776
currence by, the Secretary of Energy, the Administrator 
determines that—
‘‘(I) extreme and unusual fuel or fuel additive 
supply circumstances exist in a State or region of 
the Nation which prevent the distribution of an ade-
quate supply of the fuel or fuel additive to con-
sumers; 
‘‘(II) such extreme and unusual fuel and fuel 
additive supply circumstances are the result of a 
natural disaster, an Act of God, a pipeline or refin-
ery equipment failure, or another event that could 
not reasonably have been foreseen or prevented and 
not the lack of prudent planning on the part of the 
suppliers of the fuel or fuel additive to such State 
or region; and 
‘‘(III) it is in the public interest to grant the 
waiver (for example, when a waiver is necessary to 
meet projected temporary shortfalls in the supply of 
the fuel or fuel additive in a State or region of the 
Nation which cannot otherwise be compensated for). 
‘‘(iii) If the Administrator makes the determinations 
required under clause (ii), such a temporary extreme and 
unusual fuel and fuel additive supply circumstances waiver 
shall be permitted only if—
777
‘‘(I) the waiver applies to the smallest geo-
graphic area necessary to address the extreme and 
unusual fuel and fuel additive supply circumstances; 
‘‘(II) the waiver is effective for a period of 20 
calendar days or, if the Administrator determines 
that a shorter waiver period is adequate, for the 
shortest practicable time period necessary to permit 
the correction of the extreme and unusual fuel and 
fuel additive supply circumstances and to mitigate 
impact on air quality; 
‘‘(III) the waiver permits a transitional period, 
the exact duration of which shall be determined by 
the Administrator, after the termination of the tem-
porary waiver to permit wholesalers and retailers to 
blend down their wholesale and retail inventory; 
‘‘(IV) the waiver applies to all persons in the 
motor fuel distribution system; and 
‘‘(V) the Administrator has given public notice 
to all parties in the motor fuel distribution system, 
and local and State regulators, in the State or re-
gion to be covered by the waiver. 
The term ‘motor fuel distribution system’ as used in this 
clause shall be defined by the Administrator through rule-
making.
778
‘‘(iv) Within 180 days of the date of enactment of 
this clause, the Administrator shall promulgate regula-
tions to implement clauses (ii) and (iii). 
‘‘(v) Nothing in this subparagraph shall—
‘‘(I) limit or otherwise affect the application of 
any other waiver authority of the Administrator pur-
suant to this section or pursuant to a regulation 
promulgated pursuant to this section; and 
‘‘(II) subject any State or person to an enforce-
ment action, penalties, or liability solely arising from 
actions taken pursuant to the issuance of a waiver 
under this subparagraph.’’. 
(b) LIMIT ON NUMBER OF BOUTIQUE FUELS.—Sec-
tion 211(c)(4)(C) of the Clean Air Act (42 U.S.C. 
7545(c)(4)), as amended by subsection (a), is further 
amended by adding at the end the following: 
‘‘(v)(I) The Administrator shall have no authority, 
when considering a State implementation plan or a State 
implementation plan revision, to approve under this para-
graph any fuel included in such plan or revision if the ef-
fect of such approval increases the total number of fuels 
approved under this paragraph as of September 1, 2004, 
in all State implementation plans. 
‘‘(II) The Administrator, in consultation with the 
Secretary of Energy, shall determine the total number of
779
fuels approved under this paragraph as of September 1, 
2004, in all State implementation plans and shall publish 
a list of such fuels, including the states and Petroleum 
Administration for Defense District in which they are 
used, in the Federal Register for public review and com-
ment no later than 90 days after enactment. 
‘‘(III) The Administrator shall remove a fuel from the 
list published under subclause (II) if a fuel ceases to be 
included in a State implementation plan or if a fuel in 
a State implementation plan is identical to a Federal fuel 
formulation implemented by the Administrator, but the 
Administrator shall not reduce the total number of fuels 
authorized under the list published under subclause (II). 
‘‘(IV) Subclause (I) shall not limit the Administra-
tor’s authority to approve a control or prohibition respect-
ing any new fuel under this paragraph in a State imple-
mentation plan or revision to a State implementation plan 
if such new fuel: 
‘‘(aa) completely replaces a fuel on the list pub-
lished under subclause (II); or 
‘‘(bb) does not increase the total number of 
fuels on the list published under subclause (II) as of 
September 1, 2004. 
In the event that the total number of fuels on the list pub-
lished under subclause (II) at the time of the Administra-
780
tor’s consideration of a control or prohibition respecting 
a new fuel is lower than the total number of fuels on such 
list as of September 1, 2004, the Administrator may ap-
prove a control or prohibition respecting a new fuel under 
this subclause if the Administrator, after consultation with 
the Secretary of Energy, publishes in the Federal Register 
after notice and comment a finding that, in the Adminis-
trator’s judgment, such control or prohibition respecting 
a new fuel will not cause fuel supply or distribution inter-
ruptions or have a significant adverse impact on fuel 
producibility in the affected area or contiguous areas. 
‘‘(V) The Administrator shall have no authority 
under this paragraph, when considering any particular 
State’s implementation plan or a revision to that State’s 
implementation plan, to approve any fuel unless that fuel 
was, as of the date of such consideration, approved in at 
least one State implementation plan in the applicable Pe-
troleum Administration for Defense District. However, the 
Administrator may approve as part of a State implementa-
tion plan or State implementation plan revision a fuel with 
a summertime Reid Vapor Pressure of 7.0 psi. In no event 
shall such approval by the Administrator cause an increase 
in the total number of fuels on the list published under 
subclause (II).
781
‘‘(VI) Nothing in this clause shall be construed to 
have any effect regarding any available authority of States 
to require the use of any fuel additive registered in accord-
ance with subsection (b), including any fuel additive reg-
istered in accordance with subsection (b) after the enact-
ment of this subclause.’’. 
(c) STUDY AND REPORT TO CONGRESS ON BOU-
TIQUE FUELS.—
(1) JOINT STUDY.—The Administrator of the 
Environmental Protection Agency and the Secretary 
of Energy shall undertake a study of the effects on 
air quality, on the number of fuel blends, on fuel 
availability, on fuel fungibility, and on fuel costs of 
the State plan provisions adopted pursuant to sec-
tion 211(c)(4)(C) of the Clean Air Act (42 U.S.C. 
7545(c)(4)(C)). 
(2) FOCUS OF STUDY.—The primary focus of 
the study required under paragraph (1) shall be to 
determine how to develop a Federal fuels system 
that maximizes motor fuel fungibility and supply, 
preserves air quality standards, and reduces motor 
fuel price volatility that results from the prolifera-
tion of boutique fuels, and to recommend to Con-
gress such legislative changes as are necessary to 
implement such a system. The study should include
782
the impacts on overall energy supply, distribution, 
and use as a result of the legislative changes rec-
ommended. 
(3) RESPONSIBILITY
OF
ADMINISTRATOR.—In 
carrying out the study required by this section, the 
Administrator shall coordinate obtaining comments 
from affected parties interested in the air quality 
impact assessment portion of the study. The Admin-
istrator shall use sound and objective science prac-
tices, shall consider the best available science, and 
shall consider and include a description of the 
weight of the scientific evidence. 
(4) RESPONSIBILITY OF SECRETARY.—In car-
rying out the study required by this section, the Sec-
retary shall coordinate obtaining comments from af-
fected parties interested in the fuel availability, 
number of fuel blends, fuel fungibility and fuel costs 
portion of the study. 
(5) REPORT TO CONGRESS.—The Administrator 
and the Secretary jointly shall submit the results of 
the study required by this section in a report to the 
Congress not later than 12 months after the date of 
the enactment of this Act, together with any rec-
ommended regulatory and legislative changes. Such 
report shall be submitted to the Committee on En-
783
ergy and Commerce of the House of Representatives 
and the Committee on Environment and Public 
Works of the Senate. 
(6) AUTHORIZATION
OF
APPROPRIATIONS.—
There is authorized to be appropriated jointly to the 
Administrator and the Secretary $500,000 for the 
completion of the study required under this sub-
section. 
(d) DEFINITIONS.—In this section: 
(1) The term ‘‘Administrator’’ means the Ad-
ministrator of the Environmental Protection Agency. 
(2) The term ‘‘Secretary’’ means the Secretary 
of Energy. 
(3) The term ‘‘fuel’’ means gasoline, diesel fuel, 
and any other liquid petroleum product commercially 
known as gasoline and diesel fuel for use in highway 
and nonroad motor vehicles. 
(4) The term ‘‘a control or prohibition respect-
ing a new fuel’’ means a control or prohibition on 
the formulation, composition, or emissions character-
istics of a fuel that would require the increase or de-
crease of a constituent in gasoline or diesel fuel.
784
TITLE XVI—STUDIES 
SEC. 1601. STUDY ON INVENTORY OF PETROLEUM AND 
NATURAL GAS STORAGE. 
(a) DEFINITION.—For purposes of this section ‘‘pe-
troleum’’ means crude oil, motor gasoline, jet fuel, dis-
tillates, and propane. 
(b) STUDY.—The Secretary of Energy shall conduct 
a study on petroleum and natural gas storage capacity and 
operational inventory levels, nationwide and by major geo-
graphical regions. 
(c) CONTENTS.—The study shall address—
(1) historical normal ranges for petroleum and 
natural gas inventory levels; 
(2) historical and projected storage capacity 
trends; 
(3) estimated operation inventory levels below 
which outages, delivery slowdown, rationing, inter-
ruptions in service, or other indicators of shortage 
begin to appear; 
(4) explanations for inventory levels dropping 
below normal ranges; and 
(5) the ability of industry to meet United 
States demand for petroleum and natural gas with-
out shortages or price spikes, when inventory levels 
are below normal ranges.
785
(d) REPORT TO CONGRESS.—Not later than 1 year 
after the date of enactment of this Act, the Secretary of 
Energy shall submit a report to Congress on the results 
of the study, including findings and any recommendations 
for preventing future supply shortages. 
SEC. 1605. STUDY OF ENERGY EFFICIENCY STANDARDS. 
The Secretary of Energy shall contract with the Na-
tional Academy of Sciences for a study, to be completed 
within 1 year after the date of enactment of this Act, to 
examine whether the goals of energy efficiency standards 
are best served by measurement of energy consumed, and 
efficiency improvements, at the actual site of energy con-
sumption, or through the full fuel cycle, beginning at the 
source of energy production. The Secretary shall submit 
the report to Congress. 
SEC. 1606. TELECOMMUTING STUDY. 
(a) STUDY REQUIRED.—The Secretary, in consulta-
tion with the Commission, the Director of the Office of 
Personnel Management, the Administrator of General 
Services, and the Administrator of NTIA, shall conduct 
a study of the energy conservation implications of the 
widespread adoption of telecommuting by Federal employ-
ees in the United States. 
(b) REQUIRED SUBJECTS OF STUDY.—The study re-
quired by subsection (a) shall analyze the following sub-
786
jects in relation to the energy saving potential of telecom-
muting by Federal employees: 
(1) Reductions of energy use and energy costs 
in commuting and regular office heating, cooling, 
and other operations. 
(2) Other energy reductions accomplished by 
telecommuting. 
(3) Existing regulatory barriers that hamper 
telecommuting, including barriers to broadband tele-
communications services deployment. 
(4) Collateral benefits to the environment, fam-
ily life, and other values. 
(c) REPORT REQUIRED.—The Secretary shall submit 
to the President and Congress a report on the study re-
quired by this section not later than 6 months after the 
date of enactment of this Act. Such report shall include 
a description of the results of the analysis of each of the 
subject described in subsection (b). 
(d) DEFINITIONS.—As used in this section: 
(1) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Energy. 
(2) COMMISSION.—The term ‘‘Commission’’ 
means the Federal Communications Commission.
787
(3) NTIA.—The term ‘‘NTIA’’ means the Na-
tional Telecommunications and Information Admin-
istration of the Department of Commerce. 
(4) TELECOMMUTING.—The term ‘‘telecom-
muting’’ means the performance of work functions 
using communications technologies, thereby elimi-
nating or substantially reducing the need to com-
mute to and from traditional worksites. 
(5) FEDERAL EMPLOYEE.—The term ‘‘Federal 
employee’’ has the meaning provided the term ‘‘em-
ployee’’ by section 2105 of title 5, United States 
Code. 
SEC. 1607. LIHEAP REPORT. 
Not later than 1 year after the date of enactment 
of this Act, the Secretary of Health and Human Services 
shall transmit to Congress a report on how the Low-In-
come Home Energy Assistance Program could be used 
more effectively to prevent loss of life from extreme tem-
peratures. In preparing such report, the Secretary shall 
consult with appropriate officials in all 50 States and the 
District of Columbia. 
SEC. 1608. OIL BYPASS FILTRATION TECHNOLOGY. 
The Secretary of Energy and the Administrator of 
the Environmental Protection Agency shall—
788
(1) conduct a joint study of the benefits of oil 
bypass filtration technology in reducing demand for 
oil and protecting the environment; 
(2) examine the feasibility of using oil bypass 
filtration technology in Federal motor vehicle fleets; 
and 
(3) include in such study, prior to any deter-
mination of the feasibility of using oil bypass filtra-
tion technology, the evaluation of products and var-
ious manufacturers. 
SEC. 1609. TOTAL INTEGRATED THERMAL SYSTEMS. 
The Secretary of Energy shall—
(1) conduct a study of the benefits of total inte-
grated thermal systems in reducing demand for oil 
and protecting the environment; and 
(2) examine the feasibility of using total inte-
grated thermal systems in Department of Defense 
and other Federal motor vehicle fleets. 
SEC. 1610. UNIVERSITY COLLABORATION. 
Not later than 2 years after the date of enactment 
of this Act, the Secretary of Energy shall transmit to Con-
gress a report that examines the feasibility of promoting 
collaborations between large institutions of higher edu-
cation and small institutions of higher education through 
grants, contracts, and cooperative agreements made by the
789
Secretary for energy projects. The Secretary shall also 
consider providing incentives for the inclusion of small in-
stitutions of higher education, including minority-serving 
institutions, in energy research grants, contracts, and co-
operative agreements. 
SEC. 1611. RELIABILITY AND CONSUMER PROTECTION AS-
SESSMENT. 
Not later than 5 years after the date of enactment 
of this Act, and each 5 years thereafter, the Federal En-
ergy Regulatory Commission shall assess the effects of the 
exemption of electric cooperatives and government-owned 
utilities from Commission regulation under section 201(f) 
of the Federal Power Act. The assessment shall include 
any effects on—
(1) reliability of interstate electric transmission 
networks; 
(2) benefit to consumers, and efficiency, of 
competitive wholesale electricity markets; 
(3) just and reasonable rates for electricity con-
sumers; and 
(4) the ability of the Commission to protect 
electricity consumers. 
If the Commission finds that the 201(f) exemption results 
in adverse effects on consumers or electric reliability, the 
Commission shall make appropriate recommendations to
790
Congress pursuant to section 311 of the Federal Power 
Act. 
SEC. 1612. REPORT ON ENERGY INTEGRATION WITH LATIN 
AMERICA. 
The Secretary of Energy shall submit an annual re-
port to the Committee on Energy and Commerce of the 
United States House of Representatives and to the Com-
mittee on Energy and Natural Resources of the United 
States Senate concerning the status of energy export de-
velopment in Latin America and efforts by the Secretary 
and other departments and agencies of the United States 
to promote energy integration with Latin America. The 
report shall contain a detailed analysis of the status of 
energy export development in Mexico and a description of 
all significant efforts by the Secretary and other depart-
ments and agencies to promote a constructive relationship 
with Mexico regarding the development of that nation’s 
energy capacity. In particular this report shall outline ef-
forts the Secretary and other departments and agencies 
have made to ensure that regulatory approval and over-
sight of United States/Mexico border projects that result 
in the expansion of Mexican energy capacity are effectively 
coordinated across departments and with the Mexican gov-
ernment.
791
SEC. 1613. LOW-VOLUME GAS RESERVOIR STUDY. 
(a) STUDY.—The Secretary of Energy shall make a 
grant to an organization of oil and gas producing States, 
specifically those containing significant numbers of mar-
ginal oil and natural gas wells, for conducting an annual 
study of low-volume natural gas reservoirs. Such organiza-
tion shall work with the State geologist of each State being 
studied. 
