II 

109TH CONGRESS 

2D SESSION S. 2290 

To provide for affordable natural gas by rebalancing domestic supply and 

demand and to promote the production of natural gas from domestic 

resources. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 15, 2006 

Mr. PRYOR (for himself, Mr. WARNER, and Mr. TALENT) introduced the following bill; which was read twice and referred to the Committee on Energy and Natural Resources 

A BILL 

To provide for affordable natural gas by rebalancing domestic 

supply and demand and to promote the production of 

natural gas from domestic resources. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Reliable and Affordable Natural Gas Energy Reform Act 

6 of 2006’’. 

7 (b) TABLE OF CONTENTS.—The table of contents of 

8 this Act is as follows: 

Sec. 1. Short title; table of contents. 
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Sec. 2. Natural gas leases. 

Sec. 3. Determination of adjacent zones and planning areas. 

Sec. 4. Leasing moratoria in the OCS. 

Sec. 5. Option to petition for extension of withdrawal from leasing within certain areas of the outer Continental Shelf. 

Sec. 6. State requests to examine energy areas. 

Sec. 7. Availability of certain areas for leasing. 

Sec. 8. Neighboring State concurrence. 

Sec. 9. Revenue sharing from moratorium areas. 

Sec. 10. Revenue sharing from nonmoratorium areas. 

Sec. 11. Repeal of requirement to conduct comprehensive inventory of OCS natural gas resources. 

Sec. 12. Leases for areas located within 100 miles off California or Florida. 

Sec. 13. Repurchase of certain leases. 

1 SEC. 2. NATURAL GAS LEASES. 

2 Section 8 of the Outer Continental Shelf Lands Act 

3 (43 U.S.C. 1337) is amended by adding at the end the 

4 following: 

5 ‘‘(q) NATURAL GAS LEASES.— 

6 ‘‘(1) IN GENERAL.—Beginning with the 5-year 

7 outer Continental Shelf oil and gas leasing program 

8 for 2007 through 2012, the Secretary may issue a 

9 lease under this section that authorizes development 

10 and production of gas and associated condensate 

11 and other hydrocarbon liquids in a moratorium area 

12 (as defined in section 18(j)(1)) in accordance with 

13 regulations issued under paragraph (2). 

14 ‘‘(2) REGULATIONS.—Not later than October 1, 

15 2006, the Secretary shall issue regulations that, for 

16 purposes of this section— 

17 ‘‘(A) define ‘natural gas’ in a manner that 

18 includes— 
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1 ‘‘(i) hydrocarbons and other sub2 stances in a gaseous state at atmospheric 

3 pressure and a temperature of 60 degrees 

4 Fahrenheit; 

5 ‘‘(ii) liquids that condense (gas liq6 uids) from natural gas in the process of 

7 treatment, dehydration, decompression, or 

8 compression prior to the point for meas9 uring volume and quality of the production 

10 established by the Secretary, acting 

11 through the Minerals Management Service; 

12 ‘‘(iii) other associated hydrocarbon 

13 liquids if the predominant component is 

14 natural gas and gas liquids; and 

15 ‘‘(iv) natural gas liquefied for trans16 portation; 

17 ‘‘(B) provide that natural gas leases shall 

18 contain the same rights and obligations as oil 

19 and gas leases; 

20 ‘‘(C) provide that, in reviewing the ade21 quacy of bids for natural gas leases, the Sec22 retary, acting through the Minerals Manage23 ment Service, shall exclude the value of any 

24 crude oil estimated to be discovered within the 

25 boundaries of the leasing area; 
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1 ‘‘(D) provide for cancellation of a natural 

2 gas lease, with payment of the fair value of the 

3 lease rights canceled, if the Secretary deter4 mines that hydrocarbons other than natural gas 

5 and natural gas liquids will be the predominant 

6 production from the lease; and 

7 ‘‘(E) provide that, at the request and with 

8 the consent of the Governor of the State adja9 cent to the lease area, as determined under sec10 tion 18(j)(2)(B)(i), and with the consent of the 

