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[Senate Report 111-236]
[From the U.S. Government Publishing Office]

                                                       Calendar No. 492
111th Congress                                                   Report
                                 SENATE
 2d Session                                                     111-236

======================================================================

 
                   OUTER CONTINENTAL SHELF REFORM ACT

                                _______
                                

                 July 28, 2010.--Ordered to be printed

                                _______
                                

   Mr. Bingaman, from the Committee on Energy and Natural Resources, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 3516]

    The Committee on Energy and Natural Resources, to which was 
referred the bill (S. 3516) to amend the Outer Continental 
Shelf Lands Act to reform the management of energy and mineral 
resources on the Outer Continental Shelf, and for other 
purposes, having considered the same, reports favorably thereon 
with amendments and recommends that the bill, as amended, do 
pass.

                                CONTENTS

                                                                   Page
Amendments.......................................................     1
Purpose of the Measure...........................................    12
Summary of Major Provisions......................................    12
Background and Need..............................................    14
Legislative History..............................................    16
Committee Recommendation and Tabulation of Votes.................    16
Committee Amendments (explanation)...............................    16
Section-by-Section Analysis......................................    18
Cost and Budgetary Considerations................................    30
Regulatory Impact Evaluation.....................................    31
Congressionally Directed Spending................................    31
Executive Communications.........................................    31
Changes in Existing Law..........................................    41

    The amendments are as follows:

    Beginning on page 3, strike line 13 and all that follows through 
page 4, line 5, and insert the following:
          (1) by striking paragraph (3) and inserting the following:
          ``(3) the outer Continental Shelf is a vital national 
        resource reserve held by the Federal Government for the public, 
        which should be managed in a manner that--
                  ``(A) recognizes the need of the United States for 
                domestic sources of energy, food, minerals, and other 
                resources;
                  ``(B) minimizes the potential impacts of development 
                of those resources on the marine and coastal 
                environment and on human health and safety; and
                  ``(C) acknowledges the long-term economic value to 
                the United States of the balanced and orderly 
                management of those resources that safeguards the 
                environment and respects the multiple values and uses 
                of the outer Continental Shelf;'';
    On page 7, line 23, insert ``peer-reviewed'' after `independent''.
    On page 16, line 8, strike ``body of evidence'' and replace with 
``complete set of safety documentation''.
    On page 16, line 25, strike ``bond amounts'' and insert ``financial 
responsibility requirements''.
    On page 17, lines 1 and 2, strike ``set any bonds, surety, or other 
evidence of financial responsibility required in amounts adequate'' and 
insert ``adjust for inflation based on the Consumer Price Index for all 
Urban Consumers published by the Bureau of Labor Statistics of the 
Department of Labor, and recommend to Congress any further changes to 
existing financial responsibility requirements necessary''.
    On page 17, line 10, strike ``3'' and insert ``4''.
    On page 18, line 7, strike ``2 years'' and insert ``1 year''.
    On page 18, line 9, strike ``5'' and insert ``4.''
    On page 18, line 14, insert ``income taxes and other significant 
financial elements,'' after ``taxes''.
    On page 19, between lines 21 and 22, insert the following:
                  ``(E) Combined report.--The Secretary may combine the 
                reports required by paragraphs (1) and (2)(D) into 1 
                report.
    On page 20, line 15, insert ``prior public'' after the word 
``after''.
    On page 22, line 14, strike ``potential'' and insert ``expected''.
    On page 22, line 23, strike ``necessary'' and insert ``to be 
used''.
    On page 25, line 18, strike ``engineering''.
    On page 25, line 19, strike ``system, including a'' and insert 
``system by not less than 2 agency engineers, including a written''.
    On page 26, lines 4 and 5, strike ``degrade'' and insert 
``compromise''.
    On page 41, line 9, strike ``The'' and insert ``To the extent 
necessary to fund the inspections described in this paragraph, the''.
    On page 45, between lines 12 and 13, insert the following:
    (l) Conflicts of Interest.--Section 29 of the Outer Continental 
Shelf Lands Act (43 U.S.C. 1355) is amended to read as follows:

``SEC. 29. CONFLICTS OF INTEREST.

    ``(a) Restrictions on Employment.--No full-time officer or employee 
of the Department of the Interior who directly or indirectly discharged 
duties or responsibilities under this Act shall--
          ``(1) within 2 years after his employment with the Department 
        has ceased--
                  ``(A) knowingly act as agent or attorney for, or 
                otherwise represent, any other person (except the 
                United States) in any formal or informal appearance 
                before;
                  ``(B) with the intent to influence, make any oral or 
                written communication on behalf of any other person 
                (except the United States) to; or
                  ``(C) knowingly aid, advise, or assist in--
                          ``(i) representing any other person (except 
                        the United States in any formal or informal 
                        appearance before; or
                          ``(ii) making, with the intent to influence, 
                        any oral or written communication on behalf of 
                        any other person (except the United States) to,
        any department, agency, or court of the United States, or any 
        officer or employee thereof, in connection with any judicial or 
        other proceeding, application, request for a ruling or other 
        determination, regulation, order lease, permit, rulemaking, 
        inspection, enforcement action, or other particular matter 
        involving a specific party or parties in which the United 
        States is a party or has a direct and substantial interest 
        which was actually pending under his official responsibility as 
        an officer or employee within a period of one year prior to the 
        termination of such responsibility or in which he participated 
        personally and substantially as an officer or employee;
          ``(2) within 1 year after his employment with the Department 
        has ceased--
                  ``(A) knowingly act as agent or attorney for, or 
                otherwise represent, any other person (except the 
                United States) in any formal or informal appearance 
                before;
                  ``(B) with the intent to influence, make any oral or 
                written communication on behalf of any other person 
                (except the United States) to; or
                  ``(C) knowingly aid, advise, or assist in--
                          ``(i) representing any other person (except 
                        the United States in any formal or informal 
                        appearance before, or
                          ``(ii) making, with the intent to influence, 
                        any oral or written communication on behalf of 
                        any other person (except the United States) to, 
                        the Department of the Interior, or any officer 
                        or employee thereof, in connection with any 
                        judicial, rulemaking, regulation, order, lease, 
                        permit, regulation, inspection, enforcement 
                        action, or other particular matter which is 
                        pending before the Department of the Interior 
                        or in which the Department has a direct and 
                        substantial interest; or
          ``(3) accept employment or compensation, during the 1-year 
        period beginning on the date on which employment with the 
        Department has ceased, from any person (other than the United 
        States) that has a direct and substantial interest--
                  ``(A) that was pending under the official 
                responsibility of the employee as an officer or 
                employee of the Department during the 1-year period 
                preceding the termination of the responsibility; or
                  ``(B) in which the employee participated personally 
                and substantially as an officer or employee.
    ``(b) Prior Employment Relationships.--No full-time officer or 
employee of the Department of the Interior who directly or indirectly 
discharged duties or responsibilities under this Act shall participate 
personally and substantially as a Federal officer or employee, through 
decision, approval, disapproval, recommendation, the rendering of 
advice, investigation, or otherwise, in a. proceeding, application, 
request for a ruling or other determination, contract, claim, 
controversy, charge, accusation, inspection, enforcement action, or 
other particular matter in which, to the knowledge of the officer or 
employee--
          ``(1) the officer or employee or the spouse, minor child, or 
        general partner of the officer or employee has a financial 
        interest;
          ``(2) any organization in which the officer or employee is 
        serving as an officer, director, trustee, general partner, or 
        employee has a financial interest;
          ``(3) any person or organization with whom the officer or 
        employee is negotiating or has any arrangement concerning 
        prospective employment has a financial interest; or
          ``(4) any person or organization in which the officer or 
        employee has, within the preceding 1-year period, served as an 
        officer, director, trustee, general partner, agent, attorney, 
        consultant, contractor, or employee.
    ``(c) Gifts From Outside Sources.--No full-time officer or employee 
of the Department of the Interior who directly or indirectly discharged 
duties or responsibilities under this Act shall, directly or 
indirectly, solicit or accept any gift in violation of subpart B of 
part 2635 of title X, Code of Federal Regulations (or successor 
regulations).
    ``(d) Exemptions.--The Secretary may, by rule, exempt from this 
section clerical and support personnel who do not conduct inspections, 
perform audits, or otherwise exercise regulatory or policy making 
authority under this Act.
    ``(e) Penalties.--
          ``(1) Criminal penalties.--Any person who violates paragraph 
        (1) or (2) of subsection (a) or subsection (b) shall be 
        punished in accordance with section 216 of title 18, United 
        States Code.
          ``(2) Civil penalties.--Any person who violates subsection 
        (a)(3) or (c) shall be punished in accordance with subsection 
        (b) of section 216 of title 18, United States Code.''.
    On page 45, between lines 13 and 14, insert the following:

SEC. 7. STUDY ON THE EFFECT OF THE MORATORIA ON NEW DEEPWATER DRILLING 
                    IN THE GULF OF MEXICO ON EMPLOYMENT AND SMALL 
                    BUSINESSES.

    (a) In General.--The Secretary of Energy, acting through the Energy 
Information Administration, shall publish a monthly study evaluating 
the effect of the moratoria resulting from the blowout and explosion of 
the mobile offshore drilling unit Deepwater Horizon that occurred on 
April 20, 2010, and resulting hydrocarbon releases into the 
environment, on employment and small businesses.
    (b) Report.--Not later than 60 days after the date of enactment of 
this Act and at the beginning of each month thereafter during the 
effective period of the moratoria described in subsection (a), the 
Secretary of Energy, acting through the Energy Information 
Administration, shall submit to the Committee on Energy and Natural 
Resources of the Senate and the Committee on Energy and Commerce of the 
House of Representatives a report regarding the results of the study 
conducted under subsection (a), including--
          (1) a survey of the effect of the moratoria on deepwater 
        drilling on employment in the industries directly involved in 
        oil and natural gas exploration in the Outer Continental Shelf;
          (2) a survey of the effect of the moratoria on employment in 
        the industries indirectly involved in oil and natural gas 
        exploration in the Outer Continental Shelf, including suppliers 
        of supplies or services and customers of industries directly 
        involved in oil and natural gas exploration;
          (3) an estimate of the effect of the moratoria on the 
        revenues of small business located near the Gulf of Mexico and, 
        to the maximum extent practicable, throughout the United 
        States; and
          (4) any recommendations to mitigate possible negative effects 
        on small business concerns resulting from the moratoria.
    On page 46, strike lines 3 through 11 and insert the following:

SEC. 8. SAFER OIL AND GAS PRODUCTION.

    (a) Program Authority.--Section 999A of the Energy Policy Act of 
2005 (42 U.S.C. 16371) is amended--
          (1) in subsection (a)--
                  (A) by striking ``ultra-deepwater'' and inserting. 
                ``deepwater''; and
                  (B) by inserting ``well control and accident 
                prevention,'' after ``safe operations,'';
          (2) in subsection (b)--
                  (A) by striking paragraph (1) and inserting the 
                following:
          ``(1) Deepwater architecture, well control and accident 
        prevention, and deepwater technology, including drilling to 
        deep formations in waters greater than 500 feet''; and
                  (B) by striking paragraph (4) and inserting the 
                following:
          ``(4) Safety technology research and development for drilling 
        activities aimed at well control and accident prevention 
        performed by the Office of Fossil Energy of the Department.''; 
        and
          (3) in subsection (d)--
                  (A) in the subsection heading, by striking ``National 
                Energy Technology Laboratory'' and inserting ``Office 
                of Fossil Energy of the Department''; and
                  (B) by striking ``National Energy Technology 
                Laboratory'' and inserting ``Office of Fossil Energy of 
                the Department''.
    (b) Deepwater and Unconventional Onshore Natural Gas and Other 
Petroleum Research and Development Program.--Section 999B of the Energy 
Policy Act of 2005 (42 U.S.C. 16372) is amended--
          (1) in the section heading, by striking ``ULTRADEEPWATER AND 
        UNCONVENTIONAL ONSHORE NATURAL GAS AND OTHER PETROLEUM'' and 
        inserting ``SAFE OIL AND GAS PRODUCTION AND ACCIDENT 
        PREVENTION'';
          (2) in subsection (a), by striking. ``, by increasing'' and 
        all that follows through the period at the end and inserting 
        ``and the safe and environmentally responsible exploration, 
        development, and production of hydrocarbon resources.'';
          (3) in subsection (e)(1)--
                  (A) by redesignating subparagraphs (D) and (E) as 
                subparagraphs (E) and (F), respectively; and
                  (B) by inserting after subparagraph (C) the 
                following:
                  ``(D) projects will be selected on a competitive, 
                peer-reviewed basis.''; and
          (4) in subsection (d)--
                  (A) in paragraph (6), by striking ``ultradeepwater'' 
                and inserting ``deepwater'';
                  (B) in paragraph (7)--
                          (i) in subparagraph (A)--
                                  (I) in the subparagraph heading, by 
                                striking ``Ultra-Deepwater'' and 
                                inserting ``Deepwater'';
                                  (II) by striking ``development and'' 
                                and inserting ``research, development, 
                                and''; and
                                  (III) by striking ``as well as'' and 
                                all that follows through the period at 
                                the end and inserting ``aimed at 
                                improving operational safety of 
                                drilling activities, including well 
                                integrity systems, well control, 
                                blowout prevention, the use of non-
                                toxic materials, and integrated systems 
                                approach-based management for 
                                exploration and production in 
                                deepwater.'';
                          (ii) in subparagraph (B), by striking ``and 
                        environmental mitigation'' and inserting ``use 
                        of non-toxic materials, drilling safety, and 
                        environmental mitigation and accident 
                        prevention'';
                          (iii) in subparagraph (C), by inserting 
                        ``safety and accident prevention, well control 
                        and systems integrity,'' after ``including''; 
                        and
                          (iv) by adding at the end the following:
                  ``(D) Safety and accident prevention technology 
                research and development.--Awards from allocations 
                under section 999H(d)(4) shall be expended on areas 
                including--
                          ``(i) development of improved cementing and 
                        casing technologies;
                          ``(ii) best management practices for 
                        cementing, casing, and other well control 
                        activities and technologies;
                          ``(iii) development of integrity and 
                        stewardship guidelines for--
                                  ``(I) well-plugging and abandonment;
                                  ``(II) development of wellbore 
                                sealant technologies; and
                                  ``(III) improvement and 
                                standardization of blowout prevention 
                                devices.''; and
                  (C) by adding at the end the following:
          ``(8) Study; report.--
                  ``(A) Study.--As soon as practicable after the date 
                of enactment of this paragraph, the Secretary shall 
                enter into an arrangement with the National Academy of 
                Sciences under which the Academy shall conduct a study 
                to determine--
                          ``(i) whether the benefits provided through 
                        each award under this subsection during 
                        calendar year 2011 have been maximized; and
                          ``(ii) the new areas of research that could 
                        be carried out to meet the overall objectives 
                        of the program.
                  ``(B) Report.--Not later than January 1, 2012, the 
                Secretary shall submit to the appropriate committees of 
                Congress a report that contains a description of the 
                results of the study conducted under subparagraph (A).
                  ``(C) Optional updates.--The Secretary may update the 
                report described in subparagraph (B) for the 5-year 
                period beginning on the date described in that 
                subparagraph and each 5-year period thereafter.'';
          (5) in subsection (e)--
                  (A) in paragraph (2)--
                          (i) in the second sentence of subparagraph 
                        (A), by inserting ``to the Secretary for 
                        review'' after ``submit''; and
                          (ii) in the first sentence of subparagraph 
                        (B), by striking ``Ultra-Deepwater'' and all 
                        that follows through ``and such Advisory 
                        Committees'' and inserting ``Program Advisory 
                        Committee established under section 999D(a), 
                        and the Advisory Committee''; and
                  (B) by adding at the end the following:
          ``(6) Research findings and recommendations for 
        implementation.--The Secretary, in consultation with the 
        Secretary of the Interior and the Administrator of the 
        Environmental Protection Agency, shall publish in the Federal 
        Register an annual report on the research findings of the 
        program carried out under this section and any recommendations 
        for implementation that the Secretary, in consultation with the 
        Secretary of the Interior and the Administrator of the 
        Environmental Protection Agency, determines to be necessary.'';
          (6) in subsection (i)--
                  (A) in the subsection heading, by striking ``United 
                States Geological Survey'' and inserting ``Department 
                of the Interior''; and
                  (B) by striking ``, through the United States 
                Geological Survey,''; and
          (7) in the first sentence of subsection by striking 
        ``National Energy Technology Laboratory'' and inserting 
        ``Office of Fossil Energy of the Department''.
    (c) Additional Requirements for Awards.--Section 999C(b) of the 
Energy Policy Act of 2005 (42 U.S.C. 16373(b)) is amended by striking 
``an ultra-deepwater technology or an ultra-deepwater architecture'' 
and inserting ``a deepwater technology''.
    (d) Program Advisory Committee.--Section 999D of the Energy Policy 
Act of 2005 (42 U.S.C. 16374) is amended to read as follows:

``SEC. 999D. PROGRAM ADVISORY COMMITTEE.

    ``(a) Establishment.--Not later than 270 days after the date of 
enactment of the Safe and Responsible Energy Production Improvement Act 
of 2010, the Secretary shall establish an advisory committee to be 
known as the `Program Advisory Committee' (referred to in this section 
as the `Advisory Committee').
    ``(b) Membership.--
          ``(1) In general.--The Advisory Committee shall be composed 
        of members appointed by the Secretary, including--
                  ``(A) individuals with extensive research experience 
                or operational knowledge of hydrocarbon exploration and 
                production;
                  ``(B) individuals broadly representative of the 
                affected interests in hydrocarbon production, including 
                interests in environmental protection and safety 
                operations;
                  ``(C) representatives of Federal agencies, including 
                the Environmental Protection Agency and the Department 
                of the Interior;
                  ``(D) State regulatory agency representatives; and
                  ``(E) other individuals, as determined by the 
                Secretary.
          ``(2) Limitations.--
                  ``(A) In general.--The Advisory Committee shall not 
                include individuals who are board members, officers, or 
                employees of the program consortium.
                  ``(B) Categorical representation.--In appointing 
                members of the Advisory Committee, the Secretary shall 
                ensure that no class of individuals described in any of 
                subparagraphs (A), (B), (D), or (E) of paragraph (1) 
                comprises more than \1/3\ of the membership of the 
                Advisory Committee.
    ``(c) Subcommittees.--The Advisory Committee may establish 
subcommittees for separate research programs carried out under this 
subtitle.
    ``(d) Duties.--The Advisory Committee shall--
          ``(1) advise the Secretary on the development and 
        implementation of programs under this subtitle; and
          ``(2) carry out section 999B(e)(2)(B).
    ``(e) Compensation.--A member of the Advisory Committee shall serve 
without compensation but shall be entitled to receive travel expenses 
in accordance with subchapter I of chapter 57 of title 5, United States 
Code.
    ``(f) Prohibition.--The Advisory Committee shall not make 
recommendations on funding awards to particular consortia or other 
entities, or for specific projects.''.
    (e) Definitions.--Section 999G of the Energy Policy Act of 2005 (42 
U.S.C. 16377) is amended--
          (1) in paragraph (1), by striking ``200 but less than 1,500 
        meters'' and inserting ``500 feet'';
          (2) by striking paragraphs (8), (9), and (10);
          (3) by redesignating paragraphs (2) through (7) and (11) as 
        paragraphs (4) through (9) and (10), respectively;
          (4) by inserting after paragraph (1) the following:
          ``(2) Deepwater architecture.--The term `deepwater 
        architecture' means the integration of technologies for the 
        exploration for, or production of, natural gas or other 
        petroleum resources located at deepwater depths.
          ``(3) Deepwater technology.--The term `deepwater technology' 
        means a discrete technology that is specially suited to address 
        1 or more challenges associated with the exploration for, or 
        production of, natural gas or other petroleum resources located 
        at deepwater depths.''; and
          (5) in paragraph (10) (as redesignated by paragraph (3)), by 
        striking ``in an economically inaccessible geological 
        formation, including resources of small producers''.
    (f) Funding.--Section 999H of the Energy Policy Act of 2005 (42 
U.S.C. 16378) is amended--
          (1) in the first sentence of subsection (a) by striking 
        ``Ultra-Deepwater and Unconventional Natural Gas and Other 
        Petroleum Research Fund'' and inserting ``Safe and Responsible 
        Energy Production Research Fund'';
          (2) in subsection (d)--
                  (A) in paragraph (1), by striking ``35 percent'' and 
                inserting ``21.5 percent'';
                  (B) in paragraph (2), by striking ``32.5 percent'' 
                and inserting ``21 percent'';
                  (C) in paragraph (4)--
                          (i) by striking ``25 percent'' and inserting 
                        ``30 percent'';
                          (ii) by striking ``complementary research'' 
                        and inserting ``safety technology research and 
                        development''; and
                          (iii) by striking ``contract management,'' 
                        and all that follows through the period at the 
                        end and inserting ``and contract management.''; 
                        and
                  (D) by adding at the end the following:
          ``(5) 20 percent shall be used for research activities 
        required under sections 20 and 21 of the Outer Continental 
        Shelf Lands Act (43 U.S.C. 1346, 1347).''; and
          (3) in subsection (f), by striking ``Ultra-Deepwater and 
        Unconventional Natural Gas and Other Petroleum Research Fund'' 
        and inserting ``Safer Oil and Gas Production and Accident 
        Prevention Research Fund''.
    (g) Conforming Amendment.--Subtitle J of title IX of the Energy 
Policy Act of 2005 (42 U.S.C. 16371 et seq.) is amended in the subtitle 
heading by striking ``Ultra-Deepwater and Unconventional Natural Gas 
and Other Petroleum Resources'' and inserting ``Safer Oil and Gas 
Production and Accident Prevention''.
    On page 46, between lines 11 and 12, insert the following:

SEC. 8. NATIONAL COMMISSION ON OUTER CONTINENTAL SHELF OIL SPILL 
                    PREVENTION.