(b) CONTENTS.—The studies under this section 
shall—
(1) determine the status and location of mar-
ginal wells and gas reservoirs; 
(2) gather the production information of these 
marginal wells and reservoirs; 
(3) estimate the remaining producible reserves 
based on variable pipeline pressures; 
(4) locate low-pressure gathering facilities and 
pipelines; 
(5) recommend incentives which will enable the 
continued production of these resources; 
(6) produce maps and literature to disseminate 
to States to promote conservation of natural gas re-
serves; and 
(7) evaluate the amount of natural gas that is 
being wasted through the practice of venting or flar-
792
ing of natural gas produced in association with 
crude oil well production. 
(c) DATA ANALYSIS.—Data development and anal-
ysis under this section shall be performed by an institution 
of higher education with GIS capabilities. If the organiza-
tion receiving the grant under subsection (a) does not have 
GIS capabilities, such organization shall contract with one 
or more entities with—
(1) technological capabilities and resources to 
perform advanced image processing, GIS program-
ming, and data analysis; and 
(2) the ability to—
(A) process remotely sensed imagery with 
high spatial resolution; 
(B) deploy global positioning systems; 
(C) process and synthesize existing, vari-
able-format gas well, pipeline, gathering facility, 
and reservoir data; 
(D) create and query GIS databases with 
infrastructure location and attribute informa-
tion; 
(E) write computer programs to customize 
relevant GIS software;
793
(F) generate maps, charts, and graphs 
which summarize findings from data research 
for presentation to different audiences; and 
(G) deliver data in a variety of formats, in-
cluding Internet Map Server for query and dis-
play, desktop computer display, and access 
through handheld personal digital assistants. 
(d) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary of En-
ergy for carrying out this section—
(1) $1,500,000 for fiscal year 2006; and 
(2) $450,000 for each of the fiscal years 2007 
through 2010. 
(e) DEFINITIONS.—For purposes of this section, the 
term ‘‘GIS’’ means geographic information systems tech-
nology that facilitates the organization and management 
of data with a geographic component. 
TITLE XVII—RENEWABLE 
ENERGY 
SEC. 1701. GRANTS TO IMPROVE THE COMMERCIAL VALUE 
OF FOREST BIOMASS FOR ELECTRIC ENERGY, 
USEFUL HEAT, TRANSPORTATION FUELS, PE-
TROLEUM-BASED 
PRODUCT 
SUBSTITUTES, 
AND OTHER COMMERCIAL PURPOSES. 
(a) FINDINGS.—Congress finds the following:
794
(1) Thousands of communities in the United 
States, many located near Federal lands, are at risk 
to wildfire. Approximately 190,000,000 acres of land 
managed by the Secretary of Agriculture and the 
Secretary of the Interior are at risk of catastrophic 
fire in the near future. The accumulation of heavy 
forest fuel loads continues to increase as a result of 
disease, insect infestations, and drought, further 
raising the risk of fire each year. 
(2) In addition, more than 70,000,000 acres 
across all land ownerships are at risk to higher than 
normal mortality over the next 15 years from insect 
infestation and disease. High levels of tree mortality 
from insects and disease result in increased fire risk, 
loss of old growth, degraded watershed conditions, 
and changes in species diversity and productivity, as 
well as diminished fish and wildlife habitat and de-
creased timber values. 
(3) Preventive treatments such as removing fuel 
loading, ladder fuels, and hazard trees, planting 
proper species mix and restoring and protecting 
early successional habitat, and other specific restora-
tion treatments designed to reduce the susceptibility 
of forest land, woodland, and rangeland to insect 
outbreaks, disease, and catastrophic fire present the
795
greatest opportunity for long-term forest health by 
creating a mosaic of species-mix and age distribu-
tion. Such prevention treatments are widely acknowl-
edged to be more successful and cost effective than 
suppression treatments in the case of insects, dis-
ease, and fire. 
(4) The byproducts of preventive treatment 
(wood, brush, thinnings, chips, slash, and other haz-
ardous fuels) removed from forest lands, woodlands 
and rangelands represent an abundant supply of bio-
mass for biomass-to-energy facilities and raw mate-
rial for business. There are currently few markets 
for the extraordinary volumes of byproducts being 
generated as a result of the necessary large-scale 
preventive treatment activities. 
(5) The United States should—
(A) promote economic and entrepreneurial 
opportunities in using byproducts removed 
through preventive treatment activities related 
to hazardous fuels reduction, disease, and insect 
infestation; and 
(B) develop and expand markets for tradi-
tionally underused wood and biomass as an out-
let for byproducts of preventive treatment ac-
tivities.
796
(b) DEFINITIONS.—In this section: 
(1) BIOMASS.—The term ‘‘biomass’’ means 
trees and woody plants, including limbs, tops, nee-
dles, and other woody parts, and byproducts of pre-
ventive treatment, such as wood, brush, thinnings, 
chips, and slash, that are removed—
(A) to reduce hazardous fuels; or 
(B) to reduce the risk of or to contain dis-
ease or insect infestation. 
(2) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 
has the meaning given the term in section 4(e) of 
the Indian Self-Determination and Education Assist-
ance Act (25 U.S.C. 450b(e)). 
(3) PERSON.—The term ‘‘person’’ includes—
(A) an individual; 
(B) a community (as determined by the 
Secretary concerned); 
(C) an Indian tribe; 
(D) a small business, micro-business, or a 
corporation that is incorporated in the United 
States; and 
(E) a nonprofit organization. 
(4) PREFERRED COMMUNITY.—The term ‘‘pre-
ferred community’’ means—
797
(A) any town, township, municipality, or 
other similar unit of local government (as deter-
mined by the Secretary concerned) that—
(i) has a population of not more than 
50,000 individuals; and 
(ii) the Secretary concerned, in the 
sole discretion of the Secretary concerned, 
determines contains or is located near 
land, the condition of which is at signifi-
cant risk of catastrophic wildfire, disease, 
or insect infestation or which suffers from 
disease or insect infestation; or 
(B) any county that—
(i) is not contained within a metro-
politan statistical area; and 
(ii) the Secretary concerned, in the 
sole discretion of the Secretary concerned, 
determines contains or is located near 
land, the condition of which is at signifi-
cant risk of catastrophic wildfire, disease, 
or insect infestation or which suffers from 
disease or insect infestation. 
(5) SECRETARY CONCERNED.—The term ‘‘Sec-
retary concerned’’ means the Secretary of Agri-
culture or the Secretary of the Interior.
798
(c) BIOMASS COMMERCIAL USE GRANT PROGRAM.—
(1) IN
GENERAL.—The Secretary concerned 
may make grants to any person that owns or oper-
ates a facility that uses biomass as a raw material 
to produce electric energy, sensible heat, transpor-
tation fuels, or substitutes for petroleum-based prod-
ucts to offset the costs incurred to purchase biomass 
for use by such facility. 
(2) GRANT AMOUNTS.—A grant under this sub-
section may not exceed $20 per green ton of biomass 
delivered. 
(3) MONITORING OF GRANT RECIPIENT ACTIVI-
TIES.—As a condition of a grant under this sub-
section, the grant recipient shall keep such records 
as the Secretary concerned may require to fully and 
correctly disclose the use of the grant funds and all 
transactions involved in the purchase of biomass. 
Upon notice by a representative of the Secretary 
concerned, the grant recipient shall afford the rep-
resentative reasonable access to the facility that pur-
chases or uses biomass and an opportunity to exam-
ine the inventory and records of the facility. 
(d) IMPROVED BIOMASS USE GRANT PROGRAM.—
(1) IN
GENERAL.—The Secretary concerned 
may make grants to persons to offset the cost of
799
projects to develop or research opportunities to im-
prove the use of, or add value to, biomass. In mak-
ing such grants, the Secretary concerned shall give 
preference to persons in preferred communities. 
(2) SELECTION.—The Secretary concerned shall 
select a grant recipient under paragraph (1) after 
giving consideration to the anticipated public bene-
fits of the project, including the potential to develop 
thermal or electric energy resources or affordable en-
ergy, opportunities for the creation or expansion of 
small businesses and micro-businesses, and the po-
tential for new job creation. 
(3) GRANT AMOUNT.—A grant under this sub-
section may not exceed $500,000. 
(e) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated $50,000,000 for each 
of the fiscal years 2006 through 2016 to carry out this 
section. 
(f) REPORT.—Not later than October 1, 2010, the 
Secretary of Agriculture, in consultation with the Sec-
retary of the Interior, shall submit to the Committee on 
Energy and Natural Resources and the Committee on Ag-
riculture, Nutrition, and Forestry of the Senate and the 
Committee on Resources, the Committee on Energy and 
Commerce, and the Committee on Agriculture of the
800
House of Representatives a report describing the results 
of the grant programs authorized by this section. The re-
port shall include the following: 
(1) An identification of the size, type, and the 
use of biomass by persons that receive grants under 
this section. 
(2) The distance between the land from which 
the biomass was removed and the facility that used 
the biomass. 
(3) The economic impacts, particularly new job 
creation, resulting from the grants to and operation 
of the eligible operations. 
SEC. 1702. ENVIRONMENTAL REVIEW FOR RENEWABLE EN-
ERGY PROJECTS. 
(a) COMPLIANCE WITH NEPA FOR RENEWABLE EN-
ERGY PROJECTS.—Notwithstanding any other law, in pre-
paring an environmental assessment or environmental im-
pact statement required under section 102 of the National 
Environmental Policy Act of 1969 (42 U.S.C. 4332) with 
respect to any action authorizing a renewable energy 
project under the jurisdiction of a Federal agency—
(1) no Federal agency is required to identify al-
ternative project locations or actions other than the 
proposed action and the no action alternative; and
801
(2) no Federal agency is required to analyze the 
environmental effects of alternative locations or ac-
tions other than those submitted by the project pro-
ponent. 
(b) CONSIDERATION OF ALTERNATIVES.—In any en-
vironmental assessment or environmental impact state-
ment referred to in subsection (a), the Federal agency 
shall only identify and analyze the environmental effects 
and potential mitigation measures of—
(1) the proposed action; and 
(2) the no action alternative. 
(c) PUBLIC COMMENT.—In preparing an environ-
mental assessment or environmental impact statement re-
ferred to in subsection (a), the Federal agency shall only 
consider public comments that specifically address the pre-
ferred action and that are filed within 20 days after publi-
cation of a draft environmental assessment or draft envi-
ronmental impact statement. Notwithstanding any other 
law, compliance with this subsection is deemed to satisfy 
section 102(2) of the National Environmental Policy Act 
of 1969 (42 U.S.C. 4332(2)) and the applicable regula-
tions and administrative guidelines with respect to pro-
posed renewable energy projects.
802
(d) RENEWABLE ENERGY PROJECT DEFINED.—For 
purposes of this section, the term ‘‘renewable energy 
project’’—
(1) means any proposal to utilize an energy 
source other than nuclear power, coal, oil, or natural 
gas; and 
(2) includes the use of wind, solar, geothermal, 
biomass, or tidal forces to generate energy. 
SEC. 1703. SENSE OF CONGRESS REGARDING GENERATION 
CAPACITY OF ELECTRICITY FROM RENEW-
ABLE 
ENERGY 
RESOURCES 
ON 
PUBLIC 
LANDS. 
It is the sense of the Congress that the Secretary of 
the Interior should, before the end of the 10-year period 
beginning on the date of enactment of this Act, seek to 
have approved non-hydropower renewable energy projects 
located on the public lands with a generation capacity of 
at least 10,000 megawatts of electricity. 
TITLE XVIII—GEOTHERMAL 
ENERGY 
SEC. 1801. SHORT TITLE. 
This title may be cited as the ‘‘John Rishel Geo-
thermal Steam Act Amendments of 2005’’.
803
SEC. 1802. COMPETITIVE LEASE SALE REQUIREMENTS. 
Section 4 of the Geothermal Steam Act of 1970 (30 
U.S.C. 1003) is amended to read as follows: 
‘‘SEC. 4. LEASING PROCEDURES. 
‘‘(a) NOMINATIONS.—The Secretary shall accept 
nominations of lands available for leasing at any time from 
qualified companies and individuals under this Act. 
‘‘(b) COMPETITIVE LEASE SALE REQUIRED.—The 
Secretary shall hold a competitive lease sale at least once 
every 2 years for lands in a State which has nominations 
pending under subsection (a) if such lands are otherwise 
available for leasing. Lands that are subject to a mining 
claim for which a plan of operations has been approved 
by the relevant Federal land management agency are not 
available for competitive leasing. 
‘‘(c) NONCOMPETITIVE LEASING.—
‘‘(1) 
REQUIREMENT.—The 
Secretary 
shall 
make available for a period of 2 years for non-
competitive leasing any tract for which a competitive 
lease sale is held, but for which the Secretary does 
not receive any bids in a competitive lease sale. 
‘‘(2) STATES WITHOUT NOMINATIONS.—In any 
State for which there are no nominations received 
under subsection (a) and having a total acreage 
under lease or the subject of an application for lease 
of less than 10,000 acres, the Secretary may des-
804
ignate lands available for 2 years for noncompetitive 
leasing. 
‘‘(d) LEASES SOLD AS A BLOCK.—If information is 
available to the Secretary indicating a geothermal resource 
that could be produced as 1 unit can reasonably be ex-
pected to underlie more than 1 parcel to be offered in a 
competitive lease sale, the parcels for such a resource may 
be offered for bidding as a block in the competitive lease 
sale. 
‘‘(e) AREA SUBJECT TO LEASE FOR GEOTHERMAL 
RESOURCES.—A geothermal lease for the use of geo-
thermal resources shall embrace not more than the 
amount of acreage determined by the Secretary to be ap-
propriate.’’. 
SEC. 1803. DIRECT USE. 
(a) FEES FOR DIRECT USE.—Section 5 of the Geo-
thermal Steam Act of 1970 (30 U.S.C. 1004) is amend-
ed—
(1) in paragraph (c) by redesignating subpara-
graphs (1) and (2) as subparagraphs (A) and (B); 
(2) by redesignating paragraphs (a) through (d) 
in order as paragraphs (1) through (4); 
(3) by inserting ‘‘(a) IN GENERAL.—’’ after 
‘‘SEC. 5.’’; and 
(4) by adding at the end the following:
805
‘‘(b) FEES FOR DIRECT USE.—
‘‘(1) IN GENERAL.—Notwithstanding subsection 
(a)(1), with respect to the direct use of geothermal 
resources for purposes other than the commercial 
generation of electricity, the Secretary of the Inte-
rior shall establish a schedule of fees and collect fees 
pursuant to such a schedule in lieu of royalties. Not-
withstanding section 102(a)(9) of the Federal Land 
Policy and Management Act of 1976 (43 U.S.C. 
1701(a)(9)), the schedule of fees shall be based upon 
comparable non-Federal fees charged for direct use 
of geothermal resources within the State concerned. 
For direct use by a State or local government for 
public purposes, the fee charged shall be nominal. 
Leases in existence on the date of enactment of this 
subsection shall be modified in order to reflect the 
provisions of this subsection. 
‘‘(2) FINAL REGULATION.—In issuing any final 
regulation establishing a schedule of fees under this 
subsection, the Secretary shall seek—
‘‘(A) to provide lessees with a simplified 
administrative system; 
‘‘(B) to encourage development of this un-
derutilized energy resource on the Federal es-
tate; and
806
‘‘(C) to contribute to sustainable economic 
development opportunities for host commu-
nities.’’. 
(b) LEASING FOR DIRECT USE.—Section 4 of the 
Geothermal Steam Act of 1970 (30 U.S.C. 1003) is fur-
ther amended by adding at the end the following: 
‘‘(f) LEASING FOR DIRECT USE OF GEOTHERMAL 
RESOURCES.—Lands leased under this Act exclusively for 
direct use of geothermal resources shall be leased to any 
qualified applicant who first applies for such a lease under 
regulations issued by the Secretary, if—
‘‘(1) the Secretary publishes a notice of the 
lands proposed for leasing 60 days before the date 
of the issuance of the lease; and 
‘‘(2) the Secretary does not receive in the 60-
day period beginning on the date of such publication 
any nomination to include the lands concerned in the 
next competitive lease sale. 
‘‘(g) AREA SUBJECT TO LEASE FOR DIRECT USE.—
A geothermal lease for the direct use of geothermal re-
sources shall embrace not more than the amount of acre-
age determined by the Secretary to be reasonably nec-
essary for such proposed utilization.’’. 
(c) EXISTING LEASES WITH A DIRECT USE FACIL-
ITY.—
807
(1) APPLICATION
TO
CONVERT.—Any lessee 
under a lease under the Geothermal Steam Act of 
1970 that was issued before the date of enactment 
of this Act may apply to the Secretary of the Inte-
rior, by not later than 18 months after the date of 
enactment of this Act, to convert such lease to a 
lease for direct utilization of geothermal resources in 
accordance with the amendments made by this sec-
tion. 
