I 

109TH CONGRESS 

2D SESSION H. R. 5649 

To provide for exploration, development, and production activities for mineral 

resources on the outer Continental Shelf, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 20, 2006 

Ms. HARRIS introduced the following bill; which was referred to the 

Committee on Resources 

A BILL 

To provide for exploration, development, and production activities for mineral resources on the outer Continental 

Shelf, 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 ‘‘Coastal Economic and 

5 Environmental Protection Act’’. 

6 SEC. 2. POLICY. 

7 It is the policy of the United States that— 

8 (1) adjacent States are required by the cir9 cumstances to commit significant resources in sup10 port of exploration, development, and production acVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 tivities for mineral resources on the outer Conti2 nental Shelf, and it is fair and proper for a portion 

3 of the receipts from such activities to be shared with 

4 Adjacent States and their local coastal governments; 

5 (2) the existing laws governing the leasing and 

6 production of the mineral resources of the outer 

7 Continental Shelf have reduced the production of 

8 mineral resources, have preempted Adjacent States 

9 from being sufficiently involved in the decisions re10 garding the allowance of mineral resource develop11 ment; 

12 (3) the national interest is served by granting 

13 the Adjacent States more options related to whether 

14 or not mineral leasing should occur in the outer 

15 Continental Shelf within their Adjacent Zones; 

16 (4) transportation of oil from a leased tract 

17 might reasonably be foreseen, under limited cir18 cumstances, to have the potential to adversely affect 

19 resources near the coastline if the oil is within 50 

20 miles of the coastline, but such potential to adversely 

21 affect such resources is likely no greater, and prob22 ably less, than the potential impacts from tanker 

23 transportation because tanker spills usually involve 

24 large releases of oil over a brief period of time; and 


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1 (5) among other bodies of inland waters, the 

2 Great Lakes, Long Island Sound, Delaware Bay, 

3 Chesapeake Bay, Albemarle Sound, San Francisco 

4 Bay, and Puget Sound are not part of the outer 

5 Continental Shelf, and are not subject to leasing by 

6 the Federal Government for the exploration, develop7 ment, and production of any mineral resources that 

8 might lie beneath them. 

9 SEC. 3. DEFINITIONS UNDER THE OUTER CONTINENTAL 

10 SHELF LANDS ACT. 

11 Section 2 of the Outer Continental Shelf Lands Act 

12 (43 U.S.C. 1331) is amended— 

13 (1) by amending paragraph (f) to read as fol14 lows: 

15 ‘‘(f) The term ‘affected State’ means the Adjacent 

16 State.’’; 

17 (2) by striking the semicolon at the end of each 

18 of paragraphs (a) through (o) and inserting a pe19 riod; 

20 (3) by striking ‘‘; and’’ at the end of paragraph 

21 (p) and inserting a period; 

22 (4) by adding at the end the following: 

23 ‘‘(r) The term ‘Adjacent State’ means, with respect 

24 to any program, plan, lease sale, leased tract or other ac25 tivity, proposed, conducted, or approved pursuant to the 


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1 provisions of this Act, any State the laws of which are 

2 declared, pursuant to section 4(a)(2), to be the law of the 

3 United States for the portion of the outer Continental 

4 Shelf on which such program, plan, lease sale, leased tract 

5 or activity appertains or is, or is proposed to be, con6 ducted. For purposes of this paragraph, the term ‘State’ 

7 includes Puerto Rico and the other Territories of the 

8 United States. 

9 ‘‘(s) The term ‘Adjacent Zone’ means, with respect 

10 to any program, plan, lease sale, leased tract, or other ac11 tivity, proposed, conducted, or approved pursuant to the 

12 provisions of this Act, the portion of the outer Continental 

13 Shelf for which the laws of a particular Adjacent State 

14 are declared, pursuant to section 4(a)(2), to be the law 

15 of the United States. 

16 ‘‘(t) The term ‘miles’ means statute miles. 

17 ‘‘(u) The term ‘coastline’ has the same meaning as 

18 the term ‘coast line’ as defined in section 2(c) of the Sub19 merged Lands Act (43 U.S.C. 1301(c)). 

20 ‘‘(v) The term ‘Neighboring State’ means a coastal 

21 state having a common boundary at the coastline with the 

22 Adjacent State.’’; and 

23 (5) in paragraph (a), by inserting after ‘‘con24 trol’’ the following: ‘‘or lying within the United 


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1 States exclusive economic zone adjacent to the Terri2 tories of the United States’’. 

3 SEC. 4. DETERMINATION OF ADJACENT ZONES AND PLAN4 NING AREAS. 

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

6 Lands Act (43 U.S.C. 1333(a)(2)(A)) is amended in the 

7 first sentence by striking ‘‘, and the President’’ and all 

8 that follows through the end of the sentence and inserting 

9 the following: ‘‘The lines extending seaward and defining 

10 each State’s Adjacent Zone, and each OCS Planning Area, 

11 are as indicated on the maps for each outer Continental 

12 Shelf region entitled ‘Alaska OCS Region State Adjacent 

13 Zone and OCS Planning Areas’, ‘Pacific OCS Region 

14 State Adjacent Zones and OCS Planning Areas’ , ‘Gulf 

15 of Mexico OCS Region State Adjacent Zones and OCS 

16 Planning Areas’, and ‘Atlantic OCS Region State Adja17 cent Zones and OCS Planning Areas’, all of which are 

18 dated September 2005 and on file in the Office of the Di19 rector, Minerals Management Service.’’. 

20 SEC. 5. ADMINISTRATION OF LEASING. 

21 Section 5 of the Outer Continental Shelf Lands Act 

22 (43 U.S.C. 1334) is amended by adding at the end the 

23 following: 

24 ‘‘(k) VOLUNTARY PARTIAL RELINQUISHMENT OF A

25 LEASE.—Any lessee of a producing lease may relinquish 


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1 to the Secretary any portion of a lease that the lessee has 

2 no interest in producing and that the Secretary finds is 

3 geologically prospective. In return for any such relinquish4 ment, the Secretary shall provide to the lessee a royalty 

5 incentive for the portion of the lease retained by the lessee, 

6 in accordance with regulations promulgated by the Sec7 retary to carry out this subsection. The Secretary shall 

8 publish final regulations implementing this subsection 

9 within 365 days after the date of the enactment of the 

10 Coastal Economic and Environmental Protection Act. 

11 ‘‘(l) NATURAL GAS LEASE REGULATIONS.—Not later 

12 than July 1, 2007, the Secretary shall publish a final regu13 lation that shall— 

14 ‘‘(1) establish procedures for entering into nat15 ural gas leases; 

16 ‘‘(2) ensure that natural gas leases are only 

17 available for tracts on the outer Continental Shelf 

18 that are wholly within 125 miles of the coastline 

19 within an area withdrawn from disposition by leas20 ing on the day after the date of enactment of the 

21 Coastal Economic and Environmental Protection 

22 Act; 

23 ‘‘(3) provide that natural gas leases shall con24 tain the same rights and obligations established for 

25 oil and gas leases, except as otherwise provided in 


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1 the Coastal Economic and Environmental Protection 

2 Act; 

3 ‘‘(4) provide that, in reviewing the adequacy of 

4 bids for natural gas leases, the value of any crude 

5 oil estimated to be contained within any tract shall 

6 be excluded; 

7 ‘‘(5) provide that any crude oil produced from 

8 a well and reinjected into the leased tract shall not 

9 be subject to payment of royalty, and that the Sec10 retary shall consider, in setting the royalty rates for 

11 a natural gas lease, the additional cost to the lessee 

12 of not producing any crude oil; and 

13 ‘‘(6) provide that any Federal law that applies 

14 to an oil and gas lease on the outer Continental 

15 Shelf shall apply to a natural gas lease unless other16 wise clearly inapplicable.’’. 

17 SEC. 6. GRANT OF LEASES BY SECRETARY. 

18 Section 8 of the Outer Continental Shelf Lands Act 

19 (43 U.S.C. 1337) is amended— 

20 (1) in subsection (a)(1) by inserting after the 

21 first sentence the following: ‘‘Further, the Secretary 

22 may grant natural gas leases in a manner similar to 

23 the granting of oil and gas leases and under the var24 ious bidding systems available for oil and gas 

25 leases.’’; 


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1 (2) by adding at the end of subsection (b) the 

2 following: ‘‘The Secretary may issue more than one 

3 lease for a given tract if each lease applies to a sepa4 rate and distinct range of vertical depths, horizontal 

5 surface area, or a combination of the two. The Sec6 retary may issue regulations that the Secretary de7 termines are necessary to manage such leases con8 sistent with the purposes of this Act.’’; 

9 (3) in subsection (p)(2)(B)— 

10 (A) by striking ‘‘27’’ and inserting ‘‘50’’; 

11 and 

12 (B) by striking ‘‘15’’ and inserting ‘‘200’’; 

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

14 ‘‘(q) NATURAL GAS LEASES.— 

15 ‘‘(1) RIGHT TO PRODUCE NATURAL GAS.—A 

16 lessee of a natural gas lease shall have the right to 

17 produce the natural gas from a natural gas leased 

18 tract if the Secretary estimates that the discovered 

19 field has at least 40 percent of the economically re20 coverable Btu content of the field contained within 

21 natural gas and such natural gas is economical to 

22 produce. 

23 ‘‘(2) RIGHT TO PRODUCE CRUDE OIL.—A lessee 

24 of a natural gas lease may produce crude oil from 

25 the lease unless the Governor and the legislature of 


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1 the Adjacent State object to such production within 

2 180 days after receipt of written notice from the les3 see of intent to produce crude oil from the lease. If 

4 the leased tract is located within 50 miles of the 

5 nearest point on the coastline of a Neighboring 

6 State, the Governor and legislature of the Neigh7 boring State shall also receive such notice and have 

8 the right to object to such production within 180 

9 days after receipt of such notice. 

10 ‘‘(3) ESTIMATES OF BTU CONTENT.—The Sec11 retary shall make estimates of the natural gas Btu 

12 content of discovered fields on a natural gas lease 

13 only after the completion of at least one exploration 

14 well, the data from which has been tied to the re15 sults of a three-dimensional seismic survey of the 

16 field. The Secretary may not require the lessee to 

17 further delineate any discovered field prior to mak18 ing such estimates. 

19 ‘‘(4) TRANSPORTATION OF CRUDE OIL.—If an 

20 Adjacent State or any applicable Neighboring State 

21 does not object to production of crude oil from a 

22 natural gas lease, the lessee shall be permitted to 

23 transport the crude oil from the leased tract through 

24 Adjacent State waters, and Neighboring State wa25 ters if applicable, to facilities onshore in the AdjaVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 cent State, and Neighboring State if applicable, un2 less the lessee agreed to other arrangements with 

3 the Adjacent State or Neighboring State, or both. 

4 ‘‘(5) REPURCHASE OF CERTAIN NATURAL GAS

5 LEASES.—Upon request of the lessee and certifi6 cation by the Secretary of the Interior that a natural 

7 gas lease contains all or part of a commercial oil and 

8 gas discovery that is not allowed to be produced be9 cause it does not meet the standard set in paragraph 

10 (1), the Secretary of the Treasury shall repurchase 

11 the lease by issuance of a check or electronic pay12 ment from OCS Receipts to the lessee in full com13 pensation for the repurchase. The Secretary shall re14 coup from the State and local governments any 

15 funds previously shared with them that were derived 

16 from the repurchased lease. Such recoupment shall 

17 only be from the State and local governments’ 

18 shares of OCS receipts that are payable after the 

19 date of repurchase. 

20 ‘‘(6) AMOUNT OF COMPENSATION.—Repurchase 

21 compensation for each lease repurchased under the 

22 authority of this section shall be in the amount of 

23 the lesser of the original bonus bid paid for the lease 

24 or, if the lessee is not the original lessee, the com25 pensation paid by the current lessee to obtain its inVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 terest in the lease. In addition, the lessee shall be 

2 compensated for any expenses directly attributable 

3 to the lease that the lessee incurs after acquisition 

4 of its interest in the lease to be repurchased, includ5 ing rentals, seismic acquisition costs, drilling costs, 

6 and other reasonable expenses on the lease, includ7 ing expenses incurred in the repurchase process, to 

8 the extent that the lessee has not previously been 

9 compensated by the United States for such expenses. 

10 The lessee shall not be compensated for general 

11 overhead expenses or employee salaries. 

12 ‘‘(7) PRIORITY RIGHT TO OBTAIN FUTURE OIL

13 AND GAS LEASE.—The lessee, or a designee of the 

14 lessee, of a repurchased natural gas leased tract 

15 shall have the right to repurchase such tract as an 

16 oil and gas lease, on a noncompetitive basis, by re17 paying the amount received by the lessee if the tract 

18 is made available for lease under an oil and gas 

19 lease within 30 years after the repurchase. 

20 ‘‘(8) DEFINITION OF NATURAL GAS.—For pur21 poses of a natural gas lease, natural gas means nat22 ural gas and all substances produced in association 

23 with gas, including, but not limited to, hydrocarbon 

24 liquids (other than crude oil) that are obtained by 

25 the condensation of hydrocarbon vapors and sepaVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 rate out in liquid form from the produced gas 

2 stream. 

