A bill to reacquire and permanently protect certain leases on the Outer Continental Shelf off the coast of California by issuing credits for new energy production in less environmentally sensitive areas in the Western and Central Planning Areas of the Gulf of Mexico.

Summary: California Coastal Protection and Louisiana Energy Enhancement Act - Directs the Secretary of the Interior to make an offer to certain lessees to issue credits in exchange for: (1) the cancellation of specified leases on the Outer Continental Shelf off the coast of California that are nonproducing as of January 1, 2002; and (2) dismissal of any civil actions, or waiver of the right to bring them, by the eligible lessees against the United States relating to pending eligible leases.Authorizes the use of such credits to: (1) bid on lease sales in the Western and Central Planning Areas of the Gulf of Mexico; (2) make royalty payments on production for oil and gas resources in those planning areas in existence as of the enactment of this Act; or (3) sell or transfer them in accordance with certain requirements.States that the Outer Continental Shelf land for which an eligible lease is canceled shall be: (1) permanently withdrawn from all forms of disposition, including mineral leasing; and (2) reserved as an ecological preserve to protect traditional fishing areas and to provide conservation, scientific, and recreational benefits.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``California Coastal Protection and 
Louisiana Energy Enhancement Act''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Eligible lease.--The term ``eligible lease'' means any 
        of the 40 leases on the Outer Continental Shelf off the coast 
        of California that--
                    (A) were issued between 1968 and 1984 under section 
                8 of the Outer Continental Shelf Lands Act (43 U.S.C. 
                1337); and
                    (B) are nonproducing as of January 1, 2002.
            (2) Eligible lessee.--The term ``eligible lessee'' means 
        the lessee under an eligible lease.
            (3) Preserve.--The term ``preserve'' means the ecological 
        preserve established under section 3(b).
            (4) Secretary.--The term ``Secretary'' means the Secretary 
        of the Interior.

SEC. 3. REDIRECTION OF NONPRODUCING OIL AND GAS LEASES TO LESS 
              ENVIRONMENTALLY SENSITIVE AREAS ON THE OUTER CONTINENTAL 
              SHELF.