    (a) Establisiiment.--There is established in the Legislative branch 
the National Commission on Outer Continental Shelf Oil Spill Prevention 
(referred to in this section as the ``Commission'').
    (b) Purposes.--The purposes of the Commission are--
          (1) to examine and report on the facts and causes relating to 
        the Deepwater Horizon explosion and oil spill of 2010;
          (2) to ascertain, evaluate, and report on the evidence 
        developed by all relevant governmental agencies regarding the 
        facts and circumstances surrounding the incident;
          (3) to build upon the investigations of other entities, and 
        avoid unnecessary duplication, by reviewing the findings, 
        conclusions, and recommendations of--
                  (A) the Committees on Energy and Natural Resources 
                and Commerce, Science, and Transportation of the 
                Senate;
                  (B) the Committee on Natural Resources and the 
                Subcommittee on Oversight and Investigations of the 
                House of Representatives; and
                  (C) other Executive branch, congressional, or 
                independent commission investigations into the 
                Deepwater Horizon incident of 2010, other fatal oil 
                platform accidents and major spills, and major oil 
                spills generally;
          (4) to make a full and complete accounting of the 
        circumstances surrounding the incident, and the extent of the 
        preparedness of the United States for, and immediate response 
        of the United States to, the incident; and
          (5) to investigate and report to the President and Congress 
        findings, conclusions, and recommendations for corrective 
        measures that may be taken to prevent similar incidents.
    (c) Composition of Commission.--
          (1) Members.--The Commission shall be composed of 10 members, 
        of whom--
                  (A) 1 member shall be appointed by the President, who 
                shall serve as Chairperson of the Commission;
                  (B) 1 member shall be appointed by the majority or 
                minority (as the case may be) leader of the Senate from 
                the Republican Party and the majority or minority (as 
                the case may be) leader of the House of Representatives 
                from the Republican Party, who shall serve as Vice 
                Chairperson of the Commission;
                  (C) 2 members shall be appointed by the senior member 
                of the leadership of the Senate from the Democratic 
                Party;
                  (D) 2 members shall be appointed by the senior member 
                of the leadership of the House of Representatives from 
                the Republican Party;
                  (E) 2 members shall be appointed by the senior member 
                of the leadership of the Senate from the Republican 
                Party; and
                  (F) 2 members shall be appointed by the senior member 
                of the leadership of the House of Representatives from 
                the Democratic Party.
          (2) Qualifications; initial meeting.--
                  (A) Political party affiliation.--Not more than 5 
                members of the Commission shall be from the same 
                political party.
                  (B) Nongovernmental appointees.--An individual 
                appointed to the Commission may not be a current 
                officer or employee of the Federal Government or any 
                State or local government.
                  (C) Other qualifications.--It is the sense of 
                Congress that individuals appointed to the Commission 
                should be prominent United States citizens, with 
                national recognition and significant depth of 
                experience and expertise in such areas as--
                          (i) engineering;
                          (ii) environmental compliance;
                          (iii) health and safety law (particularly oil 
                        spill legislation);
                          (iv) oil spill insurance policies;
                          (v) public administration;
                          (vi) oil and gas exploration and production;
                          (vii) environmental cleanup; and
                          (viii) fisheries and wildlife management.
                  (D) Deadline for appointment.--All members of the 
                Commission shall be appointed on or before September 
                15, 2010.
                  (E) Initial meeting.--The Commission shall meet and 
                begin the operations of the Commission as soon as 
                practicable after the date of enactment of this Act.
          (3) Quorum; vacancies.--
                  (A) In general.--After the initial meeting of the 
                Commission, the Commission shall meet upon the call of 
                the Chairperson or a majority of the members of the 
                Commission.
                  (B) Quorum.--6 members of the Commission shall 
                constitute a quorum.
                  (C) Vacancies.--Any vacancy in the Commission shall 
                not affect the powers of the Commission, but shall be 
                filled in the same manner in which the original 
                appointment was made.
    (d) Functions of Commission.--
          (1) In general.--The functions of the Commission are--
                  (A) to conduct an investigation that--
                          (i) investigates relevant facts and 
                        circumstances relating to the Deepwater Horizon 
                        incident of April 20, 2010, and the associated 
                        oil spill thereafter, including any relevant 
                        legislation, Executive order, regulation, plan, 
                        policy, practice, or procedure; and
                          (ii) may include relevant facts and 
                        circumstances relating to--
                                  (I) permitting agencies;
                                  (II) environmental and worker safety 
                                law enforcement agencies;
                                  (III) national energy requirements;
                                  (IV) deepwater and ultradeepwater oil 
                                and gas exploration and development;
                                  (V) regulatory specifications, 
                                testing, and requirements for offshore 
                                oil and gas well explosion prevention;
                                  (VI) regulatory specifications, 
                                testing, and requirements offshore oil 
                                and gas well casing and cementing 
                                regulation;
                                  (VII) the role of congressional 
                                oversight and resource allocation; and
                                  (VIII) other areas of the public and 
                                private sectors determined to be 
                                relevant to the Deepwater Horizon 
                                incident by the Commission;
                  (B) to identify, review, and evaluate the lessons 
                learned from the Deepwater Horizon incident of April 
                20, 2010, regarding the structure, coordination, 
                management policies, and procedures of the Federal 
                Government, and, if appropriate, State and local 
                governments and nongovernmental entities, and the 
                private sector, relative to detecting, preventing, and 
                responding to those incidents; and
                  (C) to submit to the President and Congress such 
                reports as are required under this section containing 
                such findings, conclusions, and recommendations as the 
                Commission determines to be appropriate, including 
                proposals for organization, coordination, planning, 
                management arrangements, procedures, rules, and 
                regulations.
          (2) Relationship to inquiry by congressional committees.--In 
        investigating facts and circumstances relating to energy 
        policy, the Commission shall--
                  (A) first review the information compiled by, and any 
                findings, conclusions, and recommendations of, the 
                committees identified in subparagraphs (A) and (B) of 
                subsection (b)(3); and
                  (B) after completion of that review, pursue any 
                appropriate area of inquiry, if the Commission 
                determines that--
                          (i) those committees have not investigated 
                        that area;
                          (ii) the investigation of that area by those 
                        committees has not been completed; or
                          (iii) new information not reviewed by the 
                        committees has become available with respect to 
                        that area.
    (e) Powers of Commission.--
          (1) Hearings and evidence.--The Commission or, on the 
        authority of the Commission, any subcommittee or member of the 
        Commission, may, for the purpose of carrying out this section--
                  (A) hold such hearings, meet and act at such times 
                and places, take such testimony, receive such evidence, 
                and administer such oaths; and
                  (B) require, by subpoena or otherwise, the attendance 
                and testimony of such witnesses and the production of 
                such books, records, correspondence, memoranda, papers, 
                documents, tapes, and materials;
        as the Commission or such subcommittee or member considers to 
        be advisable.
          (2) Subpoenas.--
                  (A) Issuance.--
                          (i) In general.--A subpoena may be issued 
                        under this paragraph only--
                                  (I) by the agreement of the 
                                Chairperson and the Vice Chairperson; 
                                or
                                  (II) by the affirmative vote of 6 
                                members of the Commission.
                          (ii) Signature.--Subject to clause (i), a 
                        subpoena issued under this paragraph--
                                  (I) shall bear the signature of the 
                                Chairperson or any member designated by 
                                a majority of the Commission;
                                  (II) and may be served by any person 
                                or class of persons designated by the 
                                Chairperson or by a member designated 
                                by a majority of the Commission for 
                                that purpose.
                  (B) Enforcement.--
                          (i) In general.--In the case of contumacy or 
                        failure to obey a subpoena issued under 
                        subparagraph (A), the United States district 
                        court for the district in which the subpoenaed 
                        person resides, is served, or may be found, or 
                        where the subpoena is returnable, may issue an 
                        order requiring the person to appear at any 
                        designated place to testify or to produce 
                        documentary or other evidence.
                          (ii) Judicial action for noncompliance.--Any 
                        failure to obey the order of the court may be 
                        punished by the court as a contempt of that 
                        court.
                          (iii) Additional enforcement.--In the case of 
                        any failure of any witness to comply with any 
                        subpoena or to testify when summoned under 
                        authority of this subsection, the Commission 
                        may, by majority vote, certify a statement of 
                        fact constituting such failure to the 
                        appropriate United States attorney, who may 
                        bring the matter before the grand jury for 
                        action, under the same statutory authority and 
                        procedures as if the United States attorney had 
                        received a certification under sections 102 
                        through 104 of the Revised Statutes (2 U.S.C. 
                        192 through 194).
          (3) Contracting.--The Commission may, to such extent and in 
        such amounts as are provided in appropriation Acts, enter into 
        contracts to enable the Commission to discharge the duties of 
        the Commission under this section.
          (4) Information from federal agencies.--
                  (A) In general.--The Commission may secure directly 
                from any Executive department, bureau, agency, board, 
                commission, office, independent establishment, or 
                instrumentality of the Federal Government, information, 
                suggestions, estimates, and statistics for the purposes 
                of this section.
                  (B) Cooperation.--Each Federal department, bureau, 
                agency, board, commission, office, independent 
                establishment, or instrumentality shall, to the extent 
                authorized by law, furnish information, suggestions, 
                estimates, and statistics directly to the Commission, 
                upon request made by the Chairperson, the Chairperson 
                of any subcommittee created by a majority of the 
                Commission, or any member designated by a majority of 
                the Commission.
                  (C) Receipt, handling, storage, and dissemination.--
                Information shall be received, handled, stored, and 
                disseminated only by members of the Commission and the 
                staff of the Commission in accordance with all 
                applicable laws (including regulations and Executive 
                orders).
          (5) Assistance from federal agencies.--
                  (A) General services administration.--The 
                Administrator of General Services shall provide to the 
                Commission on a reimbursable basis administrative 
                support and other services for the performance of the 
                functions of the Commission.
                  (B) Other departments and agencies.--In addition to 
                the assistance prescribed in subparagraph (A), 
                departments and agencies of the United States may 
                provide to the Commission such services, funds, 
                facilities, staff, and other support services as are 
                determined to be advisable and authorized by law.
          (6) Gifts.--The Commission may accept, use, and dispose of 
        gifts or donations of services or property, including travel, 
        for the direct advancement of the functions of the Commission.
          (7) Postal services.--The Commission may use the United 
        States mails in the same manner and under the same conditions 
        as departments and agencies of the United States.
    (f) Public Meetings and Hearings.--
          (1) Public meetings and release of public versions of 
        reports.--The Commission shall--
                  (A) hold public hearings and meetings, to the extent 
                appropriate; and
                  (B) release public versions of the reports required 
                under paragraphs (1) and (2) of subsection (j).
          (2) Public Hearings.--Any public hearings of the Commission 
        shall be conducted in a manner consistent with the protection 
        of proprietary or sensitive information provided to or 
        developed for or by the Commission as required by any 
        applicable law (including a regulation or Executive order).
    (g) Staff of Commission.--
          (1) In general.--
                  (A) Appointment and compensation.--
                          (i) In general.--The Chairperson, in 
                        consultation with the Vice Chairperson and in 
                        accordance with rules agreed upon by the 
                        Commission, may, without regard to the civil 
                        service laws (including regulations), appoint 
                        and fix the compensation of a staff director 
                        and such other personnel as are necessary to 
                        enable the Commission to carry out the 
                        functions of the Commission.
                          (ii) Maximum rate of pay.--No rate of pay 
                        fixed under this subparagraph may exceed the 
                        equivalent of that payable for a position at 
                        level V of the Executive Schedule under section 
                        5316 of title 5, United States Code.
                  (B) Personnel as federal employees.--
                          (i) In general.--The staff director and any 
                        personnel of the Commission who are employees 
                        shall be considered to be employees under 
                        section 2105 of title 5, United States Code, 
                        for purposes of chapters 63, 81, 83, 84, 85, 
                        87, 89, and 90 of that title.
                          (ii) Members of commission.--Clause (i) shall 
                        not apply to members of the Commission.
          (2) Detailees.--
                  (A) In general.--An employee of the Federal 
                Government may be detailed to the Commission without 
                reimbursement.
                  (B) Civil service status.--The detail of the employee 
                shall be without interruption or loss of civil service 
                status or privilege.
          (3) Procurement of temporary and intermittent services.--The 
        Chairperson of the Commission may procure temporary and 
        intermittent services in accordance with section 3109(b) of 
        title 5, United States Code, at rates for individuals that do 
        not exceed the daily equivalent of the annual rate of basic pay 
        prescribed for level V of the Executive Schedule under section 
        5316 of that title.
    (h) Compensation and Travel Expenses.--
          (1) Compensation of members.--
                  (A) Non-federal employees.--A member of the 
                Commission who is not an officer or employee of the 
                Federal Government shall be compensated at a rate equal 
                to the daily equivalent of the annual rate of basic pay 
                prescribed for level IV of the Executive Schedule under 
                section 5315 of title 5, United States Code, for each 
                day (including travel time) during which the member is 
                engaged in the performance of the duties of the 
                Commission.
                  (B) Federal employees.--A member of the Commission 
                who is an officer or employee of the Federal Government 
                shall serve without compensation in addition to the 
                compensation received for the services of the member as 
                an officer or employee of the Federal Government.
          (2) Travel expenses.--A member of the Commission shall be 
        allowed travel expenses, including per diem in lieu of 
        subsistence, at rates authorized for an employee of an agency 
        under subchapter I of chapter 57 of title 5, United States 
        Code, while away from the home or regular place of business of 
        the member in the performance of the duties of the Commission.
    (i) Security Clearances for Commission Members and Staff.--
          (1) In general.--Subject to paragraph (2), the appropriate 
        Federal agencies or departments shall cooperate with the 
        Commission in expeditiously providing to the members and staff 
        of the Commission appropriate security clearances, to the 
        maximum extent practicable, pursuant to existing procedures and 
        requirements.
          (2) Proprietary information.--No person shall be provided 
        with access to proprietary information under this section 
        without the appropriate security clearances.
    (j) Reports of Commission; Adjournment.--
        (1) Interim reports.--The Commission may submit to the 
        President and Congress interim reports containing such 
        findings, conclusions, and recommendations for corrective 
        measures as have been agreed to by a majority of members of the 
        Commission.
          (2) Final report.--Not later than 180 days after the date of 
        the enactment of this Act, the Commission shall submit to the 
        President and Congress a final report containing such findings, 
        conclusions, and recommendations for corrective measures as 
        have been agreed to by a majority of members of the Commission.
          (3) Temporary adjournment.--
                  (A) In general.--The Commission, and all the 
                authority provided under this section, shall adjourn 
                and be suspended, respectively, on the date that is 60 
                days after the date on which the final report is 
                submitted under paragraph (2).
                  (B) Administrative activities before termination.--
                The Commission may use the 60-day period referred to in 
                subparagraph (A) for the purpose of concluding 
                activities of the Commission, including--
                          (i) providing testimony to committees of 
                        Congress concerning reports of the Commission; 
                        and
                          (ii) disseminating the final report submitted 
                        under paragraph (2).
                  (C) Reconvening of commission.--The Commission shall 
                stand adjourned until such time as the President or the 
                Secretary of Homeland Security declares an oil spill of 
                national significance to have occurred, at which time--
                          (i) the Commission shall reconvene in 
                        accordance with subsection (c)(3); and
                          (ii) the authority of the Commission under 
                        this section shall be of full force and effect.
    (k) Funding.--
          (1) Authorization of appropriations.--There are authorized to 
        be appropriated to carry out this section--
                  (A) $10,000,000 for the first fiscal year in which 
                the Commission convenes; and
                  (B) $3,000,000 for each fiscal year thereafter in 
                which the Commission convenes.
          (2) Availability.--Amounts made available to carry out this 
        section shall be available--
                  (A) for transfer to the Commission for use in 
                carrying out the functions and activities of the 
                Commission under this section; and
                  (B) until the date on which the Commission adjourns 
                for the fiscal year under subsection (j)(3).
    (l) Nonapplicability of Federal Advisory Committee Act.--The 
Federal Advisory Committee Act (5 U.S.C. App.) shall not apply to the 
Commission.
    On page 46, strike line 12 and insert the following:

SEC. 8. CLASSIFICATION OF OFFSHORE SYSTEMS.

    (a) Regulations.--
          (1) In general.--Not later than 2 years after the date of 
        enactment of this Act, the Secretary of the Interior and the 
        Secretary of the Department in which the Coast Guard is 
        operating shall jointly issue regulations requiring systems 
        (including existing systems) used in the offshore exploration, 
        development, and production of oil and gas in the outer 
        Continental Shelf (as defined in section 2 of the Outer 
        Continental Shelf Lands Act (43 U.S.C. 1331) to be constructed, 
        maintained, and operated so as to meet classification, 
        certification, rating, and inspection standards that are 
        necessary--
                  (A) to protect the health and safety of affiliated 
                workers; and
                  (B) to prevent environmental degradation.
          (2) Third-party verification.--The standards established by 
        regulation under paragraph (1) shall be verified through 
        certification and classification by independent third parties 
        that--
                  (A) have been preapproved by both the Secretary of 
                the Interior and the Secretary of the Department in 
                which the Coast Guard is operating; and
                  (B) have no financial conflict of interest in 
                conducting the duties of the third parties.
          (3) Minimum systems covered.--At a minimum, the regulations 
        issued under paragraph (1) shall require the certification and 
        classification by an independent third party who meets the 
        requirements of paragraph (2) of--
                  (A) mobile offshore drilling units;
                  (B) fixed and floating drilling or production 
                facilities;
                  (C) drilling systems, including risers and blowout 
                preventers; and
                  (D) any other equipment dedicated to the safety 
                systems relating to offshore extraction and production 
                of oil and gas.
          (4) Exceptions.--The Secretary of the Interior and the 
        Secretary of the Department in which the Coast Guard is 
        operating may waive the standards established by regulation 
        under paragraph (1) for an existing system only if--
                  (A) the system is of an age or type where meeting 
                such requirements is impractical; and
                  (B) the system poses an acceptably low level of risk 
                to the environment and to human safety.
    (b) Authority of Coast Guard.--Nothing in this section preempts or 
interferes with the authority of the Coast Guard.

SEC. 9. SAVINGS PROVISIONS.

    On page 47, strike line 7 and insert the following:

SEC. 10. BUDGETARY EFFECTS.

                                Purpose

    The purposes of the measure are: to improve the management, 
oversight, accountability, safety, and environmental protection 
of all the resources on the Outer Continental Shelf; to provide 
independent development and enforcement of safety and 
environmental laws governing energy development and mineral 
extractions activities on the Outer Continental Shelf and 
related offshore activities; and to ensure a fair return to the 
taxpayer from, and independent management of, royalty and 
revenue activities from mineral and energy resources.

                      Summary of Major Provisions

National Policy for the Outer Continental Shelf

    Section 4 clarifies U.S. policy to be applied in all 
management decisions regarding the Outer Continental Shelf. 
That policy provides that the vital resources of the U.S. Outer 
Continental Shelf are to be managed in a way that recognizes 
and balances the value of all of the resources, minimizes the 
impact of development on the environment, and acknowledges the 
long term economic value of balanced and orderly management. It 
further provides that it is national policy to allow energy and 
mineral development activities only when there is reasonable 
assurance of adequate protection from harm to life, health, the 
environment, property, or to other users of the waters, seabed, 
or subsoil.

Structural Reform of Outer Continental Shelf Program Management

    Section 5 reforms the organizational structure of the OCS 
in several major ways. It requires reorganization of the agency 
so that the revenue collection functions are kept separate from 
the other functions; that no more than two other bureaus are to 
be designated to carry out the leasing, safety, and 
environmental functions in a way that minimizes the potential 
for conflicts of interest; and that the heads of the bureaus or 
offices created be appointed by the President and confirmed by 
the Senate. It provides the Secretary with new hiring and 
compensation authorities for a certain number of employees as 
necessary to ensure that the agency has the technical expertise 
required to carry out its safety and environmental functions. 
Finally, it creates a new Outer Continental Shelf Safety and 
Environmental Advisory Board made up of a balanced and unbiased 
group of experts identified through consultation with the 
National Academies of Science and Engineering to reflect a 
range of disciplines related to safe and environmentally 
compliant energy and mineral development activities. This Board 
is to provide independent peer reviewed scientific and 
technical advice for use by the agency in carrying out its 
safety and environmental responsibilities.

Safety, Environmental, and Financial Reform

    Section 6 amends various aspects of the Outer Continental 
Shelf Lands Act to strengthen the planning, safety, and 
environmental requirements involved in offshore energy 
development to prevent future accidents and to create a culture 
of excellence that governs both the regulators and the 
industry. In addition to mandating more stringent regulatory 
activity, it provides the Department of the Interior with 
additional scientific and technical capability and some new 
resources to help in the exercise of adequate oversight over 
the industry through development of regulations, inspections, 
and enforcement.
    Key components of this system include: requirements for 
exploration plans, separate deepwater operations plans, and 
drilling permits for individual wells that focus on review of 
the system of operations as a whole and as related to the 
offshore conditions in which the system will operate; required 
use of best available technology; full review of the systems by 
qualified engineers; an evidentiary demonstration of the safety 
of the system and any modifications; and new requirements to 
ensure that containment systems and oil spill response plans 
are adequate in advance of the start of operations.
    An operations plan is also required that will demonstrate 
that the industry employees who work on offshore facilities are 
adequately trained and experienced, and training requirements 
are established for all employees engaged in offshore 
operations. Time limits currently applicable to review of 
exploration plans are extended to ensure that the Secretary has 
adequate time for complete review of the plans.
    The Department of the Interior is required to establish 
independent internal programs for research and development of 
environmental and safety issues that must be used to inform the 
regulatory activity, so that science will always be transparent 
and an essential part of both areas. Existing research funding 
is redirected to this research to reflect its high priority 
status. This research, as well as data from required 
investigations of all accidents, must be made public. The 
Secretary is required to maximize the value of this 
information, in part by the exchange of technical information 
domestically and internationally to ensure widespread 
understanding of best practices. The Department is also 
required to seek the views of other agencies and to make public 
those views and the Department's analysis of them to the extent 
the Department disagrees.
    The bill also will provide for a qualified independent 
third party classification and certification utilizing a 
technical and engineering review of key systems for each 
operation based on standards to be developed jointly by the 
Department of the Interior and the Coast Guard. This process is 
modeled on the certification and classification systems 
currently required for ocean-going vessels engaged in shipping 
operations, and will provide an additional level of oversight 
with the goal of safety and environmental protection.
    Enforcement of the law is strengthened in a number of 
respects. Inspection fees are established at a level that will 
fully fund all inspections, so that increased numbers of highly 
trained inspectors will be available to oversee compliance with 
these rules. Operators who are found to be not meeting 
diligence, safety, or environmental requirements on other 
leases, or who have failed to meet their obligations for oil 
spill-related damages, are disqualified from bidding on new 
leases after public notice prior to the lease sale and 
opportunity for a hearing. The Secretary is required to review 
financial responsibility requirements to adjust the 
requirements for Consumer Price Index and make recommendations 
to Congress to ensure that they are adequate to permit lessees 
to fulfill obligations, including oil spill-related 
obligations. The National Transportation Safety Board is 
authorized to perform independent investigations of any 
accident at the Secretary's request. Civil and criminal 
penalties for violations of any legal requirements are 
increased. New ethics requirements are established to prevent 
conflicts of interest and eliminate industry influence of 
regulators.
    To ensure a fair return to the taxpayer, the Secretary is 
required to periodically review royalty rates and to complete a 
comparative review of all components of relevant fiscal systems 
for oil and gas resources with periodic reports to Congress.

Research for Safer Oil and Gas Production

    Section 9 amends section 999 of the Energy Policy Act of 
2005 to ensure research on the highest priority needs for 
safety and environmental protection in offshore oil and gas 
production; and to redirect a portion of the funding to the 
Department of the Interior to assist in carrying out its new 
research responsibilities as required by this Act.

                          Background and Need

    The Department of the Interior is charged with the 
management of the energy and mineral resources contained on the 
Outer Continental Shelf--numerous and varied resources that all 
are vital to our national well-being. Between January 19, 1982 
and June 18, 2010, this responsibility was delegated by the 
Secretary to the Minerals Management Service (MMS). While the 
MMS was a small agency that was not well-known to the public, 
it was tasked with an increasingly complex and wide-ranging set 
of responsibilities which in some cases have a perceived or 
real potential for conflict.
    MMS had management responsibilities that determined the 
uses of portions of the Outer Continental Shelf. It had 
regulatory responsibilities that directly impacted the design 
and operation of complex systems of offshore energy production. 
It had planning responsibilities that significantly impacted 
the marine and coastal environment. These same planning 
decisions in some cases determined the level of federal revenue 
received from offshore operations. It also had responsibility 
for the collection of revenue that makes up a significant 
portion of the federal budget from both offshore and onshore 
mineral development on public lands.
    The issues over which MMS had oversight became vastly more 
complicated as offshore oil and gas operations moved into 
deeper water and used deeper wells. The industry developed 
increasingly sophisticated and complex technology for these 
undertakings. For example, between 1992-2006, 2493 wells were 
drilled at water depths greater than 1,000 feet. Wells are now 
routinely drilled to depths of 10,000 feet below the sea floor 
and often to 20,000 to 25,000 feet deep.
    In such operations the potential impacts can be extremely 
high, should there be a regulatory or operational failure. 
Containment of wells and control of oil discharges in deepwater 
can be much more complex than in shallow water or onshore. In 
addition, marine research has provided better data about the 
complexities of the ocean environment and its resources that 
must be considered in planning efforts, making these efforts 
much more sophisticated undertakings if done correctly. At the 
same time, the MMS budget did not keep pace with other agencies 
in terms of research capabilities. MMS had to become 
increasingly reliant on industry for understanding of the 
industry's technology and for understanding safety mechanisms 
applicable to key components of the well design and operation.
    The primary statute governing offshore oil and gas 
development is the Outer Continental Shelf Lands Act (67 
Stat.29), which originally was enacted in 1953 and last amended 
by the Energy Policy Act of 2005 (Public Law 109-58; 119 
Stat.594). Some significant safety and environmental provisions 
have remained unchanged since 1978. Provisions of that Act 
suggest that the primary responsibility of the agency carrying 
out the Act is to provide national energy resources. Knowledge 
of the other resources in the marine environment--both economic 
and otherwise--has evolved significantly since initial 
enactment, as has the technological capability of the industry 
to locate and develop oil and gas in the outer continental 
shelf.
    In this legislative and regulatory context, on April 20, 
2010 a loss of well control occurred and resulted in an 
explosion and fire on the semisubmersible Mobile Offshore 
Drilling Unit Deepwater Horizon about 50 miles off the coast of 
Louisiana. Eleven lives were lost in this incident and the 
vessel subsequently sank.
    This drilling operation was in a water depth of 4,993 feet 
and the well itself was at a depth of nearly 18,000 feet below 
the seabed. As of the date of Committee consideration of this 
bill, the well was not contained. Millions of gallons of oil 
had been discharged into the Gulf, with dire consequences for 
the people and wildlife of the Gulf coast, the regional marine 
and coastal environment, and the fishing and tourism 
industries.
    The exact causes of the accident are as yet unknown and 
several investigations are ongoing. However, testimony provided 
during the Committee's hearings on the issue has demonstrated 
that, at a minimum, there were multiple technical failures as 
well as multiple regulatory failures. For example, the 
regulatory system failed to require adequate demonstrations of 
safety in well design, blowout prevention, containment 
capability, and oil spill response planning. Questions exist 
about the permitting of modifications to the well design, 
adequacy and frequency of required inspections, and balanced 
consideration generally of areas to be leased and risks 
associated with leasing in those areas.
    Even before the accident, in recognition of the increasing 
complexity and volume of MMS's responsibilities, the Department 
of the Interior had requested that Congress consider enactment 
of an ``organic act'' for the MMS as well as budget increases 
to fund more personnel, including inspectors, for offshore 
operations. Following the accident, the Secretary requested, 
among other things, that Congress eliminate the statutory time 
constraints applicable to the agency's review of lessee's 
exploration plans, the first plans in which the agency receives 
specific, place-based design for the exploration process from a 
lessee for review.
    On May 19, 2010, in light of the Deepwater Horizon 
accident, the Secretary announced a plan to fundamentally 
restructure MMS and divide its responsibilities among three 
separate offices: a Bureau of Ocean Energy Management; a Bureau 
of Safety and Environmental Enforcement; and an Office of 
Natural Resources Revenue. On June 18, 2010, the Secretary 
renamed MMS the Bureau of Ocean Energy Management, Regulation, 
and Enforcement pending further reorganization. He has been and 
is still in the process of establishing additional safety 
requirements applicable to the areas of concern in the loss of 
well control, and has hired additional rig inspectors.
    However, it is clear that administrative changes alone 
cannot ultimately be sufficient to the challenges that are 
demonstrated by the Deepwater Horizon accident. Legislation 
will ensure that the necessary safety and environmental 
requirements can be developed, enforced and maintained 
regardless of changes in the leadership of the Department; that 
the agency always has the scientific and technical resources to 
lead instead of follow advances in technology of well design, 
containment and oil spill response; and that agency 
organization avoids conflicts of interest that can and have 
arisen due to its multiple responsibilities. Legislation is 
needed to create and embed an enduring culture of excellence in 
the regulatory agency that in turn can ensure the same level of 
excellence in industry operations.

