I 

111TH CONGRESS 

1ST SESSION H. R. 2250 

To immediately provide for domestic energy production and jobs and to 

pursue alternatives in renewable energy. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 5, 2009 

Mr. BURTON of Indiana introduced the following bill; which was referred to 

the Committee on Energy and Commerce, and in addition to the Committees on Armed Services, Science and Technology, Natural Resources, and 

Ways and Means, for a period to be subsequently determined by the 

Speaker, in each case for consideration of such provisions as fall within 

the jurisdiction of the committee concerned 

A BILL 

To immediately provide for domestic energy production and 

jobs and to pursue alternatives in renewable energy. 

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

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

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

5 ‘‘Energy Independence Now Act of 2009’’. 

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

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Findings. 


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TITLE I—REFINERIES 

Subtitle A—Tax Incentives 

Sec. 101. Issuance of guidance. 

Sec. 102. Tax-exempt financing of domestic use oil refinery facilities. 

Sec. 103. Designation and availability of Federal lands for oil and natural gas 

refineries. 

Subtitle B—Availability of Federal Lands 

Sec. 111. Definitions. 

Sec. 112. State participation and presidential designation. 

Sec. 113. Process coordination and rules of procedure. 

Sec. 114. Alternative uses of land. 

TITLE II—NUCLEAR ENERGY 

Sec. 201. Waste confidence. 

Sec. 202. ASME Nuclear Certification credit. 

TITLE III—DRILLING 

Subtitle A—Tax Provisions 

Sec. 301. Credit for producing fuel from nonconventional sources to apply to 

gas produced onshore from formations more than 15,000 feet 

deep. 

Sec. 302. Tax credit for carbon dioxide captured from industrial sources and 

used in enhanced oil and natural gas recovery. 

Subtitle B—Termination of Congressional Moratoria on Oil and Gas 

Development on the Outer Continental Shelf 

Sec. 311. Termination of laws prohibiting expenditures for oil and natural gas 

leasing and preleasing activities regarding areas of the Outer 

Continental Shelf. 

Subtitle C—Oil and Gas Development on the Coastal Plain of Alaska 

Sec. 321. Short title. 

Sec. 322. Definitions. 

Sec. 323. Leasing program for lands within the Coastal Plain. 

Sec. 324. Lease sales. 

Sec. 325. Grant of leases by the Secretary. 

Sec. 326. Lease terms and conditions. 

Sec. 327. Coastal plain environmental protection. 

Sec. 328. Expedited judicial review. 

Sec. 329. Federal and State distribution of revenues. 

Sec. 330. Rights-of-way across the Coastal Plain. 

Sec. 331. Conveyance. 

Sec. 332. Local government impact aid and community service assistance. 

TITLE IV—OTHER PROVISIONS 

Sec. 401. Modification of renewable electricity production credit for biomass facilities. 

Sec. 402. Elimination of other restrictions on use of energy alternatives. 


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Sec. 403. Increased credit for certain vehicles acquired from domestic corporations. 

TITLE V—COAL-TO-LIQUID FUEL 

Subtitle A—Coal-to-Liquid Fuel Activities 

Sec. 501. Short title. 

Sec. 502. Definitions. 

Sec. 503. Coal-to-liquid fuel loan guarantee program. 

Sec. 504. Coal-to-liquid facilities loan program. 

Sec. 505. Location of coal-to-liquid manufacturing facilities. 

Sec. 506. Strategic Petroleum Reserve. 

Sec. 507. Authorization to conduct research, development, testing, and evaluation of assured domestic fuels. 

Sec. 508. Coal-to-liquid long-term fuel procurement and Department of Defense 

development. 

Sec. 509. Report on emissions of Fischer-Tropsch products used as transportation fuels. 

Subtitle B—Amendments to the Internal Revenue Code of 1986 

Sec. 511. Credit for investment in coal-to-liquid fuels projects. 

Sec. 512. Temporary expensing for equipment used in coal-to-liquid fuels process. 

Sec. 513. Extension of alternative fuel credit for fuel derived from coal through 

the Fischer-Tropsch process. 

Sec. 514. Modifications to enhanced oil recovery credit. 

Sec. 515. Allowance of enhanced oil, natural gas, and coalbed methane recovery, and capture and sequestration credit against the alternative minimum tax. 

TITLE VI—INCENTIVIZING THE EXTRACTION AND PROCESSING 

OF OIL SHALE 

Sec. 601. Incentives for extraction and processing of oil shale. 

TITLE VII—LAND FOR BIOFUEL PRODUCTION 

Sec. 701. Lease of public lands for production of renewable biomass for 

biofuels. 

1 SEC. 2. FINDINGS. 

2 Congress finds the following: 

3 (1) Over the course of the past few years, gas 

4 prices have fluctuated from a cost as low as $2 per 

5 gallon to as high as over $4 per gallon. 

6 (2) Volatile fuel costs present daunting chal7 lenges to American families, small businesses and 


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1 corporations making it difficult to budget and plan 

2 efficiently. 

3 (3) Hidden taxes on American oil companies 

4 provide an unfair advantage to foreign competitors. 

5 This serves only to increase dependence on foreign 

6 oil and eliminate domestic jobs. 

7 (4) The Federal regulations that restrict drill8 ing impose prohibitive costs on the development of 

9 new sources of energy, artificially inflating the price 

10 of oil and gasoline. 

11 (5) It has been estimated that oil shale deposits 

12 in Colorado, Utah, and Wyoming hold as little as 1.8 

13 trillion barrels of oil and as many as 8 trillion bar14 rels. 

15 (6) The United States is the only Nation in the 

16 world that has gone to such great lengths to restrict 

17 its own energy supply. 

18 (7) It is estimated that 19 billion barrels of oil 

19 exist untouched within areas that the United States 

20 has restricted from drilling. This is equivalent to 

21 nearly 30 years worth of current imports of oil from 

22 our second largest foreign source of oil, Saudi Ara23 bia. 


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1 (8) The Federal gasoline tax contributes to the 

2 burden of high prices for American families, busi3 ness, and truckers. 

4 (9) While many oil companies do hold leases on 

5 various plots of land, the most promising areas for 

6 oil and gas development, such as the Arctic National 

7 Wildlife Refuge and the Outer Continental Shelf, are 

8 currently off limits. 

9 (10) Expanding drilling in these areas would 

10 create an upwards of 750,000 well-paying, long11 term, privately funded American jobs. 

12 (11) Allowing private parties to delay, or even 

13 halt, the construction of new refineries through liti14 gation over the National Environmental Policy Act 

15 of 1969’s Environmental Impact Statement require16 ment reduces the supply of gas thus raising gas 

17 prices. 

18 (12) Food sources should not be used for the 

19 production of fuel, driving up food prices. Rather, it 

20 is essential to designate specific land for biofuels 

21 while investing in technology that can produce eth22 anol from nonfood sources. 

23 (13) It is necessary to invest in emission-free 

24 energy sources, such as wind and solar energy tech25 nologies, to prepare for the future. 


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1 (14) Extending the biomass tax credit from 

2 only producers who sell their power into the grid, to 

3 also producers who use that energy on-site, will in4 crease the number of Americans and American com5 panies eligible for tax credits. 

6 (15) Promoting locally produced greener 

7 biofuels will encourage private ownership as well as 

8 a more environmentally friendly energy source. 

9 TITLE I—REFINERIES 

10 Subtitle A—Tax Incentives 

11 SEC. 101. ISSUANCE OF GUIDANCE. 

12 The Secretary of the Treasury shall, not later than 

13 60 days after the date of the enactment of this Act, pre14 scribe the regulations described in paragraph (1) of sec15 tion 179C(b) of the Internal Revenue Code of 1986 (relat16 ing to election to expense certain refineries). 

17 SEC. 102. TAX-EXEMPT FINANCING OF DOMESTIC USE OIL 

18 REFINERY FACILITIES. 

19 (a) IN GENERAL.— 

20 (1) TREATMENT AS EXEMPT FACILITY BOND.— 

21 Subsection (a) of section 142 of the Internal Rev22 enue Code of 1986 (relating to exempt facility bond) 

23 is amended by striking ‘‘or’’ at the end of paragraph 

24 (14), by striking the period at the end of paragraph 


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1 (15) and inserting ‘‘, and’’, and by inserting at the 

2 end the following new paragraph: 

3 ‘‘(16) domestic use oil refinery facilities.’’. 

4 (2) DOMESTIC USE OIL REFINERY FACILI5 TIES.—Section 142 of such Code is amended by 

6 adding at the end the following new subsection: 

7 ‘‘(n) DOMESTIC USE OIL REFINERY FACILITIES.— 

8 ‘‘(1) IN GENERAL.—For purposes of subsection 

9 (a)(16), the term ‘domestic use oil refinery facility’ 

10 means any facility in the United States— 

11 ‘‘(A) which processes liquid fuel from 

12 crude oil, and 

13 ‘‘(B) all of the output of which it is rea14 sonably certain ultimate consumption will occur 

15 in the United States. 

16 ‘‘(2) ELECTION TO TERMINATE TAX-EXEMPT

17 BOND FINANCING BY CERTAIN REFINERIES.—In the 

18 case of a facility financed with bonds which would 

19 cease to be tax-exempt by reason of the failure to 

20 meet the domestic use requirement of this sub21 section, rules similar to the rules of subsection (f)(4) 

22 shall apply for purposes of this section.’’. 

23 (b) EFFECTIVE DATE.—The amendments made by 

24 this section shall apply to bonds issued after the date of 

25 the enactment of this Act. 


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1 SEC. 103. DESIGNATION AND AVAILABILITY OF FEDERAL 

2 LANDS FOR OIL AND NATURAL GAS REFIN3 ERIES. 

4 (a) DESIGNATION.—Within 18 months after the date 

5 of enactment of this Act, the President shall designate at 

6 least ten sites on Federal lands that are suitable for the 

7 siting of an oil refinery or natural gas refinery (or both). 

8 (b) AVAILABILITY OF LANDS.—Within 24 months 

9 after the date of enactment of this Act, the President shall 

10 make each site designated under subsection (a) available 

11 to the private sector for construction of an oil refinery or 

12 natural gas refinery (or both), as appropriate. 

13 Subtitle B—Availability of Federal 

14 Lands 

15 SEC. 111. DEFINITIONS. 

16 For purposes of this subtitle— 

17 (1) the term ‘‘base closure law’’ means the De18 fense Base Closure and Realignment Act of 1990 

19 (part A of title XXIX of Public Law 101–510; 10 

20 U.S.C. 2687 note) and title II of the Defense Au21 thorization Amendments and Base Closure and Re22 alignment Act (Public Law 100–526; 10 U.S.C. 

23 2687 note); 

24 (2) the term ‘‘closed military installation’’ 

25 means a military installation closed or approved for 

26 closure pursuant to a base closure law; 


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1 (3) the term ‘‘designated refinery’’ means a re2 finery designated under section 112(a); 

3 (4) the term ‘‘Federal refinery authorization’’— 

4 (A) means any authorization required 

5 under Federal law, whether administered by a 

6 Federal or State administrative agency or offi7 cial, with respect to siting, construction, expan8 sion, or operation of a refinery; and 

9 (B) includes any permits, special use au10 thorizations, certifications, opinions, or other 

11 approvals required under Federal law with re12 spect to siting, construction, expansion, or oper13 ation of a refinery; 

14 (5) the term ‘‘refinery’’ means— 

15 (A) a facility designed and operated to re16 ceive, load, unload, store, transport, process, 

17 and refine crude oil by any chemical or physical 

18 process, including distillation, fluid catalytic 

19 cracking, hydrocracking, coking, alkylation, 

20 etherification, polymerization, catalytic reform21 ing, isomerization, hydrotreating, blending, and 

22 any combination thereof, in order to produce 

23 gasoline or other fuel; or 

24 (B) a facility designed and operated to re25 ceive, load, unload, store, transport, process, 


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1 and refine coal by any chemical or physical 

2 process, including liquefaction, in order to 

3 produce gasoline, diesel, or other liquid fuel as 

4 its primary output; 

5 (6) the term ‘‘Secretary’’ means the Secretary 

6 of Energy; and 

7 (7) the term ‘‘State’’ means a State, the Dis8 trict of Columbia, the Commonwealth of Puerto 

9 Rico, and any other territory or possession of the 

10 United States. 

11 SEC. 112. STATE PARTICIPATION AND PRESIDENTIAL DES12 IGNATION. 

13 (a) DESIGNATION REQUIREMENT.—Not later than 

14 90 days after the date of enactment of this Act, the Presi15 dent shall designate no less than 3 closed military installa16 tions, or portions thereof, subject to subsection (c)(2), that 

17 are appropriate for the purposes of siting a refinery. 

18 (b) ANALYSIS OF REFINERY SITES.—In considering 

19 any site for possible designation under subsection (a), the 

20 President shall conduct an analysis of— 

21 (1) the availability of crude oil supplies to the 

22 site, including supplies from domestic production of 

23 shale oil and tar sands and other strategic uncon24 ventional fuels; 


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1 (2) the distribution of the Nation’s refined pe2 troleum product demand; 

3 (3) whether such site is in close proximity to 

4 substantial pipeline infrastructure, including both 

5 crude oil and refined petroleum product pipelines, 

6 and potential infrastructure feasibility; 

7 (4) the need to diversify the geographical loca8 tion of the domestic refining capacity; 

9 (5) the effect that increased refined petroleum 

10 products from a refinery on that site may have on 

11 the price and supply of gasoline to consumers; 

12 (6) the impact of locating a refinery on the site 

13 on the readiness and operations of the Armed 

14 Forces; and 

15 (7) such other factors as the President con16 siders appropriate. 

17 (c) SALE OR DISPOSAL.— 

18 (1) DESIGNATION.—Except as provided in 

19 paragraph (2), until the expiration of 2 years after 

20 the date of enactment of this Act, the Federal Gov21 ernment shall not sell or otherwise dispose of the 

22 military installations designated pursuant to sub23 section (a). 

