SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Thompson Divide Withdrawal and 
Protection Act of 2017''.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds that--
            (1) the Thompson Divide in western Colorado provides rural 
        character, a robust agriculture-based economy, and outstanding 
        recreational and sporting opportunities to the public;
            (2) the Thompson Divide--
                    (A) provides important spring and summer grazing 
                land for historical ranching operations; and
                    (B) was described by President Theodore Roosevelt 
                as a ``great, wild country'';
            (3) the Interior Board of Land Appeals has determined that 
        certain mineral leases previously issued within the Thompson 
        Divide are legally deficient;
            (4) the remedy to the deficiencies described in paragraph 
        (3) may result in protracted legal action and uncertainty for 
        surrounding communities and industry; and
            (5) the communities affected by the leases have requested a 
        solution that--
                    (A) addresses the leasing controversy; and
                    (B) provides long-term certainty for management of 
                Federal land within the Thompson Divide and the 
                surrounding landscape.
    (b) Purposes.--The purposes of this Act are--
            (1) to provide for the cancellation of certain Federal 
        mineral leases in the Thompson Divide;
            (2) subject to valid existing rights, to withdraw certain 
        Federal land in the Thompson Divide area from future mineral 
        and other disposal laws; and
            (3) to provide a market-based form of reimbursement for 
        cancelled leases.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) North thompson divide lease.--The term ``North Thompson 
        Divide Lease'' means each of the Federal mineral leases 
        numbered COC 66706, COC 66707, COC 66708, COC 66709, COC 66710, 
        COC 66711, and COC 66712.
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of the Interior.
            (3) South thompson divide lease.--The term ``South Thompson 
        Divide Lease'' means each of the Federal mineral leases 
        numbered COC 66701, COC 66687, COC 66688, COC 66689, COC 66690, 
        COC 66691, COC 66692, COC 66693, COC 66694, COC 66695, COC 
        66696, COC 66697, COC 66698, COC 66699, COC 66700, COC 66702, 
        COC 66908, and COC 66909.
            (4) State.--The term ``State'' means the State of Colorado.
            (5) Thompson divide map.--The term ``Thompson Divide map'' 
        means the map entitled ``Greater Thompson Divide Area Map'' and 
        dated September 22, 2016.
            (6) Thompson divide withdrawal and protection area.--The 
        term ``Thompson Divide Withdrawal and Protection Area'' means 
        the Federal land and minerals at Thompson Divide and adjacent 
        areas in Gunnison County, Colorado, as generally depicted on 
        the Thompson Divide map as the ``Thompson Divide Withdrawal and 
        Protection Area''.
            (7) Wolf creek storage field development rights.--
                    (A) In general.--The term ``Wolf Creek Storage 
                Field development rights'' means the development rights 
                for each of the Federal mineral leases numbered COC 
                007496, COC 007497, COC 007498, COC 007499, COC 007500, 
                COC 007538, COC 008128, COC 015373, COC 0128018, COC 
                051645, and COC 051646, and generally depicted on the 
                Thompson Divide map as ``Wolf Creek Storage 
                Agreement''.
                    (B) Exclusions.--The term ``Wolf Creek Storage 
                Field development rights'' does not include any storage 
                rights or related activities within the area described 
                in subparagraph (A).

SEC. 4. THOMPSON DIVIDE WITHDRAWAL AND PROTECTION AREA.

    (a) Withdrawal.--Subject to valid existing rights, the Thompson 
Divide Withdrawal and Protection Area is withdrawn from all forms of--
            (1) entry, appropriation, and disposal under the public 
        land laws;
            (2) location, entry, and patent under the mining laws; and
            (3) operation of the mineral leasing, mineral materials, 
        and geothermal leasing laws.
    (b) Surveys.--The exact acreage and legal description of the 
Thompson Divide Withdrawal and Protection Area shall be determined by 
surveys approved by the Secretary, in consultation with the Secretary 
of Agriculture.

SEC. 5. NORTH THOMPSON DIVIDE LEASE EXCHANGE.

