IIB 

114TH CONGRESS 

2D SESSION H. R. 5577 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 7, 2016 

Received; read twice and referred to the Committee on Energy and Natural 

Resources 

AN ACT 

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, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Innovation in Offshore 

3 Leasing Act’’. 

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

5 SALES. 

6 (a) AUTHORIZATION.—Section 8 of the Outer Conti7 nental Shelf Lands Act (43 U.S.C. 1337) is amended by 

8 adding at the end the following: 

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

10 SALES.— 

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

12 Nation’s offshore leasing program to ensure the best 

13 return to the Federal taxpayer, reduce fraud, and 

14 ensure a fair and competitive leasing process, the 

15 Secretary may conduct lease sales under this section 

16 through Internet-based, sealed-bidding methods. 

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

18 under paragraph (1) shall ensure— 

19 ‘‘(A) a publicly and freely accessible digital 

20 delivery of the bid reading process, such as live 

21 Internet streaming, and an option for bidders 

22 to submit bids electronically; 

23 ‘‘(B) a bidder verification process that dis24 closes to bidders, by no later than 5 p.m. Cen25 tral Time of the day before each sale, a list of 

26 all bids submitted (including the person submitVerDate Sep 11 2014 22:48 Sep 07, 2016 Jkt 059200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H5577.RFS H5577

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1 ting each bid) on each lease tract without dis2 closing bid amounts; 

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

4 possible misreading of a submitted bid; 

5 ‘‘(D) a designee from within the Office of 

6 the Solicitor of the Department of the Interior 

7 to act as an independent, third-party observer 

8 who will be present during the bid reading proc9 ess to prevent wrongdoing, independently certify 

10 the bidding process, and maintain transparency; 

11 ‘‘(E) data security measures to ensure bid12 der data is kept secure; and 

13 ‘‘(F) a participant survey soliciting vol14 untary feedback from bidders on the bidding 

15 process. 

16 ‘‘(3) TRANSPARENCY IN SALE-DAY STATIS17 TICS.— 

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

19 publicly disclose statistical data regarding each 

20 lease sale under this subsection, on the day the 

21 sale is executed. 

22 ‘‘(B) INCLUDED DATA.—Among data dis23 closed, the Secretary shall include— 

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

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


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

2 ‘‘(iv) the number of tracts receiving 

3 bids; 

4 ‘‘(v) the number of acres receiving 

5 bids; 

6 ‘‘(vi) the total number of bids; 

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

8 tract; 

9 ‘‘(viii) the total number of bidders 

10 participating; 

11 ‘‘(ix) bidding statistics by water 

12 depth; 

13 ‘‘(x) the name of the entity that sub14 mitted each bid, the amount of the bid, 

15 and the tract for which the bid was sub16 mitted; 

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

18 number of bids per tract by water depth; 

19 ‘‘(xii) the tract receiving the greatest 

20 number of bids; 

21 ‘‘(xiii) the tract receiving the highest 

22 bid; and 

23 ‘‘(xiv) any other statistical data that 

24 may be disclosed in accordance with this 

25 Act. 


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1 ‘‘(C) DATA TRANSPARENCY.—The Sec2 retary shall ensure all data regarding lease 

3 sales under this subsection is publicly available 

4 and easily accessible, free of charge, on the 

5 Internet, including for download and aggrega6 tion in machine-readable format.’’. 

7 (b) MODERNIZING LEASING THROUGH COLLABORA8 TION.— 

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

10 Internet-based lease sale under the amendment 

11 made by this section, the Secretary of the Interior 

12 shall issue a request for information from each com13 pany present for bidding at the ten most recent oil 

14 and gas lease sales conducted by the Secretary 

15 under the Outer Continental Shelf Lands Act, in 

16 order to provide the bidding public sufficient oppor17 tunity to share innovative ideas, methods, and con18 cerns regarding Internet-based leasing. 

19 (2) INTEGRATION OF INFORMATION.—The Sec20 retary shall review, evaluate, and integrate sugges21 tions and concerns collected under paragraph (1) as 

22 the Secretary works to modernize the offshore leas23 ing process through Internet-based leasing options. 

24 (3) USER WORKSHOP.—The Secretary shall 

25 conduct not less than one user workshop with viable 


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1 bidders prior to conducting an Internet-based lease 

2 sale to provide the bidding public with an oppor3 tunity to beta test any prototype of an Internet4 based leasing platform. 

5 (c) DEADLINE FOR GULF OF MEXICO LEASE

6 SALE.—Not later than 18 months after the date of the 

7 enactment of this Act, the Secretary of the Interior shall 

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

9 amendment made by subsection (a) for leasable acreage 

10 in the Gulf of Mexico. 

11 (d) EVALUATING INTERNET-BASED OFFSHORE

12 LEASING.—Not later than 90 days after the third Inter13 net-based lease sale conducted under the amendment 

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

15 analyze all such Internet-based lease sales and transmit 

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

17 shall include— 

18 (1) estimates of increases or decreases in such 

19 lease sales, compared to sales conducted by non20 Internet-based bidding, in— 

21 (A) the number of bidders; 

22 (B) the average amount of bids; 

23 (C) the highest bid; and 

24 (D) the lowest bid; 


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

2 the Department of the Interior as a result of such 

3 sales, compared to sales conducted by non-Internet4 based bidding; 

5 (3) voluntary and anonymous feedback from 

6 persons participating in such sales, on the Internet7 based leasing process and potential areas for im8 provement in such sales; and 

9 (4) an evaluation of the demonstrated or ex10 pected effectiveness of different structures for lease 

11 sales that may provide an opportunity to better 

12 maximize bidder participation, ensure the highest re13 turn to the Federal taxpayers, minimize opportuni14 ties for fraud or collusion, and ensure the security 

15 and integrity of the leasing process. 

Passed the House of Representatives September 6, 

2016. 

Attest: KAREN L. HAAS, 

Clerk. 


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