                          Legislative History

    S. 3516 was introduced by Senator Bingaman on June 21, 
2010, and is cosponsored by Senators Murkowski, Dorgan and 
Stabenow. The Committee on Energy and Natural Resources held a 
hearing on environmental stewardship on November 19, 2009, four 
oversight hearings on offshore oil and gas development and the 
Deepwater Horizon Accident (May 11, May 18, May 25, and June 9, 
2010), and a legislative hearing on S. 3516 and related 
legislation on June 24, 2010. At its business meeting on June 
30, 2010, the Committee on Energy and Natural Resources ordered 
S. 3516 to be favorably reported with amendments.

                        Committee Recommendation

    The Committee on Energy and Natural Resources, in open 
business session on June 30, 2010, by a unanimous voice vote of 
a quorum present, recommends that the Senate pass S. 3516, if 
amended as described herein.

                          Committee Amendments

    During its consideration of S. 3516, the Committee adopted 
seven amendments as follows:
    1. An amendment (#1) offered by Senator Shaheen to section 
4 of S. 3516, which in turn amends section 3 of the Outer 
Continental Shelf Lands Act relating to the national policy for 
the OCS. The amendment requires that the OCS be managed in a 
way that ``minimizes'' rather than ``recognizes'' the potential 
impacts of the development of energy, food, mineral, and other 
OCS resources on the marine and coastal environment and on 
human health and safety.
    2. An amendment (#2-17) offered by Senators Bingaman and 
Murkowski, to make a series of 16 minor, technical, or 
clarifying amendments to the bill.
    3. An amendment (#18) offered by Senators Bingaman and 
Wyden, which adds a new subsection (l) to section 6 of the 
bill. The amendment amends section 29 of the Outer Continental 
Shelf Lands Act to strengthen the post-employment restrictions 
currently found in the Act, to add new conflict-of-interest 
restrictions, and to prescribe civil and criminal penalties for 
violations of the restrictions.
    4. An amendment (#19) offered by Senator Landrieu, which 
adds a new section 7 to the bill, to require that the Secretary 
of Energy, acting through the Energy Information 
Administration, publish a monthly study evaluating the effect 
of the moratoria which followed the blowout and explosion of 
the mobile offshore drilling unit Deepwater Horizon that 
occurred on April 20, 2010. The amendment also requires that 
not later than 60 days after the date of enactment of this Act 
and at the beginning of each month thereafter during the 
effective period of the moratoria, the Secretary of Energy 
submit a report to the Committee on Energy and Natural 
Resources of the Senate and the Committee on Energy and 
Commerce of the House of Representatives regarding the results 
of the study.
    5. An amendment (#20) offered by Senator Udall, which adds 
a new section 9 to the bill and amends title IX, subtitle J of 
the Energy Policy Act of 2005, relating to ultra-deepwater and 
unconventional natural gas and other petroleum resources. The 
amendment refocuses the ultra-deepwater research and 
development program on deepwater, redefines ``deepwater'' to 
apply to depths of 500 feet or greater, and expands the scope 
of the program to include deepwater well control and accident 
prevention, improved safety and blowout prevention 
technologies, and best practices. The amendment also changes 
the name of the Fund established by section 999H of the Energy 
Policy Act of 2005 and changes how the Fund is allocated among 
program elements. It provides some of the funding to the 
Department of the Interior for priority research required by 
the bill.
    6. An amendment (#21) offered by Senator Barrasso, which 
adds a new section 10 to the bill, to establish a National 
Commission on Outer Continental Shelf Oil Spill Prevention in 
the Legislative branch to be comprised of 10 members to be 
appointed by both political parties before September 15, 2010. 
Functions of the Commission include: conducting an 
investigation relating to the facts and circumstances of the 
Deepwater Horizon incident of April 20, 2010 and the associated 
oil spill; identifying, reviewing, and evaluating the lessons 
learned from the Deepwater Horizon incident regarding 
structure, coordination, management policies, and procedures of 
the Federal Government and, if appropriate, State and local 
governments, non-governmental entities, and the private sector; 
and submitting to the President and the Congress reports 
containing the Commission's findings, conclusions, and 
recommendations, including a final report 180 days after 
enactment. The Commission is given subpoena power and is 
authorized at a level of $10,000,000 for the first fiscal year 
and $3,000,000 for each fiscal year thereafter in which the 
Commission convenes. It will adjourn 60 days after filing its 
final report, with the authority to reconvene upon declaration 
of any oil spill of national significance.
    7. An amendment (#22) offered by Senator Cantwell, which 
adds a new section 11 to the bill, to require that not later 
than 2 years after the date of enactment, the Secretary of the 
Interior and the Secretary of the department in which the Coast 
Guard is operating jointly issue regulations requiring drilling 
systems used in the offshore exploration, development, and 
production of oil and gas in the OCS to be constructed, 
maintained, and operated so as to meet classification, 
certification, rating, and inspection standards that are 
necessary to protect the health and safety of workers and 
prevent environmental degradation. The standards established by 
the regulations are to be verified through certification and 
classification by qualified independent third parties that have 
been preapproved by the Secretaries and have no financial 
conflict of interest. The Secretaries may waive the standards 
for an existing system only if the system is of an age or type 
where meeting such requirements is impractical and the system 
poses an acceptably low level of risk to the environment and 
human safety.
    The amendments are explained in further detail in the 
section-by-section analysis that follows.

                      Section-by-Section Analysis

Section 1. Short title; table of contents

    This section sets forth the short title and table of 
contents.

Section 2. Purposes

    This section sets forth the purposes of the legislation.

Section 3. Definitions

    This section sets forth definitions.

Section 4. National policy for the outer Continental Shelf

    This section amends the section 3 of the Outer Continental 
Shelf Lands Act (OCSLA) (43 U.S.C. 1332), pertaining to the 
national policy for the outer Continental Shelf (OCS).
    Paragraph (1) adds a new paragraph (3) to section 3 of the 
OCSLA that provides that the outer Continental Shelf (OCS) is a 
vital national resource reserve to be managed to recognize the 
need for domestic sources of energy, food, minerals, and other 
resources; minimizes the potential impacts of development of 
those resources on the marine and coastal environment and on 
human health and safety; and acknowledges the long-term 
economic value to the United States of the balanced and orderly 
management of those resources that safeguards the environment 
and respects the multiple values and uses of the OCS.
    Paragraphs (2), (3), and (4) make conforming changes.
    Paragraph (5) adds a new paragraph (6) to section 3 of the 
OCSLA that provides that it is the policy of the United States 
that energy exploration, development, and production on the OCS 
should be allowed only when it can be done in a manner that 
provides reasonable assurance of adequate protection against 
harm to life, health, the environment, property or other users 
of the waters, seabed or subsoil.
    Paragraphs (6) and (7) are self-explanatory.

Section 5. Structural reform of Outer Continental Shelf program 
        management

    Section 5(a) amends the OCSLA by adding a new section 32 
pertaining to structural reform of OCS program management.
    New OCLSA section 32(a) provides that the Secretary of the 
Interior shall establish not more than two bureaus to carry out 
the leasing, permitting, safety and environmental regulatory 
functions vested in the Secretary by this Act and the Federal 
Oil and Gas Royalty Management Act of 1982 (30 U.S.C. 1701, et 
seq.) related to the OCS. The Secretary is required to ensure 
to the maximum extent practicable that any potential 
organizational conflicts of interest are eliminated. The bureau 
or bureaus established pursuant to this subsection are to be 
headed by a Director appointed by the President by and with the 
advice and consent of the Senate. The remaining provisions of 
new subsection (a) pertaining to compensation and 
qualifications are self-explanatory.
    New OCSLA section 32(b) requires the Secretary to establish 
within the Department of the Interior an office to carry out 
the royalty and revenue management functions vested in the 
Secretary by the OCSLA and the Federal Oil and Gas Royalty 
Management Act of 1982 (30 U.S.C. 1701, et seq.). The office 
established pursuant to this subsection is to be headed by a 
Director appointed by the President by and with the advice and 
consent of the Senate. The remaining provisions of new 
subsection (b) pertaining to compensation and qualifications 
are self-explanatory.
    New OCSLA section 32(c) requires the Secretary of the 
Interior to establish an Outer Continental Shelf Safety and 
Environmental Advisory Board to provide the Secretary and the 
bureau Directors with independent scientific and technical 
advice on safe and environmentally compliant energy and mineral 
resource exploration, development and production activities. 
Paragraphs (2) through (5) address membership, meetings, 
reports, and travel expenses, and are self-explanatory.
    New OCSLA section 32(d) provides special personnel 
authorities for the direct hiring of critical personnel, 
including highly qualified accountants, scientists, engineers, 
or critical technical personnel. The authorities include 
critical pay authority and authority to reemploy civilian 
retirees. The section imposes certain limitations on the terms 
of employment for the employees hired under these special 
authorities. The section also provides for continuity of 
authorities and conforming amendments.
    Section 5(b) makes conforming changes.

Section 6. Safety, environmental, and financial reform of the Outer 
        Continental Shelf Lands Act

    This section amends several sections of the OCSLA to modify 
safety, environmental, and financial requirements.
    Section 6(a) amends section 2 of the OCSLA (43 U.S.C. 1331) 
by adding a new subsection (r) setting forth the definition of 
``safety case''.
    Section 6(b) amends section 5(a) of the OCSLA (43 U.S.C. 
1334(a) by requiring the Secretary to prescribe and amend rules 
and regulations to provide for operational safety and the 
protection of marine and coastal environment.
    Section 6(c) amends section 6 of the OCSLA (43 U.S.C. 1335) 
by adding new subsections (f) and (g). New OCSLA section 6(f) 
requires the Secretary to review, periodically, minimum 
financial responsibility requirements and adjust for inflation 
and recommend to Congress any further changes to existing 
financial responsibility requirements necessary to permit 
lessees to fulfill all obligations under the OCSLA and the Oil 
Pollution Act of 1990 (33 U.S.C. 2701, et seq.). New OCSLA 
section 6(g)(1) requires a periodic review of rental and 
royalty rates for leases under the OCSLA. New OCSLA section 
6(g)(2) requires a periodic comparative review of fiscal 
systems of the United States and other resource owners, 
including states and foreign nations, for offshore oil and gas, 
including requirements for bonus bids, royalties, rentals, 
fees, oil and gas taxes, income taxes and other significant 
financial elements. The Secretary may combine the reports 
required under paragraphs (1) and (2)(D) into one report.
    Section 6(d) amends section 8 of the OCSLA (43 U.S.C. 1337) 
by striking subsection (d) and inserting a new subsection (d) 
which provides that no bid for a lease may be submitted by any 
entity that the Secretary finds, after prior public notice and 
an opportunity for a hearing, is not meeting due diligence, 
safety, or environmental requirements on other leases, or is a 
responsible party for a vessel or facility from which oil is 
discharged for purposes of section 1002 of the Oil Pollution 
Act of 1990 and has failed to meet the obligations of the 
responsible party under that Act to provide compensation for 
covered removal costs and damages. It is the Committee's 
intention that prior public notice of any such noncompliance 
occur at the time of the lease sale announcement.
    Section 6(e)(1) amends section 11(c) of the OCSLA (43 
U.S.C. 1340(c)) to replace the requirement that the Secretary 
approve an exploration plan within 30 days with a requirement 
that the approval take place by the deadline described in new 
paragraph (5).
    Section 6(e)(1) further amends the OCSLA by adding a new 
section 11(c)(3) that specifies certain requirements for the 
exploration plan, including: a complete description and 
schedule of exploration activities; a description of the 
equipment to be used for exploration activities, including a 
description of the drilling unit; a statement of the design of 
major safety-related equipment; a statement demonstrating the 
equipment meets the best available technology requirements; a 
map showing the location of each well; a scenario for the 
potential blowout of the well involving the highest expected 
volume of liquid hydrocarbons; and a description of the 
response plan to control the blowout and manage the 
accompanying discharge of hydrocarbons. Before conducting 
exploration activities in water depths greater than 500 feet, 
the lessee must submit to the Secretary for approval a 
deepwater operations plan prepared by the lessee, which must be 
based on best available technology to carry out the exploration 
activity and blowout response plan. The Secretary shall not 
approve the plan unless it includes a technical systems 
analysis as specified, including blowout prevention technology 
and blowout and spill response plans.
    Section 6(e)(1) further amends the OCSLA by adding a new 
section 11(c)(5) that provides that for leases issued under a 
sale held after March 17, 2010, the deadline for approval of an 
exploration plan is 90 days, except that an additional 180 days 
may be taken if the Secretary makes a finding that additional 
time is necessary to complete any environmental, safety, or 
other reviews. The Secretary may extend the 30 day deadline 
with the consent of the lessee for leases issued under a sale 
held on or before March 17, 2010. March 17, 2010 is the date of 
the last lease sale held prior to the Deepwater Horizon 
accident.
    Section 6(e)(2) makes conforming changes.
    Section 6(e)(3) amends section 11(d) of the OCSLA (43 
U.S.C. 1340(d)) by striking subsection (d) and inserting a new 
subsection that provides that the Secretary require that the 
lessee obtain a drilling permit prior to drilling a well under 
an exploration plan and before significantly modifying a well 
design originally approved by the Secretary. The Secretary may 
not grant any drilling permit until the date of completion of a 
full review of the well system by not less than 2 agency 
engineers, including a written determination that critical 
safety systems will use best available technology and blowout 
preventions systems will include redundancy and remote 
triggering capability. The Secretary may not approve any 
modification of a permit without a determination, after an 
additional engineering review, that the modification will not 
compromise the safety of the well system previously approved. 
The Secretary may not grant any drilling permit or modification 
of a permit until the date of completion and approval of a 
safety and environmental management plan that specifies the 
expertise and experience level of crew members who will be 
present on the rig and that requires that not later than May 1, 
2012, all employees on the rig meet certain training and 
experience requirements.
    Section 6(e)(3) further amends section 11 by adding a new 
subsection (e) which requires that the Secretary disapprove an 
exploration plan if the Secretary makes certain determinations 
as specified. New OCSLA section 11(e) applies the Act's 
provisions relating to compensation if an exploration plan is 
disapproved under the subsection.
    Section 6(f)(1) amends section 18(a) of the OCSLA (43 
U.S.C. 1344(a)) to include the consideration of protection of 
marine and coastal environment and resources in developing the 
schedule for leasing on the OCS, and to require that equal 
consideration is given to certain factors in developing the oil 
and gas leasing program. The remaining provision is self-
explanatory.
    Section 6(f)(2) amends section 18(b) of the OCSLA (43 
U.S.C. 1344(b)) to require that additional items be considered 
in estimating the appropriations and staff needed to carry out 
the leasing program.
    Section 6(f)(3) amends section 18(d)(2) of the OCSLA (43 
U.S.C. 1344(d)(2)) to require the submission by the Secretary 
under that paragraph to indicate why any specific 
recommendation of the head of a Federal agency with respect to 
a proposed leasing program was not accepted.
    Section 6(f)(4) amends section 18(g) of the OCSLA (43 
U.S.C. 1344(g) to list additional information that may be 
obtained by the Secretary in preparing an environmental impact 
statement and other evaluations required by the section.
    Section 6(f)(5) amends section 18 of the OCSLA (43 U.S.C. 
1344) by adding a new subsection (i) that requires the 
Secretary to carry out a program of research and development to 
ensure the continued improvement of methodologies for 
characterizing resources of the OCS and conditions that may 
affect the ability to develop and use those resources in a 
safe, sound, and environmentally responsible manner. This may 
include activities to provide accurate resource estimates. 
These activities are not to be considered leasing or pre-
leasing activities. This section is not intended to alter other 
provisions of the Act related to activities for characterizing 
the resources of the OCS including environmental permitting 
requirements.
    Section 6(g) amends section 20 of the OCSLA (43 U.S.C. 
1346) by making conforming changes and by inserting a new 
subsection (a) that requires the Secretary to carry out 
programs for the collection, evaluation and dissemination of 
environmental and other resource data relevant to carrying out 
the OCSLA. New OCSLA section 20(a) sets forth the scope of the 
research and the use of the data. The subsection requires that 
the program be carried out in a manner that is programmatically 
separate and distinct from the leasing program and provides for 
external scientific review of studies. Section 6(g) amends 
redesignated section 20(b) of the OCSLA to require an 
environmental study every three years of any area or region 
included in any oil and gas lease sale.
    Section 6(h)(1) amends section 21(a) of the OCSLA (43 
U.S.C. 1347(a)) to require not later than May 1, 2011, and 
every three years thereafter, a study of the adequacy of 
existing safety and health regulations and of the technology, 
equipment, and techniques available for the exploration, 
development, and production of minerals on the OCS.
    Section 6(h)(2) amends section 21 of the OCSLA by striking 
subsection (b) and inserting a new subsection. New OCSLA 
subsection 21(b)(1) requires on all new drilling and production 
operations and, to the maximum extent practicable, on existing 
operations, the use of the best available and safest 
technologies and practices, if the failure of the equipment 
would have a significant effect on safety, health, or the 
environment. New OCSLA section 21(b)(2) requires the Secretary 
to identify and publish not later than every three years an 
updated list of best available technologies for key areas of 
well design and operation. It is the Committee's intention that 
this list be maintained to reflect developing technologies and 
not preclude the use of improved equipment developed between 
updates. New OCSLA section 21(b)(3) requires that the Secretary 
promulgate regulations requiring a safety case to be submitted 
along with each new application for a permit to drill.
    New OCSLA section 21(b)(4) requires the Secretary to issue 
regulations no later than May 1, 2011, setting standards for 
training for all workers on offshore facilities conducting 
energy and mineral resource exploration, development, and 
production operations on the OCS. The standards shall require 
that any worker who has less than 5 years of applied experience 
pass a certification requirement after receiving appropriate 
training. The new section sets forth additional requirements 
regarding employee training that are self-explanatory.
    Section 6(h)(3) amends section 21 of the OCSLA by adding a 
new subsection (g) that requires the Secretary to carry out a 
program of research, development, and risk assessment to 
address technology and development issues associated with OCS 
energy and mineral resource activities. New OCLSA section 
21(g)(2) sets for the specific areas of focus for the program 
and is self-explanatory. New OCSLA section 21(g)(3) requires 
the Secretary to carry out programs to facilitate the exchange 
and dissemination of scientific and technical information and 
best practices. The Secretary is further directed to carry out 
programs to cooperate with international organizations and 
foreign governments to share information and best practices 
related to management of safety and environmental issues 
associated with energy and mineral resource exploration, 
production and development on the OCS.
    New OCSLA section 21(g)(4) sets forth reporting 
requirements and is self-explanatory. New OCSLA section 
21(g)(5) requires the Secretary to create a program within the 
appropriate bureau that shall be programmatically separate and 
distinct from the leasing program to carry out these studies 
and activities, to provide for external scientific review, and 
to make certain information available to the public.
    Section 6(i)(1) amends section 22(d)(1) of the OCSLA (43 
U.S.C. 1348(d)(1)) to require investigations of accidents that 
presented a serious risk to human or environmental safety, 
including: each loss of well control, blowout, and activation 
of a blowout preventer. Section 22(d)(1) is further amended to 
provide that the lessee shall cooperate with the investigation 
as a condition of the lease.
    Section 6(i)(2) amends section 22(e) of the OCSLA (43 
U.S.C. 1348(e)) by redesignating the existing text as paragraph 
(1) and adding a new paragraph (2) that requires the Secretary 
to investigate any allegation of the existence of a violation 
of a safety regulation issued under the OCSLA from an employee 
of a lessee or a subcontractor.
    Section 6(i)(3) amends Section 22 of the OCSLA by adding a 
new subsection (g) authorizing the National Transportation 
Safety Board to conduct, at the request of the Secretary of the 
Interior, an independent investigation of certain accidents 
occurring on the OCS and involving activities under the OCSLA. 
New subsection (g) further provides that for purposes of an 
investigation under this subsection, the accident that is the 
subject of the request by the Secretary shall be determined to 
be a transportation accident within the meaning of that term in 
chapter 11 of title 49 of the United States Code.
    Section 6(i)(3) further amends section 22 of the OCSLA by 
adding a new subsection (h) that requires the Secretary to make 
available to lessees and the public in a public database 
technical information about the causes and corrective actions 
taken for all incidents investigated under this section.
    Section 6(i)(3) further amends section 22 of the OCSLA by 
adding a new subsection (i) that requires, to the extent 
necessary to fund the inspections described in this paragraph, 
the Secretary to collect from the designated operator for 
facilities subject to inspection under subsection (c), a non-
refundable inspection fee which shall be deposited in the Ocean 
Energy Enforcement Fund. The Secretary shall establish the fee 
by regulation at a level necessary to offset the annual 
expenses of the inspections using a schedule that reflects 
differences in complexity among the classes of facilities to be 
inspected. Monies from the Fund may be expended only for 
inspections and shall be subject to appropriation. The 
subsection further provides that the Secretary is required to 
prepare a report on the operation of the Fund and to submit the 
report to the Congress, and need not collect the fee if 
inspections are adequately funded. The remaining provisions in 
new OCSLA section 22(i) are self-explanatory.
    Section 6(j)(1) amends section 24 of the OCSLA (43 U.S.C. 
1350) by striking subsection (b) and inserting a new subsection 
(b). Section 24(b)(1) increases civil administrative penalties 
to $75,000 per day of the continuance of the violation. New 
OCSLA section 24(b)(2) provides that the Secretary may assess, 
collect, and compromise any penalty under paragraph (1). New 
OCSLA section 24(b)(3) provides that no penalty shall be 
assessed until the person charged with a violation has been 
given the opportunity for a hearing. New OCSLA section 24(b)(4) 
provides that the civil penalty amount shall increase annually 
to reflect any increases in the Consumer Price Index for All 
Urban Consumers.
    Section 6(j)(2) amends section 24(c) of the OCSLA (43 
U.S.C. 1350(c)) to increase the corresponding criminal penalty 
from not more than $100,000 per violation to not more than 
$10,000,000. The subsection is further amended to provide that 
the penalty amount shall increase each year to reflect any 
increases in the Consumer Price Index for All Urban Consumers.
    Section 6(j)(3) amends section 24(d) of the OCSLA (43 
U.S.C. 1350(d)) to establish an additional basis for criminal 
liability for officers and agents of a corporation or other 
entity for authorizing, ordering, or carrying out proscribed 
activities with reckless disregard.
    Section 6(k) amends section 25 of the OCSLA (43 U.S.C. 
1351) to delete exceptions from certain requirements for the 
Gulf of Mexico.
    Section 6(l) amends section 29 of the OCSLA (43 U.S.C. 
1355) to strengthen the employment restrictions currently found 
in section 29, add conflict of interest restrictions, and 
stiffen penalties for violations of the restrictions.
    Under current law, section 29 imposes two sets of 
employment restrictions on any full-time officer or employee of 
the Department of the Interior who directly or indirectly 
discharged duties or responsibilities under the OSCLA and who 
was at any time during the 12 months preceding the termination 
of his employment with the Department compensated under the 
Executive Schedule or at or above the GS-16 level of the 
General Schedule. One set applies for two years after the 
employee's employment with the Department ends and restricts 
appearances before, communications to, and aiding and assisting 
in appearances before federal agencies, officers, and employees 
in any particular matter involving a specific party in which 
the United States is a party or has a direct and substantial 
interest, and which was actually pending under the employee's 
official responsibility within one year before his or her 
termination or in which he or she participated personally and 
substantially. The second set applies for one year after the 
employee's employment ends and restricts appearances before and 
communications to the Department of the Interior or any officer 
or employee on any particular matter that is pending before the 
Department or in which the Department has a substantial 
interest.
    Subsection (l) redesignates the existing section 29 as 
subsection (a) of an expanded section 29. It eliminates the 
current language limiting the restrictions to senior officials 
and employees, thereby making the restrictions applicable to 
all full-time officers and employees discharging duties or 
responsibilities under the OSCLA. It expands the two-year 
restrictions by expressly including advising (in addition to 
aiding and assisting) in the list of restricted activities in 
paragraph (1)(C), and by banning aiding, advising, or assisting 
others in making prohibited communications as well as in making 
prohibited appearances in paragraph (1)(C). It expands the one-
year restrictions by adding a new paragraph (2)(C) that bans 
aiding, advising or assisting others in making prohibited 
appearances or prohibited communications.
    In addition, subsection (l) adds a new paragraph (3) to the 
redesignated section 29(a), which prohibits all officers and 
employees discharging duties or responsibilities under the 
OSCLA from accepting employment or compensation within one year 
after his or her employment has ceased from any person that has 
a direct and substantial interest which was actually pending 
under his or her official responsibility during the year prior 
to his or her termination or in which he participated 
personally and substantially.
    Subsection (l) also adds 4 new subsections to section 29. 
Subsection (b) prohibits any full-time officer or employee of 
the Department of the Interior who directly or indirectly 
discharges duties or responsibilities under the OSCLA from 
participating personally and substantially in any particular 
matter in which--
          (1) the officer or employee or his or her spouse, 
        minor child, or general partner has a financial 
        interest;
          (2) any organization in which the officer or employee 
        is serving as an officer, director, trustee, or general 
        partner, or employee has a financial interest;
          (3) any person or organization with whom the officer 
        or employee is negotiating or has arranged future 
        employment has a financial interest; or
          (4) any person or organization in which the officer 
        or employee, during the preceding year, served as an 
        officer, director, trustee, general partner, agent, 
        attorney, consultant, contractor, or employee has a 
        financial interest.
    Section 29 of the OCSLA currently contains no comparable 
provision, though the federal criminal code and the Standards 
of Ethical Conduct for Employees of the Executive Branch do. 
Section 208 of title 18 of the United States Code already makes 
it a felony for an officer or employee of the executive branch 
to participate in particular matters covered by items (1), (2), 
and (3) above. In addition, section 502 of the Standards of 
Ethical Conduct prohibit a federal employee from participating 
in any particular matter described in item (4). 5 C.F.R. 
2635.502(b)(iv).
    Subsection (c) prohibits any full-time officer or employee 
of the Department of the Interior who directly or indirectly 
discharged duties or responsibilities under the OSCLA from 
soliciting or accepting any gifts in violation of the gift ban 
in the Standards of Ethical Conduct for Employees of the 
Executive Branch, 5 C.F.R. 2635, subpart B.
    Subsection (d) authorizes the Secretary to exempt, by rule, 
clerical or support personnel who would otherwise be covered by 
section 29, as amended, if they do not conduct inspections, 
perform audits, or otherwise exercise regulatory or policy 
making authority under the OCSLA.
    Subsection (e) prescribes penalties for violations of 
section 29, as amended. As it now stands, section 29 itself 
does not contain penalties for its violation. The federal 
criminal code, however, provides that a violation of the post-
employment restrictions in 18 U.S.C. 207, which are similar to 
those in paragraphs (1) and (2) of the amended section 29(a), 
and the conflict-of-interest restrictions in 18 U.S.C. 208, 
which are similar to those in paragraphs (1), (2), and (3) of 
the amended section 29(b), is a felony, punishable by 
imprisonment for up to one year, or up to five years if the 
violation is willful, criminal fines of up to $250,000, and 
civil penalties of up to $50,000 or the amount of compensation 
which the person received for the prohibited conduct. 18 U.S.C. 
216; 18 U.S.C. 3571. Violations of the provisions of the 
Standards of Ethical Conduct similar to subsections (a)(3), 
(b)(4), and (c) of the amended section 29 are not criminal, and 
are punishable by disciplinary employment actions, such as 
reprimand, suspension, demotion, or removal, rather than civil 
or criminal penalties.
    Subsection (e) prescribes penalties for violations of 
section 29 that are generally comparable to the penalties for 
similar violations of federal law. Paragraph (1) provides that 
any person who violates the post-employment restrictions in 
paragraphs (1) or (2) of the amended section 29(a), which are 
comparable to restrictions in 18 U.S.C. 207, or the conflict-
of-interest restrictions in subsection (b), which are 
comparable to restrictions in 18 U.S.C. 208, shall be 
punishable in accordance with 18 U.S.C. 216, which provides for 
imprisonment for up to one year, or up to five years if the 
violation is willful, criminal fines of up to $250,000, and 
civil penalties of up to $50,000 or the amount of compensation 
which the person received for the prohibited conduct. 18 U.S.C. 
216; 18 U.S.C. 3571. Paragraph (2) provides that any person who 
violates the post-employment restriction in section 29(a)(3) or 
the gift ban in subsection (c) shall be punishable in 
accordance with subsection (b) of 18 U.S.C. 216, which provides 
for a civil penalty of up to $55,000 ($50,000 adjusted for 
inflation in accordance with the Federal Civil Monetary 
Penalties Inflation Adjustment Act of 1990). 28 C.F.R. 85.3(c). 
The penalty for violating the post-employment restriction in 
section 29(a)(3) is comparable to the penalty for violating the 
similar post-employment restriction on federal procurement 
officers by the Procurement Integrity Act, 41 U.S.C. 423. The 
penalties for violating the conflict-of-interest restriction in 
section 29(b)(4) and the gift ban in section 29(c) are harsher 
than those provided by current law, which are now limited to 
disciplinary employment actions.
    The Committee notes that section 24(c) of the OCSLA 
provides that ``any person'' who fails to comply with ``any 
provision'' of the OCSLA is subject to a civil penalty of up to 
$20,000 for each day of failure, and that any person who 
knowingly and willfully violates any provision of the OCSLA may 
be punished by a fine of up to $100,000 or imprisoned for up to 
10 years, or both. Section 6(j) of S. 3516 amends section 24 of 
the OCSLA to increase the maximum civil penalty from $20,000 to 
$75,000 per day of violation, and to increase the maximum 
criminal fine from $100,000 to $10,000,000. While the broad 
language of section 24(c) could be read to apply to section 29, 
the Committee is not aware of any instance in which section 
24(c) penalties have been imposed on an officer or employee of 
the Department for violating the employment restrictions of 
section 29. The Department has informally advised the Committee 
that ``there is some ambiguity as to whether section 24 would 
be applicable to section 29.'' Accordingly, the Committee chose 
to prescribe specific penalties for violating section 29 in 
section 29 itself, rather than rely on section 24(c).
    Subsection (l) does not define key terms already used in 
section 29 of the OCSLA, such as ``particular matter'', 
``specific party'', ``direct and substantial interest'', 
``official responsibility'', and ``personal and substantial 
participation.'' The Committee believes that the meaning of 
these terms have long been established by federal ethics laws 
and the Standards of Ethical Conduct for Employees of the 
Executive Branch, and does not intend to alter their 
established meaning.
    The Committee intends the amendments to section 29 of the 
OCSLA made by subsection (l) to operate prospectively. Section 
29(a), as amended, by its terms can apply only to any ``full-
time officer or employee of the Department of the Interior who 
directly or indirectly discharges duties or responsibilities 
under'' the OCSLA on or after the date of enactment of the 
Outer Continental Shelf Reform Act of 2010. The amendments made 
to the post-employment restrictions are intended to apply to 
officers or employees who leave the Department on or after the 
effective date of the Act, and under ordinary rules of 
statutory construction, do not affect the substantive rights of 
officers or employees who leave the Department prior to the 
effective date of the Act.