11 lessee, an existing natural gas lease may be 

12 converted, without an increase in the rental roy13 alty rate and without further payment in the 

14 nature of a lease bonus, to a lease under sub15 section (b), in accordance with a process, to be 

16 established by the Secretary, that requires— 

17 ‘‘(i) consultation by the Secretary 

18 with the Governor of the State and the les19 see with respect to the operating conditions 

20 of the lease, taking into consideration envi21 ronmental resource conservation and recov22 ery, economic factors, and other factors, as 

23 the Secretary determines to be relevant; 

24 and 
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1 ‘‘(ii) compliance with the National 

2 Environmental Policy Act of 1969 (42 

3 U.S.C. 4321 et seq.). 

4 ‘‘(3) EFFECT OF OTHER LAWS.—Any Federal 

5 law (including regulations) that applies to an oil and 

6 gas lease on the outer Continental Shelf shall apply 

7 to a natural gas lease issued under this subsection.’’. 

8 SEC. 3. DETERMINATION OF ADJACENT ZONES AND PLAN9 NING AREAS. 

10 Section 4(a)(2)(A) of the Outer Continental Shelf 

11 Lands Act (43 U.S.C. 1333(a)(2)(A)) is amended— 

12 (1) by designating the first, second, and third 

13 sentences as clause (i), (iii), and (iv), respectively; 

14 (2) in clause (i) (as so designated), by striking 

15 ‘‘, and the President’’ and all that follows through 

16 the end of the sentence; and 

17 (3) by inserting after clause (i) (as so des18 ignated) the following: 

19 ‘‘(ii) The lines extending seaward and defining the 

20 Adjacent Zone of each State, and each Planning Area of 

21 the outer Continental Shelf, shall be as indicated on the 

22 maps for each outer Continental Shelf region entitled— 

23 ‘‘(I) ‘Alaska OCS Region State Adjacent Zone 

24 and OCS Planning Areas’; 
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1 ‘‘(II) ‘Pacific OCS Region State Adjacent Zones 

2 and OCS Planning Areas’; 

3 ‘‘(III) ‘Gulf of Mexico OCS Region State Adja4 cent Zones and OCS Planning Areas’; and 

5 ‘‘(IV) ‘Atlantic OCS Region State Adjacent 

6 Zones and OCS Planning Areas’; 

7 all of which are dated September 2005 and on file in the 

8 Office of the Director, Minerals Management Service.’’. 

9 SEC. 4. LEASING MORATORIA IN THE OCS. 

10 Section 18 of the Outer Continental Shelf Lands Act 

11 (43 U.S.C. 1344) is amended by adding at the end the 

12 following: 

13 ‘‘(i) LEASING WITHIN CERTAIN AREAS OF THE

14 OUTER CONTINENTAL SHELF.— 

15 ‘‘(1) PROHIBITION AGAINST LEASING.—Except 

16 as otherwise provided in this subsection and sub17 section (k), prior to June 30, 2012, the Secretary 

18 shall not offer for leasing for natural gas— 

19 ‘‘(A) any area withdrawn from disposition 

20 by leasing in the Atlantic OCS Region, the Pa21 cific OCS Region, or the Gulf of Mexico OCS 

22 Region Eastern Planning Area, as depicted on 

23 the applicable map described in subparagraph 

24 (B), under the ‘Memorandum on Withdrawal of 

25 Certain Areas of the United States Outer Con-
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1 tinental Shelf from Leasing Disposition’, from 

2 34 Weekly Comp. Pres. Doc. 1111, dated June 

3 12, 1998; or 

4 ‘‘(B) any area not withdrawn under that 

5 Memorandum that is included within— 

6 ‘‘(i) the Gulf of Mexico OCS Region 

7 Eastern Planning Area as indicated on the 

8 map entitled ‘Gulf of Mexico OCS Region 

9 State Adjacent Zones and OCS Planning 

10 Areas’; or 

11 ‘‘(ii) the Florida Straits Planning 

12 Area as indicated on the map entitled ‘At13 lantic OCS Region State Adjacent Zones 

14 and OCS Planning Areas’; 