24 (2) GOVERNOR’S OBJECTION.—No site may be 

25 used for a refinery under this subtitle if, not later 


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1 than 60 days after designation of the site under sub2 section (a), the Governor of the State in which the 

3 site is located transmits to the President an objec4 tion to the designation, unless, not later than 60 

5 days after the President receives such objection, the 

6 Congress has by law overridden the objection. 

7 (d) REDEVELOPMENT AUTHORITY.—With respect to 

8 a closed military installation, or portion thereof, des9 ignated by the President as a potentially suitable refinery 

10 site pursuant to subsection (a)— 

11 (1) the redevelopment authority for the installa12 tion, in preparing or revising the redevelopment plan 

13 for the installation, shall consider the feasibility and 

14 practicability of siting a refinery on the installation; 

15 and 

16 (2) the Secretary of Defense, in managing and 

17 disposing of real property at the installation pursu18 ant to the base closure law applicable to the installa19 tion, shall give substantial deference to the rec20 ommendations of the redevelopment authority, as 

21 contained in the redevelopment plan for the installa22 tion, regarding the siting of a refinery on the instal23 lation. 


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1 SEC. 113. PROCESS COORDINATION AND RULES OF PROCE2 DURE. 

3 (a) DESIGNATION AS LEAD AGENCY.— 

4 (1) IN GENERAL.—The Department of Energy 

5 shall act as the lead agency for the purposes of co6 ordinating all applicable Federal refinery authoriza7 tions and related environmental reviews with respect 

8 to a designated refinery. 

9 (2) OTHER AGENCIES.—Each Federal and 

10 State agency or official required to provide a Fed11 eral refinery authorization shall cooperate with the 

12 Secretary and comply with the deadlines established 

13 by the Secretary. 

14 (b) SCHEDULE.— 

15 (1) SECRETARY’S AUTHORITY TO SET SCHED16 ULE.—The Secretary shall establish a schedule for 

17 all Federal refinery authorizations with respect to a 

18 designated refinery. In establishing the schedule, the 

19 Secretary shall— 

20 (A) ensure expeditious completion of all 

21 such proceedings; and 

22 (B) accommodate the applicable schedules 

23 established by Federal law for such proceedings. 

24 (2) FAILURE TO MEET SCHEDULE.—If a Fed25 eral or State administrative agency or official does 

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1 quired for a Federal refinery authorization in ac2 cordance with the schedule established by the Sec3 retary under this subsection, the applicant may pur4 sue remedies under subsection (d). 

5 (c) CONSOLIDATED RECORD.—The Secretary shall, 

6 with the cooperation of Federal and State administrative 

7 agencies and officials, maintain a complete consolidated 

8 record of all decisions made or actions taken by the Sec9 retary or by a Federal administrative agency or officer (or 

10 State administrative agency or officer acting under dele11 gated Federal authority) with respect to any Federal re12 finery authorization. Such record shall be the record for 

13 judicial review under subsection (d) of decisions made or 

14 actions taken by Federal and State administrative agen15 cies and officials, except that, if the Court determines that 

16 the record does not contain sufficient information, the 

17 Court may remand the proceeding to the Secretary for fur18 ther development of the consolidated record. 

19 (d) JUDICIAL REVIEW.— 

20 (1) IN GENERAL.—The United States Court of 

21 Appeals for the District of Columbia shall have 

22 original and exclusive jurisdiction over any civil ac23 tion for the review of— 


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1 (A) an order or action, related to a Federal 

2 refinery authorization, by a Federal or State 

3 administrative agency or official; and 

4 (B) an alleged failure to act by a Federal 

5 or State administrative agency or official acting 

6 pursuant to a Federal refinery authorization. 

7 The failure of an agency or official to act on a Fed8 eral refinery authorization in accordance with the 

9 Secretary’s schedule established pursuant to sub10 section (b) shall be considered inconsistent with Fed11 eral law for the purposes of paragraph (2) of this 

12 subsection. 

13 (2) COURT ACTION.—If the Court finds that an 

14 order or action described in paragraph (1)(A) is in15 consistent with the Federal law governing such Fed16 eral refinery authorization, or that a failure to act 

17 as described in paragraph (1)(B) has occurred, and 

18 the order, action, or failure to act would prevent the 

19 siting, construction, expansion, or operation of the 

20 designated refinery, the Court shall remand the pro21 ceeding to the agency or official to take appropriate 

22 action consistent with the order of the Court. If the 

23 Court remands the order, action, or failure to act to 

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1 cial, the Court shall set a reasonable schedule and 

2 deadline for the agency or official to act on remand. 

3 (3) SECRETARY’S ACTION.—For any civil action 

4 brought under this subsection, the Secretary shall 

5 promptly file with the Court the consolidated record 

6 compiled by the Secretary pursuant to subsection 

7 (c). 

8 (4) EXPEDITED REVIEW.—The Court shall set 

9 any civil action brought under this subsection for ex10 pedited consideration. 

11 (5) ATTORNEY’S FEES.—In any action chal12 lenging a Federal refinery authorization that has 

13 been granted, reasonable attorney’s fees and other 

14 expenses of litigation shall be awarded to the pre15 vailing party. This paragraph shall not apply to any 

16 action seeking remedies for denial of a Federal refin17 ery authorization or failure to act on an application 

18 for a Federal refinery authorization. 

19 SEC. 114. ALTERNATIVE USES OF LAND. 

20 Any land designated under section 112(a) that has 

21 not been used for an oil refinery within 10 years after 

22 such designation shall be made available for leasing for 

23 renewable energy development purposes, such as wind or 

24 solar energy installations or an ethanol refinery. 


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1 TITLE II—NUCLEAR ENERGY 

2 SEC. 201. WASTE CONFIDENCE. 

3 The Nuclear Regulatory Commission may not deny 

4 an application for a license, permit, or other authorization 

5 under the Atomic Energy Act of 1954 on the grounds that 

6 sufficient capacity does not exist, or will not become avail7 able on a timely basis, for disposal of spent nuclear fuel 

8 or high-level radioactive waste from the facility for which 

9 the license, permit, or other authorization is sought. 

10 SEC. 202. ASME NUCLEAR CERTIFICATION CREDIT. 

11 (a) IN GENERAL.—Subpart D of part IV of sub12 chapter A of chapter 1 of the Internal Revenue Code of 

13 1986 (relating to business related credits) is amended by 

14 adding at the end the following new section: 

15 ‘‘SEC. 45R. ASME NUCLEAR CERTIFICATION CREDIT. 

16 ‘‘(a) IN GENERAL.—For purposes of section 38, the 

17 ASME Nuclear Certification credit determined under this 

18 section for any taxable year is an amount equal to 15 per19 cent of the qualified nuclear expenditures paid or incurred 

20 by the taxpayer. 

21 ‘‘(b) QUALIFIED NUCLEAR EXPENDITURES.—For 

22 purposes of this section, the term ‘qualified nuclear ex23 penditures’ means any expenditure related to— 


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1 ‘‘(1) obtaining a certification under the Amer2 ican Society of Mechanical Engineers Nuclear Com3 ponent Certification program, or 

4 ‘‘(2) increasing the taxpayer’s capacity to con5 struct, fabricate, assemble, or install components— 

6 ‘‘(A) for any facility which uses nuclear en7 ergy to produce electricity, and 

8 ‘‘(B) with respect to the construction, fab9 rication, assembly, or installation of which the 

10 taxpayer is certified under such program. 

11 ‘‘(c) TIMING OF CREDIT.—The credit allowed under 

12 subsection (a) for any expenditures shall be allowed— 

13 ‘‘(1) in the case of a qualified nuclear expendi14 ture described in subsection (b)(1), for the taxable 

15 year of such certification, and 

16 ‘‘(2) in the case of any other qualified nuclear 

17 expenditure, for the taxable year in which such ex18 penditure is paid or incurred. 

19 ‘‘(d) SPECIAL RULES.— 

20 ‘‘(1) BASIS ADJUSTMENT.—For purposes of 

21 this subtitle, if a credit is allowed under this section 

22 for an expenditure, the increase in basis which would 

23 result (but for this subsection) for such expenditure 

24 shall be reduced by the amount of the credit allowed 

25 under this section. 


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1 ‘‘(2) DENIAL OF DOUBLE BENEFIT.—No deduc2 tion shall be allowed under this chapter for any 

3 amount taken into account in determining the credit 

4 under this section. 

5 ‘‘(e) TERMINATION.—This section shall not apply to 

6 any expenditures paid or incurred in taxable years begin7 ning after December 31, 2021.’’. 

8 (b) CONFORMING AMENDMENTS.—(1) Subsection (b) 

9 of section 38 is amended by striking ‘‘plus’’ at the end 

10 of paragraph (34), by striking the period at the end of 

11 paragraph (35) and inserting ‘‘, plus’’, and by adding at 

12 the end the following new paragraph: 

13 ‘‘(36) the ASME Nuclear Certification credit 

14 determined under section 45R(a).’’. 

15 (2) Subsection (a) of section 1016 (relating to adjust16 ments to basis) is amended by striking ‘‘and’’ at the end 

17 of paragraph (36), by striking the period at the end of 

18 paragraph (37) and inserting ‘‘, and’’, and by adding at 

19 the end the following new paragraph: 

20 ‘‘(38) to the extent provided in section 

21 45R(e)(1).’’. 

22 (c) CLERICAL AMENDMENT.—The table of sections 

23 for subpart B of part IV of subchapter A of chapter 1 

24 of such Code (relating to other credits) is amended by add25 ing at the end the following new item: 


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‘‘Sec. 45R. Credit for carbon dioxide captured from industrial sources and used 

as a tertiary injectant in enhanced oil and natural gas recovery.’’. 

1 (d) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to expenditures paid or incurred 

3 in taxable years beginning after December 31, 2009. 

4 TITLE III—DRILLING 

5 Subtitle A—Tax Provisions 

6 SEC. 301. CREDIT FOR PRODUCING FUEL FROM NON7 CONVENTIONAL SOURCES TO APPLY TO GAS 

8 PRODUCED ONSHORE FROM FORMATIONS 

9 MORE THAN 15,000 FEET DEEP. 

10 (a) IN GENERAL.—Subparagraph (B) of section 

11 45K(c)(1) of the Internal Revenue Code of 1986 is amend12 ed by striking ‘‘or’’ at the end of clause (i), by striking 

13 ‘‘and’’ at the end of clause (ii) and inserting ‘‘or’’, and 

14 by inserting after clause (ii) the following new clause: 

15 ‘‘(iii) an onshore well from a forma16 tion more than 15,000 feet deep, and’’. 

17 (b) ELIGIBLE DEEP GAS WELLS.—Section 45K of 

18 such Code is amended by adding at the end the following 

19 new subsection: 

20 ‘‘(h) ELIGIBLE DEEP GAS WELLS.—In the case of 

21 a well producing qualified fuel described in subsection 

22 (c)(1)(B)(iii)— 

23 ‘‘(1) for purposes of subsection (e)(1)(A), such 

24 well shall be treated as drilled before January 1, 


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1 1993, if such well is drilled after the date of the en2 actment of this subsection, and 

3 ‘‘(2) subsection (e)(2) shall not apply.’’. 

4 (c) EFFECTIVE DATE.—The amendments made by 

5 this section shall apply to taxable years ending after the 

6 date of the enactment of this Act. 

7 SEC. 302. TAX CREDIT FOR CARBON DIOXIDE CAPTURED 

8 FROM INDUSTRIAL SOURCES AND USED IN 

9 ENHANCED OIL AND NATURAL GAS RECOV10 ERY. 

11 (a) IN GENERAL.—Subpart D of part IV of sub12 chapter A of chapter 1 of the Internal Revenue Code of 

13 1986 (relating to business credits), as amended by this 

14 Act, is amended by adding at the end the following new 

15 section: 

16 ‘‘SEC. 45S. CREDIT FOR CARBON DIOXIDE CAPTURED FROM 

17 INDUSTRIAL SOURCES AND USED AS A TER18 TIARY INJECTANT IN ENHANCED OIL AND 

19 NATURAL GAS RECOVERY. 

20 ‘‘(a) GENERAL RULE.—For purposes of section 38, 

21 the captured carbon dioxide tertiary injectant credit for 

22 any taxable year is an amount equal to the product of— 

23 ‘‘(1) the credit amount, and 

24 ‘‘(2) the qualified carbon dioxide captured from 

25 industrial sources and used as a tertiary injectant in 


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1 qualified enhanced oil and natural gas recovery 

2 which is attributable to the taxpayer. 

3 ‘‘(b) CREDIT AMOUNT.—For purposes of this sec4 tion— 

5 ‘‘(1) IN GENERAL.—The credit amount is $0.75 

6 per 1,000 standard cubic feet. 

7 ‘‘(2) INFLATION ADJUSTMENT.—In the case of 

8 any taxable year beginning in a calendar year after 

9 2007, there shall be substituted for the $0.75 

10 amount under paragraph (1) an amount equal to the 

11 product of— 

12 ‘‘(A) $0.75, multiplied by 

13 ‘‘(B) the inflation adjustment factor for 

14 such calendar year determined under section 

15 43(b)(3)(B) for such calendar year, determined 

16 by substituting ‘2006’ for ‘1990’. 

17 ‘‘(c) QUALIFIED CARBON DIOXIDE.—For purposes of 

18 this section— 

19 ‘‘(1) IN GENERAL.—The term ‘qualified carbon 

20 dioxide’ means carbon dioxide captured from an an21 thropogenic source that— 

22 ‘‘(A) would otherwise be released into the 

23 atmosphere as industrial emission of green24 house gas, 


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1 ‘‘(B) is measurable at the source of cap2 ture, 

3 ‘‘(C) is compressed, treated, and trans4 ported via pipeline, 

5 ‘‘(D) is sold as a tertiary injectant in 

6 qualified enhanced oil and natural gas recovery, 

7 and 

8 ‘‘(E) is permanently sequestered in geologi9 cal formations as a result of the enhanced oil 

10 and natural gas recovery process. 

11 ‘‘(2) ANTHROPOGENIC SOURCE.—An anthropo12 genic source of carbon dioxide is an industrial 

13 source, including any of the following types of 

14 plants, and facilities related to such plant— 

15 ‘‘(A) a coal and natural gas fired electrical 

16 generating power station, 

17 ‘‘(B) a natural gas processing and treating 

18 plant, 

19 ‘‘(C) an ethanol plant, 

20 ‘‘(D) a fertilizer plant, and 

21 ‘‘(E) a chemical plant. 

22 ‘‘(3) DEFINITIONS.— 

23 ‘‘(A) QUALIFIED ENHANCED OIL AND NAT24 URAL GAS RECOVERY.—The term ‘qualified enVerDate Nov 24 2008 06:45 May 06, 2009 Jkt 079200 PO 00000 Frm 00023 Fmt 6652 Sfmt 6201 E:\BILLS\H2250.IH H2250

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1 hanced oil and natural gas recovery’ has the 

2 meaning given such term by section 43(c)(2). 