    (a) In General.--Except as provided in subsection (b), in exchange 
for the relinquishment by a leaseholder of all North Thompson Divide 
Leases of the leaseholder, the Secretary may issue to the leaseholder 
credits for bid, royalty, or rental payments due under Federal oil and 
gas leases on Federal land in the State.
    (b) Exception.--If a North Thompson Divide Lease has been cancelled 
by the Secretary before the date of enactment of this Act and the 
holder of the cancelled lease has been compensated for the cancelled 
lease, the Secretary may not issue credits for bid, royalty, or rental 
payments for the cancelled lease under subsection (a).
    (c) Amount of Credit.--
            (1) In general.--The amount of the credits issued to a 
        holder of any North Thompson Divide Leases relinquished under 
        subsection (a) shall--
                    (A) be equal to the sum of--
                            (i) the amount of the bonus bids paid for 
                        the applicable North Thompson Divide Leases;
                            (ii) the amount of any rental paid for the 
                        applicable North Thompson Divide Leases as of 
                        the date on which the holder of the applicable 
                        North Thompson Divide Leases notifies the 
                        Secretary of the decision to relinquish the 
                        applicable North Thompson Divide Leases; and
                            (iii) the amount of any expenses incurred 
                        by the holder of the applicable North Thompson 
                        Divide Leases in the preparation of drilling 
                        permits, sundry notices, or other related 
                        submissions in furtherance of the development 
                        of the applicable North Thompson Divide Leases 
                        as of July 29, 2016, including any expenses 
                        related to the preparation of analyses under 
                        the National Environmental Policy Act of 1969 
                        (42 U.S.C. 4321 et seq.); and
                    (B) require the approval of the Secretary.
            (2) Exclusion.--The amount of a credit issued under 
        subsection (a) shall not include any expenses paid by the 
        holder of a North Thompson Divide Lease for legal fees or 
        related expenses for legal work with respect to a North 
        Thompson Divide Lease.
    (d) Cancellation.--The North Thompson Divide Leases, on 
relinquishment and without further action by the Secretary, shall--
            (1) be permanently cancelled; and
            (2) not be reissued.
    (e) Conditions.--
            (1) Applicable law.--Except as otherwise provided in this 
        section, the exchange under this section shall be conducted in 
        accordance with--
                    (A) this Act; and
                    (B) other applicable laws (including regulations).
            (2) Acceptance of credits.--The Secretary shall accept 
        credits issued under subsection (a) in the same manner as cash 
        for the payments described in that subsection.
            (3) Applicability.--The use of the credits issued under 
        subsection (a) shall be subject to the laws (including 
        regulations) applicable to the payments described in that 
        subsection, to the extent the laws are consistent with this 
        section.
            (4) Treatment of credits.--All amounts in the form of 
        credits issued under subsection (a) accepted by the Secretary 
        shall be considered to be amounts received for the purposes 
        of--
                    (A) section 35 of the Mineral Leasing Act (30 
                U.S.C. 191); and
                    (B) section 20 of the Geothermal Steam Act of 1970 
                (30 U.S.C. 1019).

SEC. 6. SOUTH THOMPSON DIVIDE LEASE EXCHANGE.