15 both of which are dated September 2005 and 

16 on file in the Office of the Director, Minerals 

17 Management Service. 

18 ‘‘(2) REVOCATION OF WITHDRAWAL.— 

19 ‘‘(A) IN GENERAL.—The withdrawal of 

20 any area from disposition by leasing under the 

21 ‘Memorandum on Withdrawal of Certain Areas 

22 of the United States Outer Continental Shelf 

23 from Leasing Disposition’, from 34 Weekly 

24 Comp. Pres. Doc. 1111, dated June 12, 1998, 

25 shall have no force or effect with respect to any 
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1 area included within the Gulf of Mexico OCS 

2 Region Central Planning Area as indicated on 

3 the map entitled ‘Gulf of Mexico OCS Region 

4 State Adjacent Zones and OCS Planning 

5 Areas’, dated September 2005 and on file in the 

6 Office of the Director, Minerals Management 

7 Service. 

8 ‘‘(B) ADDITIONAL AREAS.—The Secretary 

9 shall amend the 5-year outer Continental Shelf 

10 oil and gas leasing program for 2002 through 

11 2007 to include— 

12 ‘‘(i) the areas added to the Gulf of 

13 Mexico OCS Region Central Planning Area 

14 by this paragraph to the extent that the 

15 areas were included within the original 

16 boundaries of proposed Lease Sale 181; 

17 and 

18 ‘‘(ii) 2 sales in such additional areas, 

19 1 of which shall be held not later than 

20 January 2007 and 1 of which shall be held 

21 not later than June 2007. 

22 ‘‘(C) ENVIRONMENTAL IMPACT STATE23 MENT.—The final environmental impact state24 ment prepared for an area covered by this para25 graph for Lease Sale 181 shall be considered 
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1 sufficient for all purposes for each lease sale in 

2 which the area is offered for lease during the 5- 

3 year outer Continental Shelf oil and gas leasing 

4 program for 2002 through 2007 without need 

5 for supplementation. 

6 ‘‘(D) PARTIAL TRACTS.— 

7 ‘‘(i) PART WITHIN PLANNING AREA.— 

8 Any tract only partially added to the Gulf 

9 of Mexico OCS Region Central Planning 

10 Area by this paragraph shall be eligible for 

11 leasing of the part of the tract that is in12 cluded within the Gulf of Mexico OCS Re13 gion Central Planning Area. 

14 ‘‘(ii) PART OUTSIDE PLANNING

15 AREA.—The remainder of the tract that 

16 lies outside of the Gulf of Mexico OCS Re17 gion Central Planning Area may be devel18 oped and produced by the lessee of the 

19 partial tract using extended reach or simi20 lar drilling from a location on a leased 

21 area.’’. 

22 SEC. 5. OPTION TO PETITION FOR EXTENSION OF WITH23 DRAWAL FROM LEASING WITHIN CERTAIN 

24 AREAS OF THE OUTER CONTINENTAL SHELF. 

25 (a) OPTION TO PETITION.— 
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1 (1) IN GENERAL.—The Governor of a State 

2 may submit to the Secretary a petition requesting 

3 that the Secretary extend for a period of time de4 scribed in paragraph (2) the withdrawal from leasing 

5 for all or part of any area within the Adjacent Zone 

6 of the State within 125 miles of the coastline of the 

7 State. 

8 (2) LENGTH OF EXTENSION.— 

9 (A) IN GENERAL.—The period of time re10 quested in a petition submitted under para11 graph (1) shall not exceed 5 years for each peti12 tion. 

13 (B) LIMITATION.—The Secretary shall not 

14 grant a petition submitted under paragraph (1) 

15 that extends the remaining period of a with16 drawal of an area from leasing for a total of 

17 more than 10 years. 

18 (3) MULTIPLE PETITIONS.—A State may peti19 tion multiple times for a particular area, but not 

20 more than once per calendar year for any particular 

21 area. 

22 (4) CONTENTS OF PETITION.—A petition sub23 mitted under paragraph (1) may— 

24 (A) apply to natural gas leasing; and 
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1 (B) request some areas to be withdrawn 

2 from all leasing and some areas only withdrawn 

3 from one type of leasing. 