3 ‘‘(B) TERTIARY INJECTANT.—The term 

4 ‘tertiary injectant’ has the same meaning as 

5 when used within section 193(b)(1). 

6 ‘‘(d) OTHER DEFINITIONS AND SPECIAL RULES.— 

7 For purposes of this section— 

8 ‘‘(1) ONLY CARBON DIOXIDE CAPTURED WITH9 IN THE UNITED STATES TAKEN INTO ACCOUNT.— 

10 Sales shall be taken into account under this section 

11 only with respect to qualified carbon dioxide of 

12 which is within— 

13 ‘‘(A) the United States (within the mean14 ing of section 638(1)), or 

15 ‘‘(B) a possession of the United States 

16 (within the meaning of section 638(2)). 

17 ‘‘(2) RECYCLED CARBON DIOXIDE.—The term 

18 ‘qualified carbon dioxide’ includes the initial deposit 

19 of captured carbon dioxide used as a tertiary 

20 injectant. Such term does not include carbon dioxide 

21 that is re-captured, recycled, and re-injected as part 

22 of the enhanced oil and natural gas recovery process. 

23 ‘‘(3) CREDIT ATTRIBUTABLE TO TAXPAYER.— 

24 Any credit under this section shall be attributable to 

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1 ports and sells the carbon dioxide for use as a ter2 tiary injectant in enhanced oil and natural gas re3 covery, except to the extent provided in regulations 

4 prescribed by the Secretary.’’. 

5 (b) CONFORMING AMENDMENT.—Section 38(b) of 

6 such Code (relating to general business credit), as amend7 ed by this Act, is amended by striking ‘‘plus’’ at the end 

8 of paragraph (35), by striking the period at the end of 

9 paragraph (36) and inserting ‘‘, plus’’, and by adding at 

10 the end of following new paragraph: 

11 ‘‘(37) the captured carbon dioxide tertiary 

12 injectant credit determined under section 45S(a).’’. 

13 (c) CLERICAL AMENDMENT.—The table of sections 

14 for subpart B of part IV of subchapter A of chapter 1 

15 of such Code (relating to other credits) is amended by add16 ing at the end the following new item: 

‘‘Sec. 45S. Credit for carbon dioxide captured from industrial sources and used 

as a tertiary injectant in enhanced oil and natural gas recovery.’’. 

17 (d) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply to taxable years beginning after 

19 the date of the enactment of this Act. 


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1 Subtitle B—Termination of Con2 gressional Moratoria on Oil and 

3 Gas Development on the Outer 

4 Continental Shelf 

5 SEC. 311. TERMINATION OF LAWS PROHIBITING EXPENDI6 TURES FOR OIL AND NATURAL GAS LEASING 

7 AND PRELEASING ACTIVITIES REGARDING 

8 AREAS OF THE OUTER CONTINENTAL SHELF. 

9 All provisions of existing Federal law prohibiting the 

10 spending of appropriated funds to conduct oil and natural 

11 gas leasing and preleasing activities for any area of the 

12 Outer Continental Shelf shall have no force or effect. 

13 Subtitle C—Oil and Gas Develop14 ment on the Coastal Plain of 

15 Alaska 

16 SEC. 321. SHORT TITLE. 

17 This subtitle may be cited as the ‘‘American-Made 

18 Energy and Good Jobs Act’’. 

19 SEC. 322. DEFINITIONS. 

20 In this subtitle: 

21 (1) COASTAL PLAIN.—The term ‘‘Coastal 

22 Plain’’ means that area described in appendix I to 

23 part 37 of title 50, Code of Federal Regulations. 


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1 (2) SECRETARY.—The term ‘‘Secretary’’, except 

2 as otherwise provided, means the Secretary of the 

3 Interior or the Secretary’s designee. 

4 SEC. 323. LEASING PROGRAM FOR LANDS WITHIN THE 

5 COASTAL PLAIN. 

6 (a) IN GENERAL.—The Secretary shall take such ac7 tions as are necessary— 

8 (1) to establish and implement, in accordance 

9 with this subtitle and acting through the Director of 

10 the Bureau of Land Management in consultation 

11 with the Director of the United States Fish and 

12 Wildlife Service, a competitive oil and gas leasing 

13 program that will result in an environmentally sound 

14 program for the exploration, development, and pro15 duction of the oil and gas resources of the Coastal 

16 Plain; and 

17 (2) to administer the provisions of this subtitle 

18 through regulations, lease terms, conditions, restric19 tions, prohibitions, stipulations, and other provisions 

20 that ensure the oil and gas exploration, development, 

21 and production activities on the Coastal Plain will 

22 result in no significant adverse effect on fish and 

23 wildlife, their habitat, subsistence resources, and the 

24 environment, including, in furtherance of this goal, 

25 by requiring the application of the best commercially 


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1 available technology for oil and gas exploration, de2 velopment, and production to all exploration, devel3 opment, and production operations under this sub4 title in a manner that ensures the receipt of fair 

5 market value by the public for the mineral resources 

6 to be leased. 

7 (b) REPEAL.— 

8 (1) REPEAL.—Section 1003 of the Alaska Na9 tional Interest Lands Conservation Act of 1980 (16 

10 U.S.C. 3143) is repealed. 

11 (2) CONFORMING AMENDMENT.—The table of 

12 contents in section 1 of such Act is amended by 

13 striking the item relating to section 1003. 

14 (c) COMPLIANCE WITH REQUIREMENTS UNDER CER15 TAIN OTHER LAWS.— 

16 (1) COMPATIBILITY.—For purposes of the Na17 tional Wildlife Refuge System Administration Act of 

18 1966 (16 U.S.C. 668dd et seq.), the oil and gas 

19 leasing program and activities authorized by this 

20 section in the Coastal Plain are deemed to be com21 patible with the purposes for which the Arctic Na22 tional Wildlife Refuge was established, and no fur23 ther findings or decisions are required to implement 

24 this determination. 


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1 (2) ADEQUACY OF THE DEPARTMENT OF THE

2 INTERIOR’S LEGISLATIVE ENVIRONMENTAL IMPACT

3 STATEMENT.—The ‘‘Final Legislative Environ4 mental Impact Statement’’ (April 1987) on the 

5 Coastal Plain prepared pursuant to section 1002 of 

6 the Alaska National Interest Lands Conservation 

7 Act of 1980 (16 U.S.C. 3142) and section 102(2)(C) 

8 of the National Environmental Policy Act of 1969 

9 (42 U.S.C. 4332(2)(C)) is deemed to satisfy the re10 quirements under the National Environmental Policy 

11 Act of 1969 that apply with respect to prelease ac12 tivities, including actions authorized to be taken by 

13 the Secretary to develop and promulgate the regula14 tions for the establishment of a leasing program au15 thorized by this subtitle before the conduct of the 

16 first lease sale. 

17 (3) COMPLIANCE WITH NEPA FOR OTHER AC18 TIONS.—Before conducting the first lease sale under 

19 this subtitle, the Secretary shall prepare an environ20 mental impact statement under the National Envi21 ronmental Policy Act of 1969 with respect to the ac22 tions authorized by this Act that are not referred to 

23 in paragraph (2). Notwithstanding any other law, 

24 the Secretary is not required to identify nonleasing 

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1 ronmental effects of such courses of action. The Sec2 retary shall only identify a preferred action for such 

3 leasing and a single leasing alternative, and analyze 

4 the environmental effects and potential mitigation 

5 measures for those two alternatives. The identifica6 tion of the preferred action and related analysis for 

7 the first lease sale under this subtitle shall be com8 pleted within 18 months after the date of enactment 

9 of this Act. The Secretary shall only consider public 

10 comments that specifically address the Secretary’s 

11 preferred action and that are filed within 20 days 

12 after publication of an environmental analysis. Not13 withstanding any other law, compliance with this 

14 paragraph is deemed to satisfy all requirements for 

15 the analysis and consideration of the environmental 

16 effects of proposed leasing under this subtitle. 

17 (d) RELATIONSHIP TO STATE AND LOCAL AUTHOR18 ITY.—Nothing in this subtitle shall be considered to ex19 pand or limit State and local regulatory authority. 

20 (e) SPECIAL AREAS.— 

21 (1) IN GENERAL.—The Secretary, after con22 sultation with the State of Alaska, the city of 

23 Kaktovik, and the North Slope Borough, may des24 ignate up to a total of 45,000 acres of the Coastal 

25 Plain as a Special Area if the Secretary determines 


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1 that the Special Area is of such unique character 

2 and interest so as to require special management 

3 and regulatory protection. The Secretary shall des4 ignate as such a Special Area the Sadlerochit Spring 

5 area, comprising approximately 4,000 acres. 

6 (2) MANAGEMENT.—Each such Special Area 

7 shall be managed so as to protect and preserve the 

8 area’s unique and diverse character including its 

9 fish, wildlife, and subsistence resource values. 

10 (3) EXCLUSION FROM LEASING OR SURFACE

11 OCCUPANCY.—The Secretary may exclude any Spe12 cial Area from leasing. If the Secretary leases a Spe13 cial Area, or any part thereof, for purposes of oil 

14 and gas exploration, development, production, and 

15 related activities, there shall be no surface occu16 pancy of the lands comprising the Special Area. 

17 (4) DIRECTIONAL DRILLING.—Notwithstanding 

18 the other provisions of this subsection, the Secretary 

19 may lease all or a portion of a Special Area under 

20 terms that permit the use of horizontal drilling tech21 nology from sites on leases located outside the Spe22 cial Area. 

23 (f) LIMITATION ON CLOSED AREAS.—The Sec24 retary’s sole authority to close lands within the Coastal 


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1 Plain to oil and gas leasing and to exploration, develop2 ment, and production is that set forth in this subtitle. 

3 (g) REGULATIONS.— 

4 (1) IN GENERAL.—The Secretary shall pre5 scribe such regulations as may be necessary to carry 

6 out this subtitle, including rules and regulations re7 lating to protection of the fish and wildlife, their 

8 habitat, subsistence resources, and environment of 

9 the Coastal Plain, by no later than 15 months after 

10 the date of enactment of this Act. 

11 (2) REVISION OF REGULATIONS.—The Sec12 retary shall periodically review and, if appropriate, 

13 revise the rules and regulations issued under sub14 section (a) to reflect any significant biological, envi15 ronmental, or engineering data that come to the Sec16 retary’s attention. 

17 SEC. 324. LEASE SALES. 

18 (a) IN GENERAL.—Lands may be leased pursuant to 

19 this subtitle to any person qualified to obtain a lease for 

20 deposits of oil and gas under the Mineral Leasing Act (30 

21 U.S.C. 181 et seq.). 

22 (b) PROCEDURES.—The Secretary shall, by regula23 tion, establish procedures for— 

24 (1) receipt and consideration of sealed nomina25 tions for any area in the Coastal Plain for inclusion 


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1 in, or exclusion (as provided in subsection (c)) from, 

2 a lease sale; 

3 (2) the holding of lease sales after such nomina4 tion process; and 

5 (3) public notice of and comment on designa6 tion of areas to be included in, or excluded from, a 

7 lease sale. 

8 (c) LEASE SALE BIDS.—Bidding for leases under 

9 this subtitle shall be by sealed competitive cash bonus bids. 

10 (d) ACREAGE MINIMUM IN FIRST SALE.—In the first 

11 lease sale under this subtitle, the Secretary shall offer for 

12 lease those tracts the Secretary considers to have the 

13 greatest potential for the discovery of hydrocarbons, tak14 ing into consideration nominations received pursuant to 

15 subsection (b)(1), but in no case less than 200,000 acres. 

16 (e) TIMING OF LEASE SALES.—The Secretary 

17 shall— 

18 (1) conduct the first lease sale under this sub19 title within 22 months after the date of the enact20 ment of this Act; and 

21 (2) conduct additional sales so long as sufficient 

22 interest in development exists to warrant, in the Sec23 retary’s judgment, the conduct of such sales. 


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1 SEC. 325. GRANT OF LEASES BY THE SECRETARY. 

2 (a) IN GENERAL.—The Secretary may grant to the 

3 highest responsible qualified bidder in a lease sale con4 ducted pursuant to section 424 any lands to be leased on 

5 the Coastal Plain upon payment by the lessee of such 

6 bonus as may be accepted by the Secretary. 

7 (b) SUBSEQUENT TRANSFERS.—No lease issued 

8 under this subtitle may be sold, exchanged, assigned, sub9 let, or otherwise transferred except with the approval of 

10 the Secretary. Prior to any such approval the Secretary 

11 shall consult with, and give due consideration to the views 

12 of, the Attorney General. 

13 SEC. 326. LEASE TERMS AND CONDITIONS. 

14 An oil or gas lease issued pursuant to this subtitle 

15 shall— 

16 (1) provide for the payment of a royalty of not 

less than 121 17 ⁄2 percent in amount or value of the 

18 production removed or sold from the lease, as deter19 mined by the Secretary under the regulations appli20 cable to other Federal oil and gas leases; 

21 (2) require that the lessee of lands within the 

22 Coastal Plain shall be fully responsible and liable for 

23 the reclamation of lands within the Coastal Plain 

24 and any other Federal lands that are adversely af25 fected in connection with exploration, development, 

26 production, or transportation activities conducted 


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1 under the lease and within the Coastal Plain by the 

2 lessee or by any of the subcontractors or agents of 

3 the lessee; 

4 (3) provide that the lessee may not delegate or 

5 convey, by contract or otherwise, the reclamation re6 sponsibility and liability to another person without 

7 the express written approval of the Secretary; 

8 (4) provide that the standard of reclamation for 

9 lands required to be reclaimed under this subtitle 

10 shall be, as nearly as practicable, a condition capable 

11 of supporting the uses which the lands were capable 

12 of supporting prior to any exploration, development, 

13 or production activities, or upon application by the 

14 lessee, to a higher or better use as approved by the 

15 Secretary; 

16 (5) include requirements and restrictions to 

17 provide for reasonable protection of fish and wildlife, 

18 their habitat, subsistence resources, and the environ19 ment as determined by the Secretary; 

20 (6) prohibit the export of oil produced under 

21 the lease; and 

22 (7) contain such other provisions as the Sec23 retary determines necessary to ensure compliance 

24 with the provisions of this subtitle and the regula25 tions issued under this subtitle. 


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1 SEC. 327. COASTAL PLAIN ENVIRONMENTAL PROTECTION. 