    (a) In General.--Except as provided in subsection (b), in exchange 
for the relinquishment by a leaseholder of all South Thompson Divide 
Leases of the leaseholder, the Secretary may issue to the leaseholder 
credits for bid, royalty, or rental payments due under Federal oil and 
gas leases on Federal land in the State.
    (b) Exception.--If a South Thompson Divide Lease has been cancelled 
by the Secretary before the date of enactment of this Act and the 
holder of the cancelled lease has been compensated for the cancelled 
lease, the Secretary may not issue credits for bid, royalty, or rental 
payments for the cancelled lease under subsection (a).
    (c) Amount of Credit.--
            (1) In general.--The amount of the credits issued to the 
        holder of any South Thompson Divide Leases relinquished under 
        subsection (a) shall--
                    (A) be equal to the sum of--
                            (i) the amount of the bonus bids paid for 
                        the applicable South Thompson Divide Leases;
                            (ii) the amount of any rental paid for the 
                        applicable South Thompson Divide Leases as of 
                        the date on which the holder of the applicable 
                        South Thompson Divide Leases notifies the 
                        Secretary of the decision to relinquish the 
                        applicable South Thompson Divide Leases;
                            (iii) the amount of any expenses incurred 
                        by the holder of the applicable South Thompson 
                        Divide Leases in the preparation of drilling 
                        permits, sundry notices, or other related 
                        submissions in furtherance of the development 
                        of the applicable South Thompson Divide Leases 
                        as of July 29, 2016, including any expenses 
                        related to the preparation of analyses under 
                        the National Environmental Policy Act of 1969 
                        (42 U.S.C. 4321 et seq.); and
                            (iv) the amount of any expenses incurred by 
                        the holder of the applicable South Thompson 
                        Divide Leases in the purchasing of rights and 
                        the preparation of drilling permits, sundry 
                        notices, or other related submissions in 
                        furtherance of the development of the Wolf 
                        Creek Storage Field development rights; and
                    (B) require the approval of the Secretary.
            (2) Exclusion.--The amount of a credit issued under 
        subsection (a) shall not include any expenses paid by the 
        holder of a South Thompson Divide Lease for legal fees or 
        related expenses for legal work with respect to a South 
        Thompson Divide Lease.
    (d) Cancellation.--The South Thompson Divide Leases, on 
relinquishment and without further action by the Secretary, shall--
            (1) be permanently cancelled; and
            (2) not be reissued.
    (e) Conditions.--
            (1) Applicable law.--Except as otherwise provided in this 
        section, the exchange under this section shall be conducted in 
        accordance with--
                    (A) this Act; and
                    (B) other applicable laws (including regulations).
            (2) Acceptance of credits.--The Secretary shall accept 
        credits issued under subsection (a) in the same manner as cash 
        for the payments described in that subsection.
            (3) Applicability.--The use of the credits issued under 
        subsection (a) shall be subject to the laws (including 
        regulations) applicable to the payments described in that 
        subsection, to the extent the laws are consistent with this 
        section.
            (4) Treatment of credits.--All amounts in the form of 
        credits issued under subsection (a) accepted by the Secretary 
        shall be considered to be amounts received for the purposes 
        of--
                    (A) section 35 of the Mineral Leasing Act (30 
                U.S.C. 191); and
                    (B) section 20 of the Geothermal Steam Act of 1970 
                (30 U.S.C. 1019).
    (f) Wolf Creek Storage Field Development Rights.--
            (1) Conveyance to secretary.--As a condition precedent to 
        the relinquishment of the South Thompson Divide Leases, a 
        leaseholder shall permanently relinquish, transfer, and 
        otherwise convey to the Secretary, in a form acceptable to the 
        Secretary, all Wolf Creek Storage Field development rights of 
        the leaseholder.
            (2) Limitation of transfer.--Any interest acquired by the 
        Secretary under paragraph (1) shall be held in perpetuity and 
        not transferred, reissued, or otherwise used for mineral 
        extraction.

SEC. 7. METHANE LEASING IN THE LOWER NORTH FORK VALLEY.

