I 

114TH CONGRESS 

1ST SESSION H. R. 3140 

To require Federal oil and gas leases to report and pay royalties on oil 

and gas production based on the actual volume of oil and gas withdrawn 

under a lease, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 21, 2015 

Mr. LIPINSKI introduced the following bill; which was referred to the 

Committee on Natural Resources 

A BILL 

To require Federal oil and gas leases to report and pay 

royalties on oil and gas production based on the actual 

volume of oil and gas withdrawn under a lease, and 

for other purposes. 

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. 

4 This Act may be cited as the ‘‘Accounting for Meth5 ane in Production through Loophole Elimination with Oil 

6 and Gas Royalties’’ or the ‘‘AMPLE Oil and Gas Royalties 

7 Act’’. 


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1 SEC. 2. FINDINGS. 

2 The Congress finds the following: 

3 (1) Some of the mineral resources owned by the 

4 Federal Government on behalf of United States tax5 payers are being developed inefficiently, costing tax6 payers millions of dollars in lost royalties, especially 

7 with respect to vented, flared, and leaked natural 

8 gas. The Government Accountability Office esti9 mates that approximately 40 percent of natural gas 

10 could be economically captured from Federal on11 shore leases, which would increase Federal royalty 

12 payments by approximately $23,000,000 and reduce 

13 greenhouse gas emissions equivalent to up to 16.5 

14 million metric tons of carbon dioxide, which is equiv15 alent to annual emissions from 3.1 million cars. 

16 (2) Significant emissions of natural gas are as17 sociated with oil and gas production and transpor18 tation, including oil and gas produced on Federal 

19 lands. According to a University of Maryland study, 

20 these emissions can negatively impact air quality 

21 hundreds of miles away. 

22 (3) Methane has a much greater impact on cli23 mate change than carbon dioxide, and the methane 

24 emissions from oil and gas production can greatly 

25 diminish the benefit of using natural gas to help reVerDate Sep 11 2014 06:44 Jul 22, 2015 Jkt 049200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3140.IH H3140

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1 duce the carbon intensity of the United States fuel 

2 mix. 

3 (4) Available control technologies exist to eco4 nomically capture a considerable amount of natural 

5 gas and resulting in taxpayers being delivered the 

6 royalties they deserve. 

7 (5) Requiring royalty payments on natural gas 

8 that is currently flared, vented, unavoidably lost, and 

9 used for beneficial purposes will lead to more effi10 cient use of Federal resources, reduce greenhouse 

11 gas emissions, and increase royalty payments to the 

12 Federal Government. 

13 SEC. 3. VOLUME ALLOCATION OF OIL AND GAS PRODUC14 TION. 

15 (a) IN GENERAL.—Section 111(k) of the Federal Oil 

16 and Gas Royalty Management Act of 1982 (30 U.S.C. 

17 1721(k)) is amended to read as follows: 

18 ‘‘(k) VOLUME ALLOCATION OF OIL AND GAS PRO19 DUCTION.— 

20 ‘‘(1) IN GENERAL.—Except as otherwise pro21 vided by this subsection— 

22 ‘‘(A) a lessee or its designee of a lease in 

23 a unit or communitization agreement that con24 tains only Federal leases with the same royalty 

25 rate and funds distribution shall report and pay 


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1 royalties on oil and gas production for each pro2 duction month based on the actual volume of oil 

3 and gas withdrawn from the reservoir by or on 

4 behalf of that lessee, including all oil and gas 

5 not sold by or on behalf of that lessee; 

6 ‘‘(B) a lessee or its designee of a lease in 

7 any other unit or communitization agreement 

8 shall report and pay royalties on oil and gas 

9 production for each production month based on 

10 the volume of oil and gas produced from such 

11 agreement and allocated to the lease in accord12 ance with the terms of the agreement; and 

13 ‘‘(C) a lessee or its designee of a lease that 

14 is not contained in a unit or communitization 

15 agreement shall report and pay royalties on oil 

16 and gas production for each production month 

17 based on the actual volume of oil and gas with18 drawn from the reservoir by or on behalf of 

19 that lessee, including all oil and gas not sold by 

20 or on behalf of that lessee. 

21 ‘‘(2) DEFINITION.—In this subsection the term 

22 ‘oil and gas withdrawn from the reservoir’ means 

23 any oil and gas that is produced, sold, vented, 

24 flared, used for beneficial purposes, leaked, or other25 wise emitted during production.’’. 


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1 (b) CONFORMING AMENDMENTS.—The Mineral 

2 Leasing Act is amended— 

3 (1) in section 17(b)(1)(A) (30 U.S.C. 

4 226(b)(1)(A)), by striking ‘‘the production removed 

5 or sold from the lease’’ and inserting ‘‘oil and gas 

6 withdrawn from the reservoir in accordance with sec7 tion 111(k) of the Federal Oil and Gas Royalty 

8 Management Act of 1982’’; 

9 (2) in section 17(c)(1) (30 U.S.C. 226(c)(1)), 

10 by striking ‘‘the production removed or sold from 

11 the lease’’ and inserting ‘‘oil and gas withdrawn 

12 from the reservoir in accordance with section 111(k) 

13 of the Federal Oil and Gas Royalty Management Act 

14 of 1982’’; 

15 (3) in section 31(e)(3) (30 U.S.C. 188(e)(3))— 

16 (A) in subparagraph (A), by striking ‘‘pro17 duction per well per day’’ and inserting ‘‘oil and 

18 gas withdrawn from the reservoir per well per 

19 day in accordance with section 111(k) of the 

20 Federal Oil and Gas Royalty Management Act 

21 of 1982’’; and 

22 (B) in subparagraph (B), by striking ‘‘all 

23 production removed or sold from such lease’’ 

24 and inserting ‘‘all oil and gas withdrawn from 

25 the reservoir in accordance with section 111(k) 


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1 of the Federal Oil and Gas Royalty Manage2 ment Act of 1982’’; and 

3 (4) in section 31(f)(4) (30 U.S.C. 188(f)(4)), 

4 by striking ‘‘production removed or sold from the oil 

5 placer mining claim’’ and inserting ‘‘oil and gas 

6 withdrawn from the reservoir in accordance with sec7 tion 111(k) of the Federal Oil and Gas Royalty 

8 Management Act of 1982’’. 

9 (c) APPLICATION.—This section, including the 

10 amendments made by this section, shall not apply with 

11 respect to any lease issued before the date of the enact12 ment of this Act. 

Æ 


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