4 (5) ALABAMA ADJACENT ZONE.—A petition for 

5 extending the withdrawal from leasing of any part of 

6 the Alabama Adjacent Zone that is a part of the 

7 Gulf of Mexico OCS Region Eastern Planning Area, 

8 as indicated on the map entitled ‘‘Gulf of Mexico 

9 OCS Region State Adjacent Zones and OCS Plan10 ning Areas’’, dated September 2005 and on file in 

11 the Office of the Director, Minerals Management 

12 Service, may be made by either the Governor of Ala13 bama or the Governor of Florida. 

14 (b) ACTION BY SECRETARY.—Not later than 90 days 

15 after receipt of a petition submitted under subsection (a), 

16 the Secretary shall approve the petition, unless the Sec17 retary determines that extending the withdrawal from 

18 leasing would likely have an adverse effect on the avail19 ability of necessary energy resources, which would con20 tribute to significant economic hardship on a national or 

21 regional basis, or would otherwise not be in the national 

22 interest. 

23 (c) FAILURE TO ACT.—If the Secretary fails to ap24 prove or deny a petition in accordance with subsection (b), 
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1 the petition shall be considered to be approved 90 days 

2 after the date on which the Secretary received the petition. 

3 SEC. 6. STATE REQUESTS TO EXAMINE ENERGY AREAS. 

4 Section 18 of the Outer Continental Shelf Lands Act 

5 (43 U.S.C. 1344) (as amended by section 4) is amended 

6 by adding at the end the following: 

7 ‘‘(j) STATE REQUESTS TO EXAMINE ENERGY

8 AREAS.— 

9 ‘‘(1) DEFINITIONS.—In this subsection through 

10 subsection (m): 

11 ‘‘(A) LEASE.—The term ‘lease’ includes a 

12 natural gas lease under section 8(q). 

13 ‘‘(B) MORATORIUM AREA.—The term 

14 ‘moratorium area’ means— 

15 ‘‘(i) any area withdrawn from disposi16 tion by leasing by the ‘Memorandum on 

17 Withdrawal of Certain Areas of the United 

18 States Outer Continental Shelf from Leas19 ing Disposition’, from 34 Weekly Comp. 

20 Pres. Doc. 1111, dated June 12, 1998; 

21 and 

22 ‘‘(ii) any area of the outer Continental 

23 Shelf as to which Congress has denied the 

24 use of appropriated funds or other means 

25 for preleasing, leasing, or related activities. 
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1 ‘‘(2) RESOURCE ESTIMATES.— 

2 ‘‘(A) REQUESTS.—At any time, the Gov3 ernor of an affected State (acting on behalf of 

4 the State) may request the Secretary to provide 

5 a current estimate of proven and potential nat6 ural gas resources that may result, and result7 ing State revenues, in any moratorium area (or 

8 any part of the moratorium area the Governor 

9 identifies) adjacent to, or lying seaward of the 

10 coastline of, that State. 

11 ‘‘(B) RESPONSE OF SECRETARY.—Not 

12 later than 45 days after the date on which the 

13 Governor of a State requests an estimate under 

14 subparagraph (A), the Secretary shall provide— 

15 ‘‘(i) a current estimate of proven and 

16 potential natural gas resources in any mor17 atorium areas off the shore of a State; 

18 ‘‘(ii) an estimate of potential revenues 

19 that could be shared under this Act if re20 sources were developed and produced; and 

21 ‘‘(iii) an explanation of the planning 

22 processes that could lead to the leasing, ex23 ploration, development, and production of 

24 the natural gas resources within the area 

25 identified.’’. 
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1 SEC. 7. AVAILABILITY OF CERTAIN AREAS FOR LEASING. 

2 Section 18 of the Outer Continental Shelf Lands Act 

3 (43 U.S.C. 1344) (as amended by section 6) is amended 

4 by adding at the end the following: 

5 ‘‘(k) AVAILABILITY OF CERTAIN AREAS FOR LEAS6 ING.— 

7 ‘‘(1) PETITION.— 

8 ‘‘(A) IN GENERAL.—On consideration of 

9 the information received from the Secretary, the 

10 Governor (acting on behalf of the State of the 

11 Governor) may submit to the Secretary a peti12 tion requesting that the Secretary make avail13 able for leasing any portion of a moratorium 

14 area in the Adjacent Zone of the State. 