2 (a) NO SIGNIFICANT ADVERSE EFFECT STANDARD

3 TO GOVERN AUTHORIZED COASTAL PLAIN ACTIVITIES.— 

4 The Secretary shall, consistent with the requirements of 

5 section 423, administer the provisions of this subtitle 

6 through regulations, lease terms, conditions, restrictions, 

7 prohibitions, stipulations, and other provisions that— 

8 (1) ensure the oil and gas exploration, develop9 ment, and production activities on the Coastal Plain 

10 will result in no significant adverse effect on fish 

11 and wildlife, their habitat, and the environment; 

12 (2) require the application of the best commer13 cially available technology for oil and gas explo14 ration, development, and production on all new ex15 ploration, development, and production operations; 

16 and 

17 (3) ensure that the maximum amount of sur18 face acreage covered by production and support fa19 cilities, including airstrips and any areas covered by 

20 gravel berms or piers for support of pipelines, does 

21 not exceed 2,000 acres on the Coastal Plain. 

22 (b) SITE-SPECIFIC ASSESSMENT AND MITIGATION.— 

23 The Secretary shall also require, with respect to any pro24 posed drilling and related activities, that— 

25 (1) a site-specific analysis be made of the prob26 able effects, if any, that the drilling or related activiVerDate Nov 24 2008 06:45 May 06, 2009 Jkt 079200 PO 00000 Frm 00036 Fmt 6652 Sfmt 6201 E:\BILLS\H2250.IH H2250

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1 ties will have on fish and wildlife, their habitat, sub2 sistence resources, and the environment; 

3 (2) a plan be implemented to avoid, minimize, 

4 and mitigate (in that order and to the extent prac5 ticable) any significant adverse effect identified 

6 under paragraph (1); and 

7 (3) the development of the plan shall occur 

8 after consultation with the agency or agencies hav9 ing jurisdiction over matters mitigated by the plan. 

10 (c) REGULATIONS TO PROTECT COASTAL PLAIN

11 FISH AND WILDLIFE RESOURCES, SUBSISTENCE USERS, 

12 AND THE ENVIRONMENT.—Before implementing the leas13 ing program authorized by this subtitle, the Secretary 

14 shall prepare and promulgate regulations, lease terms, 

15 conditions, restrictions, prohibitions, stipulations, and 

16 other measures designed to ensure that the activities un17 dertaken on the Coastal Plain under this subtitle are con18 ducted in a manner consistent with the purposes and envi19 ronmental requirements of this subtitle. 

20 (d) COMPLIANCE WITH FEDERAL AND STATE ENVI21 RONMENTAL LAWS AND OTHER REQUIREMENTS.—The 

22 proposed regulations, lease terms, conditions, restrictions, 

23 prohibitions, and stipulations for the leasing program 

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1 cable provisions of Federal and State environmental law, 

2 and shall also require the following: 

3 (1) Standards at least as effective as the safety 

4 and environmental mitigation measures set forth in 

5 items 1 through 29 at pages 167 through 169 of the 

6 ‘‘Final Legislative Environmental Impact State7 ment’’ (April 1987) on the Coastal Plain. 

8 (2) Seasonal limitations on exploration, develop9 ment, and related activities, where necessary, to 

10 avoid significant adverse effects during periods of 

11 concentrated fish and wildlife breeding, denning, 

12 nesting, spawning, and migration. 

13 (3) Design safety and construction standards 

14 for all pipelines and any access and service roads, 

15 that— 

16 (A) minimize, to the maximum extent pos17 sible, adverse effects upon the passage of mi18 gratory species such as caribou; and 

19 (B) minimize adverse effects upon the flow 

20 of surface water by requiring the use of cul21 verts, bridges, and other structural devices. 

22 (4) Prohibitions on general public access and 

23 use on all pipeline access and service roads. 

24 (5) Stringent reclamation and rehabilitation re25 quirements, consistent with the standards set forth 


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1 in this subtitle, requiring the removal from the 

2 Coastal Plain of all oil and gas development and 

3 production facilities, structures, and equipment upon 

4 completion of oil and gas production operations, ex5 cept that the Secretary may exempt from the re6 quirements of this paragraph those facilities, struc7 tures, or equipment that the Secretary determines 

8 would assist in the management of the Arctic Na9 tional Wildlife Refuge and that are donated to the 

10 United States for that purpose. 

11 (6) Appropriate prohibitions or restrictions on 

12 access by all modes of transportation. 

13 (7) Appropriate prohibitions or restrictions on 

14 sand and gravel extraction. 

15 (8) Consolidation of facility siting. 

16 (9) Appropriate prohibitions or restrictions on 

17 use of explosives. 

18 (10) Avoidance, to the extent practicable, of 

19 springs, streams, and river system; the protection of 

20 natural surface drainage patterns, wetlands, and ri21 parian habitats; and the regulation of methods or 

22 techniques for developing or transporting adequate 

23 supplies of water for exploratory drilling. 

24 (11) Avoidance or minimization of air traffic-re25 lated disturbance to fish and wildlife. 


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1 (12) Treatment and disposal of hazardous and 

2 toxic wastes, solid wastes, reserve pit fluids, drilling 

3 muds and cuttings, and domestic wastewater, includ4 ing an annual waste management report, a haz5 ardous materials tracking system, and a prohibition 

6 on chlorinated solvents, in accordance with applica7 ble Federal and State environmental law. 

8 (13) Fuel storage and oil spill contingency plan9 ning. 

10 (14) Research, monitoring, and reporting re11 quirements. 

12 (15) Field crew environmental briefings. 

13 (16) Avoidance of significant adverse effects 

14 upon subsistence hunting, fishing, and trapping by 

15 subsistence users. 

16 (17) Compliance with applicable air and water 

17 quality standards. 

18 (18) Appropriate seasonal and safety zone des19 ignations around well sites, within which subsistence 

20 hunting and trapping shall be limited. 

21 (19) Reasonable stipulations for protection of 

22 cultural and archeological resources. 

23 (20) All other protective environmental stipula24 tions, restrictions, terms, and conditions deemed 

25 necessary by the Secretary. 


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1 (e) CONSIDERATIONS.—In preparing and promul2 gating regulations, lease terms, conditions, restrictions, 

3 prohibitions, and stipulations under this section, the Sec4 retary shall consider the following: 

5 (1) The stipulations and conditions that govern 

6 the National Petroleum Reserve-Alaska leasing pro7 gram, as set forth in the 1999 Northeast National 

8 Petroleum Reserve-Alaska Final Integrated Activity 

9 Plan/Environmental Impact Statement. 

10 (2) The environmental protection standards 

11 that governed the initial Coastal Plain seismic explo12 ration program under parts 37.31 to 37.33 of title 

13 50, Code of Federal Regulations. 

14 (3) The land use stipulations for exploratory 

15 drilling on the KIC–ASRC private lands that are set 

16 forth in Appendix 2 of the August 9, 1983, agree17 ment between Arctic Slope Regional Corporation and 

18 the United States. 

19 (f) FACILITY CONSOLIDATION PLANNING.— 

20 (1) IN GENERAL.—The Secretary shall, after 

21 providing for public notice and comment, prepare 

22 and update periodically a plan to govern, guide, and 

23 direct the siting and construction of facilities for the 

24 exploration, development, production, and transpor25 tation of Coastal Plain oil and gas resources. 


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1 (2) OBJECTIVES.—The plan shall have the fol2 lowing objectives: 

3 (A) Avoiding unnecessary duplication of fa4 cilities and activities. 

5 (B) Encouraging consolidation of common 

6 facilities and activities. 

7 (C) Locating or confining facilities and ac8 tivities to areas that will minimize impact on 

9 fish and wildlife, their habitat, and the environ10 ment. 

11 (D) Utilizing existing facilities wherever 

12 practicable. 

13 (E) Enhancing compatibility between wild14 life values and development activities. 

15 (g) ACCESS TO PUBLIC LANDS.—The Secretary 

16 shall— 

17 (1) manage public lands in the Coastal Plain 

18 subject to subsections (a) and (b) of section 811 of 

19 the Alaska National Interest Lands Conservation 

20 Act (16 U.S.C. 3121); and 

21 (2) ensure that local residents shall have rea22 sonable access to public lands in the Coastal Plain 

23 for traditional uses. 

24 SEC. 328. EXPEDITED JUDICIAL REVIEW. 

25 (a) FILING OF COMPLAINT.— 


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1 (1) DEADLINE.—Subject to paragraph (2), any 

2 complaint seeking judicial review of any provision of 

3 this Act or any action of the Secretary under this 

4 subtitle shall be filed— 

5 (A) except as provided in subparagraph 

6 (B), within the 90-day period beginning on the 

7 date of the action being challenged; or 

8 (B) in the case of a complaint based solely 

9 on grounds arising after such period, within 90 

10 days after the complainant knew or reasonably 

11 should have known of the grounds for the com12 plaint. 

13 (2) VENUE.—Any complaint seeking judicial re14 view of any provision of this subtitle or any action 

15 of the Secretary under this subtitle may be filed only 

16 in the United States Court of Appeals for the Dis17 trict of Columbia. 

18 (3) LIMITATION ON SCOPE OF CERTAIN RE19 VIEW.—Judicial review of a Secretarial decision to 

20 conduct a lease sale under this subtitle, including 

21 the environmental analysis thereof, shall be limited 

22 to whether the Secretary has complied with the 

23 terms of this subtitle and shall be based upon the 

24 administrative record of that decision. The Sec25 retary’s identification of a preferred course of action 


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1 to enable leasing to proceed and the Secretary’s 

2 analysis of environmental effects under this subtitle 

3 shall be presumed to be correct unless shown other4 wise by clear and convincing evidence to the con5 trary. 

6 (b) LIMITATION ON OTHER REVIEW.—Actions of the 

7 Secretary with respect to which review could have been 

8 obtained under this section shall not be subject to judicial 

9 review in any civil or criminal proceeding for enforcement. 

10 SEC. 329. FEDERAL AND STATE DISTRIBUTION OF REVE11 NUES. 

12 (a) IN GENERAL.—Notwithstanding any other provi13 sion of law, of the amount of adjusted bonus, rental, and 

14 royalty revenues from Federal oil and gas leasing and op15 erations authorized under this subtitle— 

16 (1) 25 percent shall be paid to the State of 

17 Alaska; and 

18 (2) except as provided in section 432(d), the 

19 balance shall be deposited into the Treasury as mis20 cellaneous receipts. 

21 (b) PAYMENTS TO ALASKA.—Payments to the State 

22 of Alaska under this section shall be made semiannually. 


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1 SEC. 330. RIGHTS-OF-WAY ACROSS THE COASTAL PLAIN. 

2 (a) IN GENERAL.—The Secretary shall issue rights3 of-way and easements across the Coastal Plain for the 

4 transportation of oil and gas— 

5 (1) except as provided in paragraph (2), under 

6 section 28 of the Mineral Leasing Act (30 U.S.C. 

7 185), without regard to title XI of the Alaska Na8 tional Interest Lands Conservation Act (30 U.S.C. 

9 3161 et seq.); and 

10 (2) under title XI of the Alaska National Inter11 est Lands Conservation Act (30 U.S.C. 3161 et 

12 seq.), for access authorized by sections 1110 and 

13 1111 of that Act (16 U.S.C. 3170 and 3171). 

14 (b) TERMS AND CONDITIONS.—The Secretary shall 

15 include in any right-of-way or easement issued under sub16 section (a) such terms and conditions as may be necessary 

17 to ensure that transportation of oil and gas does not result 

18 in a significant adverse effect on the fish and wildlife, sub19 sistence resources, their habitat, and the environment of 

20 the Coastal Plain, including requirements that facilities be 

21 sited or designed so as to avoid unnecessary duplication 

22 of roads and pipelines. 

23 (c) REGULATIONS.—The Secretary shall include in 

24 regulations under section 423(g) provisions granting 

25 rights-of-way and easements described in subsection (a) 

26 of this section. 


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1 SEC. 331. CONVEYANCE. 

2 In order to maximize Federal revenues by removing 

3 clouds on title to lands and clarifying land ownership pat4 terns within the Coastal Plain, the Secretary, notwith5 standing the provisions of section 1302(h)(2) of the Alas6 ka National Interest Lands Conservation Act (16 U.S.C. 

7 3192(h)(2)), shall convey— 

8 (1) to the Kaktovik Inupiat Corporation the 

9 surface estate of the lands described in paragraph 1 

10 of Public Land Order 6959, to the extent necessary 

11 to fulfill the Corporation’s entitlement under sec12 tions 12 and 14 of the Alaska Native Claims Settle13 ment Act (43 U.S.C. 1611 and 1613) in accordance 

14 with the terms and conditions of the Agreement be15 tween the Department of the Interior, the United 

16 States Fish and Wildlife Service, the Bureau of 

17 Land Management, and the Kaktovik Inupiat Cor18 poration effective January 22, 1993; and 

19 (2) to the Arctic Slope Regional Corporation 

20 the remaining subsurface estate to which it is enti21 tled pursuant to the August 9, 1983, agreement be22 tween the Arctic Slope Regional Corporation and the 

23 United States of America. 

24 SEC. 332. LOCAL GOVERNMENT IMPACT AID AND COMMU25 NITY SERVICE ASSISTANCE. 

26 (a) FINANCIAL ASSISTANCE AUTHORIZED.— 


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1 (1) IN GENERAL.—The Secretary may use 

2 amounts available from the Coastal Plain Local Gov3 ernment Impact Aid Assistance Fund established by 

4 subsection (d) to provide timely financial assistance 

5 to entities that are eligible under paragraph (2) and 

6 that are directly impacted by the exploration for or 

7 production of oil and gas on the Coastal Plain under 

8 this subtitle. 

9 (2) ELIGIBLE ENTITIES.—The North Slope 

10 Borough, the City of Kaktovik, and any other bor11 ough, municipal subdivision, village, or other com12 munity in the State of Alaska that is directly im13 pacted by exploration for, or the production of, oil 

14 or gas on the Coastal Plain under this Act, as deter15 mined by the Secretary, shall be eligible for financial 

16 assistance under this section. 