(2) CONVERSION.—The Secretary shall approve 
such an application and convert such a lease to a 
lease in accordance with the amendments by not 
later than 180 days after receipt of such application, 
unless the Secretary determines that the applicant is 
not a qualified applicant with respect to the lease. 
(3) APPLICATION OF NEW LEASE TERMS.—The 
schedule of fees established under the amendment 
made by subsection (a)(4) shall apply with respect to 
payments under a lease converted under this sub-
section that are due and owing to the United States 
on or after July 16, 2003. 
SEC. 1804. ROYALTIES AND NEAR-TERM PRODUCTION IN-
CENTIVES. 
(a) ROYALTY.—Section 5 of the Geothermal Steam 
Act of 1970 (30 U.S.C. 1004) is further amended—
808
(1) in subsection (a) by striking paragraph (1) 
and inserting the following: 
‘‘(1) a royalty on electricity produced using geo-
thermal resources, other than direct use of geo-
thermal resources, that shall be—
‘‘(A) not less than 1 percent and not more 
than 2.5 percent of the gross proceeds from the 
sale of electricity produced from such resources 
during the first 10 years of production under 
the lease; and 
‘‘(B) not less than 2 and not more than 5 
percent of the gross proceeds from the sale of 
electricity produced from such resources during 
each year after such 10-year period;’’; and 
(2) by adding at the end the following: 
‘‘(c) FINAL REGULATION ESTABLISHING ROYALTY 
RATES.—In issuing any final regulation establishing roy-
alty rates under this section, the Secretary shall seek—
‘‘(1) to provide lessees a simplified administra-
tive system; 
‘‘(2) to encourage new development; 
‘‘(3) to achieve the same long-term level of roy-
alty revenues to States and counties as the regula-
tion in effect on the date of enactment of this sub-
section; and
809
‘‘(4) to reflect any change in profitability of op-
erations for which royalties will be paid due to the 
requirements imposed by Federal agencies, including 
delays. 
‘‘(d) CREDITS FOR IN-KIND PAYMENTS OF ELEC-
TRICITY.—The Secretary may provide to a lessee a credit 
against royalties owed under this Act, in an amount equal 
to the value of electricity provided under contract to a 
State or county government that is entitled to a portion 
of such royalties under section 20 of this Act, section 35 
of the Mineral Leasing Act (30 U.S.C. 191), or section 
6 of the Mineral Leasing Act for Acquired Lands (30 
U.S.C. 355), if—
‘‘(1) the Secretary has approved in advance the 
contract between the lessee and the State or county 
government for such in-kind payments; 
‘‘(2) the contract establishes a specific method-
ology to determine the value of such credits; and 
‘‘(3) the maximum credit will be equal to the 
royalty value owed to the State or county that is a 
party to the contract and the electricity received will 
serve as the royalty payment from the Federal Gov-
ernment to that entity.’’. 
(b) DISPOSAL OF MONEYS FROM SALES, BONUSES, 
ROYALTIES, AND RENTS.—Section 20 of the Geothermal
810
Steam Act of 1970 (30 U.S.C. 1019) is amended to read 
as follows: 
‘‘SEC. 20. DISPOSAL OF MONEYS FROM SALES, BONUSES, 
RENTALS, AND ROYALTIES. 
‘‘(a) IN GENERAL.—Except with respect to lands in 
the State of Alaska, all monies received by the United 
States from sales, bonuses, rentals, and royalties under 
this Act shall be paid into the Treasury of the United 
States. Of amounts deposited under this subsection, sub-
ject to the provisions of section 35 of the Mineral Leasing 
Act (30 U.S.C. 191(b)) and section 5(a)(2) of this Act—
‘‘(1) 50 percent shall be paid to the State with-
in the boundaries of which the leased lands or geo-
thermal resources are or were located; and 
‘‘(2) 25 percent shall be paid to the County 
within the boundaries of which the leased lands or 
geothermal resources are or were located. 
‘‘(b) USE OF PAYMENTS.—Amounts paid to a State 
or county under subsection (a) shall be used consistent 
with the terms of section 35 of the Mineral Leasing Act 
(30 U.S.C. 191).’’. 
(c) NEAR-TERM PRODUCTION INCENTIVE FOR EX-
ISTING LEASES.—
(1) IN
GENERAL.—Notwithstanding section 
5(a) of the Geothermal Steam Act of 1970, the roy-
811
alty required to be paid shall be 50 percent of the 
amount of the royalty otherwise required, on any 
lease issued before the date of enactment of this Act 
that does not convert to new royalty terms under 
subsection (e)—
(A) with respect to commercial production 
of energy from a facility that begins such pro-
duction in the 6-year period beginning on the 
date of enactment of this Act; or 
(B) on qualified expansion geothermal en-
ergy. 
(2) 4-YEAR APPLICATION.—Paragraph (1) ap-
plies only to new commercial production of energy 
from a facility in the first 4 years of such produc-
tion. 
(d) DEFINITION OF QUALIFIED EXPANSION GEO-
THERMAL ENERGY.—In this section, the term ‘‘qualified 
expansion geothermal energy’’ means geothermal energy 
produced from a generation facility for which—
(1) the production is increased by more than 10 
percent as a result of expansion of the facility car-
ried out in the 6-year period beginning on the date 
of enactment of this Act; and 
(2) such production increase is greater than 10 
percent of the average production by the facility dur-
812
ing the 5-year period preceding the expansion of the 
facility (as such average is adjusted to reflect any 
trend, in changes in production during that period). 
(e) ROYALTY UNDER EXISTING LEASES.—
(1) IN
GENERAL.—Any lessee under a lease 
issued under the Geothermal Steam Act of 1970 be-
fore the date of enactment of this Act may modify 
the terms of the lease relating to payment of royal-
ties to comply with the amendment made by sub-
section (a), by applying to the Secretary of the Inte-
rior by not later than 18 months after the date of 
enactment of this Act. 
(2) APPLICATION
OF
MODIFICATION.—Such 
modification shall apply to any use of geothermal re-
sources to which the amendment applies that occurs 
after the date of that application. 
(3) CONSULTATION.—The Secretary—
(A) shall consult with the State and local 
governments affected by any proposed changes 
in lease royalty terms under this subsection; 
and 
(B) may establish royalty based on a gross 
proceeds percentage within the range specified 
in the amendment made by subsection (a)(1)
813
and with the concurrence of the lessee and the 
State. 
SEC. 1805. EXPEDITING ADMINISTRATIVE ACTION FOR GEO-
THERMAL LEASING. 
(a) TREATMENT OF GEOTHERMAL LEASING WITH 
RESPECT TO FEDERAL LAND MANAGEMENT PLAN RE-
QUIREMENTS.—Section 15 of the Geothermal Steam Act 
of 1970 (30 U.S.C. 1014) is amended by adding at the 
end the following: 
‘‘(d) TREATMENT OF GEOTHERMAL LEASING UNDER 
FEDERAL
LAND
MANAGEMENT
PLANS.—Geothermal 
leasing and development of Federal lands in accordance 
with this Act is deemed to be consistent with the manage-
ment of National Forest System lands under section 6 of 
the Forest and Rangeland Renewable Resources Planning 
Act of 1974 (16 U.S.C. 1604) and public lands under sec-
tion 202 of the Federal Land Policy and Management Act 
of 1976 (43 U.S.C. 1712). Land and resource manage-
ment plans and land use plans in effect under such sec-
tions on the date of the enactment of this subsection are 
deemed to be adequate to proceed with the issuance of 
leases under this Act.’’. 
(b) LEASE APPLICATIONS PENDING ON JANUARY 1, 
2005.—
814
(1) PRIORITY.—It shall be a priority for the 
Secretary of the Interior, and for the Secretary of 
Agriculture with respect to National Forest Systems 
lands, to ensure timely completion of administrative 
actions necessary to process applications for geo-
thermal leasing pending on January 1, 2005. 
(2) APPLICABLE LAW.—An application referred 
to in paragraph (1), and any lease issued pursuant 
to such an application—
(A) except as provided in subparagraph 
(B), shall be subject to this section as in effect 
on January 1, 2005; or 
(B) at the election of the applicant, shall 
be subject to this section as in effect on the ef-
fective date of this paragraph. 
SEC. 1806. COORDINATION OF GEOTHERMAL LEASING AND 
PERMITTING ON FEDERAL LANDS. 
(a) IN GENERAL.—Not later than 180 days after the 
date of enactment of this section, the Secretary of the In-
terior and the Secretary of Agriculture shall enter into and 
submit to Congress a memorandum of understanding in 
accordance with this section, the Geothermal Steam Act 
of 1970 (as amended by this Act), and other applicable 
laws, regarding coordination of leasing and permitting for
815
geothermal development of public lands and National For-
est System lands under their respective jurisdictions. 
(b) LEASE AND PERMIT APPLICATIONS.—The memo-
randum of understanding shall—
(1) establish an administrative procedure for 
processing geothermal lease applications, including 
lines of authority, steps in application processing, 
and time limits for application procession; 
(2) establish a 5-year program for geothermal 
leasing of lands in the National Forest System, and 
a process for updating that program every 5 years; 
and 
(3) establish a program for reducing the back-
log of geothermal lease application pending on Janu-
ary 1, 2005, by 90 percent within the 5-year period 
beginning on the date of enactment of this Act, in-
cluding, as necessary, by—
(A) issuing leases, rejecting lease applica-
tions for failure to comply with the provisions 
of the regulations under which they were filed, 
or determining that an original applicant (or 
the applicant’s assigns, heirs, or estate) is no 
longer interested in pursuing the lease applica-
tion;
816
(B) making diligent efforts to directly con-
tact the lease applicants (including their heirs, 
assigns, or estates); and 
(C) ensuring that no lease application is 
rejected except in compliance with all require-
ments regarding diligent direct contact. 
(c) DATA RETRIEVAL SYSTEM.—The memorandum 
of understanding shall establish a joint data retrieval sys-
tem that is capable of tracking lease and permit applica-
tions and providing to the applicant information as to 
their status within the Departments of the Interior and 
Agriculture, including an estimate of the time required for 
administrative action. 
SEC. 1807. REVIEW AND REPORT TO CONGRESS. 
The Secretary of the Interior shall promptly review 
and report to Congress not later than 3 years after the 
date of enactment of this Act regarding the status of all 
withdrawals from leasing under the Geothermal Steam Act 
of 1970 (30 U.S.C. 1001 et seq.) of Federal lands, speci-
fying for each such area whether the basis for such with-
drawal still applies.
817
SEC. 1808. REIMBURSEMENT FOR COSTS OF NEPA ANAL-
YSES, DOCUMENTATION, AND STUDIES. 
(a) IN GENERAL.—The Geothermal Steam Act of 
1970 (30 U.S.C. 1001 et seq.) is amended by adding at 
the end the following: 
‘‘SEC. 30. REIMBURSEMENT FOR COSTS OF CERTAIN ANAL-
YSES, DOCUMENTATION, AND STUDIES. 
‘‘(a) IN GENERAL.—The Secretary of the Interior 
shall issue regulations under which the Secretary shall re-
imburse a person that is a lessee, operator, operating 
rights owner, or applicant for any lease under this Act 
for reasonable amounts paid by the person for preparation 
for the Secretary by a contractor or other person selected 
by the Secretary of any project-level analysis, documenta-
tion, or related study required pursuant to the National 
Environmental Policy Act of 1969 (42 U.S.C. 4321 et 
seq.) with respect to the lease. 
‘‘(b) CONDITIONS.—The Secretary may provide reim-
bursement under subsection (a) only if—
‘‘(1) adequate funding to enable the Secretary 
to timely prepare the analysis, documentation, or re-
lated study is not appropriated; 
‘‘(2) the person paid the costs voluntarily; 
‘‘(3) the person maintains records of its costs 
in accordance with regulations issued by the Sec-
retary;
818
‘‘(4) the reimbursement is in the form of a re-
duction in the Federal share of the royalty required 
to be paid for the lease for which the analysis, docu-
mentation, or related study is conducted, and is 
agreed to by the Secretary and the person reim-
bursed prior to commencing the analysis, docu-
mentation, or related study; and 
‘‘(5) the agreement required under paragraph 
(4) contains provisions—
‘‘(A) reducing royalties owed on lease pro-
duction based on market prices; 
‘‘(B) stipulating an automatic termination 
of the royalty reduction upon recovery of docu-
mented costs; and 
‘‘(C) providing a process by which the les-
see may seek reimbursement for circumstances 
in which production from the specified lease is 
not possible.’’. 
(b) APPLICATION.—The amendment made by this 
section shall apply with respect to an analysis, documenta-
tion, or a related study conducted on or after the date 
of enactment of this Act for any lease entered into before, 
on, or after the date of enactment of this Act. 
(c) DEADLINE FOR REGULATIONS.—The Secretary 
shall issue regulations implementing the amendment made
819
by this section by not later than 1 year after the date 
of enactment of this Act. 
SEC. 1809. ASSESSMENT OF GEOTHERMAL ENERGY POTEN-
TIAL. 
The Secretary of Interior, acting through the Direc-
tor of the United States Geological Survey and in coopera-
tion with the States, shall update the 1978 Assessment 
of Geothermal Resources, and submit that updated assess-
ment to Congress—
(1) not later than 3 years after the date of en-
actment of this Act; and 
(2) thereafter as the availability of data and de-
velopments in technology warrant. 
SEC. 1810. COOPERATIVE OR UNIT PLANS. 
Section 18 of the Geothermal Steam Act of 1970 (30 
U.S.C. 1017) is amended to read as follows: 
‘‘SEC. 18. UNIT AND COMMUNITIZATION AGREEMENTS. 
‘‘(a) ADOPTION OF UNITS BY LESSEES.—
‘‘(1) IN GENERAL.—For the purpose of more 
properly conserving the natural resources of any 
geothermal reservoir, field, or like area, or any part 
thereof (whether or not any part of the geothermal 
field, or like area, is then subject to any Unit Agree-
ment (cooperative plan of development or oper-
ation)), lessees thereof and their representatives may
820
unite with each other, or jointly or separately with 
others, in collectively adopting and operating under 
a Unit Agreement for such field, or like area, or any 
part thereof including direct use resources, if deter-
mined and certified by the Secretary to be necessary 
or advisable in the public interest. A majority inter-
est of lessees under any single lease shall have the 
authority to commit that lease to a Unit Agreement. 
The Secretary of the Interior may also initiate the 
formation of a Unit Agreement, if such action is in 
the public interest. 
‘‘(2) MODIFICATION OF LEASE REQUIREMENTS 
BY SECRETARY.—The Secretary may, in the discre-
tion of the Secretary, and with the consent of the 
holders of leases involved, establish, alter, change, or 
revoke rates of operations (including drilling, oper-
ations, production, and other requirements) of such 
leases and make conditions with reference to such 
leases, with the consent of the lessees, in connection 
with the creation and operation of any such Unit 
Agreement as the Secretary may deem necessary or 
proper to secure the proper protection of the public 
interest. Leases with unlike lease terms or royalty 
rates do not need to be modified to be in the same 
unit.
821
‘‘(b) REQUIREMENT
OF
PLANS
UNDER
NEW 
LEASES.—The Secretary—
‘‘(1) may provide that geothermal leases issued 
under this Act shall contain a provision requiring 
the lessee to operate under such a reasonable Unit 
Agreement; and 
‘‘(2) may prescribe such an Agreement under 
which such lessee shall operate, which shall ade-
quately protect the rights of all parties in interest, 
including the United States. 
‘‘(c) MODIFICATION OF RATE OF PROSPECTING, DE-
VELOPMENT, AND PRODUCTION.—The Secretary may re-
quire that any Agreement authorized by this section that 
applies to lands owned by the United States contain a pro-
vision under which authority is vested in the Secretary, 
or any person, committee, or State or Federal officer or 
agency as may be designated in the Agreement to alter 
or modify from time to time the rate of prospecting and 
development and the quantity and rate of production 
under such an Agreement. 
‘‘(d) EXCLUSION FROM DETERMINATION OF HOLD-
ING OR CONTROL.—Any lands that are subject to any 
Agreement approved or prescribed by the Secretary under 
this section shall not be considered in determining hold-
ings or control under any provision of this Act.
