under this subsection to States and local political subdivisions may
be used as matching funds for other Federal programs without limitation.
Funds allocated to local political subdivisions under this subsection
may not be used in calculation of payments to such local political subdivisions
under programs for payments in lieu of taxes or other similar programs.
`(F) NO ACCOUNTING REQUIRED- No recipient of funds under this subsection
shall be required to account to the Federal Government for the expenditure
of such funds, except as otherwise may be required by law.
`(4) DEFINITIONS- In this subsection:
`(A) COUNTY-EQUIVALENT POLITICAL SUBDIVISION- The term `county-equivalent
political subdivision' means a political jurisdiction immediately below
the level of State government, including a county, parish, borough in
Alaska, independent municipality not part of a county, parish, or borough
in Alaska, or other equivalent subdivision of a State.
`(B) MUNICIPAL POLITICAL SUBDIVISION- The term `municipal political
subdivision' means a municipality located within and part of a county,
parish, borough in Alaska, or other equivalent subdivision of a State.'.
END