15 ‘‘(B) CONTENTS.—In a petition under sub16 paragraph (A), a Governor may request that an 

17 area described in subparagraph (A) be made 

18 available for leasing under subsection (b) or (q), 

19 or both, of section 8. 

20 ‘‘(2) ACTION BY SECRETARY.—Not later than 

21 90 days after the date of receipt of a petition under 

22 paragraph (1), the Secretary shall approve the peti23 tion unless the Secretary determines that leasing in 

24 the affected area presents a significant likelihood of 

25 incidents associated with the development of re26 sources that would cause serious harm or damage to 
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1 the marine resources of the area or of an adjacent 

2 State. 

3 ‘‘(3) FAILURE TO ACT.—If the Secretary fails 

4 to approve or deny a petition in accordance with 

5 paragraph (2), the petition shall be considered to be 

6 approved as of the date that is 90 days after the 

7 date of receipt of the petition. 

8 ‘‘(4) TREATMENT.—Notwithstanding any other 

9 provision of this section, not later than 180 days 

10 after the date on which a petition is approved, or 

11 considered to be approved, under paragraph (2) or 

12 (3), the Secretary shall— 

13 ‘‘(A) treat the petition of the Governor 

14 under paragraph (1) as a proposed revision to 

15 a leasing program under this section; and 

16 ‘‘(B) except as provided in paragraph (5), 

17 expedite the revision of the 5-year outer Conti18 nental Shelf oil and gas leasing program in ef19 fect as of that date to include any lease sale for 

20 any area covered by the petition. 

21 ‘‘(5) INCLUSION IN SUBSEQUENT PLANS.— 

22 ‘‘(A) IN GENERAL.—If there are less than 

23 18 months remaining in the 5-year outer Conti24 nental Shelf oil and gas leasing program de25 scribed in paragraph (4)(B), the Secretary, 
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1 without consultation with any State, shall in2 clude the areas covered by the petition in lease 

3 sales under the subsequent 5-year outer Conti4 nental Shelf oil and gas leasing program. 

5 ‘‘(B) ENVIRONMENTAL ASSESSMENT.—Be6 fore modifying a 5-Year outer Continental Shelf 

7 oil and gas leasing program under subpara8 graph (A), the Secretary shall complete an envi9 ronmental assessment that describes any antici10 pated environmental effect of leasing in the 

11 area covered by the petition. 

12 ‘‘(6) SPENDING LIMITATIONS.—Any Federal 

13 spending limitation with respect to preleasing, leas14 ing, or a related activity in an area made available 

15 for leasing under this subsection shall terminate as 

16 of the date on which the petition of the Governor re17 lating to the area is approved, or considered to be 

18 approved, under paragraph (2) or (3). 

19 ‘‘(7) APPLICATION.—This subsection shall not 

20 apply to— 

21 ‘‘(A) any area designated as a national 

22 marine sanctuary or a national wildlife refuge; 

23 ‘‘(B) any area not included in the outer 

24 Continental Shelf; 
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1 ‘‘(C) the Great Lakes (as defined in sec2 tion 118(a)(3) of the Federal Water Pollution 

3 Control Act (33 U.S.C. 1268(a)(3)); 

4 ‘‘(D) the eastern coast of the State of 

5 Florida; or 

6 ‘‘(E) Bristol Bay. 

7 ‘‘(8) GREAT LAKES.—The Great Lakes (as de8 fined in section 118(a)(3) of the Federal Water Pol9 lution Control Act (33 U.S.C. 1268(a)(3)))— 

10 ‘‘(A) shall not be considered part of the 

11 outer Continental Shelf under this Act; and 

12 ‘‘(B) shall not be subject to production.’’. 