822
‘‘(e) POOLING
OF CERTAIN LANDS.—If separate 
tracts of lands cannot be independently developed and op-
erated to use geothermal resources pursuant to any sec-
tion of this Act—
‘‘(1) such lands, or a portion thereof, may be 
pooled with other lands, whether or not owned by 
the United States, for purposes of development and 
operation under a Communitization Agreement pro-
viding for an apportionment of production or royal-
ties among the separate tracts of land comprising 
the production unit, if such pooling is determined by 
the Secretary to be in the public interest; and 
‘‘(2) operation or production pursuant to such 
an Agreement shall be treated as operation or pro-
duction with respect to each tract of land that is 
subject to the agreement. 
‘‘(f) UNIT AGREEMENT REVIEW.—No more than 5 
years after approval of any cooperative or Unit Agreement 
and at least every 5 years thereafter, the Secretary shall 
review each such Agreement and, after notice and oppor-
tunity for comment, eliminate from inclusion in such 
Agreement any lands that the Secretary determines are 
not reasonably necessary for Unit operations under the 
Agreement. Such elimination shall be based on scientific 
evidence, and shall occur only if it is determined by the
823
Secretary to be for the purpose of conserving and properly 
managing the geothermal resource. Any land so eliminated 
shall be eligible for an extension under subsection (g) of 
section 6 if it meets the requirements for such an exten-
sion. 
‘‘(g) DRILLING
OR DEVELOPMENT CONTRACTS.—
The Secretary may, on such conditions as the Secretary 
may prescribe, approve drilling or development contracts 
made by 1 or more lessees of geothermal leases, with 1 
or more persons, associations, or corporations if, in the 
discretion of the Secretary, the conservation of natural re-
sources or the public convenience or necessity may require 
or the interests of the United States may be best served 
thereby. All leases operated under such approved drilling 
or development contracts, and interests thereunder, shall 
be excepted in determining holdings or control under sec-
tion 7. 
‘‘(h) COORDINATION WITH STATE GOVERNMENTS.—
The Secretary shall coordinate unitization and pooling ac-
tivities with the appropriate State agencies and shall en-
sure that State leases included in any unitization or pool-
ing arrangement are treated equally with Federal leases.’’.
824
SEC. 1811. ROYALTY ON BYPRODUCTS. 
Section 5 of the Geothermal Steam Act of 1970 (30 
U.S.C. 1004) is further amended in subsection (a) by 
striking paragraph (2) and inserting the following: 
‘‘(2) a royalty on any byproduct that is a min-
eral named in the first section of the Mineral Leas-
ing Act (30 U.S.C. 181), and that is derived from 
production under the lease, at the rate of the royalty 
that applies under that Act to production of such 
mineral under a lease under that Act;’’. 
SEC. 1812. REPEAL OF AUTHORITIES OF SECRETARY TO RE-
ADJUST TERMS, CONDITIONS, RENTALS, AND 
ROYALTIES. 
Section 8 of the Geothermal Steam Act of 1970 (30 
U.S.C. 1007) is amended by repealing subsection (b), and 
by redesignating subsection (c) as subsection (b). 
SEC. 1813. CREDITING OF RENTAL TOWARD ROYALTY. 
Section 5 of the Geothermal Steam Act of 1970 (30 
U.S.C. 1004) is further amended—
(1) in subsection (a)(2) by inserting ‘‘and’’ 
after the semicolon at the end; 
(2) in subsection (a)(3) by striking ‘‘; and’’ and 
inserting a period; 
(3) by striking paragraph (4) of subsection (a); 
and 
(4) by adding at the end the following:
825
‘‘(e) CREDITING OF RENTAL TOWARD ROYALTY.—
Any annual rental under this section that is paid with re-
spect to a lease before the first day of the year for which 
the annual rental is owed shall be credited to the amount 
of royalty that is required to be paid under the lease for 
that year.’’. 
SEC. 1814. LEASE DURATION AND WORK COMMITMENT RE-
QUIREMENTS. 
Section 6 of the Geothermal Steam Act of 1970 (30 
U.S.C. 1005) is amended—
(1) by striking so much as precedes subsection 
(c), and striking subsections (e), (g), (h), (i), and 
(j); 
(2) by redesignating subsections (c), (d), and 
(f) in order as subsections (g), (h), and (i); and 
(3) by inserting before subsection (g), as so re-
designated, the following: 
‘‘SEC. 6. LEASE TERM AND WORK COMMITMENT REQUIRE-
MENTS. 
‘‘(a) IN GENERAL.—
‘‘(1) PRIMARY TERM.—A geothermal lease shall 
be for a primary term of 10 years. 
‘‘(2) INITIAL EXTENSION.—The Secretary shall 
extend the primary term of a geothermal lease for
826
5 years if, for each year after the fifth year of the 
lease—
‘‘(A) the Secretary determined under sub-
section (c) that the lessee satisfied the work 
commitment requirements that applied to the 
lease for that year; or 
‘‘(B) the lessee paid in accordance with 
subsection (d) the value of any work that was 
not completed in accordance with those require-
ments. 
‘‘(3) ADDITIONAL EXTENSION.—The Secretary 
shall extend the primary term of a geothermal lease 
(after an initial extension under paragraph (2)) for 
an additional 5 years if, for each year of the initial 
extension under paragraph (2), the Secretary deter-
mined under subsection (c) that the lessee satisfied 
the work commitment requirements that applied to 
the lease for that year. 
‘‘(b) REQUIREMENT
TO SATISFY ANNUAL WORK 
COMMITMENT REQUIREMENT.—
‘‘(1) IN GENERAL.—The lessee for a geothermal 
lease shall, for each year after the fifth year of the 
lease, satisfy work commitment requirements pre-
scribed by the Secretary that apply to the lease for 
that year.
827
‘‘(2) PRESCRIPTION OF WORK COMMITMENT RE-
QUIREMENTS.—The Secretary shall issue regulations 
prescribing minimum equivalent dollar value work 
commitment requirements for geothermal leases, 
that—
‘‘(A) require that a lessee, in each year 
after the fifth year of the primary term of a 
geothermal lease, diligently work to achieve 
commercial utilization of geothermal resources 
under the lease; 
‘‘(B) describe work that qualifies to meet 
these requirements and factors, such as force 
majeure events, that suspend or modify the 
work commitment obligation; 
‘‘(C) carry forward and apply to work com-
mitment requirements for a year, work com-
pleted in any year in the preceding 3-year pe-
riod that was in excess of the work required to 
be performed in that preceding year; 
‘‘(D) establish transition rules for leases 
issued before the date of the enactment of this 
subsection, including terms under which a lease 
that is near the end of its term on the date of 
enactment of this subsection may be extended 
for up to 2 years—
828
‘‘(i) to allow achievement of produc-
tion under the lease; or 
‘‘(ii) to allow the lease to be included 
in a producing unit; and 
‘‘(E) establish an annual payment that, at 
the option of the lessee, may be exercised in lieu 
of meeting any work requirement for a limited 
number of years that the Secretary determines 
will not impair achieving diligent development 
of the geothermal resource. 
‘‘(3) GEOTHERMAL LEASE OVERLYING MINING 
CLAIM.—
‘‘(A) EXEMPTION.—The lessee for a geo-
thermal lease of an area overlying an area sub-
ject to a mining claim for which a plan of oper-
ations has been approved by the relevant Fed-
eral land management agency is exempt from 
annual work requirements established under 
this Act, if development of the geothermal re-
source subject to the lease would interfere with 
the mining operations under such claim. 
‘‘(B) TERMINATION OF EXEMPTION.—An 
exemption under this paragraph expires upon 
the termination of the mining operations.
829
‘‘(4) TERMINATION
OF
APPLICATION
OF
RE-
QUIREMENTS.—Work commitment requirements pre-
scribed under this subsection shall not apply to a 
geothermal lease after the date on which the geo-
thermal resource is utilized under the lease in com-
mercial quantities. 
‘‘(c) DETERMINATION OF WHETHER REQUIREMENTS 
SATISFIED.—The Secretary shall, by not later than 90 
days after the end of each year for which work commit-
ment requirements under subsection (b) apply to a geo-
thermal lease—
‘‘(1) determine whether the lessee has satisfied 
the requirements that apply for that year; 
‘‘(2) notify the lessee of that determination; and 
‘‘(3) in the case of a notification that the lessee 
did not satisfy work commitment requirements for 
the year, include in the notification—
‘‘(A) a description of the specific work that 
was not completed by the lessee in accordance 
with the requirements; and 
‘‘(B) the amount of the dollar value of 
such work that was not completed, reduced by 
the amount of expenditures made for work com-
pleted in a prior year that is carried forward 
pursuant to subsection (b)(2)(D).
830
‘‘(d) PAYMENT
OF
VALUE
OF
UNCOMPLETED 
WORK.—
‘‘(1) IN GENERAL.—If the Secretary notifies a 
lessee that the lessee failed to satisfy work commit-
ment requirements under subsection (b), the lessee 
shall pay to the Secretary, by not later than the end 
of the 60-day period beginning on the date of the 
notification, the dollar value of work that was not 
completed by the lessee, in the amount stated in the 
notification (as reduced under subsection (c)(3)(B)). 
‘‘(2) 
FAILURE
TO
PAY
VALUE
OF 
UNCOMPLETED WORK.—If a lessee fails to pay such 
amount to the Secretary before the end of that pe-
riod, the lease shall terminate upon the expiration of 
the period. 
‘‘(e) CONTINUATION DURING COMMERCIAL UTILIZA-
TION.—
‘‘(1) IN GENERAL.—If a geothermal resource 
that is subject to a geothermal lease is utilized in 
commercial quantities within the primary term of 
the lease under subsection (a) (including any exten-
sion of the lease under subsection (a)), such lease 
shall continue until the date on which the geo-
thermal resource is no longer utilized in commercial 
quantities.
831
‘‘(2) CONTINUATION OF ASSOCIATED LEASES.—
If a geothermal lease is for an area in which there 
is injected fluid or steam from a nearby geothermal 
resource for the purpose of maintaining commercial 
utilization of a geothermal resource, such lease shall 
continue until such commercial utilization is termi-
nated. 
‘‘(f) CONVERSION OF GEOTHERMAL LEASE TO MIN-
ERAL LEASE.—A lessee under a lease for a geothermal 
resource that has been utilized for commercial production 
of electricity, has been determined by the Secretary to be 
incapable of any further commercial utilization, and is 
producing any valuable byproduct in payable quantities 
may, within 6 months after such determination—
‘‘(1) convert the lease to a mineral lease under 
the Mineral Leasing Act (30 U.S.C. 181 et seq.) or 
under the Mineral Leasing Act for Acquired Lands 
(30 U.S.C. 351 et seq.), if the lands that are subject 
to the lease can be leased under that Act for the 
production of such byproduct; or 
‘‘(2) convert the lease to a mining claim under 
the general mining laws, if the byproduct is a 
locatable mineral.’’.
832
SEC. 1815. ADVANCED ROYALTIES REQUIRED FOR SUSPEN-
SION OF PRODUCTION. 
Section 5 of the Geothermal Steam Act of 1970 (30 
U.S.C. 1004) is further amended by adding at the end 
the following: 
‘‘(f) ADVANCED ROYALTIES REQUIRED FOR SUSPEN-
SION OF PRODUCTION.—
‘‘(1) CONTINUATION
OF
LEASE
FOLLOWING 
CESSATION OF PRODUCTION.—If, at any time after 
commercial production under a geothermal lease is 
achieved, production ceases for any cause the lease 
shall remain in full force and effect—
‘‘(A) during the 1-year period beginning on 
the date production ceases; and 
‘‘(B) after such period if, and so long as, 
the lessee commences and continues diligently 
and in good faith until such production is re-
sumed the steps, operations, or procedures nec-
essary to cause a resumption of such produc-
tion. 
‘‘(2) ADVANCE ROYALTIES FOLLOWING SUSPEN-
SION OF PRODUCTION.—If production of heat or en-
ergy under a geothermal lease is suspended after the 
date of any such production for which royalty is re-
quired under subsection (a) and the terms of para-
graph (1) are not met, the Secretary shall require
833
the lessee, until the end of such suspension, to pay 
royalty in advance at the monthly pro rata rate of 
the average annual rate at which such royalty was 
paid each year in the 5-year-period preceding the 
date of suspension. 
‘‘(3) LIMITATION ON APPLICATION.—Paragraph 
(2) shall not apply if the suspension is required or 
otherwise caused by the Secretary, the Secretary of 
a military department, a State or local government, 
or a force majeure.’’. 
SEC. 1816. ANNUAL RENTAL. 
(a) ANNUAL RENTAL RATE.—Section 5 of the Geo-
thermal Steam Act of 1970 (30 U.S.C. 1004) is further 
amended in subsection (a) in paragraph (3) by striking 
‘‘$1 per acre or fraction thereof for each year of the lease’’ 
and all that follows through the end of the paragraph and 
inserting ‘‘$1 per acre or fraction thereof for each year 
of the lease through the tenth year in the case of a lease 
awarded in a noncompetitive lease sale; or $2 per acre or 
fraction thereof for the first year, $3 per acre or fraction 
thereof for each of the second through tenth years, in the 
case of a lease awarded in a competitive lease sale; and 
$5 per acre or fraction thereof for each year after the 10th 
year thereof for all leases.’’.
834
(b) TERMINATION OF LEASE FOR FAILURE TO PAY 
RENTAL.—Section 5 of the Geothermal Steam Act of 
1970 (30 U.S.C. 1004) is further amended by adding at 
the end the following: 
‘‘(g) TERMINATION OF LEASE FOR FAILURE TO PAY 
RENTAL.—
‘‘(1) IN GENERAL.—The Secretary shall termi-
nate any geothermal lease with respect to which 
rental is not paid in accordance with this Act and 
the terms of the lease under which the rental is re-
quired, upon the expiration of the 45-day period be-
ginning on the date of the failure to pay such rental. 
‘‘(2) 
NOTIFICATION.—The 
Secretary 
shall 
promptly notify a lessee that has not paid rental re-
quired under the lease that the lease will be termi-
nated at the end of the period referred to in para-
graph (1). 
‘‘(3) REINSTATEMENT.—A geothermal lease 
that would otherwise terminate under paragraph (1) 
shall not terminate under that paragraph if the les-
see pays to the Secretary, before the end of the pe-
riod referred to in paragraph (1), the amount of 
rental due plus a late fee equal to 10 percent of such 
amount.’’.
835
SEC. 1817. DEPOSIT AND USE OF GEOTHERMAL LEASE REV-
ENUES FOR 5 FISCAL YEARS. 
(a) 
DEPOSIT
OF
GEOTHERMAL
RESOURCES 
LEASES.—Notwithstanding any other provision of law, 
amounts received by the United States in the first 5 fiscal 
years beginning after the date of enactment of this Act 
as rentals, royalties, and other payments required under 
leases under the Geothermal Steam Act of 1970, excluding 
funds required to be paid to State and county govern-
ments, shall be deposited into a separate account in the 
Treasury. 
(b) USE OF DEPOSITS.—Subject to appropriations, 
the Secretary may use amounts deposited under sub-
section (a) to implement the Geothermal Steam Act of 
1970 and this Act. 
SEC. 1818. REPEAL OF ACREAGE LIMITATIONS. 
Section 7 of the Geothermal Steam Act of 1970 (30 
U.S.C. 1006) is repealed. 
SEC. 1819. TECHNICAL AMENDMENTS. 
The Geothermal Steam Act of 1970 (30 U.S.C. 1001 
et seq.) is further amended as follows: 
(1) By striking ‘‘geothermal steam and associ-
ated geothermal resources’’ each place it appears 
and inserting ‘‘geothermal resources’’. 
(2) Section 2(e) (30 U.S.C. 1001(e)) is amend-
ed to read as follows:
836
‘‘(e) ‘direct use’ means utilization of geothermal 
resources for commercial, residential, agricultural, 
public facilities, off-grid generation of electricity, or 
other energy needs other than the commercial pro-
duction of electricity; and’’. 
(3) Section 21 (30 U.S.C. 1020) is amended by 
striking ‘‘(a) Within one hundred’’ and all that fol-
lows through ‘‘(b) Geothermal’’ and inserting ‘‘Geo-
thermal’’. 
(4) The first section (30 U.S.C. 1001 note) is 
amended by striking ‘‘That this’’ and inserting the 
following: 
‘‘SEC. 1. SHORT TITLE. 
‘‘This’’. 
(5) Section 2 (30 U.S.C. 1001) is amended by 
striking ‘‘SEC. 2. As’’ and inserting the following: 
‘‘SEC. 2. DEFINITIONS. 
‘‘As’’. 
(6) Section 3 (30 U.S.C. 1002) is amended by 
striking ‘‘SEC. 3. Subject’’ and inserting the fol-
lowing: 
‘‘SEC. 3. LANDS SUBJECT TO GEOTHERMAL LEASING. 