    (a) Inventory.--Not later than 1 year after the date of enactment 
of this Act, the Secretary shall complete, or shall collaborate with 
agencies of the State or with institutions of higher education in the 
State to complete, an inventory of all significant emissions of methane 
in the North Fork Valley, Colorado, including methane emissions from 
active, inactive, and abandoned coal mines.
    (b) Leasing Program.--
            (1) In general.--Not later than 1 year after the date of 
        completion of the inventory required under subsection (a), the 
        Secretary shall carry out, to the extent permissible under 
        applicable law, a program to offer for lease Federal methane 
        from active, inactive, and abandoned coal mines, subject to 
        valid existing rights.
            (2) Conditions.--The program carried out under paragraph 
        (1) shall--
                    (A) only include methane that can be collected and 
                transported in a manner that does not--
                            (i) endanger the safety of coal mine 
                        workers; or
                            (ii) unreasonably interfere with ongoing 
                        operations at coal mines; and
                    (B) provide for the owners or operators of mines 
                with leases that overlap potential methane leases under 
                the program carried out under paragraph (1) to elect to 
                remove the areas from potential methane leasing under 
                the program if the owners or operators determine that 
                the conditions described in subparagraph (A) are not 
                met.
    (c) Coal Mine Methane Electrical Power Generation Demonstration 
Program.--
            (1) In general.--Not later than 2 years after the date of 
        completion of the inventory required under subsection (a), the 
        Secretary shall enter into discussions with the eligible 
        entities described in paragraph (2) to develop a program to 
        facilitate the sale and delivery of methane that is subject to 
        subsection (b), but which has not been leased under that 
        subsection, to one or more of the eligible entities to 
        demonstrate the feasibility, cost-effectiveness, and 
        environmental benefits of producing electrical power from 
        methane from coal mines.
            (2) Description of eligible entity.--An eligible entity 
        referred to in paragraph (1) is a rural electric utility, 
        energy cooperative, or municipal utility with service area 
        boundaries within 100 miles of Paonia, Colorado.
            (3) Establishment of pricing.--In facilitating the delivery 
        of methane under paragraph (1), the Secretary shall establish 
        pricing for the sale and delivery of methane that is sufficient 
        to reimburse all costs to the Secretary for the implementation 
        and management of the demonstration program developed under 
        that paragraph.
            (4) Contracts.--The Secretary may contract with the State 
        or one or more institutions of higher education in the State to 
        provide services to the eligible entities described in 
        paragraph (2) to facilitate the program developed under 
        paragraph (1), with all related costs to be included in the 
        pricing established under paragraph (3).

SEC. 8. EFFECT.

    Unless expressly provided in this Act, nothing in this Act--
            (1) expands, diminishes, or impairs any valid existing 
        mineral leases, mineral interest, or other property rights 
        wholly or partially within the Thompson Divide Withdrawal and 
        Protection Area, including access to the leases, rights, or 
        land in accordance with applicable Federal, State, and local 
        laws (including regulations);
            (2) prevents the capture of methane from active, inactive, 
        or abandoned coal mines covered by this Act, in accordance with 
        applicable law; or
            (3) prevents access to, or the development of, any new or 
        existing coal mine or lease in Delta or Gunnison County, 
        Colorado.
Thompson Divide Withdrawal and Protection Act of 2017 This bill withdraws the Thompson Divide Withdrawal and Protection Area in Colorado from: (1) entry, appropriation, and disposal under the public land laws; (2) location, entry, and patent under the mining laws; and (3) operation of the mineral leasing, mineral materials, and geothermal leasing laws.  In exchange for the relinquishment of all of the North Thompson Divide leases or South Thompson Divide leases of a leaseholder, the Department of the Interior may issue to such leaseholder credits for bid, royalty, or rental payments due under federal oil and gas leases on federal land in Colorado. Upon relinquishment, such leases shall be permanently canceled and shall not be reissued.  As a condition for relinquishing South Thompson Divide leases, a leaseholder must permanently relinquish, transfer, and otherwise convey to Interior all of its Wolf Creek Storage Field development rights, excluding any storage rights or related activities within the area.  Interior shall: (1) complete, or shall collaborate with state agencies or institutions of higher education in Colorado to complete, an inventory of all significant methane emissions in the North Fork Valley, including emissions from active, inactive, and abandoned coal mines; (2) carry out a program to lease federal methane from such mines; and (3) enter into discussions to develop a program to facilitate the sale and delivery of such methane that has not been leased to at least one rural electric utility, municipal utility, or energy cooperative with service area boundaries within 100 miles of Paonia, Colorado, to demonstrate the feasibility, cost-effectiveness, and environmental benefits of producing electrical power from methane collected from coal mines. 
Thompson Divide Withdrawal and Protection Act of 2017