13 SEC. 8. NEIGHBORING STATE CONCURRENCE. 

14 (a) NOTICE.—The Secretary of the Interior shall pro15 vide notice to a neighboring State of any proposed lease 

16 of natural gas if the lease would be located within 20 miles 

17 of the nearest point on the coastline of the State. 

18 (b) OBJECTION.—Not later than 30 days after receiv19 ing the notice, the Governor of the State may object to 

20 the issuance of the lease on grounds that the lease pre21 sents a significant risk to environmental and economic re22 sources of the State. 

23 (c) SECRETARY REVIEW.—If the Secretary, after re24 view of the objection and consultation with the adjacent 

25 State, concurs that the lease presents a significant risk 
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1 described in subsection (b), and that the risk cannot be 

2 reasonably mitigated— 

3 (1) the Secretary shall not approve an explo4 ration plan for the lease; and 

5 (2) the lease shall be eligible for repurchase in 

6 accordance with section 13. 

7 (d) NONAPPLICABILITY.—This section does not apply 

8 to a State covered by section 12. 

9 SEC. 9. REVENUE SHARING FROM MORATORIUM AREAS. 

10 Section 18 of the Outer Continental Shelf Lands Act 

11 (43 U.S.C. 1344) (as amended by section 7) is amended 

12 by adding at the end the following: 

13 ‘‘(l) REVENUE SHARING FROM MORATORIUM

14 AREAS.— 

15 ‘‘(1) BONUS BIDS.—If the Governor of a State 

16 requests the Secretary to allow natural gas leasing 

17 in a moratorium area and the Secretary allows the 

18 leasing, the State shall, without further appropria19 tion or action, receive 50 percent of any bonus bid 

20 paid for leasing rights in the area. 

21 ‘‘(2) POST LEASING REVENUES.—In addition to 

22 bonus bids under paragraph (1), a State described 

23 in paragraph (1) shall receive, from leasing of the 

24 area, 50 percent of— 

25 ‘‘(A) any lease rental minimum royalty; 
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1 ‘‘(B) any royalty proceeds from a sale of 

2 royalties taken in kind by the Secretary; and 

3 ‘‘(C) any other revenues from a bidding 

4 system under section 8. 

5 ‘‘(3) CONSERVATION ROYALTIES.—After mak6 ing distributions in accordance with paragraphs (1) 

7 and (2) and in accordance with section 31, the Sec8 retary shall, without further appropriation or action, 

9 distribute a conservation royalty equal to 12.5 per10 cent of Federal royalty revenues derived from an 

11 area leased under this section in an amount not to 

12 exceed $1,250,000,000 from all areas leased under 

13 this section for any year, into the following pro14 grams that distribute conservation funds to States: 

15 ‘‘(A) The Federal aid to wildlife restora16 tion fund established under section 3(a)(1) of 

17 the Pittman-Robertson Wildlife Restoration Act 

18 (16 U.S.C. 669b(a)(1)). 

19 ‘‘(B) The land and water conservation 

20 fund established under section 2 of the Land 

21 and Water Conservation Fund Act of 1965 (16 

22 U.S.C. 460l–5) to provide financial assistance 

23 to States under section 6 of that Act (16 

24 U.S.C. 460l–8).’’. 
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1 SEC. 10. REVENUE SHARING FROM NONMORATORIUM 

2 AREAS. 

3 Section 18 of the Outer Continental Shelf Lands Act 

4 (43 U.S.C. 1344) (as amended by section 9) is amended 

5 by adding at the end the following: 

6 ‘‘(m) REVENUE SHARING FROM NONMORATORIUM

7 AREA.—Revenues from production that occurs beginning 

8 on the date that is 5 years after the date of enactment 

9 of this subsection in an area that is not a moratorium 

10 area shall be distributed in the same proportion and for 

11 the same uses as provided in subsection (l).’’. 

