I 

114TH CONGRESS 

2D SESSION H. R. 5577 

To amend the Outer Continental Shelf Lands Act to authorize the Secretary 

of the Interior to conduct offshore oil and gas lease sales through 

Internet-based live lease sales, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 24, 2016 

Mr. GRAVES of Louisiana (for himself and Mr. LOWENTHAL) introduced the 

following bill; which was referred to the Committee on Natural Resources 

A BILL 

To amend the Outer Continental Shelf Lands Act to authorize the Secretary of the Interior to conduct offshore 

oil and gas lease sales through Internet-based live lease 

sales, 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 ‘‘Innovation in Offshore 

5 Leasing Act’’. 


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1 SEC. 2. INTERNET-BASED OFFSHORE OIL AND GAS LEASE 

2 SALES. 

3 (a) AUTHORIZATION.—Section 8 of the Outer Conti4 nental Shelf Leasing Act (43 U.S.C. 1337) is amended 

5 by adding at the end the following: 

6 ‘‘(q) INTERNET-BASED OIL AND GAS LEASE

7 SALES.— 

8 ‘‘(1) IN GENERAL.—In order to modernize the 

9 Nation’s offshore leasing program to ensure the best 

10 return to the Federal taxpayer, reduce fraud, and 

11 ensure a fair and competitive leasing process, the 

12 Secretary may conduct lease sales under this section 

13 through Internet-based, sealed-bidding methods. 

14 ‘‘(2) SALE REQUIREMENTS.—Sales conducted 

15 under paragraph (1) shall ensure— 

16 ‘‘(A) live web streaming of the bid reading 

17 process; 

18 ‘‘(B) a bidder verification process that dis19 closes to bidders at least 24 hours before the 

20 bid reading process a list of bids submitted by 

21 all persons on each lease tract without dis22 closing bid amounts; 

23 ‘‘(C) the ability for a bidder to correct a 

24 possible misreading of a submitted bid; 

25 ‘‘(D) an independent, third-party observer 

26 from the Department of the Interior’s Office of 


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1 the Inspector General present during the bid 

2 reading process to prevent wrongdoing, inde3 pendently certify the bidding process, and main4 tain transparency; 

5 ‘‘(E) data security measures to ensure bid6 der data is kept secure; and 

7 ‘‘(F) a participant survey soliciting vol8 untary feedback from bidders on the bidding 

9 process. 

10 ‘‘(3) TRANSPARENCY IN SALE-DAY STATIS11 TICS.— 

12 ‘‘(A) REQUIREMENT.—The Secretary shall 

13 publicly disclose statistical data regarding each 

14 lease sale under this subsection, on the day the 

15 sale is executed. 

16 ‘‘(B) INCLUDED DATA.—Among data dis17 closed, the Secretary shall include— 

18 ‘‘(i) the total value of high bids; 

19 ‘‘(ii) the number of tracts offered; 

20 ‘‘(iii) the number of acres offered; 

21 ‘‘(iv) the number of tracts receiving 

22 bids; 

23 ‘‘(v) the number of acres receiving 

24 bids; 

25 ‘‘(vi) the total number of bids; 


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1 ‘‘(vii) the average number of bids per 

2 tract; 

3 ‘‘(viii) the total number of bidders 

4 participating; 

5 ‘‘(ix) bidding statistics by water 

6 depth; 

7 ‘‘(x) the name of the entity that sub8 mitted each bid, the amount of the bid, 

9 and the tract for which the bid was sub10 mitted; 

11 ‘‘(xi) of tracts receiving bids, the 

12 number of bids per tract by water depth; 

13 ‘‘(xii) the tract receiving the greatest 

14 number of bids; 

15 ‘‘(xiii) the tract receiving the highest 

16 bid; and 

17 ‘‘(xiv) any other statistical data that 

18 may be disclosed in accordance with this 

19 Act. 

20 ‘‘(C) DATA TRANSPARENCY.—The Sec21 retary shall ensure all data regarding lease 

22 sales under this subsection is publicly available 

23 and easily accessible, free of charge, on the 

24 Internet, including for download and aggrega25 tion in machine-readable format.’’. 


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1 (b) MODERNIZING LEASING THROUGH COLLABORA2 TION.— 

3 (1) IN GENERAL.—Before conducting the first 

4 Internet-based lease sale under the amendment 

5 made by this section, the Secretary of the Interior 

6 shall issue a request for information from each com7 pany present for bidding at the ten most recent oil 

8 and gas lease sales conducted by the Secretary 

9 under the Outer Continental Shelf Lands Act, in 

10 order to provide the bidding public sufficient oppor11 tunity to share innovative ideas, methods, and con12 cerns regarding Internet-based leasing. 

13 (2) INTEGRATION OF INFORMATION.—The Sec14 retary shall review, evaluate, and integrate sugges15 tions and concerns collected under paragraph (1) as 

16 the Secretary works to modernize the offshore leas17 ing process through Internet-based leasing options. 

18 (3) USER WORKSHOP.—The Secretary shall 

19 conduct not less than one user workshop with viable 

20 bidders prior to conducting an Internet-based lease 

21 sale to provide the bidding public with an oppor22 tunity to beta test any prototype of an Internet23 based leasing platform. 

24 (c) DEADLINE FOR GULF OF MEXICO LEASE

25 SALE.—Not later than one year after the date of the enVerDate Sep 11 2014 03:33 Jun 28, 2016 Jkt 059200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H5577.IH H5577

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1 actment of this Act, the Secretary of the Interior shall 

2 conduct at least one Internet-based lease sale under the 

3 amendment made by subsection (a) for leasable acreage 

4 in the Gulf of Mexico. 

5 (d) EVALUATING INTERNET-BASED OFFSHORE

6 LEASING.—Not later than 90 days after the third Inter7 net-based lease sale conducted under the amendment 

8 made by subsection (a), the Secretary of the Interior shall 

9 analyze all such Internet-based lease sales and transmit 

10 to Congress a thorough analysis of the sales. The analysis 

11 shall include— 

12 (1) estimates of increases or decreases in such 

13 lease sales, compared to sales conducted by non14 Internet-based bidding, in— 

15 (A) the number of bidders; 

16 (B) the average amount of bids; 

17 (C) the highest bid; and 

18 (D) the lowest bid; 

19 (2) an estimate of the total cost or savings to 

20 the Department of the Interior as a result of such 

21 sales, compared to sales conducted by non-Internet22 based bidding; 

23 (3) voluntary and anonymous feedback from 

24 persons participating in such sales, on the InternetVerDate Sep 11 2014 03:33 Jun 28, 2016 Jkt 059200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H5577.IH H5577

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1 based leasing process and potential areas for im2 provement in such sales; and 

3 (4) an evaluation of the demonstrated or ex4 pected effectiveness of different structures for lease 

5 sales that may provide an opportunity to better 

6 maximize bidder participation, ensure the highest re7 turn to the Federal taxpayers, minimize opportuni8 ties for fraud or collusion, and ensure the security 

9 and integrity of the leasing process. 

Æ 


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