3 ‘‘(r) REMOVAL OF RESTRICTIONS ON JOINT BIDDING

4 IN CERTAIN AREAS OF THE OUTER CONTINENTAL

5 SHELF.—Restrictions on joint bidders shall no longer 

6 apply to tracts located in the Alaska OCS Region. Such 

7 restrictions shall not apply to tracts in other OCS regions 

8 determined to be ‘frontier tracts’ or otherwise ‘high cost 

9 tracts’ under final regulations that shall be published by 

10 the Secretary by not later than 365 days after the date 

11 of the enactment of the Coastal Economic and Environ12 mental Protection Act.’’; 

13 (5) by striking subsection (a)(3)(A) and redes14 ignating the subsequent subparagraphs as subpara15 graphs (A) and (B), respectively; 

16 (6) in subsection (a)(3)(A) (as so redesignated) 

17 by striking ‘‘In the Western’’ and all that follows 

18 through ‘‘the Secretary’’ the first place it appears 

19 and inserting ‘‘The Secretary’’; and 

20 (7) effective October 1, 2006, in subsection 

21 (g)— 

22 (A) by striking all after ‘‘(g)’’, except para23 graph (3); 

24 (B) by striking the last sentence of para25 graph (3); and 


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1 (C) by striking ‘‘(3)’’. 

2 SEC. 7. DISPOSITION OF RECEIPTS. 

3 Section 9 of the Outer Continental Shelf Lands Act 

4 (43 U.S.C. 1338) is amended— 

5 (1) by designating the existing text as sub6 section (a); 

7 (2) in subsection (a) (as so designated) by in8 serting ‘‘, if not paid as otherwise provided in this 

9 title’’ after ‘‘receipts’’; and 

10 (3) by adding the following: 

11 ‘‘(b) TREATMENT OF OCS RECEIPTS FROM TRACTS

12 COMPLETELY WITHIN 100 MILES OF THE COASTLINE.— 

13 ‘‘(1) DEPOSIT.—The Secretary shall deposit 

14 into a separate account in the Treasury the portion 

15 of OCS Receipts for each fiscal year that will be 

16 shared under paragraphs (2), (3), and (4). 

17 ‘‘(2) PHASED-IN RECEIPTS SHARING.— 

18 ‘‘(A) Beginning October 1, 2005, the Sec19 retary shall share OCS Receipts derived from 

20 the following areas: 

21 ‘‘(i) Lease tracts located on portions 

22 of the Gulf of Mexico OCS Region com23 pletely beyond 4 marine leagues from any 

24 coastline and completely within 125 miles 

25 of any coastline that are available for leasVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 ing under the 2002–2007 5-Year Oil and 

2 Gas Leasing Program in effect prior to the 

3 date of the enactment of the Coastal Eco4 nomic and Environmental Protection Act. 

5 ‘‘(ii) Lease tracts in production prior 

6 to October 1, 2005, completely beyond 4 

7 marine leagues from any coastline and 

8 completely within 125 miles of any coast9 line located on portions of the OCS that 

10 were not available for leasing under the 

11 2002–2007 5-Year OCS Oil and Gas Leas12 ing Program in effect prior to the date of 

13 the enactment of the Coastal Economic 

14 and Environmental Protection Act. 

15 ‘‘(iii) Lease tracts for which leases are 

16 issued prior to October 1, 2005, located in 

17 the Alaska OCS Region completely beyond 

18 4 marine leagues from any coastline and 

19 completely within 125 miles of the coast20 line. 

21 ‘‘(B) The Secretary shall share the fol22 lowing percentages of OCS Receipts from the 

23 leases described in subparagraph (A) derived 

24 during the fiscal year indicated: 

25 ‘‘(i) For fiscal year 2006, 6.0 percent. 


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1 ‘‘(ii) For fiscal year 2007, 7.0 per2 cent. 

3 ‘‘(iii) For fiscal year 2008, 8.0 per4 cent. 

5 ‘‘(iv) For fiscal year 2009, 9.0 per6 cent. 

7 ‘‘(v) For fiscal year 2010, 12.0 per8 cent. 

9 ‘‘(vi) For fiscal year 2011, 15.0 per10 cent. 

11 ‘‘(vii) For fiscal year 2012, 18.0 per12 cent. 

13 ‘‘(viii) For fiscal year 2013, 21.0 per14 cent. 

15 ‘‘(ix) For fiscal year 2014, 24.0 per16 cent. 

17 ‘‘(x) For fiscal year 2015, 27.0 per18 cent. 

19 ‘‘(xi) For fiscal year 2016, 30.0 per20 cent. 

21 ‘‘(xii) For fiscal year 2017, 33.0 per22 cent. 

23 ‘‘(xiii) For fiscal year 2018, 36.0 per24 cent. 


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1 ‘‘(xiv) For fiscal year 2019, 39.0 per2 cent. 

3 ‘‘(xv) For fiscal year 2020, 42.0 per4 cent. 

5 ‘‘(xvi) For fiscal year 2021, 45.0 per6 cent. 

7 ‘‘(xvii) For fiscal year 2022 and each 

8 subsequent fiscal year, 50.0 percent. 

9 ‘‘(C) The provisions of this paragraph shall 

10 not apply to leases that could not have been 

11 issued but for section 5(k) of this Act or section 

12 6(2) of the Coastal Economic and Environ13 mental Protection Act. 

14 ‘‘(3) IMMEDIATE RECEIPTS SHARING.—Begin15 ning October 1, 2005, the Secretary shall share 50 

16 percent of OCS Receipts derived from all leases lo17 cated completely beyond 4 marine leagues from any 

18 coastline and completely within 125 miles of any 

19 coastline not included within the provisions of para20 graph (2). 

21 ‘‘(4) RECEIPTS SHARING FROM TRACTS WITHIN

22 4 MARINE LEAGUES OF ANY COASTLINE.—Beginning 

23 October 1, 2005, the Secretary shall share 75 per24 cent of OCS Receipts derived from all leases located 


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1 completely or partially within 4 marine leagues from 

2 any coastline. 

3 ‘‘(5) ALLOCATIONS.—The Secretary shall allo4 cate the OCS Receipts deposited into the separate 

5 account established by paragraph (1) that are 

6 shared under paragraphs (2), (3), and (4) as follows: 

7 ‘‘(A) BONUS BIDS.—Deposits derived from 

8 bonus bids from a leased tract, including inter9 est thereon, shall be allocated at the end of 

10 each fiscal year as follows: 

11 ‘‘(i) 87.5 percent to the Adjacent 

12 State. 

13 ‘‘(ii) 6.25 percent into the Treasury, 

14 which shall be allocated to the account es15 tablished by section 14 of the Coastal Eco16 nomic and Environmental Protection Act. 

17 ‘‘(iii) 5 percent into the account es18 tablished by section 23 of the Coastal Eco19 nomic and Environmental Protection Act. 

20 ‘‘(iv) 1.25 percent into the account es21 tablished by section 26 of the Coastal Eco22 nomic and Environmental Protection Act. 

23 ‘‘(B) ROYALTIES.—Deposits derived from 

24 royalties from a leased tract, including interest 


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1 thereon, shall be allocated at the end of each 

2 fiscal year as follows: 

3 ‘‘(i) 87.5 percent to the Adjacent 

4 State and any other producing State or 

5 States with a leased tract within its Adja6 cent Zone within 125 miles of its coastline 

7 that generated royalties during the fiscal 

8 year, if the other producing or States have 

9 a coastline point within 300 miles of any 

10 portion of the leased tract, in which case 

11 the amount allocated for the leased tract 

12 shall be— 

13 ‘‘(I) one-third to the Adjacent 

14 State; and 

15 ‘‘(II) two-thirds to each pro16 ducing State, including the Adjacent 

17 State, inversely proportional to the 

18 distance between the nearest point on 

19 the coastline of the producing State 

20 and the geographic center of the 

21 leased tract. 

22 ‘‘(ii) 6.25 percent into the Treasury, 

23 which shall be allocated to the account es24 tablished by section 14 of the Coastal Eco25 nomic and Environmental Protection Act; 


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1 ‘‘(iii) 5 percent into the account es2 tablished by section 23 of the Coastal Eco3 nomic and Environmental Protection Act; 

4 and 

5 ‘‘(iv) 1.25 percent into the account es6 tablished by section 26 of the Coastal Eco7 nomic and Environmental Protection Act. 

8 ‘‘(c) TREATMENT OF OCS RECEIPTS FROM TRACTS

9 PARTIALLY OR COMPLETELY BEYOND 125 MILES OF THE

10 COASTLINE.— 

11 ‘‘(1) DEPOSIT.—The Secretary shall deposit 

12 into a separate account in the Treasury the portion 

13 of OCS Receipts for each fiscal year that will be 

14 shared under paragraphs (2) and (3). 

15 ‘‘(2) PHASED-IN RECEIPTS SHARING.— 

16 ‘‘(A) Beginning October 1, 2005, the Sec17 retary shall share OCS Receipts derived from 

18 the following areas: 

19 ‘‘(i) Lease tracts located on portions 

20 of the Gulf of Mexico OCS Region partially 

21 or completely beyond 125 miles of any 

22 coastline that are available for leasing 

23 under the 2002–2007 5-Year Oil and Gas 

24 Leasing Program in effect prior to the 


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1 date of enactment of the Coastal Economic 

2 and Environmental Protection Act. 

3 ‘‘(ii) Lease tracts in production prior 

4 to October 1, 2005, partially or completely 

5 beyond 125 miles of any coastline located 

6 on portions of the OCS that were not 

7 available for leasing under the 2002–2007 

8 5-Year OCS Oil and Gas Leasing Program 

9 in effect prior to the date of enactment of 

10 the Coastal Economic and Environmental 

11 Protection Act. 

12 ‘‘(iii) Lease tracts for which leases are 

13 issued prior to October 1, 2005, located in 

14 the Alaska OCS Region partially or com15 pletely beyond 125 miles of the coastline. 

16 ‘‘(B) The Secretary shall share the fol17 lowing percentages of OCS Receipts from the 

18 leases described in subparagraph (A) derived 

19 during the fiscal year indicated: 

20 ‘‘(i) For fiscal year 2006, 6.0 percent. 

21 ‘‘(ii) For fiscal year 2007, 7.0 per22 cent. 

23 ‘‘(iii) For fiscal year 2008, 8.0 per24 cent. 


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1 ‘‘(iv) For fiscal year 2009, 9.0 per2 cent. 

3 ‘‘(v) For fiscal year 2010, 12.0 per4 cent. 

5 ‘‘(vi) For fiscal year 2011, 15.0 per6 cent. 

7 ‘‘(vii) For fiscal year 2012, 18.0 per8 cent. 

9 ‘‘(viii) For fiscal year 2013, 21.0 per10 cent. 

11 ‘‘(ix) For fiscal year 2014, 24.0 per12 cent. 

13 ‘‘(x) For fiscal year 2015, 27.0 per14 cent. 

15 ‘‘(xi) For fiscal year 2016, 30.0 per16 cent. 

17 ‘‘(xii) For fiscal year 2017, 33.0 per18 cent. 

19 ‘‘(xiii) For fiscal year 2018, 36.0 per20 cent. 

21 ‘‘(xiv) For fiscal year 2019, 39.0 per22 cent. 

23 ‘‘(xv) For fiscal year 2020, 42.0 per24 cent. 


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1 ‘‘(xvi) For fiscal year 2021, 45.0 per2 cent. 

3 ‘‘(xvii) For fiscal year 2022 and each 

4 subsequent fiscal year, 50.0 percent. 

5 ‘‘(C) The provisions of this paragraph shall 

6 not apply to leases that could not have been 

7 issued but for section 5(k) of this Act or section 

8 6(2) of the Coastal Economic and Environ9 mental Protection Act. 

10 ‘‘(3) IMMEDIATE RECEIPTS SHARING.—Begin11 ning October 1, 2005, the Secretary shall share 50 

12 percent of OCS Receipts derived on and after Octo13 ber 1, 2005, from all leases located partially or com14 pletely beyond 125 miles of any coastline not in15 cluded within the provisions of paragraph (2). 

16 ‘‘(4) ALLOCATIONS.—The Secretary shall allo17 cate the OCS Receipts deposited into the separate 

18 account established by paragraph (1) that are 

19 shared under paragraphs (2) and (3) as follows: 

20 ‘‘(A) BONUS BIDS.—Deposits derived from 

21 bonus bids from a leased tract, including inter22 est thereon, shall be allocated at the end of 

23 each fiscal year as follows: 

24 ‘‘(i) 87.5 percent to the Adjacent 

25 State. 


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1 ‘‘(ii) 6.25 percent into the Treasury, 

2 which shall be allocated to the account es3 tablished by section 14 of the Coastal Eco4 nomic and Environmental Protection Act. 

5 ‘‘(iii) 5 percent into the account es6 tablished by section 23 of the Coastal Eco7 nomic and Environmental Protection Act. 

8 ‘‘(iv) 1.25 percent into the account es9 tablished by section 26 of the Coastal Eco10 nomic and Environmental Protection Act. 

11 ‘‘(B) ROYALTIES.—Deposits derived from 

12 royalties from a leased tract, including interest 

13 thereon, shall be allocated at the end of each 

14 fiscal year as follows: 

15 ‘‘(i) 87.5 percent to the Adjacent 

16 State and any other producing State or 

17 States with a leased tract within its Adja18 cent Zone partially or completely beyond 

19 125 miles of its coastline that generated 

20 royalties during the fiscal year, if the other 

21 producing State or States have a coastline 

22 point within 300 miles of any portion of 

23 the leased tract, in which case the amount 

24 allocated for the leased tract shall be— 


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1 ‘‘(I) one-third to the Adjacent 

2 State; and 

3 ‘‘(II) two-thirds to each pro4 ducing State, including the Adjacent 

5 State, inversely proportional to the 

6 distance between the nearest point on 

7 the coastline of the producing State 

8 and the geographic center of the 

9 leased tract. 