Section 7. Study on the effect of the moratoria on new deepwater 
        drilling in the Gulf of Mexico on employment and small 
        businesses

    Section 7(a) provides that the Secretary of Energy, acting 
through the Energy Information Administration, shall publish a 
monthly study evaluating the effect of the moratoria which 
followed the blowout and explosion of the mobile offshore 
drilling unit Deepwater Horizon that occurred on April 20, 
2010.
    Section 7(b) provides that not later than 60 days after the 
date of enactment of this Act and at the beginning of each 
month thereafter during the effective period of the moratoria, 
the Secretary of Energy shall submit a report to the Committee 
on Energy and Natural Resources of the Senate and the Committee 
on Energy and Commerce of the House of Representatives a report 
regarding the results of the study conducted under subsection 
(a). The subsection further specifies the contents of the 
report and is self-explanatory.

Section 8. Reform of Other Law

    Section 8 amends section 388(b) of the Energy Policy Act of 
2005 (43 U.S.C. 1337 note) to add a new paragraph (4) that 
requires that with respect to the coordinated mapping 
initiative provided for by that subsection, any head of a 
Federal agency is required, on the request of the Secretary of 
the Interior, to provide data and information that the 
Secretary determines is necessary to the mapping initiative, 
except the agency head is not required to provide privileged or 
confidential information.

Section 9. Safer Oil and Gas Production

    Section 9(a)(1) amends section 999A(a) of the Energy Policy 
Act of 2005 (42 U.S.C. 16371(a)) to broaden the focus of the 
research and development program from ``ultra-deepwater'' 
(defined in section 999G(8) of the Energy Policy Act of 2005 
(42 U.S.C. 16377(8)) as 1,500 meters or greater) to 
``deepwater'' (redefined by section 9(e)(1) as 500 feet or 
greater). Paragraph (1) also adds research, development, 
demonstration, and commercial application of technologies for 
deepwater well control and accident prevention to the program's 
mission. Paragraph (2) makes changes in two of the program 
elements in section 999A(b) to reflect the program's new focus. 
Paragraphs (2)(B) and (3) changes references to the National 
Energy Technology Laboratory in subsections (b)(4) and (d) of 
section 999A of the Energy Policy Act of 2005 to the Office of 
Fossil Energy.
    Section 9(b) amends section 999B of the Energy Policy Act 
of 2005 (42 U.S.C. 16372) to refocus the program on developing 
improved safety and blowout prevention technologies and best 
practices associated with the drilling of deepwater oil and gas 
wells. Paragraph (3) requires the program consortium to select 
research and development projects on a competitive, peer-
reviewed basis. Paragraph (4)(D) requires the Secretary of 
Energy to commission the National Academy of Sciences to review 
the research program and its projects to determine the programs 
effectiveness. Paragraph (5)(B) requires the Secretary of 
Energy, in consultation with the Secretary of the Interior and 
the Administrator of the Environmental Protection Agency, to 
annually report on the research findings of the program and any 
recommendations.
    Section 9(c) amends section 999C(b) of the Energy Policy 
Act of 2005 (42 U.S.C. 16373(b)) to change a reference to 
``ultra-deepwater technology or . . . architecture'' to 
``deepwater technology.''
    Section 9(d) amends section 999D of the Energy Policy Act 
of 2005 (42 U.S.C. 16374) to eliminate the Ultra-Deepwater 
Advisory Committee and establish in its place a Program 
Advisory Committee to advise the Secretary on the development 
and implementation of the deepwater research and development 
program.
    Section 9(e) amends section 999G of the Energy Policy Act 
of 2005 (42 U.S.C. 16375) by amending the definition of deep-
water in paragraph (1) from 200 to 1,500 meters to any water 
depth greater than 500 feet deep, striking definitions relating 
to ultra-deepwater, adding new definitions for ``deepwater 
architecture'' and ``deepwater technology,'' and by renumbering 
the remaining definitions.
    Section 9(f) amends section 999H of the Energy Policy Act 
of 2005 (42 U.S.C. 16378) to change the name of the Ultra-
Deepwater and Unconventional Natural Gas and Other Petroleum 
Research Fund to the Safe and Responsible Energy Production 
Research Fund, to modify how the Fund is allocated among 
program elements, as those program elements are modified by 
section 9(a), and to provide a new allocation of 20 percent of 
the Fund for environmental and safety research required by 
sections 20 and 21 of the OCSLA (43 U.S.C. 1346 and 1347), as 
amended by sections 9(g) and 9(h).
    Section 9(g) amends the subtitle heading to reflect the 
program's new focus.

Section 10. National Commission on Outer Continental Shelf Oil Spill 
        Prevention

    Section 10(a) establishes in the Legislative branch the 
National Commission on Outer Continental Shelf Oil Spill 
Prevention.
    Section 10(b) sets forth the purposes of the Commission and 
is self-explanatory.
    Section 10(c) requires that the Commission be composed of 
10 members and sets forth who shall appoint each member. 
Subsection (c) sets forth qualification for commission members 
and is self-explanatory. Subsection (c) provides that all 
members of the Commission shall be appointed on or before 
September 15, 2010, and requires that the initial Commission 
meeting be as soon as practicable. Subsection (c) further 
addresses quorum requirements and vacancies.
    Section 10(d) sets forth the functions of the Commission, 
including: conducting an investigation relating to the facts 
and circumstances of the Deepwater Horizon incident of April 
20, 2010 and the associated oil spill thereafter; identifying, 
reviewing, and evaluating the lessons learned from the 
Deepwater Horizon incident regarding structure, coordination, 
management policies and procedures of the Federal Government 
and if appropriate, State and local governments, non-
governmental entities, and the private sector; and submit to 
the President and the Congress reports as are required by the 
section containing such findings, conclusions, and 
recommendations as the Commission finds appropriate. Section 
10(d) sets forth the relationship of the Commission to the 
inquiry by congressional committees and is self-explanatory.
    Section 10(e) describes the powers of the Commission with 
respect to: hearings and evidence; the issuance and enforcement 
of subpoenas; contracting; securing and handling information 
from Federal agencies; obtaining assistance from Federal 
agencies; gifts; and postal services.
    Section 10(f) requires the Commission to hold public 
hearings and meetings, to the extent appropriate and to release 
public versions of the Commission's interim and final reports 
required under paragraphs (1) and (2) of subsection (j). Public 
meetings are required to be conducted in a manner consistent 
with the protection of proprietary or sensitive information.
    Section 10(g) addresses the appointment and compensation of 
Commission staff, the treatment of Commission staff as Federal 
employees, and employees detailed to the Commission.
    Section 10(h) addresses compensation and travel expenses 
for Commission members and is self-explanatory.
    Section 10(i) sets forth requirements relating to security 
clearances for Commission members and staff and is self-
explanatory.
    Section 10(j) addresses the reports of the Commission and 
requirements relating to adjournment of the Commission and is 
self-explanatory. Section 10(j)((3)(C) provides that after 
adjourning upon completion of the final report on the Deepwater 
Horizon incident, the Commission is to reconvene at such time 
as the President or the Secretary of Homeland Security declares 
an oil spill of national significance to have occurred.
    Section 10(k) authorizes appropriations of $10,000,000 for 
the first fiscal year in which the Commission convenes and 
$3,000,000 for each fiscal year thereafter in which the 
Commission convenes.
    Section 10(l) provides that the Federal Advisory Committee 
Act shall not apply to the Commission.

Section 11. Classification of Offshore Systems

    Section 11(a) requires that not later than 2 years after 
the date of enactment, the Secretary and the Secretary of the 
department in which the Coast Guard is operating shall jointly 
issue regulations requiring systems used in the offshore 
exploration, development and production of oil and gas in the 
OCS to be constructed, maintained, and operated so as to meet 
classification, certification, rating, and inspection standards 
that are necessary to protect the health and safety of workers 
and prevent environmental degradation. The standards 
established by the regulations are to be verified through 
certification and classification by independent third parties 
that have been preapproved by the Secretaries and have no 
financial conflict of interest. Section 11(a) further describes 
the minimum systems covered. The Secretaries may waive the 
standards for an existing system only if the system is of an 
age or type where meeting such requirements is impractical and 
the system poses an acceptably low level of risk to the 
environment and human safety.
    Section 11(b) provides that nothing in section 11 preempts 
or interferes with the authority of the Coast Guard.

Section 12. Savings Provisions

    Section 12(a) provides that all regulations, rules, 
standards, determinations, contracts and agreements, memoranda 
of understanding, certifications, or any other actions issued, 
made or taken by or pursuant to the authority of any law that 
resulted in the assignment of functions to the Secretary, the 
Director of the Minerals Management Service or the Department, 
that were in effect on the date of enactment of this Act, 
remain in full force and effect after the date of enactment of 
this Act unless previously scheduled to expire or until 
otherwise modified or rescinded by this Act or any other Act.
    Section 12(b) provides that this Act does not amend or 
alter the provisions of other applicable laws, unless otherwise 
noted.

Section 13. Budgetary Effects

    Section 13 addresses the determination of budgetary effects 
of the legislation.

                   Cost and Budgetary Considerations

    The Congressional Budget Office estimate of the costs of 
this measure has been requested but was not received at the 
time the report was filed. When the cost estimate is available 
it will be posted on the Congressional Budget Office's website 
www.cbo.gov.

                      Regulatory Impact Evaluation

    In compliance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
evaluation of the regulatory impact which would be incurred in 
carrying out S. 3516.
    The bill strengthens the safety, environmental, and 
financial regulation of companies exploring for, developing, 
and producing federal oil and natural gas resources on the 
Outer Continental Shelf, and is expected to impose some 
additional regulatory burdens on such companies.
    No personal information would be collected in administering 
the program. Therefore, there would be no impact on personal 
privacy.
    Additional paperwork would result from the enactment of S. 
3516, as ordered reported, due to increased requirements for 
safety and environmental regulatory compliance, application, 
planning, review, and documentation.

                   Congressionally Directed Spending

    S. 3516, as ordered reported, does not contain any 
congressionally directed spending items, limited tax benefits, 
or limited tariff benefits as defined in rule XLIV of the 
Standing Rules of the Senate.

                        Executive Communications

    The views of the Administration on S. 3516 are included in 
the testimony of the Secretary of the Interior received by the 
Committee at its June 24, 2010, hearing, which is set forth 
below:

   Statement of Ken Salazar, Secretary of the Interior, June 24, 2010

    Chairman Bingaman, Ranking Member Murkowski, and Members of 
the Committee, I want to thank you for holding this hearing 
today as we continue to address the issues and challenges 
associated with the continuing reform of the Department of the 
Interior's offshore energy program.
    Before we begin, I want to introduce Michael R. Bromwich, 
the new Director of the Bureau of Ocean Energy Management, 
Regulation, and Enforcement. His impressive background includes 
time as the Inspector General of the U.S. Department of 
Justice, as an Assistant U.S. Attorney, and since 1999, as an 
attorney in private practice. His extensive experience in 
government and the private sector in improving the way 
organizations work make him an ideal choice to lead the 
restructuring and reform of the Department's offshore energy 
program.
    For the same reasons I chose Michael Bromwich for this 
position, I chose Wilma Lewis who oversees the Department's 
energy bureaus as the Assistant Secretary for Land and Minerals 
Management. A former U.S. Attorney for the District of Columbia 
and Inspector General at the Department, Wilma has played a 
central leadership role in some of the most significant reforms 
during my tenure as Secretary. She has helped shape reforms 
ranging from our new approach to offshore oil and gas leasing 
and a new emphasis on renewable energy development on the Outer 
Continental Shelf, to ethics reform, to the enhancement of 
leasing programs and the development of renewable energy 
programs onshore, to support for our study of policies designed 
to ensure fair return to American taxpayers for the development 
of public oil and gas resources. I have also appointed her to 
chair the Safety Oversight Board in the aftermath of the 
Deepwater Horizon oil spill, and to help spearhead the 
reorganization of MMS toward a new future.

                   offshore energy reforms completed

    Although this unprecedented disaster, which resulted in the 
tragic loss of life and many injuries, is commanding our time 
and resources, it has also strengthened our resolve to continue 
reforming the OCS program.
    The reforms we have embarked on over the last 17 months, 
and upon which we will continue to build, are substantive and 
systematic, not cosmetic. The kind of fundamental changes we 
are making do not come easily and many of the changes we have 
already made have raised the ire of industry. Our efforts at 
reform have been characterized by some as impediments and 
roadblocks to the development of domestic oil and gas 
resources. We believe, however, that they are crucial to 
ensuring that we carry out our responsibilities effectively, 
without compromise, and in a manner that facilitates the 
balanced, responsible, and sustainable development of the 
resources entrusted to us.
    To review the reforms we have undertaken:
    First, we focused our efforts on ethics and other concerns 
that had been raised in the revenue collection side of the MMS. 
We began changing the way the bureau does business and took 
concrete action to:
           upgrade and strengthen ethics standards 
        throughout MMS and for all political and career 
        employees;
           terminate the Royalty-in-Kind program to 
        reduce the likelihood of fraud or collusion with 
        industry in connection with the collection of 
        royalties; and
           aggressively pursue continued implementation 
        of the recommendations to improve the royalty 
        collection program that came from the Department's 
        Inspector General, the Government Accountability 
        Office, and a committee chaired by former Senators Bob 
        Kerrey and Jake Gam.
    Second, we started reforms of the offshore oil and gas 
regulatory program, which included actions to:
           initiate in Fall 2009 an independent study 
        by an arm of the National Academy of Engineering to 
        examine how we could upgrade our inspection program for 
        offshore rigs;
           procure substantial increases in the MMS 
        budget for FY 2010 and FY 2011, including a ten percent 
        increase in the number of inspectors for offshore 
        facilities; and
           develop a new approach to on-going oil and 
        gas activities on the OCS aimed at promoting the 
        responsible, environmentally sound, and scientifically 
        grounded development of oil and gas resources on the 
        Outer Continental Shelf.
    In that effort, we cancelled the upcoming Beaufort and 
Chukchi lease sales, removed Bristol Bay altogether from 
leasing under the current 5 year plan, and removed the Pacific 
Coast and the Northeast entirely from any drilling under a new 
5 year plan. We made clear that we will require full 
environmental analysis through an Environmental Impact 
Statement prior to any decision to lease in any additional 
areas, such as the mid and south Atlantic, and launched a 
scientific evaluation, led by the Director of USGS, to analyze 
issues associated with drilling in the Arctic.
    Third, we laid the groundwork for expanding the mission of 
MMS beyond conventional oil and gas by devoting significant 
attention and infusing new resources into the renewable energy 
program, thereby providing for a more balanced energy portfolio 
that reflects the President's priorities for clean energy. 
Toward that end, we took action to:
           finalize long-stalled regulations that 
        define a permitting process for off-shore wind--cutting 
        through jurisdictional disputes with FERC in the 
        process and ultimately approving the Cape Wind project;
           announce the establishment of a regional 
        renewable energy office, located in Virginia, which 
        will coordinate and expedite, as appropriate, the 
        development of wind, solar, and other renewable energy 
        resources on the Atlantic Outer Continental Shelf; and
           commence discussions and enter into an MOU 
        with governors of East Coast states, which formally 
        established an Atlantic Offshore Wind Energy Consortium 
        to promote the efficient, orderly, and responsible 
        development of wind resources on the Outer Continental 
        Shelf through increased Federal-State cooperation.

        offshore energy reforms and related activities underway

    Since the Deepwater Horizon explosion and oil spill, the 
reforms and associated efforts have continued with urgency, 
with particular focus on issues raised by, and lessons being 
learned from, the circumstances surrounding the event. We are 
aggressively pursuing actions on multiple fronts, including:
           inspecting all deepwater oil and gas 
        drilling operations in the Gulf of Mexico and issuance 
        of a safety notice to all rig operators;
           implementing the 30 day safety report to the 
        President, including issuing notices to lessees on new 
        safety requirements, and developing new rules for 
        safety and environmental protection; defending the 
        moratorium on new deepwater drilling, which is 
        currently the subject of litigation; and
           implementing new requirements that operators 
        submit information regarding blowout scenarios in their 
        exploration plans--reversing a long standing exemption 
        that resulted from too much reliance on industry to 
        self-regulate.
    Additional reforms will be influenced by several ongoing 
investigations and reviews, including the Deepwater Horizon 
Joint Investigation currently underway by the Bureau of Ocean 
Energy Management, Regulation and Enforcement, and the United 
States Coast Guard. In addition, at my request, a separate 
investigation is being undertaken by the National Academy of 
Engineering to conduct an independent, science-based analysis 
of the root causes of the oil spill. I also requested that the 
Inspector General's Office undertake an investigation to 
determine whether there was a failure of MMS personnel to 
adequately enforce standards or inspect the Deepwater Horizon.
    Further, on April 30th I announced the formation of the 
Outer Continental Shelf Safety Oversight Board to identify, 
evaluate and implement new safety requirements. The Board, 
which consists of Assistant Secretary for Land and Minerals 
Management Wilma A. Lewis, who serves as Chair, Assistant 
Secretary for Policy, Management and Budget Rhea Suh, and 
Acting Inspector General Mary Kendall, will develop 
recommendations designed to strengthen safety, and improve 
overall management, regulation, and oversight of operations on 
the Outer Continental Shelf.
    Finally, the President established the independent 
bipartisan National Commission on the BP Deepwater Horizon Oil 
Spill and Offshore Drilling tasked with providing options on 
how we can prevent and mitigate the impact of any future spills 
that result from offshore drilling. The Commission will be 
focused on the environmental and safety precautions we must 
build into our regulatory framework in order to ensure an 
accident like this never happens again, taking into account the 
other investigations concerning the causes of the spill.