‘‘Subject’’. 
(7) Section 5 (30 U.S.C. 1004) is further 
amended by striking ‘‘SEC. 5.’’, and by inserting im-
837
mediately before and above subsection (a) the fol-
lowing: 
‘‘SEC. 5. RENTS AND ROYALTIES.’’. 
(8) Section 8 (30 U.S.C. 1007) is amended by 
striking ‘‘SEC. 8. (a) The’’ and inserting the fol-
lowing: 
‘‘SEC. 8. READJUSTMENT OF LEASE TERMS AND CONDI-
TIONS. 
‘‘(a) The’’. 
(9) Section 9 (30 U.S.C. 1008) is amended by 
striking ‘‘SEC. 9. If’’ and inserting the following: 
‘‘SEC. 9. BYPRODUCTS. 
‘‘If’’. 
(10) Section 10 (30 U.S.C. 1009) is amended 
by striking ‘‘SEC. 10. The’’ and inserting the fol-
lowing: 
‘‘SEC. 10. RELINQUISHMENT OF GEOTHERMAL RIGHTS. 
‘‘The’’. 
(11) Section 11 (30 U.S.C. 1010) is amended 
by striking ‘‘SEC. 11. The’’ and inserting the fol-
lowing: 
‘‘SEC. 11. SUSPENSION OF OPERATIONS AND PRODUCTION. 
‘‘The’’.
838
(12) Section 12 (30 U.S.C. 1011) is amended 
by striking ‘‘SEC. 12. Leases’’ and inserting the fol-
lowing: 
‘‘SEC. 12. TERMINATION OF LEASES. 
‘‘Leases’’. 
(13) Section 13 (30 U.S.C. 1012) is amended 
by striking ‘‘SEC. 13. The’’ and inserting the fol-
lowing: 
‘‘SEC. 13. WAIVER, SUSPENSION, OR REDUCTION OF RENT-
AL OR ROYALTY. 
‘‘The’’. 
(14) Section 14 (30 U.S.C. 1013) is amended 
by striking ‘‘SEC. 14. Subject’’ and inserting the fol-
lowing: 
‘‘SEC. 14. SURFACE LAND USE. 
‘‘Subject’’. 
(15) Section 15 (30 U.S.C. 1014) is amended 
by striking ‘‘SEC. 15. (a) Geothermal’’ and inserting 
the following: 
‘‘SEC. 15. LANDS SUBJECT TO GEOTHERMAL LEASING. 
‘‘(a) Geothermal’’. 
(16) Section 16 (30 U.S.C. 1015) is amended 
by striking ‘‘SEC. 16. Leases’’ and inserting the fol-
lowing:
839
‘‘SEC. 16. REQUIREMENT FOR LESSEES. 
‘‘Leases’’. 
(17) Section 17 (30 U.S.C. 1016) is amended 
by striking ‘‘SEC. 17. Administration’’ and inserting 
the following: 
‘‘SEC. 17. ADMINISTRATION. 
‘‘Administration’’. 
(18) Section 19 (30 U.S.C. 1018) is amended 
by striking ‘‘SEC. 19. Upon’’ and inserting the fol-
lowing: 
‘‘SEC. 19. DATA FROM FEDERAL AGENCIES. 
‘‘Upon’’. 
(19) Section 21 (30 U.S.C. 1020) is further 
amended by striking ‘‘SEC. 21.’’, and by inserting 
immediately before and above the remainder of that 
section the following: 
‘‘SEC. 21. PUBLICATION IN FEDERAL REGISTER; RESERVA-
TION OF MINERAL RIGHTS.’’. 
(20) Section 22 (30 U.S.C. 1021) is amended 
by striking ‘‘SEC. 22. Nothing’’ and inserting the 
following: 
‘‘SEC. 22. FEDERAL EXEMPTION FROM STATE WATER LAWS. 
‘‘Nothing’’. 
(21) Section 23 (30 U.S.C. 1022) is amended 
by striking ‘‘SEC. 23. (a) All’’ and inserting the fol-
lowing:
840
‘‘SEC. 23. PREVENTION OF WASTE; EXCLUSIVITY. 
‘‘(a) All’’. 
(22) Section 24 (30 U.S.C. 1023) is amended 
by striking ‘‘SEC. 24. The’’ and inserting the fol-
lowing: 
‘‘SEC. 24. RULES AND REGULATIONS. 
‘‘The’’. 
(23) Section 25 (30 U.S.C. 1024) is amended 
by striking ‘‘SEC. 25. As’’ and inserting the fol-
lowing: 
‘‘SEC. 25. INCLUSION OF GEOTHERMAL LEASING UNDER 
CERTAIN OTHER LAWS. 
‘‘As’’. 
(24) Section 26 is amended by striking ‘‘SEC. 
26. The’’ and inserting the following: 
‘‘SEC. 26. AMENDMENT. 
‘‘The’’. 
(25) Section 27 (30 U.S.C. 1025) is amended 
by striking ‘‘SEC. 27. The’’ and inserting the fol-
lowing: 
‘‘SEC. 27. FEDERAL RESERVATION OF CERTAIN MINERAL 
RIGHTS. 
‘‘The’’. 
(26) Section 28 (30 U.S.C. 1026) is amended 
by striking ‘‘SEC. 28. (a)(1) The’’ and inserting the 
following:
841
‘‘SEC. 28. SIGNIFICANT THERMAL FEATURES. 
‘‘(a)(1) The’’. 
(27) Section 29 (30 U.S.C. 1027) is amended 
by striking ‘‘SEC. 29. The’’ and inserting the fol-
lowing: 
‘‘SEC. 29. LAND SUBJECT TO PROHIBITION ON LEASING. 
‘‘The’’. 
SEC. 1820. INTERMOUNTAIN WEST GEOTHERMAL CONSOR-
TIUM. 
(a) PARTICIPATION AUTHORIZED.—The Secretary of 
Energy, acting through the Idaho National Laboratory, 
may participate in a consortium described in subsection 
(b) to address science and science policy issues sur-
rounding the expanded discovery and use of geothermal 
energy, including from geothermal resources on public 
lands. 
(b) MEMBERS.—The consortium referred to in sub-
section (a) shall—
(1) be known as the ‘‘Intermountain West Geo-
thermal Consortium’’; 
(2) be a regional consortium of institutions and 
government agencies that focuses on building col-
laborative efforts among the universities in the State 
of Idaho, other regional universities, State agencies, 
and the Idaho National Laboratory;
842
(3) include Boise State University, the Univer-
sity of Idaho (including the Idaho Water Resources 
Research Institute), the Oregon Institute of Tech-
nology, the Desert Research Institute with the Uni-
versity and Community College System of Nevada, 
and the Energy and Geoscience Institute at the Uni-
versity of Utah; 
(4) be hosted and managed by Boise State Uni-
versity; and 
(5) have a director appointed by Boise State 
University, and associate directors appointed by each 
participating institution. 
(c) FINANCIAL ASSISTANCE.—The Secretary of En-
ergy, acting through the Idaho National Laboratory and 
subject to the availability of appropriations, will provide 
financial assistance to Boise State University for expendi-
ture under contracts with members of the consortium to 
carry out the activities of the consortium. 
TITLE XIX—HYDROPOWER 
SEC. 1901. INCREASED HYDROELECTRIC GENERATION AT 
EXISTING FEDERAL FACILITIES. 
(a) IN GENERAL.—The Secretary of the Interior, the 
Secretary of Energy, and the Secretary of the Army shall 
jointly conduct a study of the potential for increasing elec-
843
tric power production capability at federally owned or op-
erated water regulation, storage, and conveyance facilities. 
(b) CONTENT.—The study under this section shall in-
clude identification and description in detail of each facil-
ity that is capable, with or without modification, of pro-
ducing additional hydroelectric power, including esti-
mation of the existing potential for the facility to generate 
hydroelectric power. 
(c) REPORT.—The Secretaries shall submit to the 
Committees on Energy and Commerce, Resources, and 
Transportation and Infrastructure of the House of Rep-
resentatives and the Committee on Energy and Natural 
Resources of the Senate a report on the findings, conclu-
sions, and recommendations of the study under this sec-
tion by not later than 18 months after the date of the 
enactment of this Act. The report shall include each of 
the following: 
(1) The identifications, descriptions, and esti-
mations referred to in subsection (b). 
(2) A description of activities currently con-
ducted or considered, or that could be considered, to 
produce additional hydroelectric power from each 
identified facility.
844
(3) A summary of prior actions taken by the 
Secretaries to produce additional hydroelectric power 
from each identified facility. 
(4) The costs to install, upgrade, or modify 
equipment or take other actions to produce addi-
tional hydroelectric power from each identified facil-
ity and the level of Federal power customer involve-
ment in the determination of such costs. 
(5) The benefits that would be achieved by such 
installation, upgrade, modification, or other action, 
including quantified estimates of any additional en-
ergy or capacity from each facility identified under 
subsection (b). 
(6) A description of actions that are planned, 
underway, or might reasonably be considered to in-
crease hydroelectric power production by replacing 
turbine runners, by performing generator upgrades 
or rewinds, or construction of pumped storage facili-
ties. 
(7) The impact of increased hydroelectric power 
production on irrigation, water supply, fish, wildlife, 
Indian tribes, river health, water quality, navigation, 
recreation, fishing, and flood control. 
(8) Any additional recommendations to increase 
hydroelectric power production from, and reduce
845
costs and improve efficiency at, federally owned or 
operated water regulation, storage, and conveyance 
facilities. 
SEC. 1902. SHIFT OF PROJECT LOADS TO OFF-PEAK PERI-
ODS. 
(a) IN GENERAL.—The Secretary of the Interior 
shall—
(1) review electric power consumption by Bu-
reau of Reclamation facilities for water pumping 
purposes; and 
(2) make such adjustments in such pumping as 
possible to minimize the amount of electric power 
consumed for such pumping during periods of peak 
electric power consumption, including by performing 
as much of such pumping as possible during off-
peak hours at night. 
(b) CONSENT OF AFFECTED IRRIGATION CUSTOMERS 
REQUIRED.—The Secretary may not under this section 
make any adjustment in pumping at a facility without the 
consent of each person that has contracted with the 
United States for delivery of water from the facility for 
use for irrigation and that would be affected by such ad-
justment. 
(c) EXISTING OBLIGATIONS NOT AFFECTED.—This 
section shall not be construed to affect any existing obliga-
846
tion of the Secretary to provide electric power, water, or 
other benefits from Bureau of Reclamation facilities, in-
cluding recreational releases. 
SEC. 1903. REPORT IDENTIFYING AND DESCRIBING THE 
STATUS OF POTENTIAL HYDROPOWER FA-
CILITIES. 
(a) REPORT REQUIREMENT.—Not later than 90 days 
after the date of enactment of this Act, the Secretary of 
the Interior, acting through the Bureau of Reclamation, 
shall submit to the Committee on Resources of the House 
of Representatives and the Committee on Energy and 
Natural Resources of the Senate a report identifying and 
describing the status of potential hydropower facilities in-
cluded in water surface storage studies undertaken by the 
Secretary for projects that have not been completed or au-
thorized for construction. 
(b) REPORT CONTENTS.—The report shall include 
the following: 
(1) Identification of all surface storage studies 
authorized by Congress since the enactment of the 
Reclamation Project Act of 1939 (43 U.S.C. 485 et 
seq.). 
(2) The purposes of each project included with-
in each study identified under paragraph (1).
847
(3) The status of each study identified under 
paragraph (1), including for each study—
(A) whether the study is completed or, if 
not completed, still authorized; 
(B) the level of analyses conducted at the 
feasibility and reconnaissance levels of review; 
(C) identifiable environmental impacts of 
each project included in the study, including to 
fish and wildlife, water quality, and recreation; 
(D) projected water yield from each such 
project; 
(E) beneficiaries of each such project; 
(F) the amount authorized and expended; 
(G) projected funding needs and timelines 
for completing the study (if applicable); 
(H) anticipated costs of each such project; 
and 
(I) other factors that might interfere with 
construction of any such project. 
(4) An identification of potential hydroelectric 
facilities that might be developed pursuant to each 
study identified under paragraph (1). 
(5) Applicable costs and benefits associated 
with potential hydroelectric production pursuant to 
each study.
848
TITLE XX—OIL AND GAS—
RESOURCES 
Subtitle A—Production Incentives 
SEC. 2001. DEFINITION OF SECRETARY. 
In this subtitle, the term ‘‘Secretary’’ means the Sec-
retary of the Interior. 
SEC. 2002. PROGRAM ON OIL AND GAS ROYALTIES IN-KIND. 
(a) APPLICABILITY OF SECTION.—Notwithstanding 
any other provision of law, this section applies to all roy-
alty in-kind accepted by the Secretary on or after the date 
of enactment of this Act under any Federal oil or gas lease 
or permit under section 36 of the Mineral Leasing Act 
(30 U.S.C. 192), section 27 of the Outer Continental Shelf 
Lands Act (43 U.S.C. 1353), or any other Federal law 
governing leasing of Federal land for oil and gas develop-
ment. 
(b) TERMS AND CONDITIONS.—All royalty accruing 
to the United States shall, on the demand of the Sec-
retary, be paid in oil or gas. If the Secretary makes such 
a demand, the following provisions apply to such payment: 
(1) SATISFACTION OF ROYALTY OBLIGATION.—
Delivery by, or on behalf of, the lessee of the royalty 
amount and quality due under the lease satisfies the 
lessee’s royalty obligation for the amount delivered, 
except that transportation and processing reimburse-
849
ments paid to, or deductions claimed by, the lessee 
shall be subject to review and audit. 
(2) MARKETABLE CONDITION.—
(A) IN
GENERAL.—Royalty production 
shall be placed in marketable condition by the 
lessee at no cost to the United States. 
(B) DEFINITION OF MARKETABLE CONDI-
TION.—In this paragraph, the term ‘‘in market-
able condition’’ means sufficiently free from im-
purities and otherwise in a condition that the 
royalty production will be accepted by a pur-
chaser under a sales contract typical of the field 
or area in which the royalty production was 
produced. 
(3) DISPOSITION
BY
THE
SECRETARY.—The 
Secretary may—
(A) sell or otherwise dispose of any royalty 
production taken in-kind (other than oil or gas 
transferred under section 27(a)(3) of the Outer 
Continental Shelf Lands Act (43 U.S.C. 
1353(a)(3))) for not less than the market price; 
and 
(B) transport or process (or both) any roy-
alty production taken in-kind.
850
(4) RETENTION BY THE SECRETARY.—The Sec-
retary may, notwithstanding section 3302 of title 31, 
United States Code, retain and use a portion of the 
revenues from the sale of oil and gas taken in-kind 
that otherwise would be deposited to miscellaneous 
receipts, without regard to fiscal year limitation, or 
may use oil or gas received as royalty taken in-kind 
(in this paragraph referred to as ‘‘royalty produc-
tion’’) to pay the cost of—
(A) transporting the royalty production; 
(B) processing the royalty production; 
(C) disposing of the royalty production; or 
(D) any combination of transporting, proc-
essing, and disposing of the royalty production. 
(5) LIMITATION.—
(A) IN GENERAL.—Except as provided in 
subparagraph (B), the Secretary may not use 
revenues from the sale of oil and gas taken in-
kind to pay for personnel, travel, or other ad-
ministrative costs of the Federal Government. 
(B) EXCEPTION.—Notwithstanding sub-
paragraph (A), the Secretary may use a portion 
of the revenues from the sale of oil taken in-
kind, without fiscal year limitation, to pay sala-
851
ries and other administrative costs directly re-
lated to the royalty-in-kind program. 
(c) REIMBURSEMENT OF COST.—If the lessee, pursu-
ant to an agreement with the United States or as provided 
in the lease, processes the royalty gas or delivers the roy-
alty oil or gas at a point not on or adjacent to the lease 
area, the Secretary shall—
(1) reimburse the lessee for the reasonable costs 
of transportation (not including gathering) from the 
lease to the point of delivery or for processing costs; 
or 
(2) allow the lessee to deduct the transportation 
or processing costs in reporting and paying royalties 
in-value for other Federal oil and gas leases. 
(d) BENEFIT TO THE UNITED STATES REQUIRED.—
The Secretary may receive oil or gas royalties in-kind only 
if the Secretary determines that receiving royalties in-kind 
provides benefits to the United States that are greater 
than or equal to the benefits that are likely to have been 
received had royalties been taken in-value. 