10 ‘‘(ii) 6.25 percent into the account es11 tablished by section 14 of the Coastal Eco12 nomic and Environmental Protection Act. 

13 ‘‘(iii) 5 percent into the account es14 tablished by section 23 of the Coastal Eco15 nomic and Environmental Protection Act. 

16 ‘‘(iv) 1.25 percent into the account es17 tablished by section 26 of the Coastal Eco18 nomic and Environmental Protection Act. 

19 ‘‘(d) TRANSMISSION OF ALLOCATIONS.— 

20 ‘‘(1) IN GENERAL.—Not later than 90 days 

21 after the end of each fiscal year, the Secretary shall 

22 transmit— 

23 ‘‘(A) to each State two-thirds of such 

24 State’s allocations under subsections 


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1 (b)(5)(A)(i), (b)(5)(B)(i), (c)(4)(A)(i), and 

2 (c)(4)(B)(i) for the immediate prior fiscal year; 

3 ‘‘(B) to coastal county-equivalent and mu4 nicipal political subdivisions of such State a 

5 total of one-third of such State’s allocations 

6 under subsections (b)(5)(A)(i), (b)(5)(B)(i), 

7 (c)(4)(A)(i), and (c)(4)(B)(i), together with all 

8 accrued interest thereon; and 

9 ‘‘(C) the remaining allocations under sub10 sections (b)(5) and (c)(4), together with all ac11 crued interest thereon. 

12 ‘‘(2) ALLOCATIONS TO COASTAL COUNTY13 EQUIVALENT POLITICAL SUBDIVISIONS.—The Sec14 retary shall make an initial allocation of the OCS 

15 Receipts to be shared under paragraph (1)(B) as fol16 lows: 

17 ‘‘(A) 25 percent shall be allocated based on 

18 the ratio of such coastal county-equivalent polit19 ical subdivision’s population to the coastal pop20 ulation of all coastal county-equivalent political 

21 subdivisions in the State. 

22 ‘‘(B) 25 percent shall be allocated based on 

23 the ratio of such coastal county-equivalent polit24 ical subdivision’s coastline miles to the coastline 

25 miles of all coastal county-equivalent political 


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1 subdivisions in the State as calculated by the 

2 Secretary. In such calculations, coastal county3 equivalent political subdivisions without a coast4 line shall be considered to have 50 percent of 

5 the average coastline miles of the coastal coun6 ty-equivalent political subdivisions that do have 

7 coastlines. 

8 ‘‘(C) 25 percent shall be allocated to all 

9 coastal county-equivalent political subdivisions 

10 having a coastline point within 300 miles of the 

11 leased tract for which OCS Receipts are being 

12 shared based on a formula that allocates the 

13 funds based on such coastal county-equivalent 

14 political subdivision’s relative distance from the 

15 leased tract. 

16 ‘‘(D) 25 percent shall be allocated to all 

17 coastal county-equivalent political subdivisions 

18 having a coastline point within 300 miles of the 

19 leased tract for which OCS Receipts are being 

20 shared based on the relative level of outer Con21 tinental Shelf oil and gas activities in a coastal 

22 political subdivision compared to the level of 

23 outer Continental Shelf activities in all coastal 

24 political subdivisions in the State. The Sec25 retary shall define the term ‘outer Continental 


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1 Shelf oil and gas activities’ for purposes of this 

2 subparagraph to include, but not be limited to, 

3 construction of vessels, drillships, and platforms 

4 involved in exploration, production, and develop5 ment on the outer Continental Shelf; support 

6 and supply bases, ports, and related activities; 

7 offices of geologists, geophysicists, engineers, 

8 and other professionals involved in support of 

9 exploration, production, and development of oil 

10 and gas on the outer Continental Shelf; pipe11 lines and other means of transporting oil and 

12 gas production from the outer Continental 

13 Shelf; and processing and refining of oil and 

14 gas production from the outer Continental 

15 Shelf. For purposes of this subparagraph, if a 

16 coastal county-equivalent political subdivision 

17 does not have a coastline, its coastal point shall 

18 be the point on the coastline closest to it. 

19 ‘‘(3) ALLOCATIONS TO COASTAL MUNICIPAL PO20 LITICAL SUBDIVISIONS.—The initial allocation to 

21 each coastal county-equivalent political subdivision 

22 under paragraph (2) shall be further allocated to the 

23 coastal county-equivalent political subdivision and 

24 any coastal municipal political subdivisions located 

25 partially or wholly within the boundaries of the 


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1 coastal county-equivalent political subdivision as fol2 lows: 

3 ‘‘(A) One-third shall be allocated to the 

4 coastal county-equivalent political subdivision. 

5 ‘‘(B) Two-thirds shall be allocated on a per 

6 capita basis to the municipal political subdivi7 sions and the county-equivalent political sub8 division, with the allocation to the latter based 

9 upon its population not included within the 

10 boundaries of a municipal political subdivision. 

11 ‘‘(e) INVESTMENT OF DEPOSITS.—Amounts depos12 ited under this section shall be invested by the Secretary 

13 of the Treasury in securities backed by the full faith and 

14 credit of the United States having maturities suitable to 

15 the needs of the account in which they are deposited and 

16 yielding the highest reasonably available interest rates as 

17 determined by the Secretary of the Treasury. 

18 ‘‘(f) USE OF FUNDS.—A recipient of funds under this 

19 section may use the funds for one or more of the following: 

20 ‘‘(1) To reduce in-State college tuition at public 

21 institutions of higher learning and otherwise support 

22 public education, including career technical edu23 cation. 

24 ‘‘(2) To make transportation infrastructure im25 provements. 


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1 ‘‘(3) To reduce taxes. 

2 ‘‘(4) To promote and provide for— 

3 ‘‘(A) coastal or environmental restoration; 

4 ‘‘(B) fish, wildlife, and marine life habitat 

5 enhancement; 

6 ‘‘(C) waterways maintenance; 

7 ‘‘(D) shore protection; and 

8 ‘‘(E) marine and oceanographic education 

9 and research. 

10 ‘‘(5) To improve infrastructure associated with 

11 energy production activities conducted on the outer 

12 Continental Shelf. 

13 ‘‘(6) To fund energy demonstration projects 

14 and supporting infrastructure for energy projects. 

15 ‘‘(7) For any other purpose as determined by 

16 State law. 

17 ‘‘(g) NO ACCOUNTING REQUIRED.—No recipient of 

18 funds under this section shall be required to account to 

19 the Federal Government for the expenditure of such 

20 funds, except as otherwise may be required by law. How21 ever, States may enact legislation providing for accounting 

22 for and auditing of such expenditures. Further, funds allo23 cated under this section to States and political subdivi24 sions may be used as matching funds for other Federal 

25 programs. 


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1 ‘‘(h) EFFECT OF FUTURE LAWS.—Enactment of any 

2 future Federal statute that has the effect, as determined 

3 by the Secretary, of restricting any Federal agency from 

4 spending appropriated funds, or otherwise preventing it 

5 from fulfilling its pre-existing responsibilities as of the 

6 date of enactment of the statute, unless such responsibil7 ities have been reassigned to another Federal agency by 

8 the statute with no prevention of performance, to issue 

9 any permit or other approval impacting on the OCS oil 

10 and gas leasing program, or any lease issued thereunder, 

11 or to implement any provision of this Act shall automati12 cally prohibit any sharing of OCS Receipts under this sec13 tion directly with the States, and their coastal political 

14 subdivisions, for the duration of the restriction. The Sec15 retary shall make the determination of the existence of 

16 such restricting effects within 30 days of a petition by any 

17 outer Continental Shelf lessee or producing State. 

18 ‘‘(i) DEFINITIONS.—In this section: 

19 ‘‘(1) COASTAL COUNTY-EQUIVALENT POLITICAL

20 SUBDIVISION.—The term ‘coastal county-equivalent 

21 political subdivision’ means a political jurisdiction 

22 immediately below the level of State government, in23 cluding a county, parish, borough in Alaska, inde24 pendent municipality not part of a county, parish, or 


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1 borough in Alaska, or other equivalent subdivision of 

2 a coastal State, that lies within the coastal zone. 

3 ‘‘(2) COASTAL MUNICIPAL POLITICAL SUBDIVI4 SION.—The term ‘coastal municipal political subdivi5 sion’ means a municipality located within and part 

6 of a county, parish, borough in Alaska, or other 

7 equivalent subdivision of a State, all or part of which 

8 coastal municipal political subdivision lies within the 

9 coastal zone. 

10 ‘‘(3) COASTAL POPULATION.—The term ‘coastal 

11 population’ means the population of all coastal coun12 ty-equivalent political subdivisions, as determined by 

13 the most recent official data of the Census Bureau. 

14 ‘‘(4) COASTAL ZONE.—The term ‘coastal zone’ 

15 means that portion of a coastal State, including the 

16 entire territory of any coastal county-equivalent po17 litical subdivision at least a part of which lies, within 

18 75 miles landward from the coastline, or a greater 

19 distance as determined by State law enacted to im20 plement this section. 

21 ‘‘(5) BONUS BIDS.—The term ‘bonus bids’ 

22 means all funds received by the Secretary to issue 

23 an outer Continental Shelf minerals lease. 

24 ‘‘(6) ROYALTIES.—The term ‘royalties’ means 

25 all funds received by the Secretary from production 


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1 of oil or natural gas, or the sale of production taken 

2 in-kind, from an outer Continental Shelf minerals 

3 lease. 

4 ‘‘(7) PRODUCING STATE.—The term ‘producing 

5 State’ means an Adjacent State having an Adjacent 

6 Zone containing leased tracts from which OCS Re7 ceipts were derived. 

8 ‘‘(8) OCS RECEIPTS.—The term ‘OCS Receipts’ 

9 means bonus bids and royalties.’’. 

10 SEC. 8. REVIEW OF OUTER CONTINENTAL SHELF EXPLO11 RATION PLANS. 

12 Subsections (c) and (d) of section 11 of the Outer 

13 Continental Shelf Lands Act (43 U.S.C. 1340) are amend14 ed to read as follows: 

15 ‘‘(c) PLAN REVIEW; PLAN PROVISIONS.— 

16 ‘‘(1) Except as otherwise provided in this Act, 

17 prior to commencing exploration pursuant to any oil 

18 and gas lease issued or maintained under this Act, 

19 the holder thereof shall submit an exploration plan 

20 (hereinafter in this section referred to as a ‘plan’) to 

21 the Secretary for review which shall include all infor22 mation and documentation required under para23 graphs (2) and (3). The Secretary shall review the 

24 plan for completeness within 10 days of submission. 

25 If the Secretary finds that the plan is not complete, 


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1 the Secretary shall notify the lessee with a detailed 

2 explanation and require such modifications of such 

3 plan as are necessary to achieve completeness. The 

4 Secretary shall have 10 days to review a modified 

5 plan for completeness. Such plan may apply to more 

6 than one lease held by a lessee in any one region of 

7 the outer Continental Shelf, or by a group of lessees 

8 acting under a unitization, pooling, or drilling agree9 ment, and the lessee shall certify that such plan is 

10 consistent with the terms of the lease and is con11 sistent with all statutory and regulatory require12 ments in effect on the date of issuance of the lease. 

13 The Secretary shall have 30 days from the date the 

14 plan is deemed complete to conduct a review of the 

15 plan. If the Secretary finds the plan is not con16 sistent with the lease and all such statutory and reg17 ulatory requirements, the Secretary shall notify the 

18 lessee with a detailed explanation of such modifica19 tions of such plan as are necessary to achieve com20 pliance. The Secretary shall have 30 days to review 

21 any modified plan submitted by the lessee. The les22 see shall not take any action under the exploration 

23 plan within the 30-day review period, or thereafter 

24 until the plan has been modified to achieve compli25 ance as so notified. 


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1 ‘‘(2) An exploration plan submitted under this 

2 subsection shall include, in the degree of detail 

3 which the Secretary may by regulation require— 

4 ‘‘(A) a schedule of anticipated exploration 

5 activities to be undertaken; 

6 ‘‘(B) a description of equipment to be used 

7 for such activities; 

8 ‘‘(C) the general location of each well to be 

9 drilled; and 

10 ‘‘(D) such other information deemed perti11 nent by the Secretary. 

12 ‘‘(3) The Secretary may, by regulation, require 

13 that such plan be accompanied by a general state14 ment of development and production intentions 

15 which shall be for planning purposes only and which 

16 shall not be binding on any party. 

17 ‘‘(d) PLAN REVISIONS; CONDUCT OF EXPLORATION

18 ACTIVITIES.— 

19 ‘‘(1) If a significant revision of an exploration 

20 plan under this subsection is submitted to the Sec21 retary, the process to be used for the review of such 

22 revision shall be the same as set forth in subsection 

23 (c) of this section. 

24 ‘‘(2) All exploration activities pursuant to any 

25 lease shall be conducted in accordance with an exploVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00034 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 ration plan or a revised plan which has been sub2 mitted to and reviewed by the Secretary.’’. 

3 SEC. 9. RESERVATION OF LANDS AND RIGHTS. 

4 Section 12 of the Outer Continental Shelf Lands Act 

5 (43 U.S.C. 1341) is amended— 

6 (1) in subsection (a) by adding at the end the 

7 following: ‘‘The President may partially or com8 pletely revise or revoke any prior withdrawal made 

9 by the President under the authority of this section. 