    (a) Lease Cancellation and Credits.--
            (1) Offer.--Not later than 30 days after the date of 
        enactment of this Act, the Secretary shall make an offer to all 
        eligible lessees to issue credits in exchange for the 
        cancellation of all eligible leases in accordance with this 
        subsection.
            (2) Acceptance.--To accept the offer of the Secretary under 
        paragraph (1) with respect to an eligible lease, an eligible 
        lessee shall submit to the Secretary a written agreement that 
        if all eligible lessees accept the offer and credits are issued 
        under paragraph (3), the eligible lessee--
                    (A) will dismiss any civil action brought by the 
                eligible lessee against the United States relating to 
                the eligible lease that is pending as of the date of 
                cancellation of the eligible lease; and
                    (B) waives the right to bring any further civil 
                action regarding the eligible lease after that date.
            (3) Issuance of credits.--If, not later than 60 days after 
        the date of the offer under paragraph (1), all eligible lessees 
        accept the offer in accordance with paragraph (2), the 
        Secretary shall--
                    (A) cancel all eligible leases; and
                    (B) issue to each eligible lessee credits in the 
                amount determined under paragraph (4).
            (4) Amount.--
                    (A) In general.--For each eligible lease, the 
                Secretary shall issue credits in an amount equal to the 
                sum of--
                            (i) the amount of consideration paid to the 
                        Federal Government for the eligible lease; and
                            (ii) the difference between--
                                    (I) the amount of direct 
                                expenditures made after the date of 
                                issuance of the eligible lease in 
                                connection with the exploration and 
                                development of the eligible lease; and
                                    (II) the amount of revenues earned 
                                from the eligible lease before the date 
                                of cancellation.
                    (B) Exclusions.--The potential value of oil and gas 
                resources associated with the eligible leases shall not 
                be a factor in determining the amount of credits under 
                subparagraph (A).
            (5) Use of credits.--
                    (A) In general.--Credits issued under paragraph 
                (3)--
                            (i) subject to subparagraph (C), may be 
                        used--
                                    (I) to bid on lease sales in the 
                                Western and Central Planning Areas of 
                                the Gulf of Mexico; or
                                    (II) to make royalty payments on 
                                production for oil and gas resources in 
                                those planning areas in existence as of 
                                the date of enactment of this Act; or
                            (ii) may be sold or transferred in 
                        accordance with paragraph (6).
                    (B) Acceptance of credits.--
                            (i) In general.--The Secretary shall accept 
                        credits issued under paragraph (3) in the same 
                        manner as--
                                    (I) cash for the payment of a cash 
                                bonus bid for leases issued in the 
                                Western and Central Planning Areas of 
                                the Gulf of Mexico under the Outer 
                                Continental Shelf Lands Act (43 U.S.C. 
                                1331 et seq.); or
                                    (II) royalty payments on oil and 
                                gas production in the Western and 
                                Central Planning Areas of the Gulf of 
                                Mexico in existence as of the date of 
                                enactment of this Act.
                            (ii) Exception.--The Secretary shall not 
                        accept credits issued under paragraph (3) for 
                        an activity in an area--
                                    (I) that is subject to a leasing 
                                moratorium; or
                                    (II) in which leasing is otherwise 
                                prohibited as of the date of enactment 
                                of this Act.
                    (C) Limitation.--In any 1 fiscal year, the 
                Secretary shall accept credits in an amount no greater 
                than 25 percent of the total amount of credits issued 
                under paragraph (3).
            (6) Sale or transfer.--
                    (A) In general.--An eligible lessee may transfer or 
                sell any credits issued under paragraph (3) to any 
                other person qualified to hold leases under the Outer 
                Continental Shelf Lands Act (43 U.S.C. 1331 et seq.).
                    (B) Requirements.--A sale or transfer of credits 
                under subparagraph (A) shall be subject to--
                            (i) this Act; and
                            (ii) any other terms to which the lessee 
                        and the transferee may agree.
                    (C) Limitations.--Credits transferred or sold under 
                subparagraph (A) shall be accepted in accordance with 
                paragraph (5)(B).
                    (D) Notification.--
                            (i) In general.--Not later than 30 days 
                        after the date on which an eligible lessee 
                        transfers or sells any credits, the eligible 
                        lessee shall notify the Secretary of the 
                        transfer or sale.
                            (ii) Validity.--A transfer or sale of a 
                        credit shall not be valid until the date on 
                        which the Secretary receives notification under 
                        clause (i).
            (7) No additional compensation.--An eligible lessee that 
        participates in the cancellation of an eligible lease under 
        this Act--
                    (A) shall be considered to be fully compensated for 
                the value of the eligible lease; and
                    (B) shall not be eligible to seek additional 
                compensation from the Federal Government for the 
                eligible lease.
            (8) Effect.--Nothing in this Act constitutes a findings by 
        Congress, or should be understood to be based on a finding by 
        Congress, that--
                    (A) actions by the Federal Government involving the 
                eligible leases before the date of enactment of this 
                Act constituted a breach of contract; or
                    (B) the eligible leases have any particular value.
    (b) Ecological Preserve.--
                    (1) In general.--Outer Continental Shelf land for 
                which an eligible lease is canceled under subsection 
                (a) shall--
                    (A) be permanently withdrawn from all forms of 
                disposition, including mineral leasing; and
                    (B) be reserved as an ecological preserve to 
                protect traditional fishing areas and to provide 
                conservation, scientific, and recreational benefits.
            (2) Management.--
                    (A) In general.--The Secretary shall manage the 
                preserve in a manner consistent with the management of 
                the Santa Barbara Channel Ecological Preserve in the 
                State of California.
                    (B) Coordination with secretary of commerce.--The 
                Secretary shall coordinate management activities 
                relating to any portion of the preserve that is 
                adjacent to a national marine sanctuary with the 
                Secretary of Commerce.
            (3) Buffer zone.--Not later than 1 year after the date of 
        establishment of the preserve, the Secretary shall determine 
        whether Outer Continental Shelf land adjacent to the preserve 
        should be withdrawn from all forms of disposition, including 
        mineral leasing, to serve as a buffer zone.