(e) REPORTS.—
(1) IN GENERAL.—Not later than September 
30, 2005, the Secretary shall submit to Congress a 
report that addresses—
852
(A) actions taken to develop businesses 
processes and automated systems to fully sup-
port the royalty-in-kind capability to be used in 
tandem with the royalty-in-value approach in 
managing Federal oil and gas revenue; and 
(B) future royalty-in-kind businesses oper-
ation plans and objectives. 
(2) REPORTS ON OIL OR GAS ROYALTIES TAKEN 
IN-KIND.—For each of fiscal years 2005 through 
2014 in which the United States takes oil or gas 
royalties in-kind from production in any State or 
from the outer Continental Shelf, excluding royalties 
taken in-kind and sold to refineries under subsection 
(h), the Secretary shall submit to Congress a report 
that describes—
(A) the methodology or methodologies used 
by the Secretary to determine compliance with 
subsection (d), including the performance 
standard for comparing amounts received by 
the United States derived from royalties in-kind 
to amounts likely to have been received had roy-
alties been taken in-value; 
(B) an explanation of the evaluation that 
led the Secretary to take royalties in-kind from
853
a lease or group of leases, including the ex-
pected revenue effect of taking royalties in-kind; 
(C) actual amounts received by the United 
States derived from taking royalties in-kind and 
costs and savings incurred by the United States 
associated with taking royalties in-kind, includ-
ing, but not limited to, administrative savings 
and any new or increased administrative costs; 
and 
(D) an evaluation of other relevant public 
benefits or detriments associated with taking 
royalties in-kind. 
(f) DEDUCTION OF EXPENSES.—
(1) IN
GENERAL.—Before making payments 
under section 35 of the Mineral Leasing Act (30 
U.S.C. 191) or section 8(g) of the Outer Continental 
Shelf Lands Act (43 U.S.C. 1337(g)) of revenues 
derived from the sale of royalty production taken in-
kind from a lease, the Secretary shall deduct 
amounts paid or deducted under subsections (b)(4) 
and (c) and deposit the amount of the deductions in 
the miscellaneous receipts of the United States 
Treasury. 
(2) ACCOUNTING FOR DEDUCTIONS.—When the 
Secretary allows the lessee to deduct transportation
854
or processing costs under subsection (c), the Sec-
retary may not reduce any payments to recipients of 
revenues derived from any other Federal oil and gas 
lease as a consequence of that deduction. 
(g) 
CONSULTATION
WITH
STATES.—The 
Sec-
retary—
(1) shall consult with a State before conducting 
a royalty in-kind program under this subtitle within 
the State, and may delegate management of any 
portion of the Federal royalty in-kind program to 
the State except as otherwise prohibited by Federal 
law; and 
(2) shall consult annually with any State from 
which Federal oil or gas royalty is being taken in-
kind to ensure, to the maximum extent practicable, 
that the royalty in-kind program provides revenues 
to the State greater than or equal to those likely to 
have been received had royalties been taken in-value. 
(h) SMALL REFINERIES.—
(1) PREFERENCE.—If the Secretary finds that 
sufficient supplies of crude oil are not available in 
the open market to refineries that do not have their 
own source of supply for crude oil, the Secretary 
may grant preference to such refineries in the sale 
of any royalty oil accruing or reserved to the United
855
States under Federal oil and gas leases issued under 
any mineral leasing law, for processing or use in 
such refineries at private sale at not less than the 
market price. 
(2) PRORATION
AMONG
REFINERIES
IN
PRO-
DUCTION AREA.—In disposing of oil under this sub-
section, the Secretary of Energy may, at the discre-
tion of the Secretary, prorate the oil among refin-
eries described in paragraph (1) in the area in which 
the oil is produced. 
(i) DISPOSITION TO FEDERAL AGENCIES.—
(1) ONSHORE ROYALTY.—Any royalty oil or gas 
taken by the Secretary in-kind from onshore oil and 
gas leases may be sold at not less than the market 
price to any Federal agency. 
(2) OFFSHORE ROYALTY.—Any royalty oil or 
gas taken in-kind from a Federal oil or gas lease on 
the outer Continental Shelf may be disposed of only 
under section 27 of the Outer Continental Shelf 
Lands Act (43 U.S.C. 1353). 
(j) FEDERAL LOW-INCOME ENERGY ASSISTANCE 
PROGRAMS.—
(1) PREFERENCE.—In disposing of royalty oil 
or gas taken in-kind under this section, the Sec-
retary may grant a preference to any person, includ-
856
ing any Federal or State agency, for the purpose of 
providing additional resources to any Federal low-in-
come energy assistance program. 
(2) REPORT.—Not later than 3 years after the 
date of enactment of this Act, the Secretary shall 
transmit a report to Congress, assessing the effec-
tiveness of granting preferences specified in para-
graph (1) and providing a specific recommendation 
on the continuation of authority to grant pref-
erences. 
SEC. 2003. MARGINAL PROPERTY PRODUCTION INCEN-
TIVES. 
(a) DEFINITION OF MARGINAL PROPERTY.—Until 
such time as the Secretary issues regulations under sub-
section (e) that prescribe a different definition, in this sec-
tion the term ‘‘marginal property’’ means an onshore unit, 
communitization agreement, or lease not within a unit or 
communitization agreement, that produces on average the 
combined equivalent of less than 15 barrels of oil per well 
per day or 90 million British thermal units of gas per well 
per day calculated based on the average over the 3 most 
recent production months, including only wells that 
produce on more than half of the days during those 3 pro-
duction months.
857
(b) CONDITIONS
FOR
REDUCTION
OF
ROYALTY 
RATE.—Until such time as the Secretary issues regula-
tions under subsection (e) that prescribe different thresh-
olds or standards, the Secretary shall reduce the royalty 
rate on—
(1) oil production from marginal properties as 
prescribed in subsection (c) when the spot price of 
West Texas Intermediate crude oil at Cushing, Okla-
homa, is, on average, less than $15 per barrel for 90 
consecutive trading days; and 
(2) gas production from marginal properties as 
prescribed in subsection (c) when the spot price of 
natural gas delivered at Henry Hub, Louisiana, is, 
on average, less than $2.00 per million British ther-
mal units for 90 consecutive trading days. 
(c) REDUCED ROYALTY RATE.—
(1) IN GENERAL.—When a marginal property 
meets the conditions specified in subsection (b), the 
royalty rate shall be the lesser of—
(A) 5 percent; or 
(B) the applicable rate under any other 
statutory or regulatory royalty relief provision 
that applies to the affected production. 
(2) PERIOD OF EFFECTIVENESS.—The reduced 
royalty rate under this subsection shall be effective
858
beginning on the first day of the production month 
following the date on which the applicable condition 
specified in subsection (b) is met. 
(d) TERMINATION OF REDUCED ROYALTY RATE.—
A royalty rate prescribed in subsection (d)(1)(A) shall ter-
minate—
(1) with respect to oil production from a mar-
ginal property, on the first day of the production 
month following the date on which—
(A) the spot price of West Texas Inter-
mediate crude oil at Cushing, Oklahoma, on av-
erage, exceeds $15 per barrel for 90 consecutive 
trading days; or 
(B) the property no longer qualifies as a 
marginal property; and 
(2) with respect to gas production from a mar-
ginal property, on the first day of the production 
month following the date on which—
(A) the spot price of natural gas delivered 
at Henry Hub, Louisiana, on average, exceeds 
$2.00 per million British thermal units for 90 
consecutive trading days; or 
(B) the property no longer qualifies as a 
marginal property.
859
(e) REGULATIONS PRESCRIBING DIFFERENT RE-
LIEF.—
(1) DISCRETIONARY REGULATIONS.—The Sec-
retary may by regulation prescribe different param-
eters, standards, and requirements for, and a dif-
ferent degree or extent of, royalty relief for marginal 
properties in lieu of those prescribed in subsections 
(a) through (d). 
(2) MANDATORY
REGULATIONS.—Not later 
than 18 months after the date of enactment of this 
Act, the Secretary shall by regulation—
(A) prescribe standards and requirements 
for, and the extent of royalty relief for, mar-
ginal properties for oil and gas leases on the 
outer Continental Shelf; and 
(B) define what constitutes a marginal 
property on the outer Continental Shelf for pur-
poses of this section. 
(3) CONSIDERATIONS.—In promulgating regu-
lations under this subsection, the Secretary may con-
sider—
(A) oil and gas prices and market trends; 
(B) production costs; 
(C) abandonment costs;
860
(D) Federal and State tax provisions and 
the effects of those provisions on production ec-
onomics; 
(E) other royalty relief programs; 
(F) regional differences in average well-
head prices; 
(G) national energy security issues; and 
(H) other relevant matters. 
(f) SAVINGS PROVISION.—Nothing in this section 
prevents a lessee from receiving royalty relief or a royalty 
reduction pursuant to any other law (including a regula-
tion) that provides more relief than the amounts provided 
by this section. 
SEC. 2004. INCENTIVES FOR NATURAL GAS PRODUCTION 
FROM DEEP WELLS IN THE SHALLOW WA-
TERS OF THE GULF OF MEXICO. 
(a) ROYALTY INCENTIVE REGULATIONS FOR ULTRA 
DEEP GAS WELLS.—
(1) IN
GENERAL.—Not later than 180 days 
after the date of enactment of this Act, in addition 
to any other regulations that may provide royalty in-
centives for natural gas produced from deep wells on 
oil and gas leases issued pursuant to the Outer Con-
tinental Shelf Lands Act (43 U.S.C. 1331 et seq.), 
the Secretary shall issue regulations granting royalty
861
relief 
suspension 
volumes 
of 
not 
less 
than 
35,000,000,000 cubic feet with respect to the pro-
duction of natural gas from ultra deep wells on 
leases issued in shallow waters less than 400 meters 
deep located in the Gulf of Mexico wholly west of 87 
degrees, 30 minutes west longitude. Regulations 
issued under this subsection shall be retroactive to 
the date that the notice of proposed rulemaking is 
published in the Federal Register. 
(2) DEFINITION
OF
ULTRA
DEEP
WELL.—In 
this subsection, 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. 
(b) ROYALTY INCENTIVE REGULATIONS FOR DEEP 
GAS WELLS.—Not later than 180 days after the date of 
enactment of this Act, in addition to any other regulations 
that may provide royalty incentives for natural gas pro-
duced from deep wells on oil and gas leases issued pursu-
ant to the Outer Continental Shelf Lands Act (43 U.S.C. 
1331 et seq.), the Secretary shall issue regulations grant-
ing royalty relief suspension volumes with respect to the 
production of natural gas from deep wells on leases issued 
in waters more than 200 meters but less than 400 meters 
deep located in the Gulf of Mexico wholly west of 87 de-
862
grees, 30 minutes west longitude. The suspension volumes 
for deep wells within 200 to 400 meters of water depth 
shall be calculated using the same methodology used to 
calculate the suspension volumes for deep wells in the 
shallower waters of the Gulf of Mexico, and in no case 
shall the suspension volumes for deep wells within 200 to 
400 meters of water depth be lower than those for deep 
wells in shallower waters. Regulations issued under this 
subsection shall be retroactive to the date that the notice 
of proposed rulemaking is published in the Federal Reg-
ister. 
(c) LIMITATION.—The Secretary may place limita-
tions on the suspension of royalty relief granted based on 
market price. 
SEC. 2005. ROYALTY RELIEF FOR DEEP WATER PRODUC-
TION. 
(a) IN GENERAL.—For all tracts located in water 
depths of greater than 400 meters in the Western and 
Central Planning Area of the Gulf of Mexico, including 
the portion of the Eastern Planning Area of the Gulf of 
Mexico encompassing whole lease blocks lying west of 87 
degrees, 30 minutes West longitude, any oil or gas lease 
sale under the Outer Continental Shelf Lands Act (43 
U.S.C. 1331 et seq.) occurring within 5 years after the 
date of enactment of this Act shall use the bidding system
863
authorized in section 8(a)(1)(H) of the Outer Continental 
Shelf Lands Act (43 U.S.C. 1337(a)(1)(H)), except that 
the suspension of royalties shall be set at a volume of not 
less than—
(1) 5,000,000 barrels of oil equivalent for each 
lease in water depths of 400 to 800 meters; 
(2) 9,000,000 barrels of oil equivalent for each 
lease in water depths of 800 to 1,600 meters; 
(3) 12,000,000 barrels of oil equivalent for each 
lease in water depths of 1,600 to 2,000 meters; and 
(4) 16,000,000 barrels of oil equivalent for each 
lease in water depths greater than 2,000 meters. 
(b) LIMITATION.—The Secretary may place limita-
tions on the suspension of royalty relief granted based on 
market price. 
SEC. 2006. ALASKA OFFSHORE ROYALTY SUSPENSION. 
Section 8(a)(3)(B) of the Outer Continental Shelf 
Lands Act (43 U.S.C. 1337(a)(3)(B)) is amended by in-
serting ‘‘and in the Planning Areas offshore Alaska’’ after 
‘‘West longitude’’. 
SEC. 2007. OIL AND GAS LEASING IN THE NATIONAL PETRO-
LEUM RESERVE IN ALASKA. 
(a) TRANSFER OF AUTHORITY.—
(1) REDESIGNATION.—The Naval Petroleum 
Reserves Production Act of 1976 (42 U.S.C. 6501
864
et seq.) is amended by redesignating section 107 (42 
U.S.C. 6507) as section 108. 
(2) TRANSFER.—The matter under the heading 
‘‘EXPLORATION OF NATIONAL PETROLEUM RESERVE 
IN
ALASKA’’ under the heading ‘‘ENERGY AND 
MINERALS’’ of title I of Public Law 96–514 (42 
U.S.C. 6508) is—
(A) transferred to the Naval Petroleum 
Reserves Production Act of 1976 (42 U.S.C. 
6501 et seq.); 
(B) designated as section 107 of that Act; 
and 
(C) moved so as to appear after section 
106 of that Act (42 U.S.C. 6506). 
(b) COMPETITIVE LEASING.—Section 107 of the 
Naval Petroleum Reserves Production Act of 1976 (as 
amended by subsection (a) of this section) is amended—
(1) by striking the heading and all that follows 
through ‘‘Provided, That (1) activities’’ and insert-
ing the following: 
‘‘SEC. 107. COMPETITIVE LEASING OF OIL AND GAS. 
‘‘(a) IN GENERAL.—Notwithstanding any other pro-
vision of law and pursuant to regulations issued by the 
Secretary, the Secretary shall conduct an expeditious pro-
gram of competitive leasing of oil and gas in the National
865
Petroleum Reserve in Alaska (referred to in this section 
as the ‘Reserve’). 
‘‘(b) MITIGATION OF ADVERSE EFFECTS.—Activi-
ties’’; 
(2) by striking ‘‘Alaska (the Reserve); (2) the’’ 
and inserting 
‘‘Alaska. 
‘‘(c) LAND USE PLANNING; BLM WILDERNESS 
STUDY.—The’’; 
(3) by striking ‘‘Reserve; (3) the’’ and inserting 
‘‘Reserve. 
‘‘(d) FIRST LEASE SALE.—The’’; 
(4) by striking ‘‘4332); (4) the’’ and inserting 
‘‘4321 et seq.). 
‘‘(e) WITHDRAWALS.—The’’; 
(5) by striking ‘‘herein; (5) bidding’’ and insert-
ing 
‘‘under this section. 
‘‘(f) BIDDING SYSTEMS.—Bidding’’; 
(6) by striking ‘‘629); (6) lease’’ and inserting 
‘‘629). 
‘‘(g) GEOLOGICAL STRUCTURES.—Lease’’; 
(7) by striking ‘‘structures; (7) the’’ and insert-
ing 
‘‘structures.
866
‘‘(h) SIZE OF LEASE TRACTS.—The’’; 
(8) by striking ‘‘Secretary; (8)’’ and all that fol-
lows through ‘‘Drilling, production,’’ and inserting 
‘‘Secretary. 
‘‘(i) TERMS.—
‘‘(1) IN GENERAL.—Each lease shall be—
‘‘(A) issued for an initial period of not 
more than 10 years; and 
‘‘(B) renewed for successive 10-year terms 
if—
‘‘(i) oil or gas is produced from the 
lease in paying quantities; 
‘‘(ii) oil or gas is capable of being pro-
duced in paying quantities; or 
‘‘(iii) drilling or reworking operations, 
as approved by the Secretary, are con-
ducted on the leased land. 
