I 
108TH CONGRESS 
1ST SESSION H. R. 1570
To accelerate natural gas exploration, development, and production from 
oil and gas wells drilled to deep depths on existing lease tracts on 
the Outer Continental Shelf, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 2, 2003
Mr. JOHN introduced the following bill; which was referred to the Committee 
on Resources 
A BILL 
To accelerate natural gas exploration, development, and pro-
duction from oil and gas wells drilled to deep depths 
on existing lease tracts on the Outer Continental Shelf, 
and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Outer Continental 
Shelf Shallow Water Deep Gas Royalty Relief Act’’. 
SEC. 2. PURPOSES. 
The purposes of this Act are the following:
(1) To accelerate natural gas exploration, devel-
opment, and production from wells drilled to deep 
depths on existing shallow water lease tracts on the 
Outer Continental Shelf. 
(2) To provide royalty incentives for the pro-
duction of natural gas from such tracts. 
(3) To provide royalty incentives for develop-
ment of new technologies and the exploration and 
development of the new frontier of deep drilling on 
the Outer Continental Shelf. 
SEC. 3. ROYALTY INCENTIVES UNDER EXISTING LEASES 
FOR PRODUCTION OF DEEP GAS IN SHALLOW 
WATER IN THE GULF OF MEXICO. 
(a) SUSPENSION OF ROYALTIES.—
(1) IN GENERAL.—The Secretary of the Inte-
rior shall grant royalty relief for natural gas pro-
duced under leases issued under the Outer Conti-
nental Shelf Lands Act (43 U.S.C. 1301 et seq.) 
prior to January 1, 2001, from deep wells on oil and 
gas lease tracts in shallow waters of the Gulf of 
Mexico located wholly west of 87 degrees, 30 min-
utes west longitude. 
(2) AMOUNT OF RELIEF.—The Secretary shall 
grant royalty relief to eligible leases in the following 
amounts:
(A) A suspension volume of at least 15 bil-
lion cubic feet of natural gas produced from a 
successful deep well with a total vertical depth 
of 15,000 feet to 17,999 feet. 
(B) A suspension volume of at least 25 bil-
lion cubic feet of natural gas produced from a 
successful deep well with a total vertical depth 
of 18,000 feet to 19,999 feet. 
(C) A suspension volume of at least 35 bil-
lion cubic feet of natural gas produced from 
any ultra deep well. 
(D) A suspension volume of at least 5 bil-
lion cubic feet of natural gas per well for up to 
2 unsuccessful wells drilled to a depth of at 
least 18,000 feet on a lease tract that subse-
quently produces natural gas from a successful 
deep well. 
(3) LIMITATION.—The Secretary shall not 
grant the royalty incentives outlined in this section 
if the average annual NYMEX natural gas price ex-
ceeds for one full calendar year the threshold price 
of $5 per million Btu, adjusted from the year 2000 
for inflation.
(b) DEFINITIONS.—For purposes of this section:
(1) The term ‘‘deep well’’ means a well drilled 
with a perforated interval, the top of which is at 
least 15,000 feet true vertical depth below the 
datum at mean sea level. 
(2) The term ‘‘eligible lease’’ means a lease 
that—
(A) was issued in a lease sale held before 
January 1, 2001;
(B) is for a tract located in the Gulf of 
Mexico entirely in water depths less than 200 
meters on a block wholly west of 87 degrees, 30 
minutes west longitude; and
(C) is for a tract that has not produced 
gas or oil from a well that commenced drilling 
before March 26, 2003, with a completion 
15,000 feet true vertical depth below the datum 
at mean sea level or deeper. 
(3) The term ‘‘shallow water’’ means water less 
than 200 meters deep. 
(4) The term ‘‘ultra deep well’’ means a well 
drilled with a perforated interval, the top of which 
is at least 20,000 feet true vertical depth below the 
datum at mean sea level.
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