10 The President may not revise or revoke a withdrawal 

11 that was initiated by a petition from a State and ap12 proved by the Secretary of the Interior under sub13 section (h). A withdrawal by the President may be 

14 for a term not to exceed 10 years. In considering a 

15 potential withdrawal under this subsection, to the 

16 maximum extent practicable the President shall ac17 commodate competing interests and potential uses of 

18 the outer Continental Shelf.’’; 

19 (2) by adding at the end the following: 

20 ‘‘(g) OPTION TO PETITION FOR LEASING WITHIN

21 CERTAIN AREAS OF THE OUTER CONTINENTAL SHELF.— 

22 ‘‘(1) PROHIBITION AGAINST LEASING.— 

23 ‘‘(A) PROHIBITION PRIOR TO JULY 1, 

24 2012.—Except as otherwise provided in this sub25 section, prior to July 1, 2012, the Secretary 


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1 shall not offer for leasing for oil and gas, or for 

2 natural gas, any area withdrawn from disposi3 tion by leasing in the Atlantic OCS Region or 

4 the Pacific OCS Region, or the Gulf of Mexico 

5 OCS Region Eastern Planning Area, as de6 picted on the map referred to within this para7 graph, under the ‘Memorandum on Withdrawal 

8 of Certain Areas of the United States Outer 

9 Continental Shelf from Leasing Disposition’, 34 

10 Weekly Comp. Pres. Doc. 1111, dated June 12, 

11 1998, or any area not withdrawn under that 

12 Memorandum that is included within the Gulf 

13 of Mexico OCS Region Eastern Planning Area 

14 as indicated on the map entitled ‘Gulf of Mexico 

15 OCS Region State Adjacent Zones and OCS 

16 Planning Areas’ or within the Florida Straits 

17 Planning Area as indicated on the map entitled 

18 ‘Atlantic OCS Region State Adjacent Zones and 

19 OCS Planning Areas’, both of which are dated 

20 September 2005 and on file in the Office of the 

21 Director, Minerals Management Service. 

22 ‘‘(B) PROHIBITION FROM AND AFTER JULY

23 1, 2012.—Except as otherwise provided in this 

24 subsection, from and after July 1, 2012, the 

25 Secretary shall not offer for leasing for oil and 


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1 gas, or for natural gas, any area not available 

2 for leasing under subparagraph (A) located 

3 within 125 miles of the coastline. 

4 ‘‘(2) REVOCATION OF WITHDRAWAL.—The pro5 visions of the ‘Memorandum on Withdrawal of Cer6 tain Areas of the United States Outer Continental 

7 Shelf from Leasing Disposition’, 34 Weekly Comp. 

8 Pres. Doc. 1111, dated June 12, 1998, are hereby 

9 revoked and are no longer in effect regarding any 

10 areas included within the Gulf of Mexico OCS Re11 gion Central Planning Area as indicated on the map 

12 entitled ‘Gulf of Mexico OCS Region State Adjacent 

13 Zones and OCS Planning Areas’ dated September 

14 2005 and on file in the Office of the Director, Min15 erals Management Service. The 2002–2007 5-Year 

16 Outer Continental Shelf Oil and Gas Leasing Pro17 gram is hereby amended to include the areas added 

18 to the Gulf of Mexico OCS Region Central Planning 

19 Area by this Act to the extent that such areas were 

20 included within the original boundaries of proposed 

21 Lease Sale 181. The amendment to such leasing 

22 program includes two sales in such additional areas, 

23 one of which shall be held in January 2007 and one 

24 of which shall be held in June 2007. The Final En25 vironmental Impact Statement prepared for this 


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1 area for Lease Sale 181 shall be deemed sufficient 

2 for all purposes for each lease sale in which such 

3 area is offered for lease during the 2002–2007 5- 

4 Year Outer Continental Shelf Oil and Gas Leasing 

5 Program without need for supplementation. Any 

6 tract only partially added to the Gulf of Mexico OCS 

7 Region Central Planning Area by this Act shall be 

8 eligible for leasing of the part of such tract that is 

9 included within the Gulf of Mexico OCS Region Cen10 tral Planning Area, and the remainder of such tract 

11 that lies outside of the Gulf of Mexico OCS Region 

12 Central Planning Area may be developed and pro13 duced by the lessee of such partial tract using ex14 tended reach or similar drilling from a location on 

15 a leased area. 

16 ‘‘(3) PETITION FOR LEASING.— 

17 ‘‘(A) IN GENERAL.—The Governor of the 

18 State, upon concurrence of its legislature, may 

19 submit to the Secretary a petition requesting 

20 that the Secretary make available any area that 

21 is within the State’s Adjacent Zone, included 

22 within the provisions of paragraph (1), and that 

23 (i) is greater than 25 miles from any point on 

24 the coastline of a Neighboring State for the 

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1 lated activities with respect to natural gas leas2 ing; or (ii) is greater than 50 miles from any 

3 point on the coastline of a Neighboring State 

4 for the conduct of offshore leasing, pre-leasing, 

5 and related activities with respect to oil and gas 

6 leasing. The Adjacent State may also petition 

7 for leasing any other area within its Adjacent 

8 Zone if leasing is allowed in the similar area of 

9 the Adjacent Zone of the applicable Neigh10 boring State, or if not allowed, if the Neigh11 boring State, acting through its Governor, ex12 presses its concurrence with the petition. The 

13 Secretary shall only consider such a petition 

14 upon making a finding that leasing is allowed 

15 in the similar area of the Adjacent Zone of the 

16 applicable Neighboring State or upon receipt of 

17 the concurrence of the Neighboring State. The 

18 date of receipt by the Secretary of such concur19 rence by the Neighboring State shall constitute 

20 the date of receipt of the petition for that area 

21 for which the concurrence applies. A petition 

22 for leasing any part of the Alabama Adjacent 

23 Zone that is a part of the Gulf of Mexico East24 ern Planning Area, as indicated on the map en25 titled ‘Gulf of Mexico OCS Region State AdjaVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00039 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 cent Zones and OCS Planning Areas’ which is 

2 dated September 2005 and on file in the Office 

3 of the Director, Minerals Management Service, 

4 shall require the concurrence of both Alabama 

5 and Florida. 

6 ‘‘(B) LIMITATIONS ON LEASING.—In its 

7 petition, a State with an Adjacent Zone that 

8 contains leased tracts may condition oil and 

9 gas, or natural gas, new leasing for tracts with10 in 25 miles of the coastline by— 

11 ‘‘(i) requiring a net reduction in the 

12 number of production platforms; 

13 ‘‘(ii) requiring a net increase in the 

14 average distance of production platforms 

15 from the coastline; 

16 ‘‘(iii) limiting permanent surface occu17 pancy on new leases to areas that are more 

18 than 10 miles from the coastline; 

19 ‘‘(iv) limiting some tracts to being 

20 produced from shore or from platforms lo21 cated on other tracts; or 

22 ‘‘(v) other conditions that the Adja23 cent State may deem appropriate as long 

24 as the Secretary does not determine that 

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1 nically impracticable or otherwise impos2 sible. 

3 ‘‘(C) ACTION BY SECRETARY.—Not later 

4 than 90 days after receipt of a petition under 

5 subparagraph (A), the Secretary shall approve 

6 the petition, unless the Secretary determines 

7 that leasing the area would probably cause seri8 ous harm or damage to the marine resources of 

9 the State’s Adjacent Zone. Prior to approving 

10 the petition, the Secretary shall complete an en11 vironmental assessment that documents the an12 ticipated environmental effects of leasing in the 

13 area included within the scope of the petition. 

14 ‘‘(D) FAILURE TO ACT.—If the Secretary 

15 fails to approve or deny a petition in accordance 

16 with subparagraph (C) the petition shall be con17 sidered to be approved 90 days after receipt of 

18 the petition. 

19 ‘‘(E) AMENDMENT OF THE 5-YEAR LEAS20 ING PROGRAM.—Notwithstanding section 18, 

21 within 180 days of the approval of a petition 

22 under subparagraph (C) or (D), the Secretary 

23 shall amend the current 5-Year Outer Conti24 nental Shelf Oil and Gas Leasing Program to 

25 include a lease sale or sales for the entire area 


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1 covered by the approved petition, unless there 

2 are, from the date of approval, fewer than 12 

3 months remaining in the current 5-Year Leas4 ing Program in which case the Secretary shall 

5 include the areas covered by the approved peti6 tion within lease sales under the next 5-Year 

7 Leasing Program. For purposes of amending 

8 the 5-Year Program in accordance with this 

9 section, further consultations with States shall 

10 not be required. The environmental assessment 

11 performed under the provisions of the National 

12 Environmental Policy Act of 1969 to assess the 

13 effects of approving the petition shall be suffi14 cient to amend the 5-Year Leasing Program. 

15 ‘‘(h) EFFECT OF OTHER LAWS.—Adoption by any 

16 Adjacent State of any constitutional provision, or enact17 ment of any State statute, that has the effect, as deter18 mined by the Secretary, of restricting either the Governor 

19 or the Legislature, or both, from exercising full discretion 

20 related to subsection (g) or (h), or both, shall automati21 cally (1) prohibit any sharing of OCS Receipts under this 

22 Act with the Adjacent State, and its coastal political sub23 divisions, and (2) prohibit the Adjacent State from exer24 cising any authority under subsection (h), for the duration 

25 of the restriction. The Secretary shall make the determinaVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00042 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 tion of the existence of such restricting constitutional pro2 vision or State statute within 30 days of a petition by any 

3 outer Continental Shelf lessee or coastal State.’’. 

4 SEC. 10. OUTER CONTINENTAL SHELF LEASING PROGRAM. 

5 Section 18 of the Outer Continental Shelf Lands Act 

6 (43 U.S.C. 1344) is amended— 

7 (1) in subsection (a), by adding at the end of 

8 paragraph (3) the following: ‘‘The Secretary shall, in 

9 each 5-year program, include lease sales that when 

10 viewed as a whole propose to offer for oil and gas 

11 or natural gas leasing at least 75 percent of the 

12 available unleased acreage within each OCS Plan13 ning Area. Available unleased acreage is that portion 

14 of the outer Continental Shelf that is not under 

15 lease at the time of the proposed lease sale, and has 

16 not otherwise been made unavailable for leasing by 

17 law.’’; 

18 (2) in subsection (c), by striking so much as 

19 precedes paragraph (3) and inserting the following: 

20 ‘‘(c)(1) During the preparation of any proposed leas21 ing program under this section, the Secretary shall con22 sider and analyze leasing throughout the entire Outer 

23 Continental Shelf without regard to any other law affect24 ing such leasing. During this preparation the Secretary 

25 shall invite and consider suggestions from any interested 


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1 Federal agency, including the Attorney General, in con2 sultation with the Federal Trade Commission, and from 

3 the Governor of any coastal State. The Secretary may also 

4 invite or consider any suggestions from the executive of 

5 any local government in a coastal State that have been 

6 previously submitted to the Governor of such State, and 

7 from any other person. Further, the Secretary shall con8 sult with the Secretary of Defense regarding military oper9 ational needs in the outer Continental Shelf. The Sec10 retary shall work with the Secretary of Defense to resolve 

11 any conflicts that might arise regarding offering any area 

12 of the outer Continental Shelf for oil and gas or natural 

13 gas leasing. If the Secretaries are not able to resolve all 

14 such conflicts, any unresolved issues shall be elevated to 

15 the President for resolution. 

16 ‘‘(2) After the consideration and analysis required by 

17 paragraph (1), including the consideration of the sugges18 tions received from any interested Federal agency, the 

19 Federal Trade Commission, the Governor of any coastal 

20 State, any local government of a coastal State, and any 

21 other person, the Secretary shall publish in the Federal 

22 Register a proposed leasing program accompanied by a 

23 draft environmental impact statement prepared pursuant 

24 to the National Environmental Policy Act of 1969. After 

25 the publishing of the proposed leasing program and during 


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1 the comment period provided for on the draft environ2 mental impact statement, the Secretary shall submit a 

3 copy of the proposed program to the Governor of each af4 fected State for review and comment. The Governor may 

5 solicit comments from those executives of local govern6 ments in the Governor’s State that the Governor, in the 

7 discretion of the Governor, determines will be affected by 

8 the proposed program. If any comment by such Governor 

9 is received by the Secretary at least 15 days prior to sub10 mission to the Congress pursuant to paragraph (3) and 

11 includes a request for any modification of such proposed 

12 program, the Secretary shall reply in writing, granting or 

13 denying such request in whole or in part, or granting such 

14 request in such modified form as the Secretary considers 

15 appropriate, and stating the Secretary’s reasons therefor. 

16 All such correspondence between the Secretary and the 

17 Governor of any affected State, together with any addi18 tional information and data relating thereto, shall accom19 pany such proposed program when it is submitted to the 

20 Congress.’’; and 

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

22 ‘‘(i) PROJECTION OF STATE ADJACENT ZONE RE23 SOURCES AND STATE AND LOCAL GOVERNMENT SHARES

24 OF OCS RECEIPTS.—Concurrent with the publication of 

25 the scoping notice at the beginning of the development of 


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1 each 5-year outer Continental Shelf oil and gas leasing 

2 program, or as soon thereafter as possible, the secretary 

3 shall— 

4 ‘‘(1) provide to each Adjacent State a current 

5 estimate of proven and potential oil and gas re6 sources located within the State’s Adjacent Zone; 

7 and 

8 ‘‘(2) provide to each Adjacent State, and coast9 al political subdivisions thereof, a best-efforts projec10 tion of the OCS Receipts that the Secretary expects 

11 will be shared with each Adjacent State, and its 

12 coastal political subdivisions, using the assumption 

13 that the unleased tracts within the State’s Adjacent 

14 Zone are fully made available for leasing, including 

15 long-term projected OCS Receipts. In addition, the 

16 Secretary shall include a macroeconomic estimate of 

17 the impact of such leasing on the national economy 

18 and each State’s economy, including investment, 

19 jobs, revenues, personal income, and other cat20 egories.’’. 