                        supplemental legislation

    The Administration will make sure that BP and other 
responsible parties are held accountable, that they will pay 
the costs of the government in responding to the spill, and 
compensation for loss or damages that arise from the spill. We 
will do everything in our power to make our affected 
communities whole. As a part of the response efforts, we expect 
to spend a total of $27 million through June 30, 2010 for 
Interior's response activities.
    As part of our reforms, we are also building on the efforts 
we undertook in the last sixteen months to strengthen the OCS 
budget. As I already mentioned, the 2011 budget includes a ten 
percent increase in the number of inspectors. Our restructuring 
of the OCS program will require additional resources to 
aggressively pursue the reforms I outlined earlier, to 
implement the 30 day report to the President, and to 
potentially address the results of ongoing investigations and 
the President's Commission. We are currently hiring an 
additional twelve inspectors, six more than we proposed in the 
2011 budget, and we are taking other actions that are outlined 
in the 30 day report to the President. Over the course of the 
next several years, our restructuring of a more robust OCS 
regulatory and enforcement program will dictate the need for 
engineering, technical, and other specialized staff.
    The President's supplemental request of May 12, 2010 
includes $29 million that will fund the near term resources we 
need for these activities. I appreciate the Senate's prompt 
action in passing the supplemental on May 27. As you know, it 
is critically needed to support our full and relentless 
reforms--to bolster inspections of offshore oil and gas 
platforms, draft enforcement and safety regulations, and carry 
out environmental and engineering studies. The President's 
request included a proposal to extend the time allowed by 
statute for review and approve of oil and gas exploration plans 
from 30 to 90 days--this is also needed and I hope Congress 
will include it in the final version of the supplemental.

           reorganization of the minerals management service

    On June 15, I appointed Michael R. Bromwich as the Director 
of the Bureau of Ocean Energy Management, Regulation and 
Enforcement. Michael will lead us through the reorganization--
the foundation for the reforms we have underway. He will lead 
the changes in how the agency does business, implement the 
reforms that will raise the bar for safe and environmentally 
sound offshore oil and gas operations, and help our Nation 
transition to a clean energy future.
    Michael will join the team that has been working out the 
details of the reorganization. In a May 19 Secretarial Order I 
tasked Rhea Suh, the Assistant Secretary for Policy, Management 
and Budget, Wilma Lewis, the Assistant Secretary for Land and 
Minerals Management, and Chris Henderson, one of my senior 
advisors, to develop a reorganization plan in consultation with 
others within the Administration and with Congress. The report 
will provide the plan to restructure the Bureau of Ocean Energy 
Management, Regulation and Enforcement in order to responsibly 
address sustained development of the Outer Continental Shelf's 
conventional and renewable energy resources, including resource 
evaluation, planning, and other activities related to leasing; 
comprehensive oversight, safety, and environmental protection 
in all offshore energy activities; and royalty and revenue 
management including the collection and distribution of 
revenue, auditing and compliance, and asset management.
    The Deepwater Horizon tragedy and the massive spill have 
made the importance and urgency of a reorganization of this 
nature ever more clear, particularly the creation of a separate 
and independent safety and environmental enforcement entity. We 
will responsibly and thoughtfully move to establish 
independence and separation for this critical mission so that 
the American people know they have a strong and independent 
organization ensuring that energy companies comply with their 
safety and environmental protection obligations.
    The restructuring will also address any concerns about the 
incentives related to revenue collections. The OCS currently 
provides nearly 30 percent of the Nation's domestic oil 
production and almost 11 percent of its domestic natural gas 
production and is one of the largest sources of non-tax and 
non-trust revenue for the Treasury. The MMS collected an 
average of more than $13 billion annually for the past 5 years. 
There will be clear separation between the entities that 
collect and manage revenue and those that are responsible for 
the management of the OCS exploration and leasing activities.

                 sustained response efforts in the gulf

    Of utmost importance to us is the oil spill containment and 
clean up of the Gulf. I have returned to the Gulf Region 
numerous times to witness the work Departmental staff and 
volunteers are carrying out to protect the coasts, wetlands, 
and wildlife threatened by this spill. We have deployed 
approximately 1,000 employees to the Gulf and they are 
directing actions to contain the spill; cleaning up affected 
coastal and marine areas under our jurisdiction; and assisting 
Gulf Coast residents with information related to the claims 
process, health and safety information, volunteer 
opportunities, and general information on the efforts being 
carried out in the region.
    Under the direction of National Incident Commander Admiral 
Thad Allen, the Flow Rate Technical Group, which is led by U.S. 
Geological Survey Director Dr. Marcia McNutt, and a scientific 
team led by Energy Secretary Steven Chu recently announced an 
improved estimate of how much oil is flowing from the leaking 
well. That estimate, suggests that the flow rate is at least 
35,000 barrels per day, based on the improved quality and 
quantity of data that are now available.
    The Department's senior staff continues to offer 
coordination and guidance to the effort. Deputy Secretary David 
J. Hayes is devoting his time to coordinating the many Gulf-
related response activities we are undertaking. Assistant 
Secretary for Fish, Wildlife and Parks Tom Strickland has been 
leading the Department's efforts for onshore and near shore 
protection. National Park Service Director Jon Jarvis and 
Acting Director of the Fish and Wildlife Service Rowan Gould 
continue to supervise incident management personnel and 
activities that their bureaus are taking to respond to the 
spill and clean up oil impacts. To protect the eight national 
parks and 36 wildlife refuges and the numerous wildlife, birds, 
and historic structures they are responsible for in the Gulf of 
Mexico, the NPS and FWS dispatched approximately 590 employees.
    Representatives from the FWS also participated with the 
U.S. Coast Guard, the Environmental Protection Agency, and 
state and local governments in a series of public meetings with 
local residents to answer questions and offer information on a 
variety of topics related to the spill and response activities.
    Finally, there are many, many people in the Department who 
are devoting significant time and energy to this event; to the 
various investigations and inquiries, both within the 
Administration and in Congress, that are being carried out; and 
to the ongoing reorganization and reform. I want to acknowledge 
their work and let them know their efforts are appreciated and 
are not going unnoticed.
    In the last 60 days we have also seen what the employees in 
the Bureau of Ocean Energy Management, Regulation and 
Enforcement are capable of, their professionalism, their 
dedication to the Department, and their enthusiasm for the 
reforms underway. With Michael's help we will be able to cast 
aside the shadow on the many dedicated employees that has been 
left by an errant few, and by previous policies that have 
prioritized production over ethics, safety, and environmental 
protection.

                     legislative efforts at reform

    All four of the bills before you today address reform of 
the Department's offshore energy and mineral resource 
development program. I would like to provide you some general 
comments on each of these bills and a few provisions in 
particular.
    Your legislation, Mr. Chairman, S. 3516, the ``Outer 
Continental Shelf Reform Act,'' would provide general organic 
authority for the restructuring of the offshore energy and 
minerals program in the Department and would make additional 
changes reforming some of the underlying laws governing 
management of these resources.
    I have previously testified in support of organic 
legislation for the functions performed by MMS, noting that an 
organization with such important responsibilities should be 
governed by a thoughtfully considered organic act. It is 
important for organic legislation to provide the Secretary with 
the discretion to implement the details of a reorganization as 
complicated as this.
    The provisions in S. 3516 authorizing the creation of the 
three new entities are consistent with the changes I have 
directed in my Secretarial Order. The report and schedule for 
implementation that I will receive on July 9 will provide a 
detailed roadmap for this reorganization and will greatly 
inform the process. The Administration would like to continue 
discussion with the Committee regarding the specifics in this 
legislation of the appointment and confirmation of the new 
bureau and office directors.
    A number of the changes contained in this bill highlight 
the need for increased safety of operations and consideration 
of the marine and coastal environment, including the need for 
integrated programs for both environmental research and 
technological research and development. In this same vein, S. 
3509, the ``Safer Oil and Gas Production Research and 
Development Act'', would amend certain research and development 
provisions contained in the Energy Policy Act of 2005 to 
provide an additional focus on research and development on 
safety and reduced environmental impacts from development of 
these resources.
    A focus on strengthened safety and oversight and the 
environmental impacts of offshore oil and gas operations are 
priorities of the Administration. These issues, and several 
others in the bills before you today, will require the 
Department to work closely with the Committee and other 
relevant federal agencies to ensure a coordinated approach to 
attaining these important objectives.
    S. 3516 also includes new planning requirements, including 
a requirement for detailed descriptions of equipment and plans 
to address potential well blowouts. S. 3497, the ``Oil Spill 
Prevention and Mitigation Improvement Act,'' includes a similar 
focus, amending the Outer Continental Shelf Lands Act to 
require that leases entered into under that Act include a plan 
for containment and termination of discharges of oil, and a 
timeline for accomplishing those actions.
    Recognizing the importance of this information, on June 18, 
2010, the Department issued a Notice to Lessees (NTL) requiring 
that new filings for drilling permits, exploration plans, or 
development plans to contain information specifically 
addressing the possibility of a blowout and the detailed steps 
that lessees or operators would take to prevent blowouts. This 
reverses a 2003 policy and a 2008 NTL that exempted many 
offshore oiland gas operations in the Gulf from submitting 
certain information about such a scenario and is consistent 
with the requirements contained in these bills.
    S. 3516 would also extend the deadline for the Department 
to review and approve exploration plans; require that lessees 
obtain a drilling permit after approval of an exploration plan; 
and require that, prior to approval of such a permit, an 
engineering review of the well system be completed and 
reviewed. The Administration supports authority to provide for 
longer review time and for stronger reviews of exploration 
plans prior to drilling. We would like to work with the 
Committee on this important issue.
    We are also supportive of the changes in S. 3516 intended 
to strengthen civil and criminal penalties contained in the 
OCSLA. These provisions are generally consistent with the 
support for increasing these penalties that Deputy Secretary 
Hayes expressed before this Committee on May 25th.
    It is also important to provide the Department with the 
tools necessary to appropriately staff critical and hard-to-
fill positions in these new entities. We look forward to 
continuing the dialog on this issue, as well.

                  strengthening the way we do business

    Over the past several weeks I have talked about the many 
ways we have changed the direction of the MMS, both 
programmatically and structurally. S. 3431 would change laws 
governing ethical standards and fraudulent statements by MMS 
employees.
    I have already mentioned the actions in this regard that I 
ordered last year. I am also pleased to have two former 
Inspectors General, in Michael Bromwich and Wilma Lewis, to 
help lead our reform efforts. But my interest in strengthened 
ethics standards isn't limited to employees of the MMS. 
President Obama made it clear from the earliest days of this 
Administration that ethical behavior, among both political and 
career employees, was to be held to a premium standard. On 
January 26, 2009, I issued a memorandum to all employees 
regarding the high ethical standards with which we were all 
expected to carry out our duties. I also directed the 
Department's Ethics Office to review Department-specific 
regulations and recommend areas where improvements could be 
made. On August 19, 2009, I issued a Secretarial Order laying 
out additional clarifications to enhance and promote a stronger 
ethical culture at the Department.
    S. 3431 would codify portions of the new standards made 
applicable to MMS employees in January 2009. The Department's 
Ethics Office is currently preparing updates to statutory 
language, including updates to provisions applicable to 
Departmental offices and to lands and energy and mineral 
development programs. I look forward to working with you and 
the sponsor as we move to modernize these important 
obligations.

                               conclusion

    Much of my time as Secretary of the Interior has been spent 
working to promote reform of prior practices in the Minerals 
Management Service and to advance the President's vision of a 
new energy future that will help us to move away from spending 
hundreds of billions of dollars each year on imported oil. A 
balanced program of safe and environmentally responsible 
offshore energy development is a necessary part of that future. 
We are also involved in a multi-agency process to develop a new 
national ocean policy that is intended to look ahead in the 
long term to help the United States think comprehensively about 
how we make better informed management decisions regarding the 
use and conservation of ocean, coastal, and Great Lakes 
resources.
    As we evaluate new areas for potential exploration and 
development on the OCS, we will conduct thorough environmental 
analysis and scientific study, gather public input and comment, 
and carefully examine the potential safety and spill risk 
considerations. The findings of the Joint Investigation and the 
independent National Academy of Engineering will provide us 
with the facts and help us understand what happened on the 
Deepwater Horizon. Those findings, the work of the Outer 
Continental Shelf Safety Oversight Board, the OIG investigation 
and review, and the findings of the Presidential Commission 
will help inform the implementation of the Administration's 
comprehensive energy strategy for the OCS.
    We are taking responsible action to address the safety of 
other offshore oil and gas operations, further tightening our 
oversight of industry's practices through a package of reforms, 
and taking a careful look at the questions this disaster is 
raising. We will also work with you on legislative reforms and 
the finalization of a reorganization that will ensure that the 
OCS program is effectively managed to achieve these goals.
    Lastly, let me assure you this Administration will continue 
its relentless response to the Deepwater Horizon tragedy. Our 
team is committed to help the people and communities of the 
Gulf Coast region persevere through this disaster, to protect 
our important places and resources, and to take actions based 
on the valuable lessons that will help prevent similar spills 
in the future.

                        Changes in Existing Law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill H.R. 2741, as ordered reported, are shown as follows 
(existing law proposed to be omitted is enclosed in black 
brackets, new matter is printed in italic, existing law in 
which no change is proposed is shown in roman):

             TABLE OF EXISTING LAWS PROPOSED TO BE CHANGED

    1. Outer Continental Shelf Lands Act, Act of August 7, 
1953, as amended
    2. Title 5, United States Code
    3. Energy Policy Act of 2005, Public Law 109-58, as amended

                   OUTER CONTINENTAL SHELF LANDS ACT

                   ACT OF AUGUST 7, 1953, AS AMENDED

 AN ACT To provide for the jurisdiction of the United States over the 
 submerged lands of the outer Continental Shelf, and to authorize the 
   Secretary of the Interior to lease such lands for certain purposes

    Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, That this 
Act may be cited as the ``Outer Continental Shelf Lands Act.''
    Sec. 2. Definitions.--When used in this Act--
    (a) The term ``outer Continental Shelf'' means all 
submerged lands lying seaward and outside of the area of lands 
beneath navigable waters as defined in section 2 of the 
Submerged Lands Act (Public Law 31, Eighty-third Congress, 
first session), and of which the subsoil and seabed appertain 
to the United States and are subject to its jurisdiction and 
control;

           *       *       *       *       *       *       *

    (r) Safety Case.--The term ``safety case'' means a complete 
set of safety documentation that provides a basis for 
determining whether a system is adequately safe for a given 
application in a given environment.
    Sec. 3. National Policy for the Outer Continental Shelf.--
It is hereby declared to be the policy of the United States 
that--
          (1) the subsoil and seabed of the outer Continental 
        Shelf appertain to the United States and are subject to 
        its jurisdiction, control, and power of disposition as 
        provided in this Act;

           *       *       *       *       *       *       *

          [(3) the outer Continental Shelf is a vital national 
        resource reserve held by the Federal Government for the 
        public, which should be made available for expeditious 
        and orderly development, subject to environmental 
        safeguards, in a manner which is consistent with the 
        maintenance of competition and other national needs;]
          (3) the outer Continental Shelf is a vital national 
        resource reserve held by the Federal Government for the 
        public, which should be managed in a manner that--
                  (A) recognizes the need of the United States 
                for domestic sources of energy, food, minerals, 
                and other resources;
                  (B) minimizes the potential impacts of 
                development of those resources on the marine 
                and coastal environment and on human health and 
                safety; and
                  (C) acknowledges the long-term economic value 
                to the United States of the balanced and 
                orderly management of those resources that 
                safeguards the environment and respects the 
                multiple values and uses of the outer 
                Continental Shelf;
          (4) since exploration, development, and production of 
        the minerals of the outer Continental Shelf will have 
        significant impacts on coastal and non-coastal areas of 
        the coastal States, and on other affected States, and, 
        in recognition of the national interest in the 
        effective management of the marine, coastal, and human 
        environments--
                  (A) such States and their affected local 
                governments may require assistance in 
                protecting their coastal zones and other 
                affected areas from any temporary or permanent 
                adverse effects of such impacts;
                  (B) the distribution of a portion of the 
                receipts from the leasing of mineral resources 
                of the outer Continental Shelf adjacent to 
                State lands, as provided under section 1337(g) 
                of this title, will provide affected coastal 
                States and localities with funds which may be 
                used for the mitigation of adverse economic and 
                environmental effects related to the 
                development of such resources; and
                  (C) such States, and through such States, 
                affected local governments, are entitled to an 
                opportunity to participate, to the extent 
                consistent with the national interest, in the 
                policy and planning decisions made by the 
                Federal Government relating to exploration for, 
                and development and production of, minerals of 
                the outer Continental Shelf[.];
          (5) the rights and responsibilities of all States 
        and, where appropriate, local governments, to preserve 
        and protect their marine, human, and coastal 
        environments through such means as regulation of land, 
        air, and water uses, of safety, and of related 
        development and activity should be considered and 
        recognized[; and];
          (6) exploration, development, and production of 
        energy and minerals on the outer Continental Shelf 
        should be allowed only when those activities can be 
        accomplished in a manner that provides reasonable 
        assurance of adequate protection against harm to life, 
        health, the environment, property, or other users of 
        the waters, seabed, or subsoil; and
          [(6)] (7) operations in the outer Continental Shelf 
        [should be] shall be conducted in a safe manner by 
        well-trained personnel using best available technology, 
        precautions, and techniques sufficient to prevent or 
        minimize the likelihood of blowouts, loss of well 
        control, fires, spillages, physical obstruction to 
        other users of the waters or subsoil and seabed, or 
        other occurrences which may cause damage to the 
        environment or to property, or endanger life or health.

           *       *       *       *       *       *       *

    Sec. 5. Administration of Leasing of the Outer Continental 
Shelf.--(a) The Secretary shall administer the provisions of 
this Act relating to the leasing of the outer Continental 
Shelf, and shall prescribe such rules and regulations as may be 
necessary to carry out such provisions. [The Secretary may at 
any time] The Secretary shall prescribe and amend such rules 
and regulations as he determines to be necessary and proper in 
order to provide for operational safety, the protection of the 
marine and coastal environment, the prevention of waste and 
conservation of the natural resources of the outer Continental 
Shelf, and the protection of correlative rights therein, and, 
not withstanding any other provisions herein, such rules and 
regulations shall, as of their effective date, apply to all 
operations conducted under a lease issued or maintained under 
the provisions of this Act. In the enforcement of safety, 
environmental, and conservation laws and regulations, the 
Secretary shall cooperate with the relevant departments and 
agencies of the Federal Government and of the affected States. 
In the formulation and promulgation of regulations, the 
Secretary shall request and give due consideration to the views 
of the Attorney General with respect to matters which may 
affect competition. In considering any regulations and in 
preparing any such views the Attorney General shall consult 
with the Federal Trade Commission. The regulations prescribed 
by the Secretary under this subsection shall include, but not 
be limited to, provisions--

           *       *       *       *       *       *       *

    Sec. 6. Maintenance of Leases on Outer Continental Shelf.--
(a) The provisions of this section shall apply to any mineral 
lease covering submerged lands of the outer Continental Shelf 
issued by any State (including any extension, renewal, or 
replacement thereof heretofore granted pursuant to such lease 
or under the laws of such State) if--
          (1) such lease, or a true copy thereof, is filed with 
        the Secretary by the lessee or his duly authorized 
        agent within ninety days from the effective date of 
        this Act, or within such further period or periods as 
        provided in section 7 hereof or as may be fixed from 
        time to time by the Secretary;

           *       *       *       *       *       *       *

    (e) In the event any lease maintained under this section 
covers lands beneath navigable waters, as that term is used in 
the Submerged Lands Act, as well as lands of the outer 
Continental Shelf, the provisions of this section shall apply 
to such lease only insofar as it covers lands of the outer 
Continental Shelf.
    (f) Review of Bond and Surety Amounts.--Not later than May 
1, 2011, and every 5 years thereafter, the Secretary shall--
          (1) review the minimum financial responsibility 
        requirements for mineral leases under subsection 
        (a)(11); and
          (2) adjust for inflation based on the Consumer Price 
        Index for all Urban Consumers published by the Bureau 
        of Labor Statistics of the Department of Labor, and 
        recommend to Congress any further changes to existing 
        financial responsibility requirements necessary to 
        permit lessees to fulfill all obligations under this 
        Act or the Oil Pollution Act of 1990 (33 U.S.C. 2701 et 
        seq.).
    (g) Periodic Fiscal Reviews and Reports.--
          (1) Royalty rates.--
                  (A) In general.--Not later than 1 year after 
                the date of enactment of this subsection and 
                every 4 years thereafter, the Secretary shall 
                carry out a review of, and prepare a report 
                that describes--
                          (i) the royalty and rental rates 
                        included in new offshore oil and gas 
                        leases and the rationale for the rates;
                          (ii) whether, in the view of the 
                        Secretary, the royalty and rental rates 
                        described in subparagraph (A) would 
                        yield a fair return to the public while 
                        promoting the production of oil and gas 
                        resources in a timely manner; and
                          (iii) whether, based on the review, 
                        the Secretary intends to modify the 
                        royalty or rental rates.
                  (B) Public participation.--In carrying out a 
                review and preparing a report under 
                subparagraph (A), the Secretary shall provide 
                to the public an opportunity to participate.
          (2) Comparative review of fiscal system.--
                  (A) In general.--Not later than 1 year after 
                the date of enactment of this subsection and 
                every 4 years thereafter, the Secretary in 
                consultation with the Secretary of the 
                Treasury, shall carry out a comprehensive 
                review of all components of the Federal 
                offshore oil and gas fiscal system, including 
                requirements for bonus bids, rental rates, 
                royalties, oil and gas taxes, income taxes and 
                other significant financial elements, and oil 
                and gas fees.
                  (B) Inclusions.--The review shall include--
                          (i) information and analyses 
                        comparing the offshore bonus bids, 
                        rents, royalties, taxes, and fees of 
                        the Federal Government to the offshore 
                        bonus bids, rents, royalties, taxes, 
                        and fees of other resource owners 
                        (including States and foreign 
                        countries); and
                          (ii) an assessment of the overall 
                        offshore oil and gas fiscal system in 
                        the United States, as compared to 
                        foreign countries.
                  (C) Independent advisory committee.--In 
                carrying out a review under this paragraph, the 
                Secretary shall convene and seek the advice of 
                an independent advisory committee comprised of 
                oil and gas and fiscal experts from States, 
                Indian tribes, academia, the energy industry, 
                and appropriate nongovernmental organizations.
                  (D) Report.--The Secretary shall prepare a 
                report that contains--
                          (i) the contents and results of the 
                        review carried out under this paragraph 
                        for the period covered by the report; 
                        and
                          (ii) any recommendations of the 
                        Secretary and the Secretary of the 
                        Treasury based on the contents and 
                        results of the review.
                  (E) Combined report.--The Secretary may 
                combine the reports required by paragraphs (1) 
                and (2)(D) into 1 report.
          (3) Report deadline.--Not later than 30 days after 
        the date on which the Secretary completes each report 
        under this subsection, the Secretary shall submit 
        copies of the report to--
                  (A) the Committee on Energy and Natural 
                Resources of the Senate;
                  (B) the Committee on Finance of the Senate;
                  (C) the Committee on Natural Resources of the 
                House of Representatives; and
                  (D) the Committee on Ways and Means of the 
                House of Representatives.

           *       *       *       *       *       *       *

    Sec. 8. Leases, Easements, and Rights-of-way on the Outer 
Continental Shelf.--(a)(1) The Secretary is authorized to grant 
to the highest responsible qualified bidder or bidders by 
competitive bidding, under regulations promulgated in advance, 
any oil and gas lease on submerged lands of the outer 
Continental Shelf which are not covered by leases meeting the 
requirements of subsection (a) of section 6 of this Act. Such 
regulations may provide for the deposit of cash bids in an 
interest-bearing account until the Secretary announces his 
decision on whether to accept the bids, with the interest 
earned thereon to be paid to the Treasury as to bids that are 
accepted and to the unsuccessful bidders as to bids that are 
rejected. The bidding shall be by sealed bid and, at the 
discretion of the Secretary, on the basis of--

           *       *       *       *       *       *       *

    [(d) No bid for a lease may be submitted if the Secretary 
finds, after notice and hearing, that the bidder is not meeting 
due diligence requirements on other leases.]
    (d) Disqualification From Bidding.--No bid for a lease may 
be submitted by any entity that the Secretary finds, after 
prior public notice and opportunity for a hearing--
          (1) is not meeting due diligence, safety, or 
        environmental requirements on other leases; or
          (2)(A) is a responsible party for a vessel or a 
        facility from which oil is discharged, for purposes of 
        section 1002 of the Oil Pollution Act of 1990 (33 
        U.S.C. 2702); and
          (B) has failed to meet the obligations of the 
        responsible party under that Act to provide 
        compensation for covered removal costs and damages.
    (e) No lease issued under this Act may be sold, exchanged, 
assigned, or otherwise transferred except with the approval of 
the Secretary. Prior to any such approval, the Secretary shall 
consult with and give due consideration to the views of the 
Attorney General.

           *       *       *       *       *       *       *

    Sec. 11. Geological and Geophysical Explorations.--(a)(1) 
Any agency of the United States and any person authorized by 
the Secretary may conduct geological and geophysical 
explorations in the outer Continental Shelf, which do not 
interfere with or endanger actual operations under any lease 
maintained or granted pursuant to this Act, and which are not 
unduly harmful to aquatic life in such area.