17 (b) USE OF ASSISTANCE.—Financial assistance 

18 under this section may be used only for— 

19 (1) planning for mitigation of the potential ef20 fects of oil and gas exploration and development on 

21 environmental, social, cultural, recreational, and sub22 sistence values; 

23 (2) implementing mitigation plans and main24 taining mitigation projects; 


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1 (3) developing, carrying out, and maintaining 

2 projects and programs that provide new or expanded 

3 public facilities and services to address needs and 

4 problems associated with such effects, including fire5 fighting, police, water, waste treatment, medivac, 

6 and medical services; and 

7 (4) establishment of a coordination office, by 

8 the north slope borough, in the City of Kaktovik, 

9 which shall— 

10 (A) coordinate with and advise developers 

11 on local conditions, impact, and history of the 

12 areas utilized for development; and 

13 (B) provide to the Committee on Resources 

14 of the House of Representatives and the Com15 mittee on Energy and Natural Resources of the 

16 Senate an annual report on the status of co17 ordination between developers and the commu18 nities affected by development. 

19 (c) APPLICATION.— 

20 (1) IN GENERAL.—Any community that is eligi21 ble for assistance under this section may submit an 

22 application for such assistance to the Secretary, in 

23 such form and under such procedures as the Sec24 retary may prescribe by regulation. 


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1 (2) NORTH SLOPE BOROUGH COMMUNITIES.—A 

2 community located in the North Slope Borough may 

3 apply for assistance under this section either directly 

4 to the Secretary or through the North Slope Bor5 ough 

6 (3) APPLICATION ASSISTANCE.—The Secretary 

7 shall work closely with and assist the North Slope 

8 Borough and other communities eligible for assist9 ance under this section in developing and submitting 

10 applications for assistance under this section. 

11 (d) ESTABLISHMENT OF FUND.— 

12 (1) IN GENERAL.—There is established in the 

13 Treasury the Coastal Plain Local Government Im14 pact Aid Assistance Fund. 

15 (2) USE.—Amounts in the fund may be used 

16 only for providing financial assistance under this 

17 section. 

18 (3) DEPOSITS.—Subject to paragraph (4), there 

19 shall be deposited into the fund amounts received by 

20 the United States as revenues derived from rents, 

21 bonuses, and royalties from Federal leases and lease 

22 sales authorized under this subtitle. 

23 (4) LIMITATION ON DEPOSITS.—The total 

24 amount in the fund may not exceed $11,000,000. 


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1 (5) INVESTMENT OF BALANCES.—The Sec2 retary of the Treasury shall invest amounts in the 

3 fund in interest bearing government securities. 

4 (e) AUTHORIZATION OF APPROPRIATIONS.—To pro5 vide financial assistance under this section there is author6 ized to be appropriated to the Secretary from the Coastal 

7 Plain Local Government Impact Aid Assistance Fund 

8 $5,000,000 for each fiscal year. 

9 TITLE IV—OTHER PROVISIONS 

10 SEC. 401. MODIFICATION OF RENEWABLE ELECTRICITY 

11 PRODUCTION CREDIT FOR BIOMASS FACILI12 TIES. 

13 (a) IN GENERAL.—Subsection (e) of section 45 of the 

14 Internal Revenue Code of 1986 is amended by adding at 

15 the end the following new paragraph: 

16 ‘‘(12) CREDIT ALLOWED FOR ELECTRICITY

17 PRODUCED FROM BIOMASS FOR ON-SITE USE.—In 

18 the case of electricity produced after December 31, 

19 2008, at any facility described in paragraph (2) or 

20 (3) of subsection (d) which is equipped with a meter21 ing device to determine electricity consumption or 

22 sale, subsection (a)(2) shall be applied without re23 gard to subparagraph (B) thereof with respect to 

24 such electricity produced and consumed at such fa25 cility.’’. 


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1 (b) CREDIT PERIOD FOR ELECTRICITY PRODUCED

2 FROM OPEN-LOOP BIOMASS FOR ON-SITE USE.—Sub3 paragraph (B) of section 45(b)(4) of the Internal Revenue 

4 Code of 1986 is amended— 

5 (1) by striking ‘‘clause (ii) or clause (iii)’’ in 

6 clause (i) and inserting ‘‘clause (ii), (iii), or (iv)’’, 

7 (2) by redesignating clause (iii) as clause (iv), 

8 and 

9 (3) by inserting after clause (ii) the following 

10 new clause: 

11 ‘‘(iii) ELECTRICITY PRODUCED FOR

12 ON-SITE USE AT CERTAIN OPEN-LOOP BIO13 MASS FACILITIES.—In the case of elec14 tricity produced and consumed as de15 scribed in subsection (e)(12) at any facility 

16 described in subsection (d)(3)(A)(ii) which 

17 is placed in service before the date of the 

18 enactment of this clause, the 5-year period 

19 beginning on January 1, 2009, shall be 

20 substituted for the 10-year period in sub21 section (a)(2)(A)(ii).’’. 

22 (c) EFFECTIVE DATE.—The amendments made by 

23 this section shall take effect on the date of the enactment 

24 of this Act. 


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1 SEC. 402. ELIMINATION OF OTHER RESTRICTIONS ON USE 

2 OF ENERGY ALTERNATIVES. 

3 (a) RENEWABLE BIOMASS.—Section 211(o)(1)(I) of 

4 the Clean Air Act (42 U.S.C. 7545(o)(1)(I)) is amended 

5 effective January 1, 2009— 

6 (1) in clause (ii), by striking ‘‘on non-federal 

7 land’’; and 

8 (2) in clause (iv), by striking ‘‘that are from 

9 non-federal forestlands, including forestlands’’ and 

10 inserting ‘‘from forestlands, including those on pub11 lic lands and those’’. 

12 (b) ALTERNATIVE FUELS.—Section 526 of the En13 ergy Independence and Security Act of 2007 (42 U.S.C. 

14 17142) is repealed. 

15 (c) LIMITATION ON NUMBER OF NEW QUALIFIED

16 HYBRID ADVANCED LEAN-BURN TECHNOLOGY VEHI17 CLES.—Section 30B of the Internal Revenue Code of 1986 

18 is amended by striking subsection (f). 

19 SEC. 403. INCREASED CREDIT FOR CERTAIN VEHICLES AC20 QUIRED FROM DOMESTIC CORPORATIONS. 

21 (a) ALTERNATIVE MOTOR VEHICLE CREDIT.—Sec22 tion 30B of the Internal Revenue Code of 1986 is amend23 ed by redesignating subsections (j) and (k) as subsections 

24 (k) and (l) and by inserting after subsection (i) the fol25 lowing new subsection: 


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1 ‘‘(j) INCREASED CREDIT FOR ACQUISITION FROM

2 DOMESTIC CORPORATIONS.—In the case of a vehicle with 

3 respect to which credit is allowable to the taxpayer under 

4 this section, the amount of such credit shall be increased 

5 by $500 if such vehicle is acquired (for use or lease) by 

6 the taxpayer from a domestic corporation.’’. 

7 (b) NEW QUALIFIED PLUG-IN ELECTRIC MOTOR VE8 HICLE CREDIT.— 

9 (1) IN GENERAL.—Subsection (b) of section 

10 30D of the Internal Revenue Code is amended by 

11 adding at the end the following new paragraph: 

12 ‘‘(4) DOMESTIC ACQUISITION.—In the case of a 

13 vehicle acquired (for use or lease) by the taxpayer 

14 from a domestic corporation, $500.’’. 

15 (2) CONFORMING AMENDMENT.—Paragraph (1) 

16 of section 30D(b) of such Code is amended by strik17 ing ‘‘and (3)’’ and inserting ‘‘, (3), and (4)’’. 

18 (c) EFFECTIVE DATE.—The amendments made by 

19 this section shall apply to vehicles acquired (for use or 

20 lease) after the date of the enactment of this Act. 


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1 TITLE V—COAL-TO-LIQUID FUEL 

2 Subtitle A—Coal-to-Liquid Fuel 

3 Activities 

4 SEC. 501. SHORT TITLE. 

5 This subtitle may be cited as the ‘‘Coal-to-Liquid 

6 Fuel Promotion Act of 2009’’. 

7 SEC. 502. DEFINITIONS. 

8 In this subtitle: 

9 (1) COAL-TO-LIQUID.—The term ‘‘coal-to-liq10 uid’’ means— 

11 (A) with respect to a process or tech12 nology, the use of a feedstock, the majority of 

13 which is the coal resources of the United 

14 States, using the class of reactions known as 

15 Fischer-Tropsch, to produce synthetic fuel suit16 able for transportation; and 

17 (B) with respect to a facility, the portion 

18 of a facility related to producing the inputs to 

19 the Fischer-Tropsch process, the Fischer20 Tropsch process, finished fuel production, or 

21 the capture, transportation, or sequestration of 

22 byproducts of the use of a feedstock that is pri23 marily domestic coal at the Fischer-Tropsch fa24 cility, including carbon emissions. 


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1 (2) SECRETARY.—The term ‘‘Secretary’’ means 

2 the Secretary of Energy. 

3 SEC. 503. COAL-TO-LIQUID FUEL LOAN GUARANTEE PRO4 GRAM. 

5 (a) ELIGIBLE PROJECTS.—Section 1703(b) of the 

6 Energy Policy Act of 2005 (42 U.S.C. 16513(b)) is 

7 amended by adding at the end the following: 

8 ‘‘(11) Large-scale coal-to-liquid facilities (as de9 fined in section 502 of the Coal-to-Liquid Fuel Pro10 motion Act of 2009) that use a feedstock, the major11 ity of which is the coal resources of the United 

12 States, to produce not less than 10,000 barrels a 

13 day of liquid transportation fuel.’’. 

14 (b) AUTHORIZATION OF APPROPRIATIONS.—Section 

15 1704 of the Energy Policy Act of 2005 (42 U.S.C. 16514) 

16 is amended by adding at the end the following: 

17 ‘‘(c) COAL-TO-LIQUID PROJECTS.— 

18 ‘‘(1) IN GENERAL.—There are authorized to be 

19 appropriated such sums as are necessary to provide 

20 the cost of guarantees for projects involving large21 scale coal-to-liquid facilities under section 

22 1703(b)(11). 

23 ‘‘(2) ALTERNATIVE FUNDING.—If no appropria24 tions are made available under paragraph (1), an eli25 gible applicant may elect to provide payment to the 


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1 Secretary, to be delivered if and at the time the ap2 plication is approved, in the amount of the estimated 

3 cost of the loan guarantee to the Federal Govern4 ment, as determined by the Secretary. 

5 ‘‘(3) LIMITATIONS.— 

6 ‘‘(A) IN GENERAL.—No loan guarantees 

7 shall be provided under this title for projects 

8 described in paragraph (1) after (as determined 

9 by the Secretary)— 

10 ‘‘(i) the tenth such loan guarantee is 

11 issued under this title; or 

12 ‘‘(ii) production capacity covered by 

13 such loan guarantees reaches 100,000 bar14 rels per day of coal-to-liquid fuel. 

15 ‘‘(B) INDIVIDUAL PROJECTS.— 

16 ‘‘(i) IN GENERAL.—A loan guarantee 

17 may be provided under this title for any 

18 large-scale coal-to-liquid facility described 

19 in paragraph (1) that produces no more 

20 than 20,000 barrels of coal-to-liquid fuel 

21 per day. 

22 ‘‘(ii) NON-FEDERAL FUNDING RE23 QUIREMENT.—To be eligible for a loan 

24 guarantee under this title, a large-scale 

25 coal-to-liquid facility described in paraVerDate Nov 24 2008 06:45 May 06, 2009 Jkt 079200 PO 00000 Frm 00056 Fmt 6652 Sfmt 6201 E:\BILLS\H2250.IH H2250

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1 graph (1) that produces more than 20,000 

2 barrels per day of coal-to-liquid fuel shall 

3 be eligible to receive a loan guarantee for 

4 the proportion of the cost of the facility 

5 that represents 20,000 barrels of coal-to6 liquid fuel per day of production. 

7 ‘‘(4) REQUIREMENTS.— 

8 ‘‘(A) GUIDELINES.—Not later than 180 

9 days after the date of enactment of this sub10 section, the Secretary shall publish guidelines 

11 for the coal-to-liquids loan guarantee applica12 tion process. 

13 ‘‘(B) APPLICATIONS.—Not later than 1 

14 year after the date of enactment of this sub15 section, the Secretary shall begin to accept ap16 plications for coal-to-liquid loan guarantees 

17 under this subsection. 

18 ‘‘(C) DEADLINE.—Not later than 1 year 

19 from the date of acceptance of an application 

20 under subparagraph (B), the Secretary shall 

21 evaluate the application and make final deter22 minations under this subsection. 

23 ‘‘(5) REPORTS TO CONGRESS.—The Secretary 

24 shall submit to the Committee on Energy and Nat25 ural Resources of the Senate and the Committee on 


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1 Energy and Commerce of the House of Representa2 tives a report describing the status of the program 

3 under this subsection not later than each of— 

4 ‘‘(A) 180 days after the date of enactment 

5 of this subsection; 

6 ‘‘(B) 1 year after the date of enactment of 

7 this subsection; and 

8 ‘‘(C) the dates on which the Secretary ap9 proves the first and fifth applications for coal10 to-liquid loan guarantees under this sub11 section.’’. 

12 SEC. 504. COAL-TO-LIQUID FACILITIES LOAN PROGRAM. 

13 (a) DEFINITION OF ELIGIBLE RECIPIENT.—In this 

14 section, the term ‘‘eligible recipient’’ means an individual, 

15 organization, or other entity that owns, operates, or plans 

16 to construct a coal-to-liquid facility that will produce at 

17 least 10,000 barrels per day of coal-to-liquid fuel. 

18 (b) ESTABLISHMENT.—The Secretary shall establish 

19 a program under which the Secretary shall provide loans, 

20 in a total amount not to exceed $20,000,000, for use by 

21 eligible recipients to pay the Federal share of the cost of 

22 obtaining any services necessary for the planning, permit23 ting, and construction of a coal-to-liquid facility. 

24 (c) APPLICATION.—To be eligible to receive a loan 

25 under subsection (b), the eligible recipient shall submit to 


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1 the Secretary an application at such time, in such manner, 

2 and containing such information as the Secretary may re3 quire. 

4 (d) NON-FEDERAL MATCH.—To be eligible to receive 

5 a loan under this section, an eligible recipient shall use 

6 non-Federal funds to provide a dollar-for-dollar match of 

7 the amount of the loan. 

8 (e) REPAYMENT OF LOAN.— 

9 (1) IN GENERAL.—To be eligible to receive a 

10 loan under this section, an eligible recipient shall 

11 agree to repay the original amount of the loan to the 

12 Secretary not later than 5 years after the date of the 

13 receipt of the loan. 