12 SEC. 11. REPEAL OF REQUIREMENT TO CONDUCT COM13 PREHENSIVE INVENTORY OF OCS NATURAL 

14 GAS RESOURCES. 

15 Section 357 of the Energy Policy Act of 2005 (42 

16 U.S.C. 15912) is repealed. 

17 SEC. 12. LEASES FOR AREAS LOCATED WITHIN 100 MILES 

18 OFF CALIFORNIA OR FLORIDA. 

19 (a) IN GENERAL.—Effective beginning on the date 

20 that is 180 days after the date of enactment of this Act, 

21 the lessee of a natural gas lease in existence on the date 

22 of enactment of this Act for an area located completely 

23 within 100 miles of the coastline and within the California 

24 or Florida Adjacent Zones shall have the option, without 

25 compensation, of exchanging the lease for a new natural 

26 gas lease having a primary term of 5 years. 
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1 (b) TRACTS.—For the area subject to the new lease, 

2 the lessee may select any unleased tract— 

3 (1) at least part of which is located within the 

4 area between 100 and 125 miles from the coastline; 

5 and 

6 (2) that is located— 

7 (A) completely beyond 100 miles from the 

8 coastline; and 

9 (B) within the same Adjacent Zone of the 

10 adjacent State as the lease being exchanged. 

11 (c) ADMINISTRATIVE PROCESS.— 

12 (1) IN GENERAL.—The Secretary of the Inte13 rior (referred to in this section as the ‘‘Secretary’’) 

14 shall establish a reasonable administrative process 

15 through which a lessee may exercise the option of 

16 the lessee to exchange a natural gas lease for a new 

17 natural gas lease in accordance with this section. 

18 (2) RELATIONSHIP TO OTHER LAWS.—An ex19 change of leases conducted in accordance with this 

20 section (including the issuance of a new lease)— 

21 (A) shall not be considered to be a major 

22 Federal action for purposes of the National En23 vironmental Policy Act of 1969 (42 U.S.C. 

24 4321 et seq.); and 
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1 (B) shall be considered in compliance with 

2 the Outer Continental Shelf Lands Act (43 

3 U.S.C. 1331 et seq.). 

4 (3) WITHDRAWAL.—The Secretary shall issue a 

5 new lease in exchange for the lease being exchanged 

6 notwithstanding that the area that will be subject to 

7 the lease may be withdrawn from leasing under the 

8 Outer Continental Shelf Lands Act (43 U.S.C. 1331 

9 et seq.) or otherwise unavailable for leasing under 

10 any other law. 

11 (d) OPERATING RESTRICTIONS.—A new lease issued 

12 in exchange for an existing lease under this section shall 

13 be subject to such national defense operating restrictions 

14 on the outer Continental Shelf tract covered by the new 

15 lease as apply on the date of issuance of the new lease. 

16 (e) PRIORITY.— 

17 (1) BONUS BID.—The Secretary shall give pri18 ority in the lease exchange process under this section 

19 based on the amount of the original bonus bid paid 

20 for the issuance of each lease to be exchanged. 

21 (2) EXCHANGE OF PARTIAL TRACTS FOR FULL

22 TRACTS.—The Secretary shall allow leases covering 

23 partial tracts to be exchanged for leases covering full 

24 tracts under this section conditioned on payment of 

25 additional bonus bids on a per-acre basis, as deter-
23 

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1 mined based on the average per acre of the original 

2 bonus bid per acre for the partial tract being ex3 changed. 

4 (f) EXPLORATION PLANS.—An exploration plan sub5 mitted to the Secretary during the period beginning on 

6 the date of enactment of this Act and ending June 30, 

7 2012, for a natural gas lease for an area wholly within 

8 100 miles of the coastline within the California Adjacent 

9 Zone or the Florida Adjacent Zone shall not be treated 

10 as received by the Secretary until the earlier of— 

11 (1) July 1, 2012; or 

12 (2) the date of approval of a petition by the Ad13 jacent State for natural gas leasing covering the 

14 area within which is located the area subject to the 

15 natural gas lease. 

16 (g) CANCELLATION OF LEASE.—As part of the lease 

17 exchange process under this section, the Secretary shall 

18 cancel a lease that is exchanged under this section. 