21 SEC. 11. COORDINATION WITH ADJACENT STATES. 

22 Section 19 of the Outer Continental Shelf Lands Act 

23 (43 U.S.C. 1345) is amended— 


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1 (1) in subsection (a) in the first sentence by in2 serting ‘‘, for any tract located within the Adjacent 

3 State’s Adjacent Zone,’’ after ‘‘government’’; and 

4 (2) by adding the following: 

5 ‘‘(f)(1) No Federal agency may permit or otherwise 

6 approve, without the concurrence of the Adjacent State, 

7 the construction of a crude oil or petroleum products (or 

8 both) pipeline within the part of the Adjacent State’s Ad9 jacent Zone that is not available by law for oil and gas 

10 or natural gas leasing, except that such a pipeline may 

11 be approved to pass through such Adjacent Zone if at least 

12 50 percent of the production projected to be carried by 

13 the pipeline within its first 10 years of operation is from 

14 areas of the Adjacent State’s Adjacent Zone. 

15 ‘‘(2) No State may prohibit the construction within 

16 its Adjacent Zone or its State waters of a natural gas pipe17 line that will transport natural gas produced from the 

18 outer Continental Shelf. However, an Adjacent State may 

19 prevent a proposed natural gas pipeline landing location 

20 if it proposes two alternate landing locations in the Adja21 cent State, acceptable to the Adjacent State, located with22 in 50 miles on either side of the proposed landing loca23 tion.’’. 


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1 SEC. 12. ENVIRONMENTAL STUDIES. 

2 Section 20(d) of the Outer Continental Shelf Lands 

3 Act (43 U.S.C. 1346) is amended— 

4 (1) by inserting ‘‘(1)’’ after ‘‘(d)’’; and 

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

6 ‘‘(2) For all programs, lease sales, leases, and 

7 actions under this Act, the following shall apply re8 garding the application of the National Environ9 mental Policy Act of 1969: 

10 ‘‘(A) Granting or directing lease suspen11 sions and the conduct of all preliminary activi12 ties on outer Continental Shelf tracts, including 

13 seismic activities, are categorically excluded 

14 from the need to prepare either an environ15 mental assessment or an environmental impact 

16 statement, and the Secretary shall not be re17 quired to analyze whether any exceptions to a 

18 categorical exclusion apply for activities con19 ducted under the authority of this Act. 

20 ‘‘(B) The environmental impact statement 

21 developed in support of each 5-year oil and gas 

22 leasing program provides the environmental 

23 analysis for all lease sales to be conducted 

24 under the program and such sales shall not be 

25 subject to further environmental analysis. 


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1 ‘‘(C) Exploration plans shall not be subject 

2 to any requirement to prepare an environmental 

3 impact statement, and the Secretary may find 

4 that exploration plans are eligible for categor5 ical exclusion due to the impacts already being 

6 considered within an environmental impact 

7 statement or due to mitigation measures in8 cluded within the plan. 

9 ‘‘(D) Within each OCS Planning Area, 

10 after the preparation of the first development 

11 and production plan environmental impact 

12 statement for a leased tract within the Area, fu13 ture development and production plans for 

14 leased tracts within the Area shall only require 

15 the preparation of an environmental assessment 

16 unless the most recent development and produc17 tion plan environmental impact statement with18 in the Area was finalized more than 10 years 

19 prior to the date of the approval of the plan, in 

20 which case an environmental impact statement 

21 shall be required.’’. 

22 SEC. 13. REVIEW OF OUTER CONTINENTAL SHELF DEVEL23 OPMENT AND PRODUCTION PLANS. 

24 Section 25 of the Outer Continental Shelf Lands Act 

25 (43 U.S.C. 1351(a)) is amended to read as follows: 


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1 ‘‘SEC. 25. REVIEW OF OUTER CONTINENTAL SHELF DEVEL2 OPMENT AND PRODUCTION PLANS. 

3 ‘‘(a) DEVELOPMENT AND PRODUCTION PLANS; SUB4 MISSION TO SECRETARY; STATEMENT OF FACILITIES AND

5 OPERATION; SUBMISSION TO GOVERNORS OF AFFECTED

6 STATES AND LOCAL GOVERNMENTS.— 

7 ‘‘(1) Prior to development and production pur8 suant to an oil and gas lease issued on or after Sep9 tember 18, 1978, for any area of the outer Conti10 nental Shelf, or issued or maintained prior to Sep11 tember 18, 1978, for any area of the outer Conti12 nental Shelf, with respect to which no oil or gas has 

13 been discovered in paying quantities prior to Sep14 tember 18, 1978, the lessee shall submit a develop15 ment and production plan (hereinafter in this sec16 tion referred to as a ‘plan’) to the Secretary for re17 view. 

18 ‘‘(2) A plan shall be accompanied by a state19 ment describing all facilities and operations, other 

20 than those on the outer Continental Shelf, proposed 

21 by the lessee and known by the lessee (whether or 

22 not owned or operated by such lessee) that will be 

23 constructed or utilized in the development and pro24 duction of oil or gas from the lease area, including 

25 the location and site of such facilities and oper26 ations, the land, labor, material, and energy requireVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00050 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 ments associated with such facilities and operations, 

2 and all environmental and safety safeguards to be 

3 implemented. 

4 ‘‘(3) Except for any privileged or proprietary 

5 information (as such term is defined in regulations 

6 issued by the Secretary), the Secretary, within 30 

7 days after receipt of a plan and statement, shall— 

8 ‘‘(A) submit such plan and statement to 

9 the Governor of any affected State, and upon 

10 request to the executive of any affected local 

11 government; and 

12 ‘‘(B) make such plan and statement avail13 able to any appropriate interstate regional enti14 ty and the public. 

15 ‘‘(b) DEVELOPMENT AND PRODUCTION ACTIVITIES

16 IN ACCORDANCE WITH PLAN AS LEASE REQUIREMENT.— 

17 After enactment of the Coastal Economic and Environ18 mental Protection Act, no oil and gas lease may be issued 

19 pursuant to this Act in any region of the outer Continental 

20 Shelf, unless such lease requires that development and 

21 production activities be carried out in accordance with a 

22 plan that complies with the requirements of this section. 

23 This section shall also apply to leases that do not have 

24 an approved development and production plan as of the 


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1 date of enactment of the Coastal Economic and Environ2 mental Protection Act. 

3 ‘‘(c) SCOPE AND CONTENTS OF PLAN.—A plan may 

4 apply to more than one oil and gas lease, and shall set 

5 forth, in the degree of detail established by regulations 

6 issued by the Secretary— 

7 ‘‘(1) the general work to be performed; 

8 ‘‘(2) a description of all facilities and operations 

9 located on the outer Continental Shelf that are pro10 posed by the lessee or known by the lessee (whether 

11 or not owned or operated by such lessee) to be di12 rectly related to the proposed development, including 

13 the location and size of such facilities and oper14 ations, and the land, labor, material, and energy re15 quirements associated with such facilities and oper16 ations; 

17 ‘‘(3) the environmental safeguards to be imple18 mented on the outer Continental Shelf and how such 

19 safeguards are to be implemented; 

20 ‘‘(4) all safety standards to be met and how 

21 such standards are to be met; 

22 ‘‘(5) an expected rate of development and pro23 duction and a time schedule for performance; and 

24 ‘‘(6) such other relevant information as the Sec25 retary may by regulation require. 


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1 ‘‘(d) COMPLETENESS REVIEW OF THE PLAN.— 

2 ‘‘(1) Prior to commencing any activity under a 

3 development and production plan pursuant to any oil 

4 and gas lease issued or maintained under this Act, 

5 the lessee shall certify that the plan is consistent 

6 with the terms of the lease and that it is consistent 

7 with all statutory and regulatory requirements in ef8 fect on the date of issuance of the lease. The plan 

9 shall include all required information and docu10 mentation required under subsection (c). 

11 ‘‘(2) The Secretary shall review the plan for 

12 completeness within 30 days of submission. If the 

13 Secretary finds that the plan is not complete, the 

14 Secretary shall notify the lessee with a detailed ex15 planation of such modifications of such plan as are 

16 necessary to achieve completeness. The Secretary 

17 shall have 30 days to review a modified plan for 

18 completeness. 

19 ‘‘(e) REVIEW FOR CONSISTENCY OF THE PLAN.— 

20 ‘‘(1) After a determination that a plan is com21 plete, the Secretary shall have 120 days to conduct 

22 a review of the plan, to ensure that it is consistent 

23 with the terms of the lease, and that it is consistent 

24 with all such statutory and regulatory requirements 

25 applicable to the lease. The review shall ensure that 


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1 the plan is consistent with lease terms, and statutory 

2 and regulatory requirements applicable to the lease, 

3 related to national security or national defense, in4 cluding any military operating stipulations or other 

5 restrictions. The Secretary shall seek the assistance 

6 of the Department of Defense in the conduct of the 

7 review of any plan prepared under this section for 

8 a lease containing military operating stipulations or 

9 other restrictions and shall accept the assistance of 

10 the Department of Defense in the conduct of the re11 view of any plan prepared under this section for any 

12 other lease when the Secretary of Defense requests 

13 an opportunity to participate in the review. If the 

14 Secretary finds that the plan is not consistent, the 

15 Secretary shall notify the lessee with a detailed ex16 planation of such modifications of such plan as are 

17 necessary to achieve consistency. 

18 ‘‘(2) The Secretary shall have 120 days to re19 view a modified plan. 

20 ‘‘(3) The lessee shall not conduct any activities 

21 under the plan during any 120-day review period, or 

22 thereafter until the plan has been modified to 

23 achieve compliance as so notified. 

24 ‘‘(4) After review by the Secretary provided for 

25 by this section, a lessee may operate pursuant to the 


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1 plan without further review or approval by the Sec2 retary. 

3 ‘‘(f) REVIEW OF REVISION OF THE APPROVED

4 PLAN.—The lessee may submit to the Secretary any revi5 sion of a plan if the lessee determines that such revision 

6 will lead to greater recovery of oil and natural gas, im7 prove the efficiency, safety, and environmental protection 

8 of the recovery operation, is the only means available to 

9 avoid substantial economic hardship to the lessee, or is 

10 otherwise not inconsistent with the provisions of this Act, 

11 to the extent such revision is consistent with protection 

12 of the human, marine, and coastal environments. The 

13 process to be used for the review of any such revision shall 

14 be the same as that set forth in subsections (d) and (e). 

15 ‘‘(g) CANCELLATION OF LEASE ON FAILURE TO SUB16 MIT PLAN OR COMPLY WITH A PLAN.—Whenever the 

17 owner of any lease fails to submit a plan in accordance 

18 with regulations issued under this section, or fails to com19 ply with a plan, the lease may be canceled in accordance 

20 with section 5(c) and (d). Termination of a lease because 

21 of failure to comply with a plan, including required modi22 fications or revisions, shall not entitle a lessee to any com23 pensation. 

24 ‘‘(h) PRODUCTION AND TRANSPORTATION OF NAT25 URAL GAS; SUBMISSION OF PLAN TO FEDERAL ENERGY


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1 REGULATORY COMMISSION; IMPACT STATEMENT.—If any 

2 development and production plan submitted to the Sec3 retary pursuant to this section provides for the production 

4 and transportation of natural gas, the lessee shall contem5 poraneously submit to the Federal Energy Regulatory 

6 Commission that portion of such plan that relates to the 

7 facilities for transportation of natural gas. The Secretary 

8 and the Federal Energy Regulatory Commission shall 

9 agree as to which of them shall prepare an environmental 

10 impact statement pursuant to the National Environmental 

11 Policy Act of 1969 (42 U.S.C. 4321 et seq.) applicable 

12 to such portion of such plan, or conduct studies as to the 

13 effect on the environment of implementing it. Thereafter, 

14 the findings and recommendations by the agency pre15 paring such environmental impact statement or con16 ducting such studies pursuant to such agreement shall be 

17 adopted by the other agency, and such other agency shall 

18 not independently prepare another environmental impact 

19 statement or duplicate such studies with respect to such 

20 portion of such plan, but the Federal Energy Regulatory 

21 Commission, in connection with its review of an applica22 tion for a certificate of public convenience and necessity 

23 applicable to such transportation facilities pursuant to sec24 tion 7 of the Natural Gas Act (15 U.S.C. 717f), may pre25 pare such environmental studies or statement relevant to 


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1 certification of such transportation facilities as have not 

2 been covered by an environmental impact statement or 

3 studies prepared by the Secretary. The Secretary, in con4 sultation with the Federal Energy Regulatory Commis5 sion, shall promulgate rules to implement this subsection, 

6 but the Federal Energy Regulatory Commission shall re7 tain sole authority with respect to rules and procedures 

8 applicable to the filing of any application with the Com9 mission and to all aspects of the Commission’s review of, 

10 and action on, any such application.’’. 

11 SEC. 14. FEDERAL ENERGY NATURAL RESOURCES EN12 HANCEMENT FUND ACT OF 2006. 

13 (a) FINDINGS.—The Congress finds the following: 

14 (1) Energy and minerals exploration, develop15 ment, and production on Federal onshore and off16 shore lands, including bio-based fuel, natural gas, 

17 minerals, oil, geothermal, and power from wind, 

18 waves, currents, and thermal energy, involves signifi19 cant outlays of funds by Federal and State wildlife, 

20 fish, and natural resource management agencies for 

21 environmental studies, planning, development, moni22 toring, and management of wildlife, fish, air, water, 

23 and other natural resources. 