           *       *       *       *       *       *       *

    (c)(1) Except as otherwise provided in the 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 to the Secretary for approval. 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 
shall be approved by the Secretary if he finds that such plan 
is consistent with the provisions of this Act, regulations 
prescribed under this Act, including regulations prescribed by 
the Secretary pursuant to paragraph (8) of section 5(a) of this 
Act, and the provisions of such lease. The Secretary shall 
require such modifications of such plan as are necessary to 
achieve such consistency. The Secretary shall approve such 
plan, as submitted or modified, [within thirty days of its 
submission] by the deadline described in paragraph (5), except 
that the Secretary shall disapprove such plan if he determines 
that (A) any proposed activity under such plan would result in 
any condition described in section 5(a)(2)(A)(i) of this Act, 
and (B) such proposed activity cannot be modified to avoid such 
condition. If the Secretary disapproves a plan under the 
preceding sentence, he may, subject to section 5(a)(2)(B) of 
this Act, cancel such lease and the lessee shall be entitled to 
compensation in accordance with the regulations prescribed 
under section 5(a)(2)(C) (i) or (ii) of this Act.
    (2) The Secretary shall not grant any license or permit for 
any activity described in detail in an exploration plan and 
affecting any land use or water use in the coastal zone of a 
State with a coastal zone management program approved pursuant 
to section 306 of the Coastal Zone Management Act of 1972 (16 
U.S.C. 1455), unless the State concurs or is conclusively 
presumed to concur with the consistency certification 
accompanying such plan pursuant to section 307(c)(3)(B) (i) or 
(ii) of such Act, or the Secretary of Commerce makes the 
finding authorized by section 307(c)(3)(B)(iii) of such Act.
    [(3) 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) Minimum Requirements.--
          (A) In general.--An exploration plan submitted under 
        this subsection shall include, in such degree of detail 
        as the Secretary by regulation may require--
                  (i) a complete description and schedule of 
                the exploration activities to be undertaken;
                  (ii) a description of the equipment to be 
                used for the exploration activities, 
                including--
                          (I) a description of the drilling 
                        unit;
                          (II) a statement of the design and 
                        condition of major safety-related 
                        pieces of equipment;
                          (III) a description of any new 
                        technology to be used; and
                          (IV) a statement demonstrating that 
                        the equipment to be used meets the best 
                        available technology requirements under 
                        section 21(b);
                  (iii) a map showing the location of each well 
                to be drilled;
                  (iv)(I) a scenario for the potential blowout 
                of the well involving the highest expected 
                volume of liquid hydrocarbons; and
                  (II) a complete description of a response 
                plan to control the blowout and manage the 
                accompanying discharge of hydrocarbons, 
                including--
                          (aa) the technology and timeline for 
                        regaining control of the well; and
                          (bb) the strategy, organization, and 
                        resources to be used to avoid harm to 
                        the environment and human health from 
                        hydrocarbons; and
                  (v) any other information determined to be 
                relevant by the Secretary.
          (B) Deepwater wells.--
                  (i) In general.--Before conducting 
                exploration activities in water depths greater 
                than 500 feet, the holder of a lease shall 
                submit to the Secretary for approval a 
                deepwater operations plan prepared by the 
                lessee in accordance with this subparagraph.
                  (ii) Technology requirements.--A deepwater 
                operations plan under this subparagraph shall 
                be based on the best available technology to 
                ensure safety in carrying out the exploration 
                activity and the blowout response plan.
                  (iii) Systems analysis required.--The 
                Secretary shall not approve a deepwater 
                operations plan under this subparagraph unless 
                the plan includes a technical systems analysis 
                of--
                          (I) the safety of the proposed 
                        exploration activity;
                          (II) the blowout prevention 
                        technology; and
                          (III) the blowout and spill response 
                        plans.
    (4) 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.
    (5) Deadline for approval.--
          (A) In general.--In the case of a lease issued under 
        a sale held after March 17, 2010, the deadline for 
        approval of an exploration plan referred to in the 
        fourth sentence of paragraph (1) is--
                  (i) the date that is 90 days after the date 
                on which the plan or the modifications to the 
                plan are submitted; or
                  (ii) the date that is not later than an 
                additional 180 days after the deadline 
                described in clause (i), if the Secretary makes 
                a finding that additional time is necessary to 
                complete any environmental, safety, or other 
                reviews.
          (B) Existing leases.--In the case of a lease issued 
        under a sale held on or before March 17, 2010, the 
        Secretary, with the consent of the holder of the lease, 
        may extend the deadline applicable to the lease for 
        such additional time as the Secretary determines is 
        necessary to complete any environmental, safety, or 
        other reviews.
    [(d) The Secretary may, by regulation, require any lessee 
operating under an approved exploration plan to obtain a permit 
prior to drilling any well in accordance with such plan.]
    (d) Drilling Permits.--
          (1) In general.--The Secretary shall, by regulation, 
        require that any lessee operating under an approved 
        exploration plan obtain a permit--
                  (A) before the lessee drills a well in 
                accordance with the plan; and
                  (B) before the lessee significantly modifies 
                the well design originally approved by the 
                Secretary.
          (2) Engineering review required.--The Secretary may 
        not grant any drilling permit until the date of 
        completion of a full review of the well system by not 
        less than 2 agency engineers, including a written 
        determination that--
                  (A) critical safety systems (including 
                blowout prevention) will use best available 
                technology; and
                  (B) blowout prevention systems will include 
                redundancy and remote triggering capability.
          (3) Modification review required.--The Secretary may 
        not approve any modification of a permit without a 
        determination, after an additional engineering review, 
        that the modification will not compromise the safety of 
        the well system previously approved.
          (4) Operator safety and environmental management 
        required.--The Secretary may not grant any drilling 
        permit or modification of the permit until the date of 
        completion and approval of a safety and environmental 
        management plan that--
                  (A) is to be used by the operator during all 
                well operations; and
                  (B) includes--
                          (i) a description of the expertise 
                        and experience level of crew members 
                        who will be present on the rig; and
                          (ii) designation of at least 2 
                        environmental and safety managers 
                        that--
                                  (I) are employees of the 
                                operator;
                                  (II) would be present on the 
                                rig at all times; and
                                  (III) have overall 
                                responsibility for the safety 
                                and environmental management of 
                                the well system and spill 
                                response plan; and
                  (C) not later than May 1, 2012, requires that 
                all employees on the rig meet the training and 
                experience requirements under section 21(b)(4).
    (e) Disapproval of Exploration Plan.--
          (1) In general.--The Secretary shall disapprove an 
        exploration plan submitted under this section if the 
        Secretary determines that, because of exceptional 
        geological conditions in the lease areas, exceptional 
        resource values in the marine or coastal environment, 
        or other exceptional circumstances, that--
                  (A) implementation of the exploration plan 
                would probably cause serious harm or damage to 
                life (including fish and other aquatic life), 
                property, mineral deposits, national security 
                or defense, or the marine, coastal or human 
                environments;
                  (B) the threat of harm or damage would not 
                disappear or decrease to an acceptable extent 
                within a reasonable period of time; and
                  (C) the advantages of disapproving the 
                exploration plan outweigh the advantages of 
                exploration.
          (2) Compensation.--If an exploration plan is 
        disapproved under this subsection, the provisions of 
        subparagraphs (B) and (C) of section 25(h)(2) shall 
        apply to the lease and the plan or any modified plan, 
        except that the reference in section 25(h)(2)(C) to a 
        development and production plan shall be considered to 
        be a reference to an exploration plan.
    [(e)] (f)(1) If a significant revision of an exploration 
plan approved under this subsection is submitted to the 
Secretary, the process to be used for the approval 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 approved exploration plan or 
an approved revision of such plan.
    [(f)] (g)(1) Exploration activities pursuant to any lease 
for which a drilling permit has been issued or for which an 
exploration plan has been approved, prior to ninety days after 
the date of enactment of this subsection, shall be considered 
in compliance with this section, except that the Secretary may, 
in accordance with section 5(a)(1)(B) of this Act, order a 
suspension or temporary prohibition of any exploration 
activities and require a revised exploration plan.
    (2) The Secretary may require the holder of a lease 
described in paragraph (1) of this subsection to supply a 
general statement in accordance with subsection (c)(4) of this 
section, or to submit other information.
    (3) Nothing in this subsection shall be construed to amend 
the terms of any permit or plan to which this subsection 
applies.
    [(g)] (h) Any permit for geological explorations authorized 
by this section shall be issued only if the Secretary 
determines, in accordance with regulations issued by the 
Secretary that--
          (1) the applicant for such permit is qualified;
          (2) the exploration will not interfere with or 
        endanger operations under any lease issued or 
        maintained pursuant to this Act; and
          (3) such exploration will not be unduly harmful to 
        aquatic life in the area, result in pollution, create 
        hazardous or unsafe conditions, unreasonably interfere 
        with other uses of the area, or disturb any site, 
        structure, or object of historical or archeological 
        significance.
    [(h)] (i) The Secretary shall not issue a lease or permit 
for, or otherwise allow, exploration, development, or 
production activities within fifteen miles of the boundaries of 
the Point Reyes Wilderness as depicted on a map entitled 
``Wilderness Plan, Point Reyes National Seashore'', numbered 
612-90,000-B and dated September 1976, unless the State of 
California issues a lease or permit for, or otherwise allows, 
exploration, development, or production activities on lands 
beneath navigable waters (as such term is defined in section 2 
of the Submerged Lands Act) of such State which are adjacent to 
such Wilderness.

           *       *       *       *       *       *       *

    Sec. 18. Outer Continental Shelf Leasing Program.--(a) The 
Secretary, pursuant to procedures set forth in subsections (c) 
and (d) of this section, shall prepare and periodically revise, 
and maintain an oil and gas leasing program to implement the 
policies of this Act. The leasing program shall consist of a 
schedule of proposed lease sales indicating, as precisely as 
possible, the size, timing, and location of leasing activity 
which he determines will best meet national energy needs and 
the need for the protection of the marine and coastal 
environment and resources for the five-year period following 
its approval or reapproval. Such leasing program shall be 
prepared and maintained in a manner consistent with the 
following principles:
          (1) Management of the outer Continental Shelf shall 
        be conducted in a manner which [considers] gives equal 
        consideration to economic, social, and environmental 
        values of the renewable and nonrenewable resources 
        contained in the outer Continental Shelf, and the 
        potential impact of oil and gas exploration on other 
        resource values of the outer Continental Shelf and the 
        marine, coastal, and human environments.

           *       *       *       *       *       *       *

          (3) The Secretary shall select the timing and 
        location of leasing, [to the maximum extent 
        practicable,] so as to obtain a proper balance between 
        the potential for environmental damage, the potential 
        for the discovery of oil and gas, and the potential for 
        adverse impact on the coastal zone.

           *       *       *       *       *       *       *

    (b) The leasing program shall include estimates of the 
appropriations and staff required to--
          (1) obtain resource information and any other 
        information needed to prepare the leasing program 
        required by this section;
          (2) analyze and interpret the exploratory data and 
        any other information which may be compiled under the 
        authority of this Act;
          (3) conduct environmental studies and prepare any 
        environmental impact statement required in accordance 
        with this Act and with section 102(2)(C) of the 
        National Environmental Policy Act of 1969 (42 U.S.C. 
        4332(2)(C)); [and]
          (4) supervise operations conducted pursuant to each 
        lease in the manner necessary to assure due diligence 
        in the exploration and development of the lease area 
        and compliance with the requirement of applicable laws 
        and regulations, and with the terms of the lease[.]; 
        and
          (5) provide technical review and oversight of the 
        exploration plan and a systems review of the safety of 
        the well design and other operational decisions;
          (6) conduct regular and thorough safety reviews and 
        inspections, and;
          (7) enforce all applicable laws (including 
        regulations).

           *       *       *       *       *       *       *

    (d)(1) Within ninety days after the date of publication of 
a proposed leasing program, the Attorney General may, after 
consultation with the Federal Trade Commission, submit comments 
on the anticipated effects of such proposed program upon 
competition. Any State, local government, or other person may 
submit comments and recommendations as to any aspect of such 
proposed program.
    (2) At least sixty days prior to approving a proposed 
leasing program, the Secretary shall submit it to the President 
and the Congress, together with any comments received. Such 
submission shall indicate why any specific recommendation of 
the Attorney General, the head of an interested Federal agency, 
or a State or local government was not accepted.

           *       *       *       *       *       *       *

    (g) The Secretary may obtain from public sources, or 
purchase from private sources, any survey, data, report, or 
other information (including interpretations of such data, 
survey, report, or other information) which may be necessary to 
assist him in preparing any environmental impact statement and 
in making other evaluations required by this Act, including 
existing inventories and mapping of marine resources previously 
undertaken by the Department of the Interior and the National 
Oceanic and Atmospheric Administration, information provided by 
the Department of Defense, and other available data regarding 
energy or mineral resource potential, navigation uses, 
fisheries, aquaculture uses, recreational uses, habitat, 
conservation, and military uses on the outer Continental Shelf. 
Data of a classified nature provided to the Secretary under the 
provisions of this subsection shall remain confidential for 
such period of time as agreed to by the head of the department 
or agency from whom the information is requested. The Secretary 
shall maintain the confidentiality of all privileged or 
proprietary data or information for such period of time as is 
provided for in this Act, established by regulation, or agreed 
to by the parties.
    (h) The heads of all Federal departments and agencies shall 
provide the Secretary with any nonprivileged or nonproprietary 
information he requests to assist him in preparing the leasing 
program and may provide the Secretary with any privileged or 
proprietary information he requests to assist him in preparing 
the leasing program. Privileged or proprietary information 
provided to the Secretary under the provisions of this 
subsection shall remain confidential for such period of time as 
agreed to by the head of the department or agency from whom the 
information is requested. In addition, the Secretary shall 
utilize the existing capabilities and resources of such Federal 
departments and agencies by appropriate agreement.
    (i) Research and Development.--
          (1) In general.--The Secretary shall carry out a 
        program of research and development to ensure the 
        continued improvement of methodologies for 
        characterizing resources of the outer Continental Shelf 
        and conditions that may affect the ability to develop 
        and use those resources in a safe, sound, and 
        environmentally responsible manner.
          (2) Inclusions.--Research and development activities 
        carried out under paragraph (1) may include activities 
        to provide accurate estimates of energy and mineral 
        reserves and potential on the outer Continental Shelf 
        and any activities that may assist in filling gaps in 
        environmental data needed to develop each leasing 
        program under this section.
          (3) Leasing activities.--Research and development 
        activities carried out under paragraph (1) shall not be 
        considered to be leasing or pre-leasing activities for 
        purposes of this Act.

           *       *       *       *       *       *       *

    Sec. 20. Environmental Studies.--(a) Comprehensive and 
Independent Studies--
          (1) In general.--The Secretary shall develop and 
        carry out programs for the collection, evaluation, 
        assembly, analysis, and dissemination of environmental 
        and other resource data that are relevant to carrying 
        out the purposes of this Act.
          (2) Scope of research.--The programs under this 
        subsection shall include--
                  (A) the gathering of baseline data in areas 
                before energy or mineral resource development 
                activities occur;
                  (B) ecosystem research and monitoring studies 
                to support integrated resource management 
                decisions; and
                  (C) the improvement of scientific 
                understanding of the fate, transport, and 
                effects of discharges and spilled materials, 
                including deep water hydrocarbon spills, in the 
                marine environment.
          (3) Use of data.--The Secretary shall ensure that 
        information from the studies carried out under this 
        section--
                  (A) informs the management of energy and 
                mineral resources on the outer Continental 
                Shelf including any areas under consideration 
                for oil and gas leasing; and
                  (B) contributes to a broader coordination of 
                energy and mineral resource development 
                activities within the context of best available 
                science.
          (4) Independence.--The Secretary shall create a 
        program within the appropriate bureau established under 
        section 32 that shall--
                  (A) be programmatically separate and distinct 
                from the leasing program;
                  (B) carry out the environmental studies under 
                this section;
                  (C) conduct additional environmental studies 
                relevant to the sound management of energy and 
                mineral resources on the outer Continental 
                Shelf;
                  (D) provide for external scientific review of 
                studies under this section, including through 
                appropriate arrangements with the National 
                Academy of Sciences; and
                  (E) subject to the restrictions of 
                subsections (g) and (h) of section 18, make 
                available to the public studies conducted and 
                data gathered under this section.
    [(a)] (b)(1) The Secretary shall conduct every 3 years a 
study of any area or region included in any oil and gas lease 
sale or other lease in order to establish information needed 
for assessment and management of environmental impacts on the 
human, marine, and coastal environments of the outer 
Continental Shelf and the coastal areas which may be affected 
by oil and gas or other mineral development in such area or 
region.
    (2) Each study required by paragraph (1) of this subsection 
shall be commenced not later than six months after the date of 
enactment of this section with respect to any area or region 
where a lease sale has been held or announced by publication of 
a notice of proposed lease sale before such date of enactment, 
and not later than six months prior to the holding of a lease 
sale with respect to any area or region where no lease sale has 
been held or scheduled before such date of enactment. In the 
case of an agreement under section 8(k)(2), each study required 
by paragraph (1) of this subsection shall be commenced not 
later than 6 months prior to commencing negotiations for such 
agreement or the entering into the memorandum of agreement as 
the case may be. The Secretary may utilize information 
collected in any study prior to such date of enactment.
    (3) In addition to developing environmental information, 
any study of an area or region, to the extent practicable, 
shall be designed to predict impacts on the marine biota which 
may result from chronic low level pollution or large spills 
associated with outer Continental Shelf production, from the 
introduction of drill cuttings and drilling muds in the area, 
and from the laying of pipe to serve the offshore production 
area, and the impacts of development offshore on the affected 
and coastal areas.
    [(b)] (c) Subsequent to the leasing and developing of any 
area or region, the Secretary shall conduct such additional 
studies to establish environmental information as he deems 
necessary and shall monitor the human, marine, and coastal 
environments of such area or region in a manner designed to 
provide time-series and data trend information which can be 
used for comparison with any previously collected data for the 
purpose of identifying any significant changes in the quality 
and productivity of such environments, for establishing trends 
in the areas studied and monitored, and for designing 
experiments to identify the causes of such changes.
    [(c)] (d) The Secretary shall, by regulation, establish 
procedures for carrying out his duties under this section, and 
shall plan and carry out such duties in full cooperation with 
affected States. To the extent that other Federal agencies have 
prepared environmental impact statements, are conducting 
studies, or are monitoring the affected human, marine, or 
coastal environment, the Secretary may utilize the information 
derived therefrom in lieu of directly conducting such 
activities. The Secretary may also utilize information obtained 
from any State of local government, or from any person, for the 
purposes of this section. For the purpose of carrying out his 
responsibilities under this section, the Secretary may by 
agreement utilize, with or without reimbursement, the services, 
personnel, or facilities of any Federal, State, or local 
government agency.
    [(d)] (e) The Secretary shall consider available relevant 
environmental information in making decisions (including those 
relating to exploration plans, drilling permits, and 
development and production plans), in developing appropriate 
regulations and lease conditions, and in issuing operating 
orders.
    [(e)] (f) As soon as practicable after the end of every 3 
fiscal years, the Secretary shall submit to the Congress and 
make available to the general public an assessment of the 
cumulative effect of activities conducted under this Act on the 
human, marine, and coastal environments.
    [(f)] (g) In executing his responsibilities under this 
section, the Secretary shall, to the maximum extent 
practicable, enter into appropriate arrangements to utilize on 
a reimbursable basis the capabilities of the Department of 
Commerce. In carrying out such arrangements, the Secretary of 
Commerce is authorized to enter into contract or grants with 
any person, organization, or entity with funds appropriated to 
the Secretary of the Interior pursuant to this Act.
    Sec. 21. Safety Regulations.--(a) [Upon the date of 
enactment of this section,] Not later than May 1, 2011, and 
every 3 years thereafter, the Secretary and the Secretary of 
the Department in which the Coast Guard is operating shall, in 
consultation with each other and, as appropriate, with the 
heads of other Federal departments and agencies, promptly 
commence a joint study of the adequacy of existing safety and 
health regulations and of the technology, equipment, and 
techniques available for the exploration, development, and 
production of the minerals of the outer Continental Shelf. The 
results of such study shall be submitted to the President who 
shall submit a plan to the Congress of his proposals to promote 
safety and health in the exploration, development, and 
production of the minerals of the outer Continental Shelf.
    [(b) In exercising their respective responsibilities for 
the artificial islands, installations, and other devices 
referred to in section 4(a)(1) of this Act, the Secretary, and 
the Secretary of the Department in which the Coast Guard is 
operating, shall require, on all new drilling and production 
operations and, wherever practicable, on existing operations, 
the use of the best available and safest technologies which the 
Secretary determines to be economically feasible, wherever 
failure of equipment would have a significant effect on safety, 
health, or the environment, except where the Secretary 
determines that the incremental benefits are clearly 
insufficient to justify the incremental costs of utilizing such 
technologies.]
    (b) Best Available Technologies and Practices.--
          (1) In general.--In exercising respective 
        responsibilities under this Act, the Secretary, and the 
        Secretary of the Department in which the Coast Guard is 
        operating, shall require, on all new drilling and 
        production operations and, to the maximum extent 
        practicable, on existing operations, the use of the 
        best available and safest technologies and practices, 
        if the failure of equipment would have a significant 
        effect on safety, health, or the environment.
          (2) Identification of best available technologies.--
        Not later than May 1, 2011, and not later than every 3 
        years thereafter, the Secretary shall identify and 
        publish an updated list of best available technologies 
        for key areas of well design and operation, including 
        blowout prevention and blowout and oil spill response.
          (3) Safety case.--Not later than May 1, 2011, the 
        Secretary shall promulgate regulations requiring a 
        safety case be submitted along with each new 
        application for a permit to drill on the outer 
        Continental Shelf.
          (4) Employee training.--
                  (A) In general.--Not later than May 1, 2011, 
                the Secretary shall promulgate regulations 
                setting standards for training for all workers 
                on offshore facilities (including mobile 
                offshore drilling units) conducting energy and 
                mineral resource exploration, development, and 
                production operations on the outer Continental 
                Shelf.
                  (B) Requirements.--The training standards 
                under this paragraph shall require that 
                employers of workers described in subparagraph 
                (A)--
                          (i) establish training programs 
                        approved by the Secretary; and
                          (ii) demonstrate that employees 
                        involved in the offshore operations 
                        meet standards that demonstrate the 
                        aptitude of the employees in critical 
                        technical skills.
                  (C) Experience.--The training standards under 
                this section shall require that any offshore 
                worker with less than 5 years of applied 
                experience in offshore facilities operations 
                pass a certification requirement after 
                receiving the appropriate training.
                  (D) Monitoring training courses.--The 
                Secretary shall ensure that Department 
                employees responsible for inspecting offshore 
                facilities monitor, observe, and report on 
                training courses established under this 
                paragraph, including attending a representative 
                number of the training sessions, as determined 
                by the Secretary.
    (c) The Secretary of the Department in which the Coast 
Guard is operating shall promulgate regulations or standards 
applying to unregulated hazardous working conditions related to 
activities on the Outer Continental Shelf when he determines 
such regulations or standards are necessary. The Secretary of 
the Department in which the Coast Guard is operating may from 
time to time modify any regulations, interim or final, dealing 
with hazardous working conditions on the Outer Continental 
Shelf.

           *       *       *       *       *       *       *

    (f)(1) In administering the provisions of this section, the 
Secretary shall consult and coordinate with the heads of other 
appropriate Federal departments and agencies for purposes of 
assuring that, to the maximum extent practicable, inconsistent 
or duplicative requirements are not imposed.
    (2) The Secretary shall make available to any interested 
person a compilation of all safety and other regulations which 
are prepared and promulgated by any Federal department or 
agency and applicable to activities on the Outer Continental 
Shelf. Such compilation shall be revised and updated annually.
    (g) Technology Research and Risk Assessment Program.--
          (1) In general.--The Secretary shall carry out a 
        program of research, development, and risk assessment 
        to address technology and development issues associated 
        with outer Continental Shelf energy and mineral 
        resource activities, with the primary purpose of 
        informing the role of research, development, and risk 
        assessment relating to safety, environmental 
        protection, and spill response.
          (2) Specific areas of focus.--The program under this 
        subsection shall include research, development, and 
        other activities related to--
                  (A) risk assessment, using all available data 
                from safety and compliance records both within 
                the United States and internationally;
                  (B) analysis of industry trends in 
                technology, investment, and interest in 
                frontier areas;
                  (C) analysis of incidents investigated under 
                section 22;
                  (D) reviews of best available technologies, 
                including technologies associated with 
                pipelines, blowout preventer mechanisms, 
                casing, well design, and other associated 
                infrastructure related to offshore energy 
                development;
                  (E) oil spill response and mitigation;
                  (F) risks associated with human factors; and
                  (G) renewable energy operations.
          (3) Information sharing activities.--
                  (A) Domestic activities.--The Secretary shall 
                carry out programs to facilitate the exchange 
                and dissemination of scientific and technical 
                information and best practices related to the 
                management of safety and environmental issues 
                associated with energy and mineral resource 
                exploration, development, and production.
                  (B) International cooperation.--The Secretary 
                shall carry out programs to cooperate with 
                international organizations and foreign 
                governments to share information and best 
                practices related to the management of safety 
                and environmental issues associated with energy 
                and mineral resource exploration, development, 
                and production.
          (4) Reports.--The program under this subsection shall 
        provide to the Secretary, each Bureau Director under 
        section 32, and the public quarterly reports that 
        address--
                  (A) developments in each of the areas under 
                paragraph (2); and
                  (B)(i) any accidents that have occurred in 
                the past quarter; and
                  (ii) appropriate responses to the accidents.
          (5) Independence.--The Secretary shall create a 
        program within the appropriate bureau established under 
        section 32 that shall--
                  (A) be programmatically separate and distinct 
                from the leasing program;
                  (B) carry out the studies, analyses, and 
                other activities under this subsection;
                  (C) provide for external scientific review of 
                studies under this section, including through 
                appropriate arrangements with the National 
                Academy of Sciences; and
                  (D) make available to the public studies 
                conducted and data gathered under this section.
          (6) Use of data.--The Secretary shall ensure that the 
        information from the studies and research carried out 
        under this section inform the development of safety 
        practices and regulations as required by this Act and 
        other applicable laws.
    Sec. 22. Enforcement.--(a) The Secretary, the Secretary of 
the Department in which the Coast Guard is operating, and the 
Secretary of the Army shall enforce safety and environmental 
regulations promulgated pursuant to this Act. Each such Federal 
department may by agreement utilize, with or without 
reimbursement, the services, personnel, or facilities of other 
Federal departments and agencies for the enforcement of their 
respective regulations.