14 (2) SOURCE OF FUNDS.—Repayment of a loan 

15 under paragraph (1) may be made from any financ16 ing or assistance received for the construction of a 

17 coal-to-liquid facility described in subsection (a), in18 cluding a loan guarantee provided under section 

19 1703(b)(11) of the Energy Policy Act of 2005 (42 

20 U.S.C. 16513(b)(11)). 

21 (f) REQUIREMENTS.— 

22 (1) GUIDELINES.—Not later than 180 days 

23 after the date of enactment of this Act, the Sec24 retary shall publish guidelines for the coal-to-liquids 

25 loan application process. 


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1 (2) APPLICATIONS.—Not later than 1 year 

2 after the date of enactment of this Act, the Sec3 retary shall begin to accept applications for coal-to4 liquid loans under this section. 

5 (g) REPORTS TO CONGRESS.—Not later than each of 

6 180 days and 1 year after the date of enactment of this 

7 Act, the Secretary shall submit to the Committee on En8 ergy and Natural Resources of the Senate and the Com9 mittee on Energy and Commerce of the House of Rep10 resentatives a report describing the status of the program 

11 under this section. 

12 (h) AUTHORIZATION OF APPROPRIATIONS.—There is 

13 authorized to be appropriated to carry out this section 

14 $200,000,000, to remain available until expended. 

15 SEC. 505. LOCATION OF COAL-TO-LIQUID MANUFACTURING 

16 FACILITIES. 

17 The Secretary, in coordination with the head of any 

18 affected agency, shall promulgate such regulations as the 

19 Secretary determines to be necessary to support the devel20 opment on Federal land (including land of the Department 

21 of Energy, military bases, and military installations closed 

22 or realigned under the defense base closure and realign23 ment) of coal-to-liquid manufacturing facilities and associ24 ated infrastructure, including the capture, transportation, 

25 or sequestration of carbon dioxide. 


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1 SEC. 506. STRATEGIC PETROLEUM RESERVE. 

2 (a) DEVELOPMENT, OPERATION, AND MAINTENANCE

3 OF RESERVE.—Section 159 of the Energy Policy and Con4 servation Act (42 U.S.C. 6239) is amended— 

5 (1) by redesignating subsections (f), (g), (j), 

6 (k), and (l) as subsections (a), (b), (e), (f), and (g), 

7 respectively; and 

8 (2) by inserting after subsection (b) (as redesig9 nated by paragraph (1)) the following: 

10 ‘‘(c) STUDY OF MAINTAINING COAL-TO-LIQUID

11 PRODUCTS IN RESERVE.—Not later than 1 year after the 

12 date of enactment of the Coal-to-Liquid Fuel Promotion 

13 Act of 2009, the Secretary and the Secretary of Defense 

14 shall— 

15 ‘‘(1) conduct a study of the feasibility and suit16 ability of maintaining coal-to-liquid products in the 

17 Reserve; and 

18 ‘‘(2) submit to the Committee on Energy and 

19 Natural Resources and the Committee on Armed 

20 Services of the Senate and the Committee on Energy 

21 and Commerce and the Committee on Armed Serv22 ices of the House of Representatives a report de23 scribing the results of the study. 

24 ‘‘(d) CONSTRUCTION OF STORAGE FACILITIES.—As 

25 soon as practicable after the date of enactment of the 

26 Coal-to-Liquid Fuel Promotion Act of 2009, the Secretary 


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1 may construct 1 or more storage facilities in the vicinity 

2 of pipeline infrastructure and at least 1 military base.’’. 

3 (b) PETROLEUM PRODUCTS FOR STORAGE IN RE4 SERVE.—Section 160 of the Energy Policy and Conserva5 tion Act (42 U.S.C. 6240) is amended— 

6 (1) in subsection (a)— 

7 (A) in paragraph (1), by inserting a semi8 colon at the end; 

9 (B) in paragraph (2), by striking ‘‘and’’ at 

10 the end; 

11 (C) in paragraph (3), by striking the pe12 riod at the end and inserting ‘‘; and’’; and 

13 (D) by adding at the end the following: 

14 ‘‘(4) coal-to-liquid products (as defined in sec15 tion 502 of the Coal-to-Liquid Fuel Promotion Act 

16 of 2009), as the Secretary determines to be appro17 priate, in a quantity not to exceed 20 percent of the 

18 total quantity of petroleum and petroleum products 

19 in the Reserve.’’; 

20 (2) in subsection (b), by redesignating para21 graphs (3) through (5) as paragraphs (2) through 

22 (4), respectively; and 

23 (3) by redesignating subsections (f) and (h) as 

24 subsections (d) and (e), respectively. 


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1 (c) CONFORMING AMENDMENTS.—Section 167 of the 

2 Energy Policy and Conservation Act (42 U.S.C. 6247) is 

3 amended— 

4 (1) in subsection (b)— 

5 (A) by redesignating paragraphs (2) and 

6 (3) as paragraphs (1) and (2), respectively; and 

7 (B) in paragraph (2) (as redesignated by 

8 subparagraph (A)), by striking ‘‘section 160(f)’’ 

9 and inserting ‘‘section 160(e)’’; and 

10 (2) in subsection (d), in the matter preceding 

11 paragraph (1), by striking ‘‘section 160(f)’’ and in12 serting ‘‘section 160(e)’’. 

13 SEC. 507. AUTHORIZATION TO CONDUCT RESEARCH, DE14 VELOPMENT, TESTING, AND EVALUATION OF 

15 ASSURED DOMESTIC FUELS. 

16 Of the amount authorized to be appropriated for the 

17 Air Force for research, development, testing, and evalua18 tion, $10,000,000 may be made available for the Air Force 

19 Research Laboratory to continue support efforts to test, 

20 qualify, and procure synthetic fuels developed from coal 

21 for aviation jet use. 


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1 SEC. 508. COAL-TO-LIQUID LONG-TERM FUEL PROCURE2 MENT AND DEPARTMENT OF DEFENSE DE3 VELOPMENT. 

4 Section 2398a of title 10, United States Code is 

5 amended— 

6 (1) in subsection (b)— 

7 (A) by striking ‘‘The Secretary’’ and in8 serting the following: 

9 ‘‘(1) IN GENERAL.—The Secretary’’; and 

10 (B) by adding at the end the following: 

11 ‘‘(2) COAL-TO-LIQUID PRODUCTION FACILI12 TIES.— 

13 ‘‘(A) IN GENERAL.—The Secretary of De14 fense may enter into contracts or other agree15 ments with private companies or other entities 

16 to develop and operate coal-to-liquid facilities 

17 (as defined in section 502 of the Coal-to-Liquid 

18 Fuel Promotion Act of 2009) on or near mili19 tary installations. 

20 ‘‘(B) CONSIDERATIONS.—In entering into 

21 contracts and other agreements under subpara22 graph (A), the Secretary shall consider land 

23 availability, testing opportunities, and proximity 

24 to raw materials.’’; 

25 (2) in subsection (d)— 


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1 (A) by striking ‘‘Subject to applicable pro2 visions of law, any’’ and inserting ‘‘Any’’; and 

3 (B) by striking ‘‘1 or more years’’ and in4 serting ‘‘up to 25 years’’; and 

5 (3) by adding at the end the following: 

6 ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There 

7 are authorized to be appropriated such sums as are nec8 essary to carry out this section.’’. 

9 SEC. 509. REPORT ON EMISSIONS OF FISCHER-TROPSCH 

10 PRODUCTS USED AS TRANSPORTATION 

11 FUELS. 

12 (a) IN GENERAL.—In cooperation with the Adminis13 trator of the Environmental Protection Agency, the Sec14 retary of Defense, the Administrator of the Federal Avia15 tion Administration, and the Secretary of Health and 

16 Human Services, the Secretary shall— 

17 (1) carry out a research and demonstration pro18 gram to evaluate the emissions of the use of Fischer19 Tropsch fuel for transportation, including diesel and 

20 jet fuel; 

21 (2) evaluate the effect of using Fischer-Tropsch 

22 transportation fuel on land and air engine exhaust 

23 emissions; and 

24 (3) in accordance with subsection (e), submit to 

25 Congress a report on the effect on air quality and 


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1 public health of using Fischer-Tropsch fuel in the 

2 transportation sector. 

3 (b) GUIDANCE AND TECHNICAL SUPPORT.—The Sec4 retary shall issue any guidance or technical support docu5 ments necessary to facilitate the effective use of Fischer6 Tropsch fuel and blends under this section. 

7 (c) FACILITIES.—For the purpose of evaluating the 

8 emissions of Fischer-Tropsch transportation fuels, the 

9 Secretary shall— 

10 (1) support the use and capital modification of 

11 existing facilities and the construction of new facili12 ties at the research centers designated in section 

13 417 of the Energy Policy Act of 2005 (42 U.S.C. 

14 15977); and 

15 (2) engage those research centers in the evalua16 tion and preparation of the report required under 

17 subsection (a)(3). 

18 (d) REQUIREMENTS.—The program described in sub19 section (a)(1) shall consider— 

20 (1) the use of neat (100 percent) Fischer21 Tropsch fuel and blends of Fischer-Tropsch fuels 

22 with conventional crude oil-derived fuel for heavy23 duty and light-duty diesel engines and the aviation 

24 sector; and 


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1 (2) the production costs associated with domes2 tic production of those fuels and prices for con3 sumers. 

4 (e) REPORTS.—The Secretary shall submit to the 

5 Committee on Energy and Natural Resources of the Sen6 ate and the Committee on Energy and Commerce of the 

7 House of Representatives— 

8 (1) not later than 180 days after the date of 

9 enactment of this Act, an interim report on actions 

10 taken to carry out this section; and 

11 (2) not later than 1 year after the date of en12 actment of this Act, a final report on actions taken 

13 to carry out this section. 

14 (f) AUTHORIZATION OF APPROPRIATIONS.—There 

15 are authorized to be appropriated such sums as are nec16 essary to carry out this section. 

17 Subtitle B—Amendments to the 

18 Internal Revenue Code of 1986 

19 SEC. 511. CREDIT FOR INVESTMENT IN COAL-TO-LIQUID 

20 FUELS PROJECTS. 

21 (a) IN GENERAL.—Section 46 of the Internal Rev22 enue Code of 1986 (relating to amount of credit) is 

23 amended by striking ‘‘and’’ at the end of paragraph (3), 

24 by striking the period at the end of paragraph (4) and 


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1 inserting ‘‘, and’’, and by adding at the end the following 

2 new paragraph: 

3 ‘‘(5) the qualifying coal-to-liquid fuels project 

4 credit.’’. 

5 (b) AMOUNT OF CREDIT.—Subpart E of part IV of 

6 subchapter A of chapter 1 of the Internal Revenue Code 

7 of 1986 (relating to rules for computing investment credit) 

8 is amended by inserting after section 48B the following 

9 new section: 

10 ‘‘SEC. 48C. QUALIFYING COAL-TO-LIQUID FUELS PROJECT 

11 CREDIT. 

12 ‘‘(a) IN GENERAL.—For purposes of section 46, the 

13 qualifying coal-to-liquid fuels project credit for any taxable 

14 year is an amount equal to 20 percent of the qualified 

15 investment for such taxable year. 

16 ‘‘(b) QUALIFIED INVESTMENT.— 

17 ‘‘(1) IN GENERAL.—For purposes of subsection 

18 (a), the qualified investment for any taxable year is 

19 the basis of property placed in service by the tax20 payer during such taxable year which is part of a 

21 qualifying coal-to-liquid fuels project— 

22 ‘‘(A)(i) the construction, reconstruction, or 

23 erection of which is completed by the taxpayer, 

24 or 


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1 ‘‘(ii) which is acquired by the taxpayer if 

2 the original use of such property commences 

3 with the taxpayer, and 

4 ‘‘(B) with respect to which depreciation (or 

5 amortization in lieu of depreciation) is allow6 able. 

7 ‘‘(2) APPLICABLE RULES.—For purposes of this 

8 section, rules similar to the rules of subsection 

9 (a)(4) and (b) of section 48 shall apply. 

10 ‘‘(c) DEFINITIONS.—For purposes of this section— 

11 ‘‘(1) QUALIFYING COAL-TO-LIQUID FUELS

12 PROJECT.—The term ‘qualifying coal-to-liquid fuels 

13 project’ means any domestic project which— 

14 ‘‘(A) employs the class of reactions known 

15 as Fischer-Tropsch to produce at least 10,000 

16 barrels per day of transportation grade liquid 

17 fuels from a feedstock that is primarily domes18 tic coal (including any property which allows for 

19 the capture, transportation, or sequestration of 

20 by-products resulting from such process, includ21 ing carbon emissions), and 

22 ‘‘(B) any portion of the qualified invest23 ment in which is certified under the qualifying 

24 coal-to-liquid program as eligible for credit 


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1 under this section in an amount (not to exceed 

2 $200,000,000) determined by the Secretary. 

3 ‘‘(2) COAL.—The term ‘coal’ means any carbon4 ized or semicarbonized matter, including peat. 

5 ‘‘(d) QUALIFYING COAL-TO-LIQUID FUELS PROJECT

6 PROGRAM.— 

7 ‘‘(1) IN GENERAL.—The Secretary, in consulta8 tion with the Secretary of Energy, shall establish a 

9 qualifying coal-to-liquid fuels project program to 

10 consider and award certifications for qualified in11 vestment eligible for credits under this section to 10 

12 qualifying coal-to-liquid fuels project sponsors under 

13 this section. The total qualified investment which 

14 may be awarded eligibility for credit under the pro15 gram shall not exceed $2,000,000,000. 

16 ‘‘(2) PERIOD OF ISSUANCE.—A certificate of 

17 eligibility under paragraph (1) may be issued only 

18 during the 10-fiscal year period beginning on Octo19 ber 1, 2007. 

20 ‘‘(3) SELECTION CRITERIA.—The Secretary 

21 shall not make a competitive certification award for 

22 qualified investment for credit eligibility under this 

23 section unless the recipient has documented to the 

24 satisfaction of the Secretary that— 


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1 ‘‘(A) the proposal of the award recipient is 

2 financially viable, 

3 ‘‘(B) the recipient will provide sufficient 

4 information to the Secretary for the Secretary 

5 to ensure that the qualified investment is spent 

6 efficiently and effectively, 

7 ‘‘(C) the fuels identified with respect to the 

8 gasification technology for such project will 

9 comprise at least 90 percent of the fuels re10 quired by the project for the production of 

11 transportation grade liquid fuels, 

12 ‘‘(D) the award recipient’s project team is 

13 competent in the planning and construction of 

14 coal gasification facilities and familiar with op15 eration of the Fischer-Tropsch process, with 

16 preference given to those recipients with experi17 ence which demonstrates successful and reliable 

18 operations of such process, and 

19 ‘‘(E) the award recipient has met other cri20 teria established and published by the Sec21 retary. 