24 (2) State wildlife, fish, and natural resource 

25 management agencies are funded primarily through 


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1 permit and license fees paid to the States by the 

2 general public to hunt and fish, and through Federal 

3 excise taxes on equipment used for these activities. 

4 (3) Funds generated from consumptive and rec5 reational uses of wildlife, fish, and other natural re6 sources currently are inadequate to address the nat7 ural resources related to energy and minerals devel8 opment on Federal onshore and offshore lands. 

9 (4) Funds available to Federal agencies respon10 sible for managing Federal onshore and offshore 

11 lands and Federal-trust wildlife and fish species and 

12 their habitats are inadequate to address the natural 

13 resources related to energy and minerals develop14 ment on Federal onshore and offshore lands. 

15 (5) Receipts derived from sales, bonus bids, and 

16 royalties under the mineral leasing laws of the 

17 United States are paid to the Treasury through the 

18 Minerals Management Service of the Department of 

19 the Interior. 

20 (6) None of the receipts derived from sales, 

21 bonus bids, and royalties under the minerals leasing 

22 laws of the United States are paid to the Federal or 

23 State agencies to examine, monitor, and manage 

24 wildlife, fish, air, water, and other natural resources 


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1 related to natural gas, oil, and mineral exploration 

2 and development. 

3 (b) PURPOSES.—It is the purpose of this section to— 

4 (1) establish a fund for the monitoring and 

5 management of wildlife and fish, and their habitats, 

6 and air, water, and other natural resources related 

7 to energy and minerals development on Federal on8 shore and offshore lands; 

9 (2) make available receipts derived from sales, 

10 bonus bids, and royalties from onshore and offshore 

11 gas, mineral, oil, and any additional form of energy 

12 exploration and development under the laws of the 

13 United States for the purposes of such fund; 

14 (3) distribute funds from such fund each fiscal 

15 year to the Secretary of the Interior and the States; 

16 and 

17 (4) use the distributed funds to secure the nec18 essary trained workforce or contractual services to 

19 conduct environmental studies, planning, develop20 ment, monitoring, and post-development manage21 ment of wildlife and fish and their habitats and air, 

22 water, and other natural resources that may be re23 lated to bio-based fuel, gas, mineral, oil, wind, or 

24 other energy exploration, development, transpor25 tation, transmission, and associated activities on 


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1 Federal onshore and offshore lands, including, but 

2 not limited to— 

3 (A) pertinent research, surveys, and envi4 ronmental analyses conducted to identify any 

5 impacts on wildlife, fish, air, water, and other 

6 natural resources from energy and mineral ex7 ploration, development, production, and trans8 portation or transmission; 

9 (B) projects to maintain, improve, or en10 hance wildlife and fish populations and their 

11 habitats or air, water, or other natural re12 sources, including activities under the Endan13 gered Species Act of 1973; 

14 (C) research, surveys, environmental anal15 yses, and projects that assist in managing, in16 cluding mitigating either onsite or offsite, or 

17 both, the impacts of energy and mineral activi18 ties on wildlife, fish, air, water, and other nat19 ural resources; and 

20 (D) projects to teach young people to live 

21 off the land. 

22 (c) DEFINITIONS.—In this section: 

23 (1) ENHANCEMENT FUND.—The term ‘‘En24 hancement Fund’’ means the Federal Energy NatVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00060 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 ural Resources Enhancement Fund established by 

2 subsection (d). 

3 (2) STATE.—The term ‘‘State’’ means the State 

4 government agency primarily responsible for fish 

5 and wildlife trust resources within a State. 

6 (d) ESTABLISHMENT AND USE OF FEDERAL ENERGY

7 NATURAL RESOURCES ENHANCEMENT FUND.— 

8 (1) ENHANCEMENT FUND.—There is estab9 lished in the Treasury a separate account to be 

10 known as the ‘‘Federal Energy Natural Resources 

11 Enhancement Fund’’. 

12 (2) FUNDING.—The Secretary of the Treasury 

13 shall deposit in the Enhancement Fund— 

14 (A) such sums as are provided by sections 

15 9(b)(5)(A)(ii), 9(b)(5)(B)(ii), 9(c)(4)(A)(ii), and 

16 9(c)(4)(B)(ii) of the Outer Continental Shelf 

17 Lands Act, as amended by this Act; 

18 (B)(i) during the period of October 1, 

19 2006, through September 30, 2015, 0.5 percent 

20 of all sums paid into the Treasury under sec21 tion 35 of the Mineral Leasing Act (30 U.S.C. 

22 191), and 

23 (ii) beginning October 1, 2015, and there24 after, 2.5 percent of all sums paid into the 


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1 Treasury under section 35 of the Mineral Leas2 ing Act (30 U.S.C. 191); and 

3 (C)(i) during the period of October 1, 

4 2006, through September 30, 2015, 0.5 percent 

5 of all sums paid into the Treasury from receipts 

6 derived from bonus bids and royalties from 

7 other mineral leasing on public lands, and 

8 (ii) beginning October 1, 2015, and there9 after, 2.5 percent of all sums paid into the 

10 Treasury from receipts derived from bonus bids 

11 and royalties from other mineral leasing on 

12 public lands. 

13 (3) INVESTMENTS.—The Secretary of the 

14 Treasury shall invest the amounts deposited under 

15 paragraph (2) and all accrued interest on the 

16 amounts deposited under paragraph (2) only in in17 terest bearing obligations of the United States or in 

18 obligations guaranteed as to both principal and in19 terest by the United States. 

20 (4) PAYMENT TO SECRETARY OF THE INTE21 RIOR.— 

22 (A) IN GENERAL.—Beginning with fiscal 

23 year 2007, and in each fiscal year thereafter, 

24 one-third of amounts deposited into the En25 hancement Fund, together with the interest 


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1 thereon, shall be available, without fiscal year 

2 limitations, to the Secretary of the Interior for 

3 use for the purposes described in (b)(4). 

4 (B) WITHDRAWALS AND TRANSFER OF

5 FUNDS.—The Secretary of the Treasury shall 

6 withdraw such amounts from the Enhancement 

7 Fund as the Secretary of the Interior may re8 quest, subject to the limitation in (A), and 

9 transfer such amounts to the Secretary of the 

10 Interior to be used, at the discretion of the Sec11 retary of the Interior, by the Minerals Manage12 ment Service, the Bureau of Land Manage13 ment, and the United States Fish and Wildlife 

14 Service for use for the purposes described in 

15 subsection (b)(4). 

16 (5) PAYMENT TO STATES.— 

17 (A) IN GENERAL.—Beginning with fiscal 

18 year 2007, and in each fiscal year thereafter, 

19 two-thirds of amounts deposited into the En20 hancement Fund, together with the interest 

21 thereon, shall be available, without fiscal year 

22 limitations, to the States for use for the pur23 poses described in (b)(4). 

24 (B) WITHDRAWALS AND TRANSFER OF

25 FUNDS.—Within the first 90 days of each fiscal 


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1 year, the Secretary of the Treasury shall with2 draw amounts from the Enhancement Fund 

3 and transfer such amounts to the States based 

4 on the proportion of all receipts that were col5 lected the previous fiscal year from Federal 

6 leases within the boundaries of each State and 

7 each State’s outer Continental Shelf Adjacent 

8 Zone as determined in accordance with section 

9 4(a) of the Outer Continental Shelf Lands Act 

10 (43 U.S.C. 1333(a)), as amended by this Act. 

11 (C) USE OF PAYMENTS BY STATE.—Each 

12 State shall use the payments made under sub13 paragraph (B) only for carrying out projects 

14 and programs for the purposes described in 

15 (b)(4). 

16 (D) ENCOURAGE USE OF PRIVATE FUNDS

17 BY STATE.—Each State shall use the payments 

18 made under subparagraph (B) to leverage pri19 vate funds for carrying out projects for the pur20 poses described in (b)(4). 

21 (e) LIMITATION ON USE.—Amounts available under 

22 this section may not be used for the purchase of any inter23 est in land. 

24 (f) REPORTS TO CONGRESS.— 


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1 (1) IN GENERAL.—Beginning in fiscal year 

2 2008 and continuing for each fiscal year thereafter, 

3 the Secretary of the Interior and each State receiv4 ing funds from the Enhancement Fund shall submit 

5 a report to the Committee on Energy and Natural 

6 Resources of the Senate and the Committee on Re7 sources of the House of Representatives. 

8 (2) REQUIRED INFORMATION.—Reports sub9 mitted to the Congress by the Secretary of the Inte10 rior and States under this subsection shall include 

11 the following information regarding expenditures 

12 during the previous fiscal year: 

13 (A) A summary of pertinent scientific re14 search and surveys conducted to identify im15 pacts on wildlife, fish, and other natural re16 sources from energy and mineral developments. 

17 (B) A summary of projects planned and 

18 completed to maintain, improve or enhance 

19 wildlife and fish populations and their habitats 

20 or other natural resources. 

21 (C) A list of additional actions that assist, 

22 or would assist, in managing, including miti23 gating either onsite or offsite, or both, the im24 pacts of energy and mineral development on 

25 wildlife, fish, and other natural resources. 


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1 (D) A summary of private (non-Federal) 

2 funds used to plan, conduct, and complete the 

3 plans and programs identified in paragraphs 

4 (2)(A) and (2)(B). 

5 SEC. 15. TERMINATION OF EFFECT OF LAWS PROHIBITING 

6 THE SPENDING OF APPROPRIATED FUNDS 

7 FOR CERTAIN PURPOSES. 

8 All provisions of existing Federal law prohibiting the 

9 spending of appropriated funds to conduct oil and natural 

10 gas leasing and preleasing activities for any area of the 

11 outer Continental Shelf shall have no force or effect. 

12 SEC. 16. OUTER CONTINENTAL SHELF INCOMPATIBLE USE. 

13 (a) IN GENERAL.—No Federal agency may permit 

14 construction or operation (or both) of any facility, or des15 ignate or maintain a restricted transportation corridor or 

16 operating area on the Federal outer Continental Shelf or 

17 in State waters, that will be incompatible with, as deter18 mined by the Secretary of the Interior, oil and gas or nat19 ural gas leasing and substantially full exploration and pro20 duction of tracts that are geologically prospective for oil 

21 or natural gas (or both). 

22 (b) EXCEPTIONS.—Subsection (a) shall not apply to 

23 any facility, transportation corridor, or operating area the 

24 construction, operation, designation, or maintenance of 

25 which is or will be— 


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1 (1) located in an area of the outer Continental 

2 Shelf that is unavailable for oil and gas or natural 

3 gas leasing by operation of law; 

4 (2) used for a military readiness activity (as de5 fined in section 315(f) of Public Law 107–314; 16 

6 U.S.C. 703 note); or 

7 (3) required in the national interest, as deter8 mined by the President. 

9 SEC. 17. REPURCHASE OF CERTAIN LEASES. 

10 (a) AUTHORITY TO REPURCHASE AND CANCEL CER11 TAIN LEASES.—The Secretary of the Interior shall repur12 chase and cancel any Federal oil and gas, geothermal, 

13 coal, oil shale, tar sands, or other mineral lease, whether 

14 onshore or offshore, if the Secretary finds that such lease 

15 qualifies for repurchase and cancellation under the regula16 tions authorized by this section. 

17 (b) REGULATIONS.—Not later than 365 days after 

18 the date of the enactment of this Act, the Secretary shall 

19 publish a final regulation stating the conditions under 

20 which a lease referred to in subsection (a) would qualify 

21 for repurchase and cancellation, and the process to be fol22 lowed regarding repurchase and cancellation. Such regula23 tion shall include, but not be limited to, the following: 


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1 (1) The Secretary shall repurchase and cancel 

2 a lease after written request by the lessee upon a 

3 finding by the Secretary that— 

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

5 permit or other approval complied with applica6 ble law, except the Coastal Zone Management 

7 Act of 1972 (16 U.S.C. 1451 et seq.), and 

8 terms of the lease and such permit or other ap9 proval was denied; 

10 (B) a Federal agency failed to act on a re11 quest by the lessee for a required permit, other 

12 approval, or administrative appeal within a reg13 ulatory or statutory time-frame associated with 

14 the requested action, whether advisory or man15 datory, or if none, within 180 days; or 

16 (C) a Federal agency attached a condition 

17 of approval, without agreement by the lessee, to 

18 a required permit or other approval if such con19 dition of approval was not mandated by Federal 

20 statute or regulation in effect on the date of 

21 lease issuance, or was not specifically allowed 

22 under the terms of the lease. 

23 (2) A lessee shall not be required to exhaust ad24 ministrative remedies regarding a permit request, 


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1 administrative appeal, or other required request for 

2 approval for the purposes of this section. 

3 (3) The Secretary shall make a final agency de4 cision on a request by a lessee under this section 

5 within 180 days of request. 

6 (4) Compensation to a lessee to repurchase and 

7 cancel a lease under this section shall be the amount 

8 that a lessee would receive in a restitution case for 

9 a material breach of contract. 

10 (5) Compensation shall be in the form of a 

11 check or electronic transfer from the Department of 

12 the Treasury from funds deposited into miscella13 neous receipts under the authority of the same Act 

14 that authorized the issuance of the lease being re15 purchased. 

16 (6) Failure of the Secretary to make a final 

17 agency decision on a request by a lessee under this 

18 section within 180 days of request shall result in a 

19 10 percent increase in the compensation due to the 

20 lessee if the lease is ultimately repurchased. 

21 (c) NO PREJUDICE.—This section shall not be inter22 preted to prejudice any other rights that the lessee would 

23 have in the absence of this section. 