           *       *       *       *       *       *       *

    (c) The Secretary and the Secretary of the Department in 
which the Coast Guard is operating shall individually, or 
jointly if they so agree, promulgate regulations to provide 
for--
          (1) scheduled onsite inspection, at least once a 
        year, of each facility on the outer Continental Shelf 
        which is subject to any environmental or safety 
        regulation promulgated pursuant to this Act, which 
        inspection shall include all safety equipment designed 
        to prevent or ameliorate blowouts, fires, spillages, or 
        other major accidents; and
          (2) periodic onsite inspection without advance notice 
        to the operator of such facility to assure compliance 
        with such environmental or safety regulations.
    (d)(1) The Secretary or the Secretary of the Department in 
which the Coast Guard is operating shall make an investigation 
and public report on each major fire, each loss of well 
control, blowout, activation of the blowout preventer, and 
other accident that presented a serious risk to human or 
environmental safety, and each major oil spillage occurring as 
a result of operations conducted pursuant to this Act, and may, 
in his discretion, make an investigation and report of lesser 
oil spillages. For purposes of this subsection, a major oil 
spillage is any spillage in one instance of more than two 
hundred barrels of oil during a period of thirty days. All 
holders of leases or permits issued or maintained under this 
Act shall cooperate with the appropriate Secretary in the 
course of any such investigation as a condition of the lease.
    (2) The Secretary or the Secretary of the Department in 
which the Coast Guard is operating shall make an investigation 
and public report on any death or serious injury occurring as a 
result of operations conducted pursuant to this Act, and may, 
in his discretion, make an investigation and report of any 
injury. For purposes of this subsection, a serious injury is 
one resulting in substantial impairment of any bodily unit or 
function. All holders of leases or permits issued or maintained 
under this Act shall cooperate with the appropriate Secretary 
in the course of any such investigation as a condition of 
lease.
    [(e) The] (e) Review of Alleged Safety Violations.--
          (1) In general.--The Secretary, or, in the case of 
        occupational safety and health, the Secretary of the 
        Department in which the Coast Guard is operating, may 
        review any allegation from any person of the existence 
        of a violation of a safety regulation issued under this 
        Act.
          (2) Investigation.--The Secretary shall investigate 
        any allegation from any employee of the lessee or any 
        subcontractor of the lessee made under paragraph (1).
    (f) In any investigation conducted pursuant to this 
section, the Secretary or the Secretary of the Department in 
which the Coast Guard is operating shall have power to summon 
witnesses and to require the production of books, papers, 
documents, and any other evidence. Attendance of witnesses or 
the production of books, papers, documents, or any other 
evidence shall be compelled by a similar process, as in the 
district courts of the United States. Such Secretary, or his 
designee, shall administer all necessary oaths to any witnesses 
summoned before such investigation.
    (g) Independent Investigation.--
          (1) In general.--At the request of the Secretary, the 
        National Transportation Safety Board may conduct an 
        independent investigation of any accident, occurring in 
        the outer Continental Shelf and involving activities 
        under this Act, that does not otherwise fall within the 
        definition of an accident or major marine casualty, as 
        those terms are used in chapter 11 of title 49, United 
        States Code.
          (2) Transportation accident.--For purposes of an 
        investigation under this subsection, the accident that 
        is the subject of the request by the Secretary shall be 
        determined to be a transportation accident within the 
        meaning of that term in chapter 11 of title 49, United 
        States Code.
    (h) Information on Causes and Corrective Actions.--
          (1) In general.--For each incident investigated under 
        this section, the Secretary shall promptly make 
        available to all lessees and the public technical 
        information about the causes and corrective actions 
        taken.
          (2) Public database.--All data and reports related to 
        an incident described in paragraph (1) shall be 
        maintained in a database that is available to the 
        public.
    (i) Inspection Fee.--
          (1) In general.--To the extent necessary to fund the 
        inspections described in this paragraph, the Secretary 
        shall collect a non-refundable inspection fee, which 
        shall be deposited in the Ocean Energy Enforcement Fund 
        established under paragraph (3), from the designated 
        operator for facilities subject to inspection under 
        subsection (c).
          (2) Establishment.--The Secretary shall establish, by 
        rule, inspection fees--
                  (A) at an aggregate level equal to the amount 
                necessary to offset the annual expenses of 
                inspections of outer Continental Shelf 
                facilities (including mobile offshore drilling 
                units) by the Department of the Interior; and
                  (B) using a schedule that reflects the 
                differences in complexity among the classes of 
                facilities to be inspected.
          (3) Ocean energy enforcement fund.--There is 
        established in the Treasury a fund, to be known as the 
        `Ocean Energy Enforcement Fund' (referred to in this 
        subsection as the `Fund'), into which shall be 
        deposited amounts collected under paragraph (1) and 
        which shall be available as provided under paragraph 
        (4).
          (4) Availability of fees.--Notwithstanding section 
        3302 of title 31, United States Code, all amounts 
        collected by the Secretary under this section--
                  (A) shall be credited as offsetting 
                collections;
                  (B) shall be available for expenditure only 
                for purposes of carrying out inspections of 
                outer Continental Shelf facilities (including 
                mobile offshore drilling units) and the 
                administration of the inspection program;
                  (C) shall be available only to the extent 
                provided for in advance in an appropriations 
                Act; and
                  (D) shall remain available until expended.
          (5) Annual reports.--
                  (A) In general.--Not later than 60 days after 
                the end of each fiscal year beginning with 
                fiscal year 2011, the Secretary shall submit to 
                the Committee on Energy and Natural Resources 
                of the Senate and the Committee on Natural 
                Resources of the House of Representatives a 
                report on the operation of the Fund during the 
                fiscal year.
                  (B) Contents.--Each report shall include, for 
                the fiscal year covered by the report, the 
                following:
                          (i) A statement of the amounts 
                        deposited into the Fund.
                          (ii) A description of the 
                        expenditures made from the Fund for the 
                        fiscal year, including the purpose of 
                        the expenditures.
                          (iii) Recommendations for additional 
                        authorities to fulfill the purpose of 
                        the Fund.
                          (iv) A statement of the balance 
                        remaining in the Fund at the end of the 
                        fiscal year.

           *       *       *       *       *       *       *

    Sec. 24. Remedies and Penalties.--(a) At the request of the 
Secretary, the Secretary of the Army, or the Secretary of the 
Department in which the Coast Guard is operating, the Attorney 
General or a United States attorney shall institute a civil 
action in the district court of the United States for the 
district in which the affected operation is located for a 
temporary restraining order, injunction, or other appropriate 
remedy to enforce any provision of this Act, any regulation or 
order issued under this Act, or any term of a lease, license, 
or permit issued pursuant to this Act.
    [(b)(1) Except as provided in paragraph (2), if any person 
fails to comply with any provision of this Act, or any term of 
a lease, or permit issued pursuant to this Act, or any 
regulation or order issued under this Act, after notice of such 
failure and expiration of any reasonable period allowed for 
corrective action, such person shall be liable for a civil 
penalty of not more than $20,000 for each day of the 
continuance of such failure. The Secretary may assess, collect, 
and compromise any such penalty. No penalty shall be assessed 
until the person charged with a violation has been given an 
opportunity for a hearing. The Secretary shall, by regulation 
at least every 3 years, adjust the penalty specified in this 
paragraph to reflect any increases in the Consumer Price Index 
(all items, United States city average) as prepared by the 
Department of Labor.
    [(2) If a failure described in paragraph (1) constitutes or 
constituted a threat of serious, irreparable, or immediate harm 
or damage to life (including fish and other aquatic life), 
property, any mineral deposit, or the marine, coastal, or human 
environment, a civil penalty may be assessed without regard to 
the requirement of expiration of a period allowed for 
corrective action.]
    (b) Civil Penalty--
          (1) In general.--Subject to paragraphs (2) through 
        (3), if any person fails to comply with this Act, any 
        term of a lease or permit issued under this Act, or any 
        regulation or order issued under this Act, the person 
        shall be liable for a civil administrative penalty of 
        not more than $75,000 for each day of continuance of 
        each failure.
          (2) Administration.--The Secretary may assess, 
        collect, and compromise any penalty under paragraph 
        (1).
          (3) Hearing.--No penalty shall be assessed under this 
        subsection until the person charged with a violation 
        has been given the opportunity for a hearing.
          (4) Adjustment.--The penalty amount specified in this 
        subsection shall increase each year to reflect any 
        increases in the Consumer Price Index for All Urban 
        Consumers published by the Bureau of Labor Statistics 
        of the Department of Labor.
    (c) Any person who knowingly and willfully (1) violates any 
provision of this Act, any term of a lease, license, or permit 
issued pursuant to this Act, or any regulations or order issued 
under the authority of this Act designed to protect health, 
safety, or the environment or conserve natural resources, (2) 
makes any false statement, representation, or certification in 
any application, record, report, or other document filed or 
required to be maintained under this Act, (3) falsifies, 
tampers with, or renders inaccurate any monitoring device or 
method of record required to be maintained under this Act, or 
(4) reveals any data or information required to be kept 
confidential by this Act shall, upon conviction, be punished by 
a fine of not more than [$100,000] $10,000,000, or by 
imprisonment for not more than ten years, or both. Each day 
that a violation under clause (1) of this subsection continues, 
or each day that any monitoring devise or data recorder remains 
inoperative or inaccurate because of any activity described in 
clause (3) of this subsection, shall constitute a separate 
violation. The penalty amount specified in this subsection 
shall increase each year to reflect any increases in the 
Consumer Price Index for All Urban Consumers published by the 
Bureau of Labor Statistics of the Department of Labor. 
    (d) Whenever a corporation or other entity is subject to 
prosecution under subsection (c) of this section, any officer 
or agent of such corporation or entity who knowingly and 
willfully, or with reckless disregard, authorized, ordered, or 
carried out the proscribed activity shall be subject to the 
same fines or imprisonment, or both, as provided for under 
subsection (c) of this section.
    (e) The remedies and penalties prescribed in this Act shall 
be concurrent and cumulative and the exercise of one shall not 
preclude the exercise of the others. Further, the remedies and 
penalties prescribed in this Act shall be in addition to any 
other remedies and penalties afforded by any other law or 
regulation.
    Sec. 25. Oil and Gas Development and Production.--(a)(1) 
Prior to development and production pursuant to an oil and gas 
lease issued after the date of enactment of this section in any 
area of the outer Continental Shelf[, other than the Gulf of 
Mexico,] or issued or maintained prior to such date of 
enactment in any area of the outer Continental Shelf, other 
than the Gulf of Mexico, with respect to which no oil or gas 
has been discovered in paying quantities prior to such date of 
enactment, the lessee shall submit a development and production 
plan (hereinafter in this section referred to as a ``plan'') to 
the Secretary, for approval pursuant to this section.

           *       *       *       *       *       *       *

    (b) After the date of enactment of this section, no oil and 
gas lease may be issued pursuant to this Act in any region of 
the outer Continental Shelf[, other than the Gulf of Mexico,] 
unless such lease requires that development and production 
activities be carried out in accordance with a plan which 
complies with the requirements of this section.

           *       *       *       *       *       *       *

    (e)(1) At least once the Secretary shall declare the 
approval of a development and production plan in any area or 
region (as defined by the Secretary) of the outer Continental 
Shelf[, other than the Gulf of Mexico,] to be a major Federal 
action.
    (2) The Secretary may require lessees of tracts for which 
development and production plans have not been approved, to 
submit preliminary or final plans for their leases, prior to or 
immediately after a determination by the Secretary that the 
procedures under the National Environmental Policy Act of 1969 
shall commence.

           *       *       *       *       *       *       *

    [Sec. 29. Restrictions on Employment.--No full-time officer 
or employee of the Department of the Interior who directly or 
indirectly discharged duties or responsibilities under this 
Act, and who was at any time during the twelve months preceding 
the termination of his employment with the Department 
compensated under the Executive Schedule or compensated at or 
above the annual rate of basic pay for grade GS-16 of the 
General Schedule shall--
          [(1) within two years after his employment with the 
        Department has ceased--
                  [(A) knowingly act as agent or attorney for, 
                or otherwise represent, any other person 
                (except the United States) in any formal or 
                informal appearance before;
                  [(B) with the intent to influence, make any 
                oral or written communication on behalf of any 
                other person (except the United States) to; or
                  [(C) knowingly aid or assist in representing 
                any other person (except the United States) in 
                any formal or informal appearance before,
        [any department, agency, or court of the United States, 
        or any officer or employee thereof, in connection with 
        any judicial or other proceeding, application, request 
        for a ruling or other determination, regulation, order, 
        lease, permit, rulemaking, or other particular matter 
        involving a specific party or parties in which the 
        United States is a party or has a direct and 
        substantial interest which was actually pending under 
        his official responsibility as an officer or employee 
        within a period of one year prior to the termination of 
        such responsibility or in which he participated 
        personally and substantially as an officer or employee; 
        or
          [(2) within one year after his employment with the 
        Department has ceased--
                  [(A) knowingly act as agent or attorney for, 
                or otherwise represent, any other person 
                (except the United States) in any formal or 
                informal appearance before; or
                  [[(B) with the intent to influence, make any 
                oral or written communication on behalf of any 
                other person (except the United States) to,
[the Department of the Interior, or any officer or employee 
thereof, in connection with any judicial, rulemaking, 
regulation, order, lease, permit, regulation, or other 
particular matter which is pending before the Department of the 
Interior or in which the Department has a direct and 
substantial interest.]

SEC. 29. CONFLICTS OF INTEREST.

    (a) Restrictions on Employment.--No full-time officer or 
employee of the department of the Interior who directly or 
indirectly discharged duties or responsibilities under this Act 
shall--
          (1) within 2 years after his employment with the 
        Department has ceased--
                  (A) knowingly act as agent or attorney for, 
                or otherwise represent, any other person 
                (except the United States) in any formal or 
                informal appearance before;
                  (B) with the intent to influence, make any 
                oral or written communication on behalf of any 
                other person (except the United States) to; or
                  (C) knowingly aid, advise, or assist in--
                          (i) representing any other person 
                        (except the United States in any formal 
                        or informal appearance before; or
                          (ii) making, with the intent to 
                        influence, any oral or written 
                        communication on behalf of any other 
                        person (except the United States) to,
        any department, agency, or court of the United States, 
        or any officer or employee thereof, in connection with 
        any judicial or other proceeding, application, request 
        for a ruling or other determination, regulation, order 
        lease, permit, rulemaking, inspection, enforcement 
        action, or other particular matter involving a specific 
        party or parties in which the United States is a party 
        or has a direct and substantial interest which was 
        actually pending under his official responsibility as 
        an officer or employee within a period of one year 
        prior to the termination of such responsibility or in 
        which he participated personally and substantially as 
        an officer or employee;
          (2) within 1 year after his employment with the 
        Department has ceased--
                  (A) knowingly act as agent or attorney for, 
                or otherwise represent, any other person 
                (except the United States) in any formal or 
                informal appearance before;
                  (B) with the intent to influence, make any 
                oral or written communication on behalf of any 
                other person (except the United States) to; or
                  (C) knowingly aid, advise, or assist in--
                          (i) representing any other person 
                        (except the United States in any formal 
                        or informal appearance before, or
                          (ii) making, with the intent to 
                        influence, any oral or written 
                        communication on behalf of any other 
                        person (except the United States) to,
        the Department of the Interior, or any officer or 
        employee thereof, in connection with any judicial, 
        rulemaking, regulation, order, lease, permit, 
        regulation, inspection, enforcement action, or other 
        particular matter which is pending before the 
        Department of the Interior or in which the Department 
        has a direct and substantial interest; or
          (3) accept employment or compensation, during the 1-
        year period beginning on the date on which employment 
        with the Department has ceased, from any person (other 
        than the United States) that has a direct and 
        substantial interest--
                  (A) that was pending under the official 
                responsibility of the employee as an officer or 
                employee of the Department during the 1-year 
                period preceding the termination of the 
                responsibility; or
                  (B) in which the employee participated 
                personally and substantially as an officer or 
                employee.
    (b) Prior Employment Relationships.--No full-time officer 
or employee of the Department of the Interior who directly or 
indirectly discharged duties or responsibilities under this Act 
shall participate personally and substantially as a Federal 
officer or employee, through decision, approval, disapproval, 
recommendation, the rendering of advice, investigation, or 
otherwise, in a proceeding, application, request for a ruling 
or other determination, contract, claim, controversy, charge, 
accusation, inspection, enforcement action, or other particular 
matter in which, to the knowledge of the officer or employee--
          (1) the officer or employee or the spouse, minor 
        child, or general partner of the officer or employee 
        has a financial interest;
          (2) any organization in which the officer or employee 
        is serving as an officer, director, trustee, general 
        partner, or employee has a financial interest;
          (3) any person or organization with whom the officer 
        or employee is negotiating or has any arrangement 
        concerning prospective employment has a financial 
        interest; or
          (4) any person or organization in which the officer 
        or employee has, within the preceding 1-year period, 
        served as an officer, director, trustee, general 
        partner, agent, attorney, consultant, contractor, or 
        employee has a financial interest.
    (c) Gifts From Outside Sources.--No full-time officer or 
employee of the Department of the Interior who directly or 
indirectly discharged duties or responsibilities under this Act 
shall, directly or indirectly, solicit or accept any gift in 
violation of subpart B of part 2635 of title V, Code of Federal 
Regulations (or successor regulations).
    (d) Exemptions.--The Secretary may, by rule, exempt from 
this section clerical and support personnel who do not conduct 
inspections, perform audits, or otherwise exercise regulatory 
or policy making authority under this Act.
    (e) Penalties.--
          (1) Criminal penalties.--Any person who violates 
        paragraph (1) or (2) of subsection (a) or subsection 
        (b) shall be punished in accordance with section 216 of 
        title 18, United States Code.
          (2) Civil penalties.--Any person who violates 
        subsection (a)(3) or (c) shall be punished in 
        accordance with subsection (b) of section 216 of title 
        18, United States Code.

           *       *       *       *       *       *       *

SEC. 31. COASTAL IMPACT ASSISTANCE PROGRAM.

           *       *       *       *       *       *       *

SEC. 32. STRUCTURAL REFORM OF OUTER CONTINENTAL SHELF PROGRAM 
                    MANAGEMENT.

    (a) Leasing, Permitting, and Regulation Bureaus.--
          (1) Establishment of bureaus.--
                  (A) In general.--Subject to the discretion 
                granted by Reorganization Plan Number 3 of 1950 
                (64 Stat. 1262; 43 U.S.C. 1451 note), the 
                Secretary shall establish in the Department of 
                the Interior not more than 2 bureaus to carry 
                out the leasing, permitting, and safety and 
                environmental regulatory functions vested in 
                the Secretary by this Act and the Federal Oil 
                and Gas Royalty Management Act of 1982 (30 
                U.S.C. 1701 et seq.) related to the outer 
                Continental Shelf.
                  (B) Conflicts of interest.--In establishing 
                the bureaus under subparagraph (A), the 
                Secretary shall ensure, to the maximum extent 
                practicable, that any potential organizational 
                conflicts of interest related to leasing, 
                revenue creation, environmental protection, and 
                safety are eliminated.
          (2) Director.--Each bureau shall be headed by a 
        Director, who shall be appointed by the President, by 
        and with the advice and consent of the Senate.
          (3) Compensation.--Each Director shall be compensated 
        at the rate provided for level V of the Executive 
        Schedule under section 5316 of title 5, United States 
        Code.
          (4) Qualifications.--Each Director shall be a person 
        who, by reason of professional background and 
        demonstrated ability and experience, is specially 
        qualified to carry out the duties of the office.
    (b) Royalty and Revenue Office.--
          (1) Establishment of office.--Subject to the 
        discretion granted by Reorganization Plan Number 3 of 
        1950 (64 Stat. 1262; 43 U.S.C. 1451 note), the 
        Secretary shall establish in the Department of the 
        Interior an office to carry out the royalty and revenue 
        management functions vested in the Secretary by this 
        Act and the Federal Oil and Gas Royalty Management Act 
        of 1982 (30 U.S.C. 1701 et seq.).
          (2) Director.--The office established under paragraph 
        (1) shall be headed by a Director, who shall be 
        appointed by the President, by and with the advice and 
        consent of the Senate.
          (3) Compensation.--The Director shall be compensated 
        at the rate provided for level V of the Executive 
        Schedule under section 5316 of title 5, United States 
        Code.
          (4) Qualifications.--The Director shall be a person 
        who, by reason of professional background and 
        demonstrated ability and experience, is specially 
        qualified to carry out the duties of the office.
    (c) OCS Safety and Environmental Advisory Board.--
          (1) Establishment.--The Secretary shall establish, 
        under the Federal Advisory Committee Act (5 U.S.C. 
        App.), an Outer Continental Shelf Safety and 
        Environmental Advisory Board (referred to in this 
        subsection as the `Board'), to provide the Secretary 
        and the Directors of the bureaus established under this 
        section with independent peer-reviewed scientific and 
        technical advice on safe and environmentally compliant 
        energy and mineral resource exploration, development, 
        and production activities.
          (2) Membership.--
                  (A) Size.--
                          (i) In general.--The Board shall 
                        consist of not more than 12 members, 
                        chosen to reflect a range of expertise 
                        in scientific, engineering, management, 
                        and other disciplines related to safe 
                        and environmentally compliant energy 
                        and mineral resource exploration, 
                        development, and production activities.
                          (ii) Consultation.--The Secretary 
                        shall consult with the National Academy 
                        of Sciences and the National Academy of 
                        Engineering to identify potential 
                        candidates for membership on the Board.
                  (B) Term.--The Secretary shall appoint Board 
                members to staggered erms of not more than 4 
                years, and shall not appoint a member for more 
                than 2 consecutive terms.
                  (C) Chair.--The Secretary shall appoint the 
                Chair for the Board.
          (3) Meetings.--The Board shall--
                  (A) meet not less than 3 times per year; and
                  (B) at least once per year, shall host a 
                public forum to review and assess the overall 
                safety and environmental performance of outer 
                Continental Shelf energy and mineral resource 
                activities.
          (4) Reports.--Reports of the Board shall--
                  (A) be submitted to Congress; and
                  (B) made available to the public in an 
                electronically accessible form.
          (5) Travel expenses.--Members of the Board, other 
        than full-time employees of the Federal Government, 
        while attending a meeting of the Board or while 
        otherwise serving at the request of the Secretary or 
        the Director while serving away from their homes or 
        regular places of business, may be allowed travel 
        expenses, including per diem in lieu of subsistence, as 
        authorized by section 5703 of title 5, United States 
        Code, for individuals in the Federal Government serving 
        without pay.
    (d) Special Personnel Authorities.--
          (1) Direct hiring authority for critical personnel.--
                  (A) In general.--Notwithstanding sections 
                3104, 3304, and 3309 through 3318 of title 5, 
                United States Code, the Secretary may, upon a 
                determination that there is a severe shortage 
                of candidates or a critical hiring need for 
                particular positions, recruit and directly 
                appoint highly qualified accountants, 
                scientists, engineers, or critical technical 
                personnel into the competitive service, as 
                officers or employees of any of the 
                organizational units established under this 
                section.
                  (B) Requirements.--In exercising the 
                authority granted under subparagraph (A), the 
                Secretary shall ensure that any action taken by 
                the Secretary--
                          (i) is consistent with the merit 
                        principles of chapter 23 of title 5, 
                        United States Code; and
                          (ii) complies with the public notice 
                        requirements of section 3327 of title 
                        5, United States Code.
          (2) Critical pay authority.--
                  (A) In general.--Notwithstanding section 5377 
                of title 5, United States Code, and without 
                regard to the provisions of that title 
                governing appointments in the competitive 
                service or the Senior Executive Service and 
                chapters 51 and 53 of that title (relating to 
                classification and pay rates), the Secretary 
                may establish, fix the compensation of, and 
                appoint individuals to critical positions 
                needed to carry out the functions of any of the 
                organizational units established under this 
                section, if the Secretary certifies that--
                          (i) the positions--
                                  (I) require expertise of an 
                                extremely high level in a 
                                scientific or technical field; 
                                and
                                  (II) any of the 
                                organizational units 
                                established in this section 
                                would not successfully 
                                accomplish an important mission 
                                without such an individual; and
                          (ii) exercise of the authority is 
                        necessary to recruit an individual 
                        exceptionally well qualified for the 
                        position.
                  (B) Limitations.--The authority granted under 
                subparagraph (A) shall be subject to the 
                following conditions:
                          (i) The number of critical positions 
                        authorized by subparagraph (A) may not 
                        exceed 40 at any 1 time in either of 
                        the bureaus established under this 
                        section.
                          (ii) The term of an appointment under 
                        subparagraph (A) may not exceed 4 
                        years.
                          (iii) An individual appointed under 
                        subparagraph (A) may not have been an 
                        employee of the Department of the 
                        Interior during the 2-year period prior 
                        to the date of appointment.
                          (iv) Total annual compensation for 
                        any individual appointed under 
                        subparagraph (A) may not exceed the 
                        highest total annual compensation 
                        payable at the rate determined under 
                        section 104 of title 3, United States 
                        Code.
                          (v) An individual appointed under 
                        subparagraph (A) may not be considered 
                        to be an employee for purposes of 
                        subchapter II of chapter 75 of title 5, 
                        United States Code.
                  (C) Notification.--Each year, the Secretary 
                shall submit to Congress a notification that 
                lists each individual appointed under this 
                paragraph.
          (3) Reemployment of civilian retirees.--
                  (A) In general.--Notwithstanding part 553 of 
                title 5, Code of Federal Regulations (relating 
                to reemployment of civilian retirees to meet 
                exceptional employment needs), or successor 
                regulations, the Secretary may approve the 
                reemployment of an individual to a particular 
                position without reduction or termination of 
                annuity if the hiring of the individual is 
                necessary to carry out a critical function of 
                any of the organizational units established 
                under this section for which suitably qualified 
                candidates do not exist.
                  (B) Limitations.--An annuitant hired with 
                full salary and annuities under the authority 
                granted by subparagraph (A)--
                          (i) shall not be considered an 
                        employee for purposes of subchapter III 
                        of chapter 83 and chapter 84 of title 
                        5, United States Code;
                          (ii) may not elect to have retirement 
                        contributions withheld from the pay of 
                        the annuitant;
                          (iii) may not use any employment 
                        under this paragraph as a basis for a 
                        supplemental or recomputed annuity; and 
                        (iv) may not participate in the Thrift 
                        Savings Plan under subchapter III of 
                        chapter 84 of title 5, United States 
                        Code.
                  (C) Limitation on term.--The term of 
                employment of any individual hired under 
                subparagraph (A) may not exceed an initial term 
                of 2 years, with an additional 2-year 
                appointment under exceptional circumstances.
    (e) Continuity of Authority.--Subject to the discretion 
granted by Reorganization Plan Number 3 of 1950 (64 Stat. 1262; 
43 U.S.C. 1451 note), any reference in any law, rule, 
regulation, directive, or instruction, or certificate or other 
official document, in force immediately prior to the date of 
enactment of this section--
          (1) to the Minerals Management Service that pertains 
        to any of the duties and authorities described in this 
        section shall be deemed to refer and apply to the 
        appropriate bureaus and offices established under this 
        section;
          (2) to the Director of the Minerals Management 
        Service that pertains to any of the duties and 
        authorities described in this section shall be deemed 
        to refer and apply to the Director of the bureau or 
        office under this section to whom the Secretary has 
        assigned the respective duty or authority; and
          (3) to any other position in the Minerals Management 
        Service that pertains to any of the duties and 
        authorities described in this section shall be deemed 
        to refer and apply to that same or equivalent position 
        in the appropriate bureau or office established under 
        this section.