‘‘(2) RENEWAL OF NONPRODUCING LEASES.—
The Secretary shall renew for an additional 10-year 
term a lease that does not meet the requirements of 
paragraph (1)(B) if the lessee submits to the Sec-
retary an application for renewal not later than 60 
days before the expiration of the primary lease 
and—
867
‘‘(A) the lessee certifies, and the Secretary 
agrees, that hydrocarbon resources were discov-
ered on 1 or more wells drilled on the leased 
land in such quantities that a prudent operator 
would hold the lease for potential future devel-
opment; 
‘‘(B) the lessee—
‘‘(i) pays the Secretary a renewal fee 
of $100 per acre of leased land; and 
‘‘(ii) provides evidence, and the Sec-
retary agrees that, the lessee has diligently 
pursued exploration that warrants continu-
ation with the intent of continued explo-
ration or future development of the leased 
land; or 
‘‘(C) all or part of the lease—
‘‘(i) is part of a unit agreement cov-
ering a lease described in subparagraph 
(A) or (B); and 
‘‘(ii) has not been previously con-
tracted out of the unit. 
‘‘(3) APPLICABILITY.—This subsection applies 
to a lease that—
868
‘‘(A) is entered into before, on, or after the 
date of enactment of the Energy Policy Act of 
2005; and 
‘‘(B) is effective on or after the date of en-
actment of that Act. 
‘‘(j) UNIT AGREEMENTS.—
‘‘(1) IN GENERAL.—For the purpose of con-
servation of the natural resources of all or part of 
any oil or gas pool, field, reservoir, or like area, les-
sees (including representatives) of the pool, field, 
reservoir, or like area may unite with each other, or 
jointly or separately with others, in collectively 
adopting and operating under a unit agreement for 
all or part of the pool, field, reservoir, or like area 
(whether or not any other part of the oil or gas pool, 
field, reservoir, or like area is already subject to any 
cooperative or unit plan of development or oper-
ation), if the Secretary determines the action to be 
necessary or advisable in the public interest. 
‘‘(2) PARTICIPATION BY STATE OF ALASKA.—
The Secretary shall ensure that the State of Alaska 
is provided the opportunity for active participation 
concerning creation and management of units 
formed or expanded under this subsection that in-
869
clude acreage in which the State of Alaska has an 
interest in the mineral estate. 
‘‘(3) PARTICIPATION
BY
REGIONAL
CORPORA-
TIONS.—The Secretary shall ensure that any Re-
gional Corporation (as defined in section 3 of the 
Alaska Native Claims Settlement Act (43 U.S.C. 
1602)) is provided the opportunity for active partici-
pation concerning creation and management of units 
that include acreage in which the Regional Corpora-
tion has an interest in the mineral estate. 
‘‘(4) 
PRODUCTION
ALLOCATION
METHOD-
OLOGY.—The Secretary may use a production alloca-
tion methodology for each participating area within 
a unit created for land in the Reserve, State of Alas-
ka land, or Regional Corporation land shall, when 
appropriate, be based on the characteristics of each 
specific oil or gas pool, field, reservoir, or like area 
to take into account reservoir heterogeneity and a 
real variation in reservoir producibility across diverse 
leasehold interests. 
‘‘(5) BENEFIT OF OPERATIONS.—Drilling, pro-
duction,’’; 
(9) by striking ‘‘When separate’’ and inserting 
the following: 
‘‘(6) POOLING.—If separate’’;
870
(10) by inserting ‘‘(in consultation with the 
owners of the other land)’’ after ‘‘determined by the 
Secretary of the Interior’’; 
(11) by striking ‘‘thereto; (10) to’’ and all that 
follows through ‘‘the terms provided therein.’’ and 
inserting 
‘‘to the agreement. 
‘‘(k) EXPLORATION INCENTIVES.—
‘‘(1) IN GENERAL.—
‘‘(A) WAIVER, SUSPENSION, OR
REDUC-
TION.—To encourage the greatest ultimate re-
covery of oil or gas or in the interest of con-
servation, the Secretary may waive, suspend, or 
reduce the rental fees or minimum royalty, or 
reduce the royalty on an entire leasehold (in-
cluding on any lease operated pursuant to a 
unit agreement), if (after consultation with the 
State of Alaska and the North Slope Borough 
of Alaska and the concurrence of any Regional 
Corporation for leases that include lands avail-
able for acquisition by the Regional Corporation 
under the provisions of section 1431(o) of the 
Alaska National Interest Lands Conservation 
Act (16 U.S.C. 3101 et seq.)) the Secretary de-
871
termines that the waiver, suspension, or reduc-
tion is in the public interest. 
‘‘(B) APPLICABILITY.—This paragraph ap-
plies to a lease that—
‘‘(i) is entered into before, on, or after 
the date of enactment of the Energy Policy 
Act of 2005; and 
‘‘(ii) is effective on or after the date 
of enactment of that Act.’’; 
(12) by striking ‘‘The Secretary is authorized 
to’’ and inserting the following: 
‘‘(2) SUSPENSION OF OPERATIONS AND PRO-
DUCTION.—The Secretary may’’; 
(13) by striking ‘‘In the event’’ and inserting 
the following: 
‘‘(3) SUSPENSION OF PAYMENTS.—If’’; 
(14) by striking ‘‘thereto; and (11) all’’ and in-
serting 
‘‘to the lease. 
‘‘(l) RECEIPTS.—All’’; 
(15) by redesignating clauses (A), (B), and (C) 
as clauses (1), (2), and (3), respectively; 
(16) by striking ‘‘Any agency’’ and inserting 
the following: 
‘‘(m) EXPLORATIONS.—Any agency’’;
872
(17) by striking ‘‘Any action’’ and inserting the 
following: 
‘‘(n) ENVIRONMENTAL IMPACT STATEMENTS.—
‘‘(1) JUDICIAL REVIEW.—Any action’’; 
(18) by striking ‘‘The detailed’’ and inserting 
the following: 
‘‘(2) INITIAL LEASE SALES.—The detailed’’; 
(19) by striking ‘‘of the Naval Petroleum Re-
serves Production Act of 1976 (90 Stat. 304; 42 
U.S.C. 6504)’’; and 
(20) by adding at the end the following: 
‘‘(o) WAIVER OF ADMINISTRATION FOR CONVEYED 
LANDS.—Notwithstanding section 14(g) of the Alaska 
Native Claims Settlement Act (43 U.S.C. 1613(g)) or any 
other provision of law—
‘‘(1) the Secretary of the Interior shall waive 
administration of any oil and gas lease insofar as 
such lease covers any land in the National Petro-
leum Reserve in Alaska in which the subsurface es-
tate is conveyed to the Arctic Slope Regional Cor-
poration; and 
‘‘(2) if any such conveyance of such subsurface 
estate does not cover all the land embraced within 
any such oil and gas lease—
873
‘‘(A) the person who owns the subsurface 
estate in any particular portion of the land cov-
ered by such lease shall be entitled to all of the 
revenues reserved under such lease as to such 
portion, including, without limitation, all the 
royalty payable with respect to oil or gas pro-
duced from or allocated to such particular por-
tion of the land covered by such lease; and 
‘‘(B) the Secretary of the Interior shall 
segregate such lease into 2 leases, 1 of which 
shall cover only the subsurface estate conveyed 
to the Arctic Slope Regional Corporation, and 
operations, production, or other circumstances 
(other than payment of rentals or royalties) 
that satisfy obligations of the lessee under, or 
maintain, either of the segregated leases shall 
likewise satisfy obligations of the lessee under, 
or maintain, the other segregated lease to the 
same extent as if such segregated leases re-
mained a part of the original unsegregated 
lease.’’. 
SEC. 2008. ORPHANED, ABANDONED, OR IDLED WELLS ON 
FEDERAL LAND. 
(a) IN GENERAL.—The Secretary, in cooperation 
with the Secretary of Agriculture, shall establish a pro-
874
gram not later than 1 year after the date of enactment 
of this Act to remediate, reclaim, and close orphaned, 
abandoned, or idled oil and gas wells located on land ad-
ministered by the land management agencies within the 
Department of the Interior and the Department of Agri-
culture. 
(b) ACTIVITIES.—The program under subsection (a) 
shall—
(1) include a means of ranking orphaned, aban-
doned, or idled wells sites for priority in remedi-
ation, reclamation, and closure, based on public 
health and safety, potential environmental harm, 
and other land use priorities; 
(2) provide for identification and recovery of 
the costs of remediation, reclamation, and closure 
from persons or other entities currently providing a 
bond or other financial assurance required under 
State or Federal law for an oil or gas well that is 
orphaned, abandoned, or idled; and 
(3) provide for recovery from the persons or en-
tities identified under paragraph (2), or their sure-
ties or guarantors, of the costs of remediation, rec-
lamation, and closure of such wells.
875
(c) COOPERATION
AND CONSULTATIONS.—In car-
rying out the program under subsection (a), the Secretary 
shall—
(1) work cooperatively with the Secretary of Ag-
riculture and the States within which Federal land 
is located; and 
(2) consult with the Secretary of Energy and 
the Interstate Oil and Gas Compact Commission. 
(d) PLAN.—Not later than 1 year after the date of 
enactment of this Act, the Secretary, in cooperation with 
the Secretary of Agriculture, shall submit to Congress a 
plan for carrying out the program under subsection (a). 
(e) IDLED WELL.—For the purposes of this section, 
a well is idled if—
(1) the well has been nonoperational for at least 
7 years; and 
(2) there is no anticipated beneficial use for the 
well. 
(f) TECHNICAL ASSISTANCE PROGRAM
FOR NON-
FEDERAL LAND.—
(1) IN
GENERAL.—The Secretary of Energy 
shall establish a program to provide technical and fi-
nancial assistance to oil and gas producing States to 
facilitate State efforts over a 10-year period to en-
sure a practical and economical remedy for environ-
876
mental problems caused by orphaned or abandoned 
oil and gas exploration or production well sites on 
State or private land. 
(2) ASSISTANCE.—The Secretary of Energy 
shall work with the States, through the Interstate 
Oil and Gas Compact Commission, to assist the 
States in quantifying and mitigating environmental 
risks of onshore orphaned or abandoned oil or gas 
wells on State and private land. 
(3) ACTIVITIES.—The program under para-
graph (1) shall include—
(A) mechanisms to facilitate identification, 
if feasible, of the persons currently providing a 
bond or other form of financial assurance re-
quired under State or Federal law for an oil or 
gas well that is orphaned or abandoned; 
(B) criteria for ranking orphaned or aban-
doned well sites based on factors such as public 
health and safety, potential environmental 
harm, and other land use priorities; 
(C) information and training programs on 
best practices for remediation of different types 
of sites; and 
(D) funding of State mitigation efforts on 
a cost-shared basis.
877
(g) FEDERAL REIMBURSEMENT
FOR ORPHANED 
WELL RECLAMATION PILOT PROGRAM.—
(1) REIMBURSEMENT FOR REMEDIATING, RE-
CLAIMING, AND CLOSING WELLS ON LAND SUBJECT 
TO A NEW LEASE.—The Secretary shall carry out a 
pilot program under which, in issuing a new oil and 
gas lease on federally owned land on which 1 or 
more orphaned wells are located, the Secretary—
(A) may require, but not as a condition of 
the lease, that the lessee remediate, reclaim, 
and close in accordance with standards estab-
lished by the Secretary, all orphaned wells on 
the land leased; and 
(B) shall develop a program to reimburse 
a lessee, through a royalty credit against the 
Federal share of royalties owed or other means, 
for the reasonable actual costs of remediating, 
reclaiming, and closing the orphaned well pur-
suant to that requirement. 
(2) REIMBURSEMENT
FOR
RECLAIMING
OR-
PHANED WELLS ON OTHER LAND.—In carrying out 
this subsection, the Secretary—
(A) may authorize any lessee under an oil 
and gas lease on federally owned land to re-
878
claim in accordance with the Secretary’s stand-
ards—
(i) an orphaned well on unleased fed-
erally owned land; or 
(ii) an orphaned well located on an ex-
isting lease on federally owned land for the 
reclamation of which the lessee is not le-
gally responsible; and 
(B) shall develop a program to provide re-
imbursement of 115 percent of the reasonable 
actual costs of remediating, reclaiming, and 
closing the orphaned well, through credits 
against the Federal share of royalties or other 
means. 
(3) EFFECT OF REMEDIATION, RECLAMATION, 
OR CLOSURE OF WELL PURSUANT TO AN APPROVED 
REMEDIATION PLAN.—
(A) 
DEFINITION
OF
REMEDIATING 
PARTY.—In this paragraph the term ‘‘remedi-
ating party’’ means a person who remediates, 
reclaims, or closes an abandoned, orphaned, or 
idled well pursuant to this subsection. 
(B) GENERAL RULE.—A remediating party 
who remediates, reclaims, or closes an aban-
doned, orphaned, or idled well in accordance
879
with a detailed written remediation plan ap-
proved by the Secretary under this subsection, 
shall be immune from civil liability under Fed-
eral environmental laws, for—
(i) pre-existing environmental condi-
tions at or associated with the well, unless 
the remediating party owns or operates, in 
the past owned or operated, or is related to 
a person that owns or operates or in the 
past owned or operated, the well or the 
land on which the well is located; or 
(ii) any remaining releases of pollut-
ants from the well during or after comple-
tion of the remediation, reclamation, or 
closure of the well, unless the remediating 
party causes increased pollution as a result 
of activities that are not in accordance 
with the approved remediation plan. 
(C) LIMITATIONS.—Nothing in this section 
shall limit in any way the liability of a remedi-
ating party for injury, damage, or pollution re-
sulting from the remediating party’s acts or 
omissions that are not in accordance with the 
approved remediation plan, are reckless or will-
880
ful, constitute gross negligence or wanton mis-
conduct, or are unlawful. 
(4) REGULATIONS.—The Secretary may issue 
such regulations as are appropriate to carry out this 
subsection. 
(h) AUTHORIZATION OF APPROPRIATIONS.—
(1) IN GENERAL.—There are authorized to be 
appropriated to carry out this section $25,000,000 
for each of fiscal years 2006 through 2010. 
(2) USE.—Of the amounts authorized under 
paragraph (1), $5,000,000 are authorized for each 
fiscal year for activities under subsection (f). 
SEC. 2009. COMBINED HYDROCARBON LEASING. 
(a) SPECIAL PROVISIONS REGARDING LEASING.—
Section 17(b)(2) of the Mineral Leasing Act (30 U.S.C. 
226(b)(2)) is amended—
(1) by inserting ‘‘(A)’’ after ‘‘(2)’’; and 
(2) by adding at the end the following: 
‘‘(B) For any area that contains any combination of 
tar sand and oil or gas (or both), the Secretary may issue 
under this Act, separately—
‘‘(i) a lease for exploration for and extraction of 
tar sand; and 
‘‘(ii) a lease for exploration for and development 
of oil and gas.
881
‘‘(C) A lease issued for tar sand shall be issued using 
the same bidding process, annual rental, and posting pe-
riod as a lease issued for oil and gas, except that the min-
imum acceptable bid required for a lease issued for tar 
sand shall be $2 per acre. 
‘‘(D) The Secretary may waive, suspend, or alter any 
requirement under section 26 that a permittee under a 
permit authorizing prospecting for tar sand must exercise 
due diligence, to promote any resource covered by a com-
bined hydrocarbon lease.’’. 
(b) 
CONFORMING
AMENDMENT.—Section 
17(b)(1)(B) of the Mineral Leasing Act (30 U.S.C. 
226(b)(1)(B)) is amended in the second sentence by in-
serting ‘‘, subject to paragraph (2)(B),’’ after ‘‘Sec-
retary’’. 
(c) REGULATIONS.—Not later than 45 days after the 
date of enactment of this Act, the Secretary shall issue 
final regulations to implement this section. 
SEC. 2010. ALTERNATE ENERGY-RELATED USES ON THE 
OUTER CONTINENTAL SHELF. 
(a) AMENDMENT TO OUTER CONTINENTAL SHELF 
LANDS ACT.—Section 8 of the Outer Continental Shelf 
Lands Act (43 U.S.C. 1337) is amended by adding at the 
end the following:
882
‘‘(p) LEASES, EASEMENTS, OR RIGHTS-OF-WAY FOR 
ENERGY AND RELATED PURPOSES.—
‘‘(1) IN GENERAL.—The Secretary, in consulta-
tion with the Secretary of the Department in which 
the Coast Guard is operating and other relevant de-
partments and agencies of the Federal Government, 
may grant a lease, easement, or right-of-way on the 
outer Continental Shelf for activities not otherwise 
authorized in this Act, the Deepwater Port Act of 
1974 (33 U.S.C. 1501 et seq.), the Ocean Thermal 
Energy Conversion Act of 1980 (42 U.S.C. 9101 et 
seq.), or other applicable law, if those activities—
‘‘(A) support exploration, development, 
production, transportation, or storage of oil, 
natural gas, or other minerals; 
‘‘(B) produce or support production, trans-
portation, or transmission of energy from 
sources other than oil and gas; or 
‘‘(C) use, for energy-related or marine-re-
lated purposes, facilities currently or previously 
used for activities authorized under this Act. 