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1 SEC. 18. OFFSITE ENVIRONMENTAL MITIGATION. 

2 Notwithstanding any other provision of law, any per3 son conducting activities under the Mineral Leasing Act 

4 (30 U.S.C. 181 et seq.), the Geothermal Steam Act (30 

5 U.S.C. 1001 et seq.), the Mineral Leasing Act for Ac6 quired Lands (30 U.S.C. 351 et seq.), the Weeks Act (16 

7 U.S.C. 552 et seq.), the General Mining Act of 1872 (30 

8 U.S.C. 22 et seq.), the Materials Act of 1947 (30 U.S.C. 

9 601 et seq.), or the Outer Continental Shelf Lands Act 

10 (43 U.S.C. 1331 et seq.), may in satisfying any mitigation 

11 requirements associated with such activities propose miti12 gation measures on a site away from the area impacted 

13 and the Secretary of the Interior shall accept these pro14 posed measures if the Secretary finds that they generally 

15 achieve the purposes for which mitigation measures apper16 tained. 

17 SEC. 19. AMENDMENTS TO THE MINERAL LEASING ACT. 

18 Section 17(g) of the Mineral Leasing Act (30 U.S.C. 

19 226(g)) is amended to read as follows: 

20 ‘‘(g) REGULATION OF SURFACE-DISTURBING ACTIVI21 TIES.— 

22 ‘‘(1) REGULATION OF SURFACE-DISTURBING

23 ACTIVITIES.—The Secretary of the Interior, or for 

24 National Forest lands, the Secretary of Agriculture, 

25 shall regulate all surface-disturbing activities con26 ducted pursuant to any lease issued under this Act, 


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1 and shall determine reclamation and other actions as 

2 required in the interest of conservation of surface re3 sources. 

4 ‘‘(2) SUBMISSION OF EXPLORATION PLAN; COM5 PLETION REVIEW; COMPLIANCE REVIEW.— 

6 ‘‘(A) Prior to beginning oil and gas explo7 ration activities, a lessee shall submit an explo8 ration plan to the Secretary of the Interior for 

9 review. 

10 ‘‘(B) The Secretary shall review the plan 

11 for completeness within 10 days of submission. 

12 ‘‘(C) In the event the exploration plan is 

13 determined to be incomplete, the Secretary shall 

14 notify the lessee in writing and specify the 

15 items or information needed to complete the ex16 ploration plan. 

17 ‘‘(D) The Secretary shall have 10 days to 

18 review any modified exploration plan submitted 

19 by the lessee. 

20 ‘‘(E) To be deemed complete, an explo21 ration plan shall include, in the degree of detail 

22 to be determined by the Secretary by rule or 

23 regulation— 

24 ‘‘(i) a drilling plan containing a de25 scription of the drilling program; 


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1 ‘‘(ii) the surface and projected com2 pletion zone location; 

3 ‘‘(iii) pertinent geologic data; 

4 ‘‘(iv) expected hazards, and proposed 

5 mitigation measures to address such haz6 ards; 

7 ‘‘(v) a schedule of anticipated explo8 ration activities to be undertaken; 

9 ‘‘(vi) a description of equipment to be 

10 used for such activities; 

11 ‘‘(vii) a certification from the lessee 

12 stating that the exploration plan complies 

13 with all lease, regulatory and statutory re14 quirements in effect on the date of the 

15 issuance of the lease; 

16 ‘‘(viii) evidence that the lessee has se17 cured an adequate bond, surety, or other 

18 financial arrangement prior to commence19 ment of any surface disturbing activity; 

20 ‘‘(ix) a plan that details the complete 

21 and timely reclamation of the lease tract; 

22 and 

23 ‘‘(x) such other relevant information 

24 as the Secretary may by regulation require. 


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1 ‘‘(F) Upon a determination that the explo2 ration plan is complete, the Secretary shall have 

3 30 days from the date the plan is deemed com4 plete to conduct a review of the plan. 

5 ‘‘(G) If the Secretary finds the exploration 

6 plan is not consistent with all statutory and 

7 regulatory requirements in effect on the date of 

8 issuance of the lease, the Secretary shall notify 

9 the lessee with a detailed explanation of such 

10 modifications of the exploration plan as are nec11 essary to achieve compliance. 

12 ‘‘(H) The lessee shall not take any action 

13 under the exploration plan within a 30 day re14 view period, or thereafter until the plan has 

15 been modified to achieve compliance as so noti16 fied. 

17 ‘‘(I) After review by the Secretary provided 

18 by this subsection, a lessee may operate pursu19 ant to the plan without further review or ap20 proval by the Secretary. 

21 ‘‘(3) PLAN REVISIONS; CONDUCT OF EXPLO22 RATION ACTIVITIES.— 

23 ‘‘(A) If a significant revision of an explo24 ration plan under this subsection is submitted 

25 to the Secretary, the process to be used for the 


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1 review of such revision shall be the same as set 

2 forth in paragraph (1) of this subsection. 

3 ‘‘(B) All exploration activities pursuant to 

4 any lease shall be conducted in accordance with 

5 an exploration plan that has been submitted to 

6 and reviewed by the Secretary or a revision of 

7 such plan. 

8 ‘‘(4) SUBMISSION OF DEVELOPMENT AND PRO9 DUCTION PLAN; COMPLETENESS REVIEW; COMPLI10 ANCE REVIEW.— 

11 ‘‘(A) Prior to beginning oil and gas devel12 opment and production activities, a lessee shall 

13 submit a development and exploration plan to 

14 the Secretary of the Interior. Upon submission, 

15 such plans shall be subject to a review for com16 pleteness. 

17 ‘‘(B) The Secretary shall review the plan 

18 for completeness within 30 days of submission. 

19 ‘‘(C) In the event a development and pro20 duction plan is determined to be incomplete, the 

21 Secretary shall notify the lessee in writing and 

22 specify the items or information needed to com23 plete the plan. 

24 ‘‘(D) The Secretary shall have 30 days to 

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1 ment and production plan submitted by the les2 see. 

3 ‘‘(E) To be deemed complete, a develop4 ment and production plan shall include, in the 

5 degree of detail to be determined by the Sec6 retary by rule or regulation— 

7 ‘‘(i) a drilling plan containing a de8 scription of the drilling program; 

9 ‘‘(ii) the surface and projected com10 pletion zone location; 

11 ‘‘(iii) pertinent geologic data; 

12 ‘‘(iv) expected hazards, and proposed 

13 mitigation measures to address such haz14 ards; 

15 ‘‘(v) a statement describing all facili16 ties and operations proposed by the lessee 

17 and known by the lessee (whether or not 

18 owned or operated by such lessee) that 

19 shall be constructed or utilized in the de20 velopment and production of oil or gas 

21 from the leases areas, including the loca22 tion and site of such facilities and oper23 ations, the land, labor, material, and en24 ergy requirements associated with such fa25 cilities and operations; 


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1 ‘‘(vi) the general work to be per2 formed; 

3 ‘‘(vii) the environmental safeguards to 

4 be implemented in connection with the de5 velopment and production and how such 

6 safeguards are to be implemented; 

7 ‘‘(viii) all safety standards to be met 

8 and how such standards are to be met; 

9 ‘‘(ix) an expected rate of development 

10 and production and a time schedule for 

11 performance; 

12 ‘‘(x) a certification from the lessee 

13 stating that the development and produc14 tion plan complies with all lease, regu15 latory, and statutory requirements in effect 

16 on the date of issuance of the lease; 

17 ‘‘(xi) evidence that the lessee has se18 cured an adequate bond, surety, or other 

19 financial arrangement prior to commence20 ment of any surface disturbing activity; 

21 ‘‘(xii) a plan that details the complete 

22 and timely reclamation of the lease tract; 

23 and 

24 ‘‘(xiii) such other relevant information 

25 as the Secretary may by regulation require. 


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1 ‘‘(F) Upon a determination that the devel2 opment and production plan is complete, the 

3 Secretary shall have 120 days from the date the 

4 plan is deemed complete to conduct a review of 

5 the plan. 

6 ‘‘(G) If the Secretary finds the develop7 ment and production plan is not consistent with 

8 all statutory and regulatory requirements in ef9 fect on the date of issuance of the lease, the 

10 Secretary shall notify the lessee with a detailed 

11 explanation of such modifications of the devel12 opment and production plan as are necessary to 

13 achieve compliance. 

14 ‘‘(H) The lessee shall not take any action 

15 under the development and production plan 

16 within a 120 day review period, or thereafter 

17 until the plan has been modified to achieve 

18 compliance as so notified. 

19 ‘‘(5) PLAN REVISIONS; CONDUCT OF DEVELOP20 MENT AND PRODUCTION ACTIVITIES.— 

21 ‘‘(A) If a significant revision of a develop22 ment and production plan under this subsection 

23 is submitted to the Secretary, the process to be 

24 used for the review of such revision shall be the 


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1 same as set forth in paragraph (4) of this sub2 section. 

3 ‘‘(B) All development and production ac4 tivities pursuant to any lease shall be conducted 

5 in accordance with an exploration plan that has 

6 been submitted to and reviewed by the Sec7 retary or a revision of such plan. 

8 ‘‘(6) CANCELLATION OF LEASE ON FAILURE TO

9 SUBMIT PLAN OR COMPLY WITH APPROVED PLAN.— 

10 Whenever the owner of any lease fails to submit a 

11 plan in accordance with regulations issued under 

12 this section, or fails to comply with a plan, the lease 

13 may be canceled in accordance with section 31. Ter14 mination of a lease because of failure to comply with 

15 a plan, including required modifications or revisions, 

16 shall not entitle a lessee to any compensation.’’. 

17 SEC. 20. MINERALS MANAGEMENT SERVICE. 

18 The bureau known as the ‘‘Minerals Management 

19 Service’’ in the Department of the Interior shall be known 

20 as the ‘‘National Ocean Resources and Royalty Service’’. 


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1 SEC. 21. AUTHORITY TO USE DECOMMISSIONED OFFSHORE 

2 OIL AND GAS PLATFORMS AND OTHER FA3 CILITIES FOR MARICULTURE, ARTIFICIAL 

4 REEF, SCIENTIFIC RESEARCH, OR OTHER 

5 USES. 

6 (a) SHORT TITLE.—This section may be cited as the 

7 ‘‘Rigs to Reefs Act of 2005’’. 

8 (b) IN GENERAL.—The Outer Continental Shelf 

9 Lands Act (43 U.S.C. 1301 et seq.) is amended by insert10 ing after section 9 the following: 

11 ‘‘SEC. 10. USE OF DECOMMISSIONED OFFSHORE OIL AND 

12 GAS PLATFORMS AND OTHER FACILITIES 

13 FOR MARICULTURE, ARTIFICIAL REEF, SCI14 ENTIFIC RESEARCH, OR OTHER USES. 

15 ‘‘(a) IN GENERAL.—The Secretary shall issue regula16 tions under which the Secretary may authorize use of an 

17 offshore oil and gas platform or other facility that is de18 commissioned from service for oil and gas purposes for 

19 culture of marine organisms, an artificial reef, scientific 

20 research, or any other use authorized under section 8(p). 

21 ‘‘(b) TRANSFER REQUIREMENTS.—The Secretary 

22 shall not allow the transfer of a decommissioned offshore 

23 oil and gas platform or other facility to another person 

24 unless the Secretary is satisfied that the transferee is suf25 ficiently bonded, endowed, or otherwise financially able to 

26 fulfill its obligations, including but not limited to— 


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1 ‘‘(1) ongoing maintenance of the platform or 

2 other facility; 

3 ‘‘(2) any liability obligations that might arise; 

4 ‘‘(3) removal of the platform or other facility if 

5 determined necessary by the Secretary; and 

6 ‘‘(4) any other requirements and obligations 

7 that the Secretary may deem appropriate by regula8 tion. 

9 ‘‘(c) PLUGGING AND ABANDONMENT.—The Sec10 retary shall ensure that obligations of a lessee regarding 

11 the plugging and abandonment of wells are unaffected by 

12 implementation of this section. 

13 ‘‘(d) POTENTIAL TO PETITION TO OPT-OUT OF REG14 ULATIONS.—An Adjacent State acting through a resolu15 tion of its legislature, with concurrence of its Governor, 

16 may petition to opt-out of the application of regulations 

17 promulgated under this section to platforms and other fa18 cilities located in the area of its Adjacent Zone within 25 

19 miles of the coastline. The Secretary is authorized to ex20 cept such area from the application of such regulations, 

21 and shall approve such petition, unless the Secretary finds 

22 that approving the petition would probably cause serious 

23 harm or damage to the marine resources of the State’s 

24 Adjacent Zone. Prior to acting on the petition, the Sec25 retary shall complete an environmental assessment that 


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1 documents the anticipated environmental effects of ap2 proving the petition. 

3 ‘‘(e) LIMITATION ON LIABILITY.—A person that had 

4 used an offshore oil and gas platform or other facility for 

5 oil and gas purposes and that no longer has any ownership 

6 or control of the platform or other facility shall not be 

7 liable under Federal law for any costs or damages arising 

8 from such platform or other facility after the date the plat9 form or other facility is used for any purpose under sub10 section (a), unless such costs or damages arise from— 

11 ‘‘(1) use of the platform or other facility by the 

12 person for development or production of oil or gas; 

13 or 

14 ‘‘(2) another act or omission of the person. 