22 ‘‘(e) DENIAL OF DOUBLE BENEFIT.—No deduction 

23 or other credit shall be allowed with respect to the basis 

24 of any property taken into account in determining the 

25 credit allowed under this section.’’. 


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1 (c) CONFORMING AMENDMENTS.— 

2 (1) Section 49(a)(1)(C) of the Internal Revenue 

3 Code of 1986 is amended by striking ‘‘and’’ at the 

4 end of clause (iii), by striking the period at the end 

5 of clause (iv) and inserting ‘‘, and’’, and by adding 

6 after clause (iv) the following new clause: 

7 ‘‘(v) the basis of any property which 

8 is part of a qualifying coal-to-liquid fuels 

9 project under section 48C.’’. 

10 (2) The table of sections for subpart E of part 

11 IV of subchapter A of chapter 1 of such Code is 

12 amended by inserting after the item relating to sec13 tion 48B the following new item: 

‘‘Sec. 48C. Qualifying coal-to-liquid fuels project credit.’’. 

14 (d) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to periods after the date of the 

16 enactment of this Act, under rules similar to the rules of 

17 section 48(m) of the Internal Revenue Code of 1986 (as 

18 in effect on the day before the date of the enactment of 

19 the Revenue Reconciliation Act of 1990). 

20 SEC. 512. TEMPORARY EXPENSING FOR EQUIPMENT USED 

21 IN COAL-TO-LIQUID FUELS PROCESS. 

22 (a) IN GENERAL.—Part VI of subchapter B of chap23 ter 1 of the Internal Revenue Code of 1986 is amended 

24 by inserting after section 179E the following new section: 


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1 ‘‘SEC. 179F. ELECTION TO EXPENSE CERTAIN COAL-TO-LIQ2 UID FUELS FACILITIES. 

3 ‘‘(a) TREATMENT AS EXPENSES.—A taxpayer may 

4 elect to treat the cost of any qualified coal-to-liquid fuels 

5 process property as an expense which is not chargeable 

6 to capital account. Any cost so treated shall be allowed 

7 as a deduction for the taxable year in which the expense 

8 is incurred. 

9 ‘‘(b) ELECTION.— 

10 ‘‘(1) IN GENERAL.—An election under this sec11 tion for any taxable year shall be made on the tax12 payer’s return of the tax imposed by this chapter for 

13 the taxable year. Such election shall be made in such 

14 manner as the Secretary may by regulations pre15 scribe. 

16 ‘‘(2) ELECTION IRREVOCABLE.—Any election 

17 made under this section may not be revoked except 

18 with the consent of the Secretary. 

19 ‘‘(c) QUALIFIED COAL-TO-LIQUID FUELS PROCESS

20 PROPERTY.—The term ‘qualified coal-to-liquid fuels proc21 ess property’ means any property located in the United 

22 States— 

23 ‘‘(1) which employs the Fischer-Tropsch process 

24 to produce transportation grade liquid fuels from a 

25 feedstock that is primarily domestic coal (including 

26 any property which allows for the capture, transporVerDate Nov 24 2008 06:45 May 06, 2009 Jkt 079200 PO 00000 Frm 00073 Fmt 6652 Sfmt 6201 E:\BILLS\H2250.IH H2250

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1 tation, or sequestration of by-products resulting 

2 from such process, including carbon emissions), 

3 ‘‘(2) the original use of which commences with 

4 the taxpayer, 

5 ‘‘(3) the construction of which— 

6 ‘‘(A) except as provided in subparagraph 

7 (B), is subject to a binding construction con8 tract entered into after the date of the enact9 ment of this section and before January 1, 

10 2013, but only if there was no written binding 

11 construction contract entered into on or before 

12 such date of enactment, or 

13 ‘‘(B) in the case of self-constructed prop14 erty, began after the date of the enactment of 

15 this section and before January 1, 2013, and 

16 ‘‘(4) which is placed in service by the taxpayer 

17 after the date of the enactment of this section and 

18 before January 1, 2018. 

19 ‘‘(d) ELECTION TO ALLOCATE DEDUCTION TO COOP20 ERATIVE OWNER.—If— 

21 ‘‘(1) a taxpayer to which subsection (a) applies 

22 is an organization to which part I of subchapter T 

23 applies, and 


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1 ‘‘(2) one or more persons directly holding an 

2 ownership interest in the taxpayer are organizations 

3 to which part I of subchapter T apply, 

4 the taxpayer may elect to allocate all or a portion of the 

5 deduction allowable under subsection (a) to such persons. 

6 Such allocation shall be equal to the person’s ratable share 

7 of the total amount allocated, determined on the basis of 

8 the person’s ownership interest in the taxpayer. The tax9 able income of the taxpayer shall not be reduced under 

10 section 1382 by reason of any amount to which the pre11 ceding sentence applies. 

12 ‘‘(e) BASIS REDUCTION.— 

13 ‘‘(1) IN GENERAL.—For purposes of this title, 

14 if a deduction is allowed under this section with re15 spect to any qualified coal-to-liquid fuels process 

16 property, the basis of such property shall be reduced 

17 by the amount of the deduction so allowed. 

18 ‘‘(2) ORDINARY INCOME RECAPTURE.—For 

19 purposes of section 1245, the amount of the deduc20 tion allowable under subsection (a) with respect to 

21 any property which is of a character subject to the 

22 allowance for depreciation shall be treated as a de23 duction allowed for depreciation under section 167. 

24 ‘‘(f) APPLICATION WITH OTHER DEDUCTIONS AND

25 CREDITS.— 


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1 ‘‘(1) OTHER DEDUCTIONS.—No deduction shall 

2 be allowed under any other provision of this chapter 

3 with respect to any expenditure with respect to 

4 which a deduction is allowed under subsection (a) to 

5 the taxpayer. 

6 ‘‘(2) CREDITS.—No credit shall be allowed 

7 under section 38 with respect to any amount for 

8 which a deduction is allowed under subsection (a). 

9 ‘‘(g) REPORTING.—No deduction shall be allowed 

10 under subsection (a) to any taxpayer for any taxable year 

11 unless such taxpayer files with the Secretary a report con12 taining such information with respect to the operation of 

13 the property of the taxpayer as the Secretary shall re14 quire.’’. 

15 (b) CONFORMING AMENDMENTS.— 

16 (1) Section 1016(a) of the Internal Revenue 

17 Code of 1986, as amended by this Act, is amended 

18 by striking ‘‘and’’ at the end of paragraph (37), by 

19 striking the period at the end of paragraph (38) and 

20 inserting ‘‘, and’’, and by adding at the end the fol21 lowing new paragraph: 

22 ‘‘(39) to the extent provided in section 

23 179F(e)(1).’’. 


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1 (2) Section 1245(a) of such Code is amended 

2 by inserting ‘‘179F,’’ after ‘‘179D,’’ both places it 

3 appears in paragraphs (2)(C) and (3)(C). 

4 (3) Section 263(a)(1) of such Code is amended 

5 by striking ‘‘or’’ at the end of subparagraph (J), by 

6 striking the period at the end of subparagraph (K) 

7 and inserting ‘‘, or’’, and by inserting after subpara8 graph (K) the following new subparagraph: 

9 ‘‘(L) expenditures for which a deduction is 

10 allowed under section 179F.’’. 

11 (4) Section 312(k)(3)(B) of such Code is 

12 amended by striking ‘‘or 179E’’ each place it ap13 pears in the heading and text and inserting ‘‘179E, 

14 or 179F’’. 

15 (5) The table of sections for part VI of sub16 chapter B of chapter 1 of such Code is amended by 

17 inserting after the item relating to section 179E the 

18 following new item: 

‘‘Sec. 179F. Election to expense certain coal-to-liquid fuels facilities.’’. 

19 (c) EFFECTIVE DATE.—The amendments made by 

20 this section shall apply to properties placed in service after 

21 the date of the enactment of this Act. 


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1 SEC. 513. EXTENSION OF ALTERNATIVE FUEL CREDIT FOR 

2 FUEL DERIVED FROM COAL THROUGH THE 

3 FISCHER-TROPSCH PROCESS. 

4 (a) ALTERNATIVE FUEL CREDIT.—Paragraph (5) of 

5 section 6426(d) of the Internal Revenue Code of 1986 is 

6 amended to read as follows: 

7 ‘‘(5) TERMINATION.—This subsection shall not 

8 apply to— 

9 ‘‘(A) any sale or use involving liquid fuel 

10 derived from a feedstock that is primarily do11 mestic coal (including peat) through the Fisch12 er-Tropsch process for any period after Sep13 tember 30, 2022, 

14 ‘‘(B) any sale or use involving liquified hy15 drogen for any period after September 30, 

16 2014, and 

17 ‘‘(C) any other sale or use for any period 

18 after December 31, 2009.’’. 

19 (b) PAYMENTS.— 

20 (1) IN GENERAL.—Paragraph (6) of section 

21 6427(e) of the Internal Revenue Code of 1986 is 

22 amended by striking ‘‘and’’ and the end of subpara23 graph (C), by striking the period at the end of sub24 paragraph (D) and inserting ‘‘, and’’, and by adding 

25 at the end the following new subparagraph: 


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1 ‘‘(E) any alternative fuel or alternative fuel 

2 mixture (as so defined) involving liquid fuel de3 rived from coal (including peat) through the 

4 Fischer-Tropsch process sold or used after Sep5 tember 30, 2022.’’. 

6 (2) CONFORMING AMENDMENT.—Section 

7 6427(e)(6)(C) of such Code is amended by striking 

8 ‘‘subparagraph (D)’’ and inserting ‘‘subparagraphs 

9 (D) and (E)’’. 

10 SEC. 514. MODIFICATIONS TO ENHANCED OIL RECOVERY 

11 CREDIT. 

12 (a) ENHANCED CREDIT FOR CARBON DIOXIDE IN13 JECTIONS.—Section 43 of the Internal Revenue Code of 

14 1986 is amended by adding at the end the following new 

15 subsection: 

16 ‘‘(f) ENHANCED CREDIT FOR PROJECTS USING

17 QUALIFIED CARBON DIOXIDE.— 

18 ‘‘(1) IN GENERAL.—For purposes of this sec19 tion— 

20 ‘‘(A) the term ‘qualified project’ includes a 

21 project described in paragraph (2), and 

22 ‘‘(B) in the case of a project described in 

23 paragraph (2), subsection (a) shall be applied 

24 by substituting ‘50 percent’ for ‘15 percent’. 


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1 ‘‘(2) PROJECTS DESCRIBED.—A project is de2 scribed in this paragraph if it begins or is substan3 tially expanded after December 31, 2007, and 

4 ‘‘(A) uses qualified carbon dioxide in an 

5 enhanced oil, natural gas, or coalbed methane 

6 recovery method, which involves flooding or in7 jection, or 

8 ‘‘(B) enables the capture or sequestration 

9 of qualified carbon dioxide. 

10 ‘‘(3) DEFINITIONS.—For purposes of this sub11 section— 

12 ‘‘(A) ENHANCED OIL RECOVERY.—The 

13 term ‘enhanced oil recovery’ means recovery of 

14 oil by injecting or flooding with qualified carbon 

15 dioxide. 

16 ‘‘(B) ENHANCED NATURAL GAS RECOV17 ERY.—The term ‘enhanced natural gas recov18 ery’ means recovery of natural gas by injecting 

19 or flooding with qualified carbon dioxide. 

20 ‘‘(C) ENHANCED COALBED METHANE RE21 COVERY.—The term ‘enhanced coalbed methane 

22 recovery’ means recovery of coalbed methane by 

23 injecting or flooding with qualified carbon diox24 ide. 


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1 ‘‘(D) QUALIFIED CARBON DIOXIDE.—The 

2 term ‘qualified carbon dioxide’ means carbon di3 oxide which is produced from the gasification 

4 and subsequent refinement of a feedstock which 

5 is primarily domestic coal, at a facility which 

6 produces coal-to-liquid fuel. 

7 ‘‘(E) CAPTURE OR SEQUESTRATION.—The 

8 term ‘capture or sequestration’ means any 

9 equipment or facility necessary to— 

10 ‘‘(i) capture or separate qualified car11 bon dioxide from other emissions, 

12 ‘‘(ii) transport qualified carbon diox13 ide, or 

14 ‘‘(iii) process and use qualified carbon 

15 dioxide in a qualified project. 

16 ‘‘(4) TERMINATION.—This subsection shall not 

17 apply to costs paid or incurred for any qualified 

18 project after December 31, 2020.’’. 

19 (b) CONFORMING AMENDMENTS.— 

20 (1) Section 43 of the Internal Revenue Code of 

21 1986 is amended— 

22 (A) by striking ‘‘enhanced oil recovery 

23 credit’’ in subsection (a) and inserting ‘‘en24 hanced oil, natural gas, and coalbed methane 

25 recovery, and capture and sequestration credit’’, 


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1 (B) by striking ‘‘qualified enhanced oil re2 covery costs’’ each place it appears and insert3 ing ‘‘qualified costs’’, 

4 (C) by striking ‘‘qualified enhanced oil re5 covery project’’ each place it appears and in6 serting ‘‘qualified project’’, and 

7 (D) by striking the heading and inserting: 

8 ‘‘SEC. 43. ENHANCED OIL, NATURAL GAS, AND COALBED 

9 METHANE RECOVERY, AND CAPTURE AND SE10 QUESTRATION CREDIT.’’. 

11 (2) The item in the table of sections for subpart 

12 D of part IV of subchapter A of chapter 1 of such 

13 Code relating to section 43 is amended to read as 

14 follows: 

‘‘Sec. 43. Enhanced oil, natural gas, and coalbed methane recovery, and capture and sequestration credit.’’. 

15 (c) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to costs paid or incurred in taxable 

17 years ending after December 31, 2009. 