                           UNITED STATES CODE

TITLE 5--GOVERNMENT ORGANIZATION AND EMPLOYEES

           *       *       *       *       *       *       *

PART III--EMPLOYEES

           *       *       *       *       *       *       *

Subpart D--Pay and Allowances

           *       *       *       *       *       *       *

CHAPTER 53--PAY RATES AND SYSTEMS

           *       *       *       *       *       *       *

Subchapter II--Executive Schedule Pay Rates

           *       *       *       *       *       *       *

Sec. 5316. Positions at level V

    Level V of the Executive Schedule applies to the following 
positions, for which the Annual rate of basic pay shall be the 
rate determined with respect to such level under chapter 11 of 
title 2, as adjusted by section 5318 of this title:

           *       *       *       *       *       *       *

    [Director, Bureau of Mines, Department of the Interior.]
    Bureau Directors, Department of the Interior (2).
    Director, Royalty and Revenue Office, Department of the 
Interior.

           *       *       *       *       *       *       *

                       ENERGY POLICY ACT OF 2005

                     PUBLIC LAW 109-58, AS AMENDED

   AN ACT To ensure jobs for our future with secure, affordable, and 
                            reliable energy.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Energy 
Policy Act of 2005''.

           *       *       *       *       *       *       *

TITLE III--OIL AND GAS

           *       *       *       *       *       *       *

Subtitle G--Miscellaneous

           *       *       *       *       *       *       *

SEC. 388. ALTERNATE ENERGY-RELATED USES ON THE OUTER CONTINENTAL SHELF.

           *       *       *       *       *       *       *

    (b) Coordinated OCS Mapping Initiative.--
          (1) In general.--The Secretary of the Interior, in 
        cooperation with the Secretary of Commerce, the 
        Commandant of the Coast Guard, and the Secretary of 
        Defense, shall establish an interagency comprehensive 
        digital mapping initiative for the outer Continental 
        Shelf to assist in decisionmaking relating to the 
        siting of activities under subsection (p) of section 8 
        of the Outer Continental Shelf Lands Act (43 U.S.C. 
        1337) (as added by subsection (a)).

           *       *       *       *       *       *       *

          (4) Federal agencies.--Any head of a Federal 
        department or agency shall, on request of the 
        Secretary, provide to the Secretary all data and 
        information that the Secretary determines to be 
        necessary for the purpose of including the data and 
        information in the mapping initiative, except that no 
        Federal department or agency shall be required to 
        provide any data or information that is privileged or 
        proprietary.

           *       *       *       *       *       *       *

TITLE IX--RESEARCH AND DEVELOPMENT

           *       *       *       *       *       *       *

    Subtitle J--[Ultra-Deepwater and Unconventional Natural Gas 
and Other Petroleum Resources] Safer Oil and Gas Production and 
Accident Prevention 

           *       *       *       *       *       *       *

SEC. 999A. PROGRAM AUTHORITY.

    (a) In General.--The Secretary shall carry out a program 
under this subtitle of research, development, demonstration, 
and commercial application of technologies for [ultra-
deepwater] deepwater and unconventional natural gas and other 
petroleum resource exploration and production, including 
addressing the technology challenges for small producers, safe 
operations, well control and accident prevention, and 
environmental mitigation (including reduction of greenhouse gas 
emissions and sequestration of carbon).
    (b) Program Elements.--The program under this subtitle 
shall address the following areas, including improving safety 
and minimizing environmental impacts of activities within each 
area:
          [(1) Ultra-deepwater architecture and technology, 
        including drilling to formations in the Outer 
        Continental Shelf to depths greater than 15,000 feet.]
          (1) Deepwater architecture, well control and accident 
        prevention, and deepwater technology, including 
        drilling to deep formations in waters greater than 500 
        feet.
          (2) Unconventional natural gas and other petroleum 
        resource exploration and production technology.
          (3) The technology challenges of small producers.
          [(4) Complementary research performed by the National 
        Energy Technology Laboratory for the Department.]
          (4) Safety technology research and development for 
        drilling activities aimed at well control and accident 
        prevention performed by the Office of Fossil Energy of 
        the Department.
    (c) Limitation on Location of Field Activities.--Field 
activities under the program under this subtitle shall be 
carried out only--
          (1) in--
                  (A) areas in the territorial waters of the 
                United States not under any Outer Continental 
                Shelf moratorium as of September 30, 2002;
                  (B) areas onshore in the United States on 
                public land administered by the Secretary of 
                the Interior available for oil and gas leasing, 
                where consistent with applicable law and land 
                use plans; and
                  (C) areas onshore in the United States on 
                State or private land, subject to applicable 
                law; and
          (2) with the approval of the appropriate Federal or 
        State land management agency or private land owner.
    (d) Activities at the [National Energy Technology 
Laboratory] Office of Fossil Energy of the Department.--The 
Secretary, through the [National Energy Technology Laboratory] 
Office of Fossil Energy of the Department, shall carry out a 
program of research and other activities complementary to and 
supportive of the research programs under subsection (b).
    (e) Consultation With Secretary of the Interior.--In 
carrying out this subtitle, the Secretary shall consult 
regularly with the Secretary of the Interior.

SEC. 999B. [ULTRA-DEEPWATER AND UNCONVENTIONAL ONSHORE NATURAL GAS AND 
                    OTHER PETROLEUM] SAFE OIL AND GAS PRODUCTION AND 
                    ACCIDENT PREVENTION RESEARCH AND DEVELOPMENT 
                    PROGRAM.

    (a) In General.--The Secretary shall carry out the 
activities under section 999A, to maximize the value of natural 
gas and other petroleum resources of the United States[, by 
increasing the supply of such resources, through reducing the 
cost and increasing the efficiency of exploration for and 
production of such resources, while improving safety and 
minimizing environmental impacts.] and the safe and 
environmentally responsible exploration, development, and 
production of hydrocarbon resources.
    (b) Role of the Secretary.--The Secretary shall have 
ultimate responsibility for, and oversight of, all aspects of 
the program under this section.
    (c) Role of the Program Consortium.--
          (1) In general.--The Secretary shall contract with a 
        corporation that is structured as a consortium to 
        administer the programmatic activities outlined in this 
        chapter. The program consortium shall--
                  (A) administer the program pursuant to 
                subsection (f)(3), utilizing program 
                administration funds only;
                  (B) issue research project solicitations upon 
                approval of the Secretary or the Secretary's 
                designee;
                  (C) make project awards to research 
                performers upon approval of the Secretary or 
                the Secretary's designee;
                  (D) projects will be selected on a 
                competitive, peer-reviewed basis;
                  [(D)] (E) disburse research funds to research 
                performers awarded under subsection (f) as 
                directed by the Secretary in accordance with 
                the annual plan under subsection (e); and
                  [(E)] (F) carry out other activities assigned 
                to the program consortium by this section.
          (2) Limitation.--The Secretary may not assign any 
        activities to the program consortium except as 
        specifically authorized under this section.

           *       *       *       *       *       *       *

    (d) Selection of the Program Consortium.--
          (1) In general.--The Secretary shall select the 
        program consortium through an open, competitive 
        process.

           *       *       *       *       *       *       *

          (6) Eligibility.--To be eligible to be selected as 
        the program consortium, an applicant must be an entity 
        whose members have collectively demonstrated 
        capabilities and experience in planning and managing 
        research, development, demonstration, and commercial 
        application programs for [ultra-deepwater] deepwater 
        and unconventional natural gas or other petroleum 
        exploration or production.
          (7) Focus areas for awards.--
                  (A) [Ultra-deepwater] Deepwater resources.--
                Awards from allocations under section 
                999H(d)(1) shall focus on the [development and] 
                research, development, and demonstration of 
                individual exploration and production 
                technologies [as well as integrated systems 
                technologies including new architectures for 
                production in ultra-deepwater.] aimed at 
                improving operational safety of drilling 
                activities, including well integrity systems, 
                well control, blowout prevention, the use of 
                non-toxic materials, and integrated systems 
                approach-based management for exploration and 
                production in deepwater.
                  (B) Unconventional resources.--Awards from 
                allocations under section 999H(d)(2) shall 
                focus on areas including advanced coalbed 
                methane, deep drilling, natural gas production 
                from tight sands, natural gas production from 
                gas shales, stranded gas, innovative 
                exploration and production techniques, enhanced 
                recovery techniques, [and environmental 
                mitigation] use of non-toxic materials, 
                drilling safety, and environmental mitigation 
                and accident prevention of unconventional 
                natural gas and other petroleum resources 
                exploration and production.
                  (C) Small producers.--Awards from allocations 
                under section 999H(d)(3) shall be made to 
                consortia consisting of small producers or 
                organized primarily for the benefit of small 
                producers, and shall focus on areas including 
                safety and accident prevention, well control 
                and systems integrity, complex geology 
                involving rapid changes in the type and quality 
                of the oil and gas reservoirs across the 
                reservoir; low reservoir pressure; 
                unconventional natural gas reservoirs in 
                coalbeds, deep reservoirs, tight sands, or 
                shales; and unconventional oil reservoirs in 
                tar sands and oil shales.
                  (D) Safety and accident prevention technology 
                research and development.--Awards from 
                allocations under section 999H(d)(4) shall be 
                expended on areas including--
                          (i) development of improved cementing 
                        and casing technologies;
                          (ii) best management practices for 
                        cementing, casing, and other well 
                        control activities and technologies;
                          (iii) development of integrity and 
                        stewardship guidelines for--
                                  (I) well-plugging and 
                                abandonment;
                                  (II) development of wellbore 
                                sealant technologies; and
                                  (III) improvement and 
                                standardization of blowout 
                                prevention devices.
          (8) Study; report.--
                  (A) Study.--As soon as practicable after the 
                date of enactment of this paragraph, the 
                Secretary shall enter into an arrangement with 
                the National Academy of Sciences under which 
                the Academy shall conduct a study to 
                determine--
                          (i) whether the benefits provided 
                        through each award under this 
                        subsection during calendar year 2011 
                        have been maximized; and
                          (ii) the new areas of research that 
                        could be carried out to meet the 
                        overall objectives of the program.
                  (B) Report.--Not later than January 1, 2012, 
                the Secretary shall submit to the appropriate 
                committees of Congress a report that contains a 
                description of the results of the study 
                conducted under subparagraph (A).
                  (C) Optional updates.--The Secretary may 
                update the report described in subparagraph (B) 
                for the 5-year period beginning on the date 
                described in that subparagraph and each 5-year 
                period thereafter.
    (e) Annual Plan.--
          (1) In general.--The program under this section shall 
        be carried out pursuant to an annual plan prepared by 
        the Secretary in accordance with paragraph (2).
          (2) Development.--
                  (A) Solicitation of recommendations.--Before 
                drafting an annual plan under this subsection, 
                the Secretary shall solicit specific written 
                recommendations from the program consortium for 
                each element to be addressed in the plan, 
                including those described in paragraph (4). The 
                program consortium shall submit to the 
                Secretary for review its recommendations in the 
                form of a draft annual plan.
                  (B) Submission of recommendations; other 
                comment.--The Secretary shall submit the 
                recommendations of the program consortium under 
                subparagraph (A) to the [Ultra-Deepwater 
                Advisory Committee established under section 
                999D(a) and to the Unconventional Resources 
                Technology Advisory Committee established under 
                section 999D(b), and such Advisory Committees] 
                Program Advisory Committee established under 
                section 999D(a), and the Advisory Committee 
                shall provide to the Secretary written comments 
                by a date determined by the Secretary. The 
                Secretary may also solicit comments from any 
                other experts.
                  (C) Consultation.--The Secretary shall 
                consult regularly with the program consortium 
                throughout the preparation of the annual plan.
          (3) Publication.--The Secretary shall transmit to 
        Congress and publish in the Federal Register the annual 
        plan, along with any written comments received under 
        paragraph (2)(A) and (B).
          (4) Contents.--The annual plan shall describe the 
        ongoing and prospective activities of the program under 
        this section and shall include--
                  (A) a list of any solicitations for awards to 
                carry out research, development, demonstration, 
                or commercial application activities, including 
                the topics for such work, who would be eligible 
                to apply, selection criteria, and the duration 
                of awards; and
                  (B) a description of the activities expected 
                of the program consortium to carry out 
                subsection (f)(3).
          (5) Estimates of increased royalty receipts.--The 
        Secretary, in consultation with the Secretary of the 
        Interior, shall provide an annual report to Congress 
        with the President's budget on the estimated cumulative 
        increase in Federal royalty receipts (if any) resulting 
        from the implementation of this subtitle. The initial 
        report under this paragraph shall be submitted in the 
        first President's budget following the completion of 
        the first annual plan required under this subsection.
          (6) Research findings and recommendations for 
        implementation.--The Secretary, in consultation with 
        the Secretary of the Interior and the Administrator of 
        the Environmental Protection Agency, shall publish in 
        the Federal Register an annual report on the research 
        findings of the program carried out under this section 
        and any recommendations for implementation that the 
        Secretary, in consultation with the Secretary of the 
        Interior and the Administrator of the Environmental 
        Protection Agency, determines to be necessary.

           *       *       *       *       *       *       *

    (i) Activities by the [United States Geological Survey] 
Department of the Interior.--The Secretary of the Interior[, 
through the United States Geological Survey,] shall, where 
appropriate, carry out programs of long-term research to 
complement the programs under this section.
    (j) Program Review and Oversight.--The [National Energy 
Technology Laboratory] Office of Fossil Energy of the 
Department, on behalf of the Secretary, shall (1) issue a 
competitive solicitation for the program consortium, (2) 
evaluate, select, and award a contract or other agreement to a 
qualified program consortium, and (3) have primary review and 
oversight responsibility for the program consortium, including 
review and approval of research awards proposed to be made by 
the program consortium, to ensure that its activities are 
consistent with the purposes and requirements described in this 
subtitle. Up to 5 percent of program funds allocated under 
paragraphs (1) through (3) of section 999H(d) may be used for 
this purpose, including program direction and the establishment 
of a site office if determined to be necessary to carry out the 
purposes of this subsection.

SEC. 999C. ADDITIONAL REQUIREMENTS FOR AWARDS.

    (a) Demonstration Projects.--An application for an award 
under this subtitle for a demonstration project shall describe 
with specificity the intended commercial use of the technology 
to be demonstrated.
    (b) Flexibility in Locating Demonstration Projects.--
Subject to the limitation in section 999A(c), a demonstration 
project under this subtitle relating to [an ultra-deepwater 
technology or an ultra-deepwater architecture] a deepwater 
technology may be conducted in deepwater depths.

           *       *       *       *       *       *       *

[SEC. 999D. ADVISORY COMMITTEES.

    [(a) Ultra-Deepwater Advisory Committee.--
          [(1) Establishment.--Not later than 270 days after 
        the date of enactment of this Act, the Secretary shall 
        establish an advisory committee to be known as the 
        Ultra-Deepwater Advisory Committee.
          [(2) Membership.--The Advisory Committee under this 
        subsection shall be composed of members appointed by 
        the Secretary, including--
                  [(A) individuals with extensive research 
                experience or operational knowledge of offshore 
                natural gas and other petroleum exploration and 
                production;
                  [(B) individuals broadly representative of 
                the affected interests in ultra-deepwater 
                natural gas and other petroleum production, 
                including interests in environmental protection 
                and safe operations;
                  [(C) no individuals who are Federal 
                employees; and
                  [(D) no individuals who are board members, 
                officers, or employees of the program 
                consortium.
          [(3) Duties.--The Advisory Committee under this 
        subsection shall--
                  [(A) advise the Secretary on the development 
                and implementation of programs under this 
                subtitle related to ultra-deepwater natural gas 
                and other petroleum resources; and
                  [(B) carry out section 999B(e)(2)(B).
          [(4) Compenstation.--A member of the Advisory 
        Committee under this subsection shall serve without 
        compensation but shall receive travel expenses in 
        accordance with applicable provisions under subchapter 
        I of chapter 57 of title 5, United States Code.
    [(b) Unconventional Resources Technology Advisory 
Committee.--
          [(1) Establishment.--Not later than 270 days after 
        the date of enactment of this Act, the Secretary shall 
        establish an advisory committee to be known as the 
        Unconventional Resources Technology Advisory Committee.
          [(2) Membership.--The Secretary shall endeavor to 
        have a balanced representation of members on the 
        Advisory Committee to reflect the breadth of geographic 
        areas of potential gas supply. The Advisory Committee 
        under this subsection shall be composed of members 
        appointed by the Secretary, including--
                  [(A) a majority of members who are employees 
                or representatives of independent producers of 
                natural gas and other petroleum, including 
                small producers;
                  [(B) individuals with extensive research 
                experience or operational knowledge of 
                unconventional natural gas and other petroleum 
                resource exploration and production;
                  [(C) individuals broadly representative of 
                the affected interests in unconventional 
                natural gas and other petroleum resource 
                exploration and production, including interests 
                in environmental protection and safe 
                operations;
                  [(D) individuals with expertise in the 
                various geographic areas of potential supply of 
                unconventional onshore natural gas and other 
                petroleum in the United States;
                  [(E) no individuals who are Federal 
                employees; and
                  [(F) no individuals who are board members, 
                officers, or employees of the program 
                consortium.
          [(3) Duties.--The Advisory Committee under this 
        subsection shall--
                  [(A) advise the Secretary on the development 
                and implementation of activities under this 
                subtitle related to unconventional natural gas 
                and other petroleum resources; and
                  [(B) carry out section 999B(e)(2)(B).
          [(4) Compenstation.--A member of the Advisory 
        Committee under this subsection shall serve without 
        compensation but shall receive travel expenses in 
        accordance with applicable provisions under subchapter 
        I of chapter 57 of title 5, United States Code.
    [(c) Prohibition.--No advisory committee established under 
this section shall make recommendations on funding awards to 
particular consortia or other entities, or for specific 
projects.]

SEC. 999D. PROGRAM ADVISORY COMMITTEE.

    (a) Establishment.--Not later than 270 days after the date 
of enactment of the Safe and Responsible Energy Production 
Improvement Act of 2010, the Secretary shall establish an 
advisory committee to be known as the Program Advisory 
Committee' (referred to in this section as the Advisory 
Committee').
    (b) Membership.--
          (1) In general.--The Advisory Committee shall be 
        composed of members appointed by the Secretary, 
        including--
                  (A) individuals with extensive research 
                experience or operational knowledge of 
                hydrocarbon exploration and production;
                  (B) individuals broadly representative of the 
                affected interests in hydrocarbon production, 
                including interests in environmental protection 
                and safety operations;
                  (C) representatives of Federal agencies, 
                including the Environmental Protection Agency 
                and the Department of the Interior;
                  (D) State regulatory agency representatives; 
                and
                  (E) other individuals, as determined by the 
                Secretary.
          (2) Limitations.--
                  (A) In general.--The Advisory Committee shall 
                not include individuals who are board members, 
                officers, or employees of the program 
                consortium.
                  (B) Categorical representation.--In 
                appointing members of the Advisory Committee, 
                the Secretary shall ensure that no class of 
                individuals described in any of subparagraphs 
                (A), (B), (D), or (E) of paragraph (1) 
                comprises more than 13 of the membership of the 
                Advisory Committee.
    (c) Subcommittees.--The Advisory Committee may establish 
subcommittees for separate research programs carried out under 
this subtitle.
    (d) Duties.--The Advisory Committee shall--
          (1) advise the Secretary on the development and 
        implementation of programs under this subtitle; and
          (2) carry out section 999B(e)(2)(B).
    (e) Compensation.--A member of the Advisory Committee shall 
serve without compensation but shall be entitled to receive 
travel expenses in accordance with subchapter I of chapter 57 
of title 5, United States Code.
    (f) Prohibition.--The Advisory Committee shall not make 
recommendations on funding awards to particular consortia or 
other entities, or for specific projects.

           *       *       *       *       *       *       *

SEC. 999G. DEFINITIONS.

    In this subtitle:
          (1) Deepwater.--The term ``deepwater'' means a water 
        depth that is greater than [200 but less than 1,500 
        meters] 500 feet.
          (2) Deepwater architecture._The term ``deepwater 
        architecture'' means the integration of technologies 
        for the exploration for, or production of, natural gas 
        or other petroleum resources located at deepwater 
        depths.
          (3) Deepwater technology.--The term ``deepwater 
        technology'' means a discrete technology that is 
        specially suited to address 1 or more challenges 
        associated with the exploration for, or production of, 
        natural gas or other petroleum resources located at 
        deepwater depths.
          [(2)] (4) Independent producer of oil or gas.--
                  (A) In general.--The term ``independent 
                producer of oil or gas'' means any person that 
                produces oil or gas other than a person to whom 
                subsection (c) of section 613A of the Internal 
                Revenue Code of 1986 does not apply by reason 
                of paragraph (2) (relating to certain 
                retailers) or paragraph (4) (relating to 
                certain refiners) of section 613A(d) of such 
                Code.
                  (B) Rules for applying paragraphs (2) and (4) 
                of section 613a(d).--For purposes of 
                subparagraph (A), paragraphs (2) and (4) of 
                section 613A(d) of the Internal Revenue Code of 
                1986 shall be applied by substituting 
                ``calendar year'' for ``taxable year'' each 
                place it appears in such paragraphs.
          [(3)] (5) Program administration funds.--The term 
        ``program administration funds'' means funds used by 
        the program consortium to administer the program under 
        this subtitle, but not to exceed 10 percent of the 
        total funds allocated under paragraphs (1) through (3) 
        of section 999H(d).
          [(4)] (6) Program consortium.--The term ``program 
        consortium'' means the consortium selected under 
        section 999B(d).
          [(5)] (7) Program research funds.--The term ``program 
        research funds'' means funds awarded to research 
        performers by the program consortium consistent with 
        the annual plan.
          [(6)] (8) Remote or inconsequential.--The term 
        ``remote or inconsequential'' has the meaning given 
        that term in regulations issued by the Office of 
        Government Ethics under section 208(b)(2) of title 18, 
        United States Code.
          [(7)] (9) Small producer.--The term ``small 
        producer'' means an entity organized under the laws of 
        the United States with production levels of less than 
        1,000 barrels per day of oil equivalent.
          [(8) Ultra-deepwater.--The term ``ultra-deepwater'' 
        means a water depth that is equal to or greater than 
        1,500 meters.
          [(9) Ultra-deepwater architecture.--The term 
        ``ultradeepwater architecture'' means the integration 
        of technologies for the exploration for, or production 
        of, natural gas or other petroleum resources located at 
        ultra-deepwater depths.
          [(10) Ultra-deepwater technology.--The term 
        ``ultradeepwater technology'' means a discrete 
        technology that is specially suited to address one or 
        more challenges associated with the exploration for, or 
        production of, natural gas or other petroleum resources 
        located at ultra-deepwater depths.]
          [(11)] (10) Unconventional natural gas and other 
        petroleum resource.--The term ``unconventional natural 
        gas and other petroleum resource'' means natural gas 
        and other petroleum resource located onshore [in an 
        economically inaccessible geological formation, 
        including resources of small producers].

SEC. 999H. [42 U.S.C. 16378] FUNDING.

    (a) Oil and Gas Lease Income.--For each of fiscal years 
2007 through 2017, from any Federal royalties, rents, and 
bonuses derived from Federal onshore and offshore oil and gas 
leases issued under the Outer Continental Shelf Lands Act (43 
U.S.C. 1331 et seq.) and the Mineral Leasing Act (30 U.S.C. 181 
et seq.) which are deposited in the Treasury, and after 
distribution of any such funds as described in subsection (c), 
$50,000,000 shall be deposited into the [Ultra-Deepwater and 
Unconventional Natural Gas and Other Petroleum Research Fund] 
Safe and Responsible Energy Production Research Fund (in this 
section referred to as the ``Fund''). For purposes of this 
section, the term ``royalties'' excludes proceeds from the sale 
of royalty production taken in kind and royalty production that 
is transferred under section 27(a)(3) of the Outer Continental 
Shelf Lands Act (43 U.S.C. 1353(a)(3)).

           *       *       *       *       *       *       *

    (d) Allocation.--Amounts obligated from the Fund under 
subsection (a)(1) in each fiscal year shall be allocated as 
follows:
          (1) [35 percent] 21.5 percent shall be for activities 
        under section 999A(b)(1).
          (2) [32.5 percent] 21 percent shall be for activities 
        under section 999A(b)(2).
          (3) 7.5 percent shall be for activities under section 
        999A(b)(3).
          (4) [25 percent] 30 percent shall be for 
        [complementary research] safety technology research and 
        development under section 999A(b)(4) and other 
        activities under section 999A(b) to include program 
        direction funds, overall program oversight, [contract 
        management, and the establishment and operation of a 
        technical committee to ensure that in-house research 
        activities funded under section 999A(b)(4) are 
        technically complementary to, and not duplicative of, 
        research conducted under paragraphs (1), (2), and (3) 
        of section 999A(b).] and contract management.
          (5) 20 percent shall be used for research activities 
        required under sections 20 and 21 of the Outer 
        Continental Shelf Lands Act (43 U.S.C. 1346, 1347).
    (e) Authorization of Appropriations.--In addition to other 
amounts that are made available to carry out this section, 
there is authorized to be appropriated to carry out this 
section $100,000,000 for each of fiscal years 2007 through 
2016.
    (f) Fund.--There is hereby established in the Treasury of 
the United States a separate fund to be known as the [``Ultra-
Deepwater and Unconventional Natural Gas and Other Petroleum 
Research Fund''] ``Safer Oil and Gas Production and Accident 
Prevention Research Fund''.

                                  
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