15 ‘‘(f) OTHER LEASING AND USE NOT AFFECTED.— 

16 This section, and the use of any offshore oil and gas plat17 form or other facility for any purpose under subsection 

18 (a), shall not affect— 

19 ‘‘(1) the authority of the Secretary to lease any 

20 area under this Act; or 

21 ‘‘(2) any activity otherwise authorized under 

22 this Act.’’. 

23 (c) DEADLINE FOR REGULATIONS.—The Secretary of 

24 the Interior shall issue regulations under subsection (b) 


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1 by not later than 180 days after the date of the enactment 

2 of this Act. 

3 (d) STUDY AND REPORT ON EFFECTS OF REMOVAL

4 OF PLATFORMS.—Not later than one year after the date 

5 of enactment of this Act, the Secretary of the Interior, 

6 in consultation with other Federal agencies as the Sec7 retary deems advisable, shall study and report to the Con8 gress regarding how the removal of offshore oil and gas 

9 platforms and other facilities from the outer Continental 

10 Shelf would affect existing fish stocks and coral popu11 lations. 

12 SEC. 22. REPEAL OF REQUIREMENT TO CONDUCT COM13 PREHENSIVE INVENTORY OF OCS OIL AND 

14 NATURAL GAS RESOURCES. 

15 The Energy Policy Act of 2005 (Public Law 109– 

16 58) is amended— 

17 (1) by repealing section 357 (119 Stat. 720; 42 

18 U.S.C. 15912); and 

19 (2) in the table of contents in section 1(b), by 

20 striking the item relating to such section 357. 

21 SEC. 23. ONSHORE AND OFFSHORE MINERAL LEASE FEES. 

22 Notwithstanding any other provision of law, the De23 partment of the Interior is prohibited from charging fees 

24 applicable to actions on Federal onshore and offshore oil 

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1 cluding transportation of any production from such leases, 

2 if such fees were not established in final regulations prior 

3 to the date of issuance of the lease. 

4 SEC. 24. LEASES FOR AREAS LOCATED WITHIN 125 MILES 

5 OF CALIFORNIA OR FLORIDA. 

6 (a) AUTHORIZATION TO CANCEL AND EXCHANGE

7 CERTAIN EXISTING OIL AND GAS LEASES; PROHIBITION

8 ON SUBMITTAL OF EXPLORATION PLANS FOR CERTAIN

9 LEASES PRIOR TO JUNE 30, 2012.— 

10 (1) AUTHORITY.—Effective 180 days after the 

11 date of enactment of this Act, the lessee of an exist12 ing oil and gas lease for an area located completely 

13 within 125 miles of the coastline within the Cali14 fornia or Florida Adjacent Zones shall have the op15 tion, without compensation, of exchanging such lease 

16 for a new oil and gas lease having a primary term 

17 of 5 years. For the area subject to the new lease, the 

18 lessee may select any unleased tract that is com19 pletely beyond 100 miles from the coastline of the 

20 Adjacent State and is located within the same Adja21 cent State’s Adjacent Zone as the lease being ex22 changed, except that leases being exchanged within 

23 the Florida Adjacent Zone may be exchanged for 

24 any unleased tract that is completely beyond 100 


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1 miles from the coastline of Florida and is located 

2 west of 86 degrees 41 minutes longitude. 

3 (2) ADMINISTRATIVE PROCESS.—The Secretary 

4 of the Interior shall establish a reasonable adminis5 trative process through which a lessee may exercise 

6 its option to exchange an oil and gas lease for a new 

7 oil and gas lease as provided for in this section. 

8 Such exchanges, including the issuance of new 

9 leases, shall not be considered to be major Federal 

10 actions for purposes of the National Environmental 

11 Policy Act of 1969 (42 U.S.C. 4321 et seq.). Fur12 ther, such exchanges conducted in accordance with 

13 this section are deemed to be in compliance all provi14 sions of the Outer Continental Shelf Lands Act (43 

15 U.S.C. 1331 et seq.). The Secretary shall issue a 

16 new lease in exchange for the lease being exchanged 

17 notwithstanding that the area that will be subject to 

18 the lease may be withdrawn from leasing under the 

19 Outer Continental Shelf Lands Act or otherwise un20 available for leasing under the provisions of any 

21 other law. 

22 (3) OPERATING RESTRICTIONS.—A new lease 

23 issued in exchange for an existing lease under this 

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1 erating restrictions on the OCS tract covered by the 

2 new lease as may be applicable upon issuance. 

3 (4) PRIORITY.—The Secretary shall give pri4 ority in the lease exchange process based on the 

5 amount of the original bonus bid paid for the 

6 issuance of each lease to be exchanged. The Sec7 retary shall allow leases covering partial tracts to be 

8 exchanged for leases covering full tracts conditioned 

9 upon payment of additional bonus bids on a per-acre 

10 basis as determined by the average per acre of the 

11 original bonus bid per acre for the partial tract 

12 being exchanged. 

13 (5) EXPLORATION PLANS.—Any exploration 

14 plan submitted to the Secretary of the Interior after 

15 the date of the enactment of this Act and before 

16 July 1, 2012, for an oil and gas lease for an area 

17 wholly within 125 miles of the coastline within the 

18 California Adjacent Zone or Florida Adjacent Zone 

19 shall not be treated as received by the Secretary 

20 until the earlier of July 1, 2012, or the date on 

21 which a petition by the Adjacent State for oil and 

22 gas leasing covering the area within which is located 

23 the area subject to the oil and gas lease was ap24 proved. 


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1 (b) FURTHER LEASE CANCELLATION AND EX2 CHANGE PROVISIONS.— 

3 (1) CANCELLATION OF LEASE.—As part of the 

4 lease exchange process under this section, the Sec5 retary shall cancel a lease that is exchanged under 

6 this section. 

7 (2) CONSENT OF LESSEES.—All lessees holding 

8 an interest in a lease must consent to cancellation 

9 of their leasehold interests in order for the lease to 

10 be cancelled and exchanged under this section. 

11 (3) WAIVER OF RIGHTS.—As a prerequisite to 

12 the exchange of a lease under this section, the lessee 

13 must waive any rights to bring any litigation against 

14 the United States related to the transaction. 

15 (4) PLUGGING AND ABANDONMENT.—The plug16 ging and abandonment requirements for any wells 

17 located on any lease to be cancelled and exchanged 

18 under this section must be complied with by the les19 sees prior to the cancellation and exchange. 

20 (c) EXISTING OIL AND GAS LEASE DEFINED.—In 

21 this section the term ‘‘existing oil and gas lease’’ means 

22 an oil and gas lease in effect on the date of the enactment 

23 of this Act. 


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1 SEC. 25. COASTAL IMPACT ASSISTANCE. 

2 Section 31 of the Outer Continental Shelf Lands Act 

3 (43 U.S.C. 1356a) is repealed. 

4 SEC. 26. OIL SHALE AND TAR SANDS AMENDMENTS. 

5 (a) REPEAL OF REQUIREMENT TO ESTABLISH PAY6 MENTS.—Section 369(o) of the Energy Policy Act of 2005 

7 (Public Law 109–58; 119 Stat. 728; 42 U.S.C. 15927) 

8 is repealed. 

9 (b) TREATMENT OF REVENUES.—Section 21 of the 

10 Mineral Leasing Act (30 U.S.C. 241) is amended by add11 ing at the end the following: 

12 ‘‘(e) REVENUES.— 

13 ‘‘(1) IN GENERAL.—Notwithstanding the provi14 sions of section 35, all revenues received from and 

15 under an oil shale or tar sands lease shall be dis16 posed of as provided in this subsection. 

17 ‘‘(2) ROYALTY RATES FOR COMMERCIAL

18 LEASES.— 

19 ‘‘(A) INITIAL PRODUCTION.—For the first 

20 10 years after initial production under each oil 

21 shale or tar sands lease issued under the com22 mercial leasing program established under sub23 section (d), the Secretary shall set the royalty 

24 rate at not less than 1 percent nor more than 

25 3 percent of the gross value of production. 

26 However, the initial production period royalty 


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1 rate set by the Secretary shall not apply to pro2 duction occurring more than 15 years after the 

3 date of issuance of the lease. 

4 ‘‘(B) SUBSEQUENT PERIODS.—After the 

5 periods of time specified in subparagraph (A), 

6 the Secretary shall set the royalty rate on each 

7 oil shale or tar sands lease issued under the 

8 commercial leasing program established under 

9 subsection (d) at not less than 6 percent nor 

10 more than 9 percent of the gross value of pro11 duction. 

12 ‘‘(C) REDUCTION.—The Secretary shall re13 duce any royalty otherwise required to be paid 

14 under subparagraphs (A) and (B) under any oil 

15 shale or tar sands lease on a sliding scale based 

16 upon market price, with a 10 percent reduction 

17 if the monthly average price of NYMEX West 

18 Texas Intermediate crude oil at Cushing, Okla19 homa, (WTI) drops below $50 (in 2005 dollars) 

20 for the month in which the production is sold, 

21 and an 80 percent reduction if the monthly av22 erage price of WTI drops below $30 (in 2005 

23 dollars) for the month in which the production 

24 is sold. 

25 ‘‘(3) DISPOSITION OF REVENUES.— 


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1 ‘‘(A) DEPOSIT.—The Secretary shall de2 posit into a separate account in the Treasury 

3 all revenues derived from any oil shale or tar 

4 sands lease. 

5 ‘‘(B) ALLOCATIONS TO STATES AND LOCAL

6 POLITICAL SUBDIVISIONS.—The Secretary shall 

7 allocate 50 percent of the revenues deposited 

8 into the account established under subpara9 graph (A) to the State within the boundaries of 

10 which the leased lands are located, with a por11 tion of that to be paid directly by the Secretary 

12 to the State’s local political subdivisions as pro13 vided in this paragraph. 

14 ‘‘(C) TRANSMISSION OF ALLOCATIONS.— 

15 ‘‘(i) IN GENERAL.—Not later than the 

16 last business day of the month after the 

17 month in which the revenues were received, 

18 the Secretary shall transmit— 

19 ‘‘(I) to each State two-thirds of 

20 such State’s allocations under sub21 paragraph (B), and in accordance 

22 with clauses (ii) and (iii) to certain 

23 county-equivalent and municipal polit24 ical subdivisions of such State a total 

25 of one-third of such State’s allocations 


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1 under subparagraph (B), together 

2 with all accrued interest thereon; and 

3 ‘‘(II) the remaining balance of 

4 such revenues deposited into the ac5 count that are not allocated under 

6 subparagraph (B), together with in7 terest thereon, shall be transmitted to 

8 the miscellaneous receipts account of 

9 the Treasury, except that until a lease 

10 has been in production for 20 years 

11 50 percent of such remaining balance 

12 derived from a lease shall be paid in 

13 accordance with subclause (I). 

14 ‘‘(ii) ALLOCATIONS TO CERTAIN

15 COUNTY-EQUIVALENT POLITICAL SUBDIVI16 SIONS.—The Secretary shall under clause 

17 (i)(I) make equitable allocations of the rev18 enues to county-equivalent political sub19 divisions that the Secretary determines are 

20 closely associated with the leasing and pro21 duction of oil shale and tar sands, under a 

22 formula that the Secretary shall determine 

23 by regulation. 

24 ‘‘(iii) ALLOCATIONS TO MUNICIPAL

25 POLITICAL SUBDIVISIONS.—The initial alVerDate Aug 31 2005 21:31 Jun 26, 2006 Jkt 049200 PO 00000 Frm 00090 Fmt 6652 Sfmt 6201 E:\BILLS\H5649.IH H5649

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1 location to each county-equivalent political 

2 subdivision under clause (ii) shall be fur3 ther allocated to the county-equivalent po4 litical subdivision and any municipal polit5 ical subdivisions located partially or wholly 

6 within the boundaries of the county-equiva7 lent political subdivision on an equitable 

8 basis under a formula that the Secretary 

9 shall determine by regulation. 

10 ‘‘(D) INVESTMENT OF DEPOSITS.—The de11 posits in the Treasury account established 

12 under this section shall be invested by the Sec13 retary of the Treasury in securities backed by 

14 the full faith and credit of the United States 

15 having maturities suitable to the needs of the 

16 account and yielding the highest reasonably 

17 available interest rates as determined by the 

18 Secretary of the Treasury. 

19 ‘‘(E) USE OF FUNDS.—A recipient of 

20 funds under this subsection may use the funds 

21 for any lawful purpose as determined by State 

22 law. Funds allocated under this subsection to 

23 States and local political subdivisions may be 

24 used as matching funds for other Federal pro25 grams without limitation. Funds allocated to 


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1 local political subdivisions under this subsection 

2 may not be used in calculation of payments to 

3 such local political subdivisions under programs 

4 for payments in lieu of taxes or other similar 

5 programs. 

6 ‘‘(F) NO ACCOUNTING REQUIRED.—No re7 cipient of funds under this subsection shall be 

8 required to account to the Federal Government 

9 for the expenditure of such funds, except as 

10 otherwise may be required by law. 

11 ‘‘(4) DEFINITIONS.—In this subsection: 

12 ‘‘(A) COUNTY-EQUIVALENT POLITICAL

13 SUBDIVISION.—The term ‘county-equivalent po14 litical subdivision’ means a political jurisdiction 

15 immediately below the level of State govern16 ment, including a county, parish, borough in 

17 Alaska, independent municipality not part of a 

18 county, parish, or borough in Alaska, or other 

19 equivalent subdivision of a State. 

20 ‘‘(B) MUNICIPAL POLITICAL SUBDIVI21 SION.—The term ‘municipal political subdivi22 sion’ means a municipality located within and 

23 part of a county, parish, borough in Alaska, or 

24 other equivalent subdivision of a State.’’. 

Æ 


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