19 (h) CONDITIONS FOR LEASE EXCHANGE.—For a 

20 lease to be cancelled and exchanged under this section— 

21 (1) each lessee holding an interest in the lease 

22 must consent to cancellation of the leasehold interest 

23 of the lessee; 
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1 (2) each lessee must waive any rights to bring 

2 any litigation against the United States related to 

3 the transaction; and 

4 (3) the plugging and abandonment require5 ments for any well located on any lease to be can6 celled and exchanged under this section must be 

7 complied with by the lessees prior to the cancellation 

8 and exchange. 

9 (i) AREA PARTIALLY WITHIN 100 MILES OF FLOR10 IDA.—A natural gas lease in existence on the date of en11 actment of this Act for an area located partially within 

12 100 miles of the coastline within the Florida Adjacent 

13 Zone may only be developed and produced under this sec14 tion using wells drilled from well-head locations at least 

15 100 miles from the coastline to any bottom-hole location 

16 on the area of the lease. 

17 SEC. 13. REPURCHASE OF CERTAIN LEASES. 

18 (a) IN GENERAL.—The Secretary of the Interior (re19 ferred to in this section as the ‘‘Secretary’’) shall repur20 chase and cancel any Federal natural gas lease in the 

21 outer Continental Shelf, if the Secretary finds that the 

22 lease qualifies for repurchase and cancellation under the 

23 regulations authorized by this section. 

24 (b) REGULATIONS.— 
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1 (1) IN GENERAL.—Not later than 1 year after 

2 the date of enactment of this Act, the Secretary 

3 shall publish a final regulation prescribing the condi4 tions under which a lease referred to in subsection 

5 (a) would qualify for repurchase and cancellation, 

6 and the process to be followed regarding repurchase 

7 and cancellation, in a manner consistent with this 

8 subsection. 

9 (2) FINDING.—The Secretary shall repurchase 

10 and cancel a lease under this section on a written re11 quest by the lessee and a finding by the Secretary 

12 that— 

13 (A) a request by the lessee for a required 

14 permit or other approval complied with applica15 ble law (other than the Coastal Zone Manage16 ment Act of 1972 (16 U.S.C. 1451 et seq.)) 

17 and terms of the lease and the permit or other 

18 approval was denied; 

19 (B) a Federal agency failed to act on a re20 quest by the lessee for a required permit, other 

21 approval, or administrative appeal— 

22 (i) within a time period established by 

23 law (including regulations) for the re24 quested action, whether advisory or man25 datory; or 
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•S 2290 IS

1 (ii) if no such period is established, 

2 within 180 days after receipt of the re3 quest; or 

4 (C) a Federal agency attached a condition 

5 of approval, without agreement by the lessee, to 

6 a required permit or other approval that— 

7 (i) was not required by Federal law 

8 (including regulations) in effect on the 

9 date of lease issuance; or 

10 (ii) was not specifically allowed under 

11 the terms of the lease. 

12 (3) EXHAUSTION OF REMEDIES.—A lessee shall 

13 not be required to exhaust administrative remedies 

14 regarding a permit request, administrative appeal, or 

15 other required request for approval under this sec16 tion. 

17 (4) DEADLINE.—The Secretary shall make a 

18 final agency decision on a request by a lessee under 

19 this section not later than 180 days after receipt of 

20 the request. 

21 (5) COMPENSATION.— 

22 (A) AMOUNT.—The amount of compensa23 tion to a lessee to repurchase and cancel a lease 

24 under this section shall be equal to the amount 
27 

•S 2290 IS

1 that a lessee would receive in a restitution case 

2 for a material breach of contract. 

3 (B) FORM.—The compensation shall be in 

4 the form of a check or electronic transfer from 

5 the Secretary of the Treasury from funds de6 posited into miscellaneous receipts under the 

7 authority of the Act that authorized the 

8 issuance of the lease being repurchased. 

9 (C) DEADLINE.—The failure of the Sec10 retary to make a final agency decision on a re11 quest by a lessee under this section in accord12 ance with paragraph (4) shall result in a per13 cent increase in the compensation due to the 

14 lessee if the lease is ultimately repurchased. 

15 (c) OTHER RIGHTS.—This section does not affect any 

16 other right the lessee may have in the absence of this sec17 tion. 

Æ