18 SEC. 515. ALLOWANCE OF ENHANCED OIL, NATURAL GAS, 

19 AND COALBED METHANE RECOVERY, AND 

20 CAPTURE AND SEQUESTRATION CREDIT 

21 AGAINST THE ALTERNATIVE MINIMUM TAX. 

22 (a) IN GENERAL.—Subsection (c) of section 38 of the 

23 Internal Revenue Code of 1986 (relating to limitation 

24 based on amount of tax) is amended by redesignating 


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1 paragraphs (4) and (5) as paragraphs (5) and (6), respec2 tively, and by inserting after paragraph (3) the following 

3 new paragraph: 

4 ‘‘(4) SPECIAL RULES FOR ENHANCED OIL, NAT5 URAL GAS, AND COALBED METHANE RECOVERY, AND

6 CAPTURE AND SEQUESTRATION CREDIT.—In the 

7 case of the enhanced oil, natural gas, and coalbed 

8 methane recovery, and capture and sequestration 

9 credit determined under section 43— 

10 ‘‘(A) this section and section 39 shall be 

11 applied separately with respect to such credit, 

12 and 

13 ‘‘(B) in applying paragraph (1) to such 

14 credit— 

15 ‘‘(i) the tentative minimum tax shall 

16 be treated as being zero, and 

17 ‘‘(ii) the limitation under paragraph 

18 (1) (as modified by clause (i)) shall be re19 duced by the credit allowed under sub20 section (a) for the taxable year (other than 

21 the enhanced oil, natural gas, and coalbed 

22 methane recovery, and capture and seques23 tration credit and the specified credits).’’. 

24 (b) CONFORMING AMENDMENTS.— 


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1 (1) Section 38(c)(2)(A)(ii)(II) of such Code is 

2 amended by inserting ‘‘the enhanced oil, natural gas, 

3 and coalbed methane recovery, and capture and se4 questration credit,’’ after ‘‘employee credit,’’. 

5 (2) Section 38(c)(3)(A)(ii)(II) of such Code is 

6 amended by inserting ‘‘, the enhanced oil, natural 

7 gas, coalbed methane recovery, capture and seques8 tration credit,’’ after ‘‘employee credit’’. 

9 (c) EFFECTIVE DATE.—The amendments made by 

10 this section shall apply to taxable years ending after De11 cember 31, 2009. 

12 TITLE VI—INCENTIVIZING THE 

13 EXTRACTION AND PROC14 ESSING OF OIL SHALE 

15 SEC. 601. INCENTIVES FOR EXTRACTION AND PROCESSING 

16 OF OIL SHALE. 

17 (a) INVESTMENT TAX CREDIT FOR EXTRACTION AND

18 PROCESSING OF OIL SHALE USING IN-SITU CONVERSION

19 TECHNOLOGY.— 

20 (1) IN GENERAL.—Subpart E of part IV of 

21 subchapter A of chapter 1 of the Internal Revenue 

22 Code of 1986, as amended by this Act, is amended 

23 by inserting after section 48C the following new sec24 tion: 


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1 ‘‘SEC. 48D. OIL SHALE EXTRACTION AND PROCESSING FA2 CILITY. 

3 ‘‘(a) GENERAL RULE.—For purposes of section 46, 

4 the oil shale extraction and processing credit for any tax5 able year is 30 percent of the cost of any qualified oil shale 

6 extraction and processing property. 

7 ‘‘(b) QUALIFIED OIL SHALE EXTRACTION AND

8 PROCESSING PROPERTY.—The term ‘qualified oil shale 

9 extraction and processing property’ means property of a 

10 character subject to the allowance for depreciation— 

11 ‘‘(1) which is used in the United States solely 

12 to extract and process oil shale using in-situ conver13 sion technology, 

14 ‘‘(2) the original use of which commences with 

15 the taxpayer after the date of the enactment of this 

16 section, 

17 ‘‘(3) which is acquired by the taxpayer by pur18 chase (as defined in section 179(d)) after the date 

19 of the enactment of this subsection, but only if no 

20 written binding contract for the acquisition was in 

21 effect on or before the date of the enactment of this 

22 subsection, and 

23 ‘‘(4) which is placed in service by the taxpayer 

24 before January 1, 2021. 


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1 ‘‘(c) SPECIAL RULE FOR CERTAIN SUBSIDIZED

2 PROPERTY.—For purposes of this section, rules similar to 

3 the rules of section 48(a)(4) shall apply. 

4 ‘‘(d) DENIAL OF DOUBLE BENEFIT.—A deduction or 

5 credit shall not be allowed under any other provision of 

6 this chapter for the cost taken into account under sub7 section (a).’’. 

8 (2) CREDIT TREATED AS PART OF INVESTMENT

9 CREDIT.—Section 46, as amended by this Act, is 

10 amended by striking ‘‘and’’ at the end of paragraph 

11 (5), by striking the period at the end of paragraph 

12 (6) and inserting ‘‘, and’’, and by adding at the end 

13 the following new paragraph: 

14 ‘‘(7) the oil shale extraction and processing 

15 credit.’’. 

16 (3) CONFORMING AMENDMENTS.— 

17 (A) Section 49(a)(1)(C), as amended by 

18 this Act, is amended by striking ‘‘and’’ at the 

19 end of clause (v), by striking the period at the 

20 end of clause (vi) and inserting ‘‘, and’’, and by 

21 adding at the end the following new clause: 

22 ‘‘(vii) the basis of any qualified oil 

23 shale extraction and processing property.’’. 

24 (B) The table of sections for subpart E of 

25 part IV of subchapter A of chapter 1, as 


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1 amended by this Act, is amended by inserting 

2 after the item relating to section 48C the fol3 lowing new item: 

‘‘Sec. 48D. Oil shale extraction and processing facility.’’. 

4 (b) EXPENSING OIL SHALE EXTRACTION AND PROC5 ESSING PROPERTY.—Part VI of subchapter B of chapter 

6 1 of such Code, as amended by this Act, is amended by 

7 inserting after section 179F the following new section: 

8 ‘‘SEC. 179G. ELECTION TO EXPENSE CERTAIN OIL SHALE 

9 EXTRACTION AND PROCESSING PROPERTY. 

10 ‘‘(a) TREATMENT AS EXPENSES.—A taxpayer may 

11 elect to treat the cost of any qualified oil shale extraction 

12 and processing property as an expense which is not 

13 chargeable to capital account. Any cost so treated shall 

14 be allowed as a deduction for the taxable year in which 

15 the expense is incurred. 

16 ‘‘(b) ELECTION.— 

17 ‘‘(1) IN GENERAL.—An election under this sec18 tion for any taxable year shall be made on the tax19 payer’s return of the tax imposed by this chapter for 

20 the taxable year. Such election shall be made in such 

21 manner as the Secretary may by regulations pre22 scribe. 

23 ‘‘(2) ELECTION IRREVOCABLE.—Any election 

24 made under this section may not be revoked except 

25 with the consent of the Secretary. 


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1 ‘‘(c) QUALIFIED OIL SHALE EXTRACTION AND PROC2 ESSING PROPERTY.—For purposes of this section— 

3 ‘‘(1) The term ‘qualified oil shale extraction 

4 and processing property’ means any property located 

5 in the United States— 

6 ‘‘(A) the original use of which commences 

7 with the taxpayer and which original use is 

8 solely to extract or process oil shale, and 

9 ‘‘(B) which is placed in service by the tax10 payer after the date of the enactment of this 

11 section and before January 1, 2019. 

12 ‘‘(d) ELECTION TO ALLOCATE DEDUCTION TO COOP13 ERATIVE OWNER.—If— 

14 ‘‘(1) a taxpayer to which subsection (a) applies 

15 is an organization to which part I of subchapter T 

16 applies, and 

17 ‘‘(2) one or more persons directly holding an 

18 ownership interest in the taxpayer are organizations 

19 to which part I of subchapter T apply, 

20 the taxpayer may elect to allocate all or a portion of the 

21 deduction allowable under subsection (a) to such persons. 

22 Such allocation shall be equal to the person’s ratable share 

23 of the total amount allocated, determined on the basis of 

24 the person’s ownership interest in the taxpayer. The tax25 able income of the taxpayer shall not be reduced under 


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1 section 1382 by reason of any amount to which the pre2 ceding sentence applies. 

3 ‘‘(e) BASIS REDUCTION.— 

4 ‘‘(1) IN GENERAL.—For purposes of this title, 

5 if a deduction is allowed under this section with re6 spect to any qualified oil shale extraction and proc7 essing property, the basis of such property shall be 

8 reduced by the amount of the deduction so allowed. 

9 ‘‘(2) ORDINARY INCOME RECAPTURE.—For 

10 purposes of section 1245, the amount of the deduc11 tion allowable under subsection (a) with respect to 

12 any property which is of a character subject to the 

13 allowance for depreciation shall be treated as a de14 duction allowed for depreciation under section 167. 

15 ‘‘(f) APPLICATION WITH OTHER DEDUCTIONS AND

16 CREDITS.— 

17 ‘‘(1) OTHER DEDUCTIONS.—No deduction shall 

18 be allowed under any other provision of this chapter 

19 with respect to any expenditure with respect to 

20 which a deduction is allowed under subsection (a) to 

21 the taxpayer. 

22 ‘‘(2) CREDITS.—No credit shall be allowed 

23 under section 38 with respect to any amount for 

24 which a deduction is allowed under subsection (a). 


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1 ‘‘(g) REPORTING.—No deduction shall be allowed 

2 under subsection (a) to any taxpayer for any taxable year 

3 unless such taxpayer files with the Secretary a report con4 taining such information with respect to the operation of 

5 the property of the taxpayer as the Secretary shall re6 quire.’’. 

7 (c) CONFORMING AMENDMENTS.— 

8 (1) Section 1016(a) of such Code, as amended 

9 by this Act, is amended by striking ‘‘and’’ at the end 

10 of paragraph (38), by striking the period at the end 

11 of paragraph (39) and inserting ‘‘, and’’, and by 

12 adding at the end the following new paragraph: 

13 ‘‘(40) to the extent provided in section 

14 179G(e)(1).’’. 

15 (2) Section 1245(a) of such Code is amended 

16 by inserting ‘‘179G,’’ after ‘‘179F,’’ both places it 

17 appears in paragraphs (2)(C) and (3)(C). 

18 (3) Section 263(a)(1) of such Code is amended 

19 by striking ‘‘or’’ at the end of subparagraph (L), by 

20 striking the period at the end of subparagraph (M) 

21 and inserting ‘‘, or’’, and by inserting after subpara22 graph (M) the following new subparagraph: 

23 ‘‘(N) expenditures for which a deduction is 

24 allowed under section 179G.’’. 


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1 (4) Section 312(k)(3)(B) of such Code is 

2 amended by striking ‘‘or 179F’’ each place it ap3 pears in the heading and text and inserting ‘‘179F, 

4 or 179G’’. 

5 (5) The table of sections for part VI of sub6 chapter B of chapter 1 of such Code is amended by 

7 inserting after the item relating to section 179F the 

8 following new item: 

‘‘Sec. 179G. Election to expense certain oil shale extraction and processing 

property.’’. 

9 (d) EFFECTIVE DATE.—The amendments made by 

10 this section shall apply to properties placed in service after 

11 the date of the enactment of this Act. 

12 TITLE VII—LAND FOR BIOFUEL 

13 PRODUCTION 

14 SEC. 701. LEASE OF PUBLIC LANDS FOR PRODUCTION OF 

15 RENEWABLE BIOMASS FOR BIOFUELS. 

16 (a) IN GENERAL.—Title II of the Federal Land Pol17 icy and Management Act of 1976 (43 U.S.C. 1711 et seq.) 

18 is amended by adding at the end the following new section: 

19 ‘‘SEC. 216. LEASE OF PUBLIC LANDS FOR PRODUCTION OF 

20 RENEWABLE BIOMASS FOR BIOFUELS. 

21 ‘‘(a) AUTHORITY TO LEASE LANDS.—The Secretary 

22 may lease a tract of the public lands under this Act where, 

23 as a result of land use planning required under section 

24 202 of this Act, the Secretary determines that— 


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1 ‘‘(1) the tract is suitable for agricultural pro2 duction; and 

3 ‘‘(2) the lessee of the tract will use the tract for 

4 the production of renewable biomass to be used in 

5 the production of biofuels. 

6 ‘‘(b) EXCLUSION OF CERTAIN PUBLIC LANDS.—This 

7 section does not apply with respect to the following land: 

8 ‘‘(1) Land in a unit of the National Wilderness 

9 Preservation System. 

10 ‘‘(2) Land included in the National Wild and 

11 Scenic Rivers Systems. 

12 ‘‘(3) Land included in the National System of 

13 Trails. 

14 ‘‘(4) Land designated as a National Monument. 

15 ‘‘(5) Land regarding which other public objec16 tives and values, including recreation and scenic val17 ues, outweigh the benefit of using the land for the 

18 production of renewable biomass for biofuels, as de19 termined by the Secretary. 

20 ‘‘(c) CONSIDERATION.—The lease of public lands 

21 under this section shall be made at a rental rate deter22 mined by the Secretary to be appropriate to promote the 

23 production of renewable biomass for biofuels. 

24 ‘‘(d) COMPETITIVE BIDDING.— 


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1 ‘‘(1) IN GENERAL.—The lease of public lands 

2 under this section shall be conducted under competi3 tive bidding procedures to be established by the Sec4 retary. 

5 ‘‘(2) MODIFICATION.—The Secretary may lease 

6 public lands under this section with modified com7 petitive bidding or without competitive bidding— 

8 ‘‘(A) to assure an equitable distribution of 

9 land among potential renters; or 

10 ‘‘(B) to encourage farmers who are using 

11 other lands to produce feed grains for biofuels 

12 production to return the other lands to crop 

13 production for food or feed use. 

14 ‘‘(e) DEFINITIONS.—In this section: 

15 ‘‘(1) BIOFUEL.—The term ‘biofuel’ means a 

16 fuel derived from renewable biomass. 

17 ‘‘(2) RENEWABLE BIOMASS.—The term ‘renew18 able biomass’ means— 

19 ‘‘(A) renewable plant material, including 

20 feed grains and other agricultural commodities 

21 (other than trees); and 

22 ‘‘(B) crop residue and other vegetative 

23 waste material (other than wood waste and 

24 wood residues).’’. 


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1 (b) CLERICAL AMENDMENT.—The table of contents 

2 at the beginning of such Act is amended by adding at the 

3 end of the items relating to title II the following new item: 

‘‘216. Lease of public lands for production of renewable biomass for biofuels.’’. 

Æ 


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