‘‘(2) PAYMENTS.—The Secretary shall establish 
reasonable forms of payments for any easement or 
right-of-way granted under this subsection. Such 
payments shall not be assessed on the basis of
883
throughput or production. The Secretary may estab-
lish fees, rentals, bonus, or other payments by rule 
or by agreement with the party to which the lease, 
easement, or right-of-way is granted. If a lease, 
easement, right-of-way, license, or permit under this 
subsection covers a specific tract of, or regards a fa-
cility located on, the outer Continental Shelf and is 
not an easement or right-of-way for transmission or 
transportation of energy, minerals, or other natural 
resources, the Secretary shall pay 50 percent of any 
amount received from the holder of the lease, ease-
ment, right-of-way, license, or permit to the State 
off the shore of which the geographic center of the 
area covered by the lease, easement, right-of-way, li-
cense, permit, or facility is located, in accordance 
with Federal law determining the seaward lateral 
boundaries of the coastal States. 
‘‘(3) CONSULTATION.—Before exercising au-
thority under this subsection, the Secretary shall 
consult with the Secretary of Defense and other ap-
propriate agencies concerning issues related to na-
tional security and navigational obstruction. 
‘‘(4) 
COMPETITIVE
OR
NONCOMPETITIVE 
BASIS.—
884
‘‘(A) IN
GENERAL.—The Secretary may 
issue a lease, easement, or right-of-way for en-
ergy and related purposes as described in para-
graph (1) on a competitive or noncompetitive 
basis. 
‘‘(B) CONSIDERATIONS.—In determining 
whether a lease, easement, or right-of-way shall 
be granted competitively or noncompetitively, 
the Secretary shall consider such factors as—
‘‘(i) prevention of waste and conserva-
tion of natural resources; 
‘‘(ii) the economic viability of an en-
ergy project; 
‘‘(iii) protection of the environment; 
‘‘(iv) the national interest and na-
tional security; 
‘‘(v) human safety; 
‘‘(vi) protection of correlative rights; 
and 
‘‘(vii) potential return for the lease, 
easement, or right-of-way. 
‘‘(5) REGULATIONS.—Not later than 270 days 
after the date of enactment of the Energy Policy Act 
of 2005, the Secretary, in consultation with the Sec-
retary of the Department in which the Coast Guard
885
is operating and other relevant agencies of the Fed-
eral Government and affected States, shall issue any 
necessary regulations to ensure safety, protection of 
the environment, prevention of waste, and conserva-
tion of the natural resources of the outer Conti-
nental Shelf, protection of national security inter-
ests, and protection of correlative rights in the outer 
Continental Shelf. 
‘‘(6) SECURITY.—The Secretary shall require 
the holder of a lease, easement, or right-of-way 
granted under this subsection to furnish a surety 
bond or other form of security, as prescribed by the 
Secretary, and to comply with such other require-
ments as the Secretary considers necessary to pro-
tect the interests of the United States. 
‘‘(7) EFFECT OF SUBSECTION.—Nothing in this 
subsection displaces, supersedes, limits, or modifies 
the jurisdiction, responsibility, or authority of any 
Federal or State agency under any other Federal 
law. 
‘‘(8) APPLICABILITY.—This subsection does not 
apply to any area on the outer Continental Shelf 
designated as a National Marine Sanctuary.’’. 
(b) CONFORMING AMENDMENT.—Section 8 of the 
Outer Continental Shelf Lands Act (43 U.S.C. 1337) is
886
amended by striking the section heading and inserting the 
following: ‘‘LEASES, EASEMENTS, AND RIGHTS-OF-WAY 
ON THE OUTER CONTINENTAL SHELF.—’’. 
(c) SAVINGS PROVISION.—Nothing in the amendment 
made by subsection (a) requires, with respect to any 
project—
(1) for which offshore test facilities have been 
constructed before the date of enactment of this Act; 
or 
(2) for which a request for proposals has been 
issued by a public authority, 
any resubmittal of documents previously submitted or any 
reauthorization of actions previously authorized. 
SEC. 2011. PRESERVATION OF GEOLOGICAL AND GEO-
PHYSICAL DATA. 
(a) SHORT TITLE.—This section may be cited as the 
‘‘National Geological and Geophysical Data Preservation 
Program Act of 2005’’. 
(b) PROGRAM.—The Secretary shall carry out a Na-
tional Geological and Geophysical Data Preservation Pro-
gram in accordance with this section—
(1) to archive geologic, geophysical, and engi-
neering data, maps, well logs, and samples; 
(2) to provide a national catalog of such archi-
val material; and
887
(3) to provide technical and financial assistance 
related to the archival material. 
(c) PLAN.—Not later than 1 year after the date of 
enactment of this Act, the Secretary shall submit to Con-
gress a plan for the implementation of the Program. 
(d) DATA ARCHIVE SYSTEM.—
(1) ESTABLISHMENT.—The Secretary shall es-
tablish, as a component of the Program, a data ar-
chive system to provide for the storage, preservation, 
and archiving of subsurface, surface, geological, geo-
physical, and engineering data and samples. The 
Secretary, in consultation with the Advisory Com-
mittee, shall develop guidelines relating to the data 
archive system, including the types of data and sam-
ples to be preserved. 
(2) SYSTEM COMPONENTS.—The system shall 
be comprised of State agencies that elect to be part 
of the system and agencies within the Department 
of the Interior that maintain geological and geo-
physical data and samples that are designated by 
the Secretary in accordance with this subsection. 
The Program shall provide for the storage of data 
and samples through data repositories operated by 
such agencies.
888
(3) LIMITATION
OF
DESIGNATION.—The Sec-
retary may not designate a State agency as a com-
ponent of the data archive system unless that agency 
is the agency that acts as the geological survey in 
the State. 
(4) DATA FROM FEDERAL LAND.—The data ar-
chive system shall provide for the archiving of rel-
evant subsurface data and samples obtained from 
Federal land—
(A) in the most appropriate repository des-
ignated under paragraph (2), with preference 
being given to archiving data in the State in 
which the data were collected; and 
(B) consistent with all applicable law and 
requirements relating to confidentiality and pro-
prietary data. 
(e) NATIONAL CATALOG.—
(1) IN GENERAL.—As soon as practicable after 
the date of enactment of this Act, the Secretary 
shall develop and maintain, as a component of the 
Program, a national catalog that identifies—
(A) data and samples available in the data 
archive system established under subsection (d); 
(B) the repository for particular material 
in the system; and
889
(C) the means of accessing the material. 
(2) AVAILABILITY.—The Secretary shall make 
the national catalog accessible to the public on the 
site of the Survey on the Internet, consistent with all 
applicable requirements related to confidentiality 
and proprietary data. 
(f) ADVISORY COMMITTEE.—
(1) IN
GENERAL.—The Advisory Committee 
shall advise the Secretary on planning and imple-
mentation of the Program. 
(2) NEW
DUTIES.—In addition to its duties 
under the National Geologic Mapping Act of 1992 
(43 U.S.C. 31a et seq.), the Advisory Committee 
shall perform the following duties: 
(A) Advise the Secretary on developing 
guidelines and procedures for providing assist-
ance for facilities under subsection (g)(1). 
(B) Review and critique the draft imple-
mentation plan prepared by the Secretary under 
subsection (c). 
(C) Identify useful studies of data archived 
under the Program that will advance under-
standing of the Nation’s energy and mineral re-
sources, geologic hazards, and engineering geol-
ogy.
890
(D) Review the progress of the Program in 
archiving significant data and preventing the 
loss of such data, and the scientific progress of 
the studies funded under the Program. 
(E) Include in the annual report to the 
Secretary required under section 5(b)(3) of the 
National Geologic Mapping Act of 1992 (43 
U.S.C. 31d(b)(3)) an evaluation of the progress 
of the Program toward fulfilling the purposes of 
the Program under subsection (b). 
(g) FINANCIAL ASSISTANCE.—
(1) ARCHIVE FACILITIES.—Subject to the avail-
ability of appropriations, the Secretary shall provide 
financial assistance to a State agency that is des-
ignated under subsection (d)(2) for providing facili-
ties to archive energy material. 
(2) STUDIES.—Subject to the availability of ap-
propriations, the Secretary shall provide financial as-
sistance to any State agency designated under sub-
section (d)(2) for studies and technical assistance 
activities that enhance understanding, interpreta-
tion, and use of materials archived in the data ar-
chive system established under subsection (d). 
(3) FEDERAL SHARE.—The Federal share of 
the cost of an activity carried out with assistance
891
under this subsection shall be not more than 50 per-
cent of the total cost of the activity. 
(4) PRIVATE CONTRIBUTIONS.—The Secretary 
shall apply to the non-Federal share of the cost of 
an activity carried out with assistance under this 
subsection the value of private contributions of prop-
erty and services used for that activity. 
(h) REPORT.—The Secretary shall include in each re-
port under section 8 of the National Geologic Mapping Act 
of 1992 (43 U.S.C. 31g)—
(1) a description of the status of the Program; 
(2) an evaluation of the progress achieved in 
developing the Program during the period covered by 
the report; and 
(3) any recommendations for legislative or other 
action the Secretary considers necessary and appro-
priate to fulfill the purposes of the Program under 
subsection (b). 
(i) MAINTENANCE OF STATE EFFORT.—It is the in-
tent of Congress that the States not use this section as 
an opportunity to reduce State resources applied to the 
activities that are the subject of the Program. 
(j) DEFINITIONS.—In this section: 
(1) ADVISORY COMMITTEE.—The term ‘‘Advi-
sory Committee’’ means the advisory committee es-
892
tablished under section 5 of the National Geologic 
Mapping Act of 1992 (43 U.S.C. 31d). 
(2) PROGRAM.—The term ‘‘Program’’ means 
the National Geological and Geophysical Data Pres-
ervation Program carried out under this section. 
(3) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of the Interior, acting through the Di-
rector of the United States Geological Survey. 
(4) SURVEY.—The term ‘‘Survey’’ means the 
United States Geological Survey. 
(k) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to carry out this section 
$30,000,000 for each of fiscal years 2006 through 2010. 
SEC. 2012. OIL AND GAS LEASE ACREAGE LIMITATIONS. 
Section 27(d)(1) of the Mineral Leasing Act (30 
U.S.C. 184(d)(1)) is amended by inserting after ‘‘acreage 
held in special tar sand areas’’ the following: ‘‘, and acre-
age under any lease any portion of which has been com-
mitted to a federally approved unit or cooperative plan or 
communitization agreement or for which royalty (includ-
ing compensatory royalty or royalty in-kind) was paid in 
the preceding calendar year,’’.
893
SEC. 2013. DEADLINE FOR DECISION ON APPEALS OF CON-
SISTENCY 
DETERMINATION 
UNDER 
THE 
COASTAL ZONE MANAGEMENT ACT OF 1972. 
(a) IN GENERAL.—Section 319 of the Coastal Zone 
Management Act of 1972 (16 U.S.C. 1465) is amended 
to read as follows: 
‘‘APPEALS TO THE SECRETARY 
‘‘SEC. 319. (a) NOTICE.—The Secretary shall publish 
an initial notice in the Federal Register not later than 30 
days after the date of the filing of any appeal to the Sec-
retary of a consistency determination under section 307. 
‘‘(b) CLOSURE OF RECORD.—
‘‘(1) IN GENERAL.—Not later than the end of 
the 120-day period beginning on the date of publica-
tion of an initial notice under subsection (a), the 
Secretary shall receive no more filings on the appeal 
and the administrative record regarding the appeal 
shall be closed. 
‘‘(2) NOTICE.—Upon the closure of the admin-
istrative record, the Secretary shall immediately 
publish a notice that the administrative record has 
been closed. 
‘‘(c) DEADLINE FOR DECISION.—The Secretary shall 
issue a decision in any appeal filed under section 307 not 
later than 120 days after the closure of the administrative 
record.
894
‘‘(d) APPLICATION.—This section applies to appeals 
initiated by the Secretary and appeals filed by an appli-
cant.’’. 
(b) APPLICATION.—
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendment made by subsection (a) 
shall apply with respect to any appeal initiated or 
filed before, on, or after the date of enactment of 
this Act. 
(2) LIMITATION.—Subsection (a) of section 319 
of the Coastal Zone Management Act of 1972 (as 
amended by subsection (a)) shall not apply with re-
spect to an appeal initiated or filed before the date 
of enactment of this Act. 
(c) CLOSURE OF RECORD FOR APPEAL FILED BE-
FORE DATE OF ENACTMENT.—Notwithstanding section 
319(b)(1) of the Coastal Zone Management Act of 1972 
(as amended by this section), in the case of an appeal of 
a consistency determination under section 307 of that Act 
initiated or filed before the date of enactment of this Act, 
the Secretary of Commerce shall receive no more filings 
on the appeal and the administrative record regarding the 
appeal shall be closed not later than 120 days after the 
date of enactment of this Act.
895
SEC. 2014. REIMBURSEMENT FOR COSTS OF NEPA ANAL-
YSES, DOCUMENTATION, AND STUDIES. 
(a) IN GENERAL.—The Mineral Leasing Act is 
amended by inserting after section 37 (30 U.S.C. 193) 
the following: 
‘‘REIMBURSEMENT FOR COSTS OF CERTAIN ANALYSES, 
DOCUMENTATION, AND STUDIES 
‘‘SEC. 38. (a) IN GENERAL.—The Secretary of the 
Interior shall issue regulations under which the Secretary 
shall reimburse a person that is a lessee, operator, oper-
ating rights owner, or applicant for any lease under this 
Act for reasonable amounts paid by the person for prepa-
ration for the Secretary by a contractor or other person 
selected by the Secretary of any project-level analysis, doc-
umentation, or related study required pursuant to the Na-
tional Environmental Policy Act of 1969 (42 U.S.C. 4321 
et seq.) with respect to the lease. 
‘‘(b) CONDITIONS.—The Secretary may provide reim-
bursement under subsection (a) only if—
‘‘(1) adequate funding to enable the Secretary 
to timely prepare the analysis, documentation, or re-
lated study is not appropriated; 
‘‘(2) the person paid the costs voluntarily; 
‘‘(3) the person maintains records of its costs 
in accordance with regulations issued by the Sec-
retary;
896
‘‘(4) the reimbursement is in the form of a re-
duction in the Federal share of the royalty required 
to be paid for the lease for which the analysis, docu-
mentation, or related study is conducted, and is 
agreed to by the Secretary and the person reim-
bursed prior to commencing the analysis, docu-
mentation, or related study; and 
‘‘(5) the agreement required under paragraph 
(4) contains provisions—
‘‘(A) reducing royalties owed on lease pro-
duction based on market prices; 
‘‘(B) stipulating an automatic termination 
of the royalty reduction upon recovery of docu-
mented costs; and 
‘‘(C) providing a process by which the les-
see may seek reimbursement for circumstances 
in which production from the specified lease is 
not possible.’’. 
(b) APPLICATION.—The amendment made by this 
section shall apply with respect to an analysis, documenta-
tion, or a related study conducted on or after the date 
of enactment of this Act for any lease entered into before, 
on, or after the date of enactment of this Act. 
(c) DEADLINE FOR REGULATIONS.—The Secretary 
shall issue regulations implementing the amendment made
897
by this section by not later than 1 year after the date 
of enactment of this Act. 
SEC. 2015. GAS HYDRATE PRODUCTION INCENTIVE. 
(a) PURPOSE.—The purpose of this section is to pro-
mote natural gas production from the abundant natural 
gas hydrate resources on the outer Continental Shelf and 
Federal lands in Alaska by providing royalty incentives. 
(b) SUSPENSION OF ROYALTIES.—
(1) IN GENERAL.—The Secretary of the Inte-
rior shall grant royalty relief in accordance with this 
section for natural gas produced from gas hydrate 
resources under any lease that is an eligible lease 
under paragraph (2). 
(2) ELIGIBLE LEASES.—A lease shall be an eli-
gible lease for purposes of this section if—
(A) it is issued under the Outer Conti-
nental Shelf Lands Act (43 U.S.C. 1331 et 
seq.), or is an oil and gas lease issued for on-
shore Federal lands in Alaska; 
(B) it is issued prior to January 1, 2016; 
and 
(C) production under the lease of natural 
gas from the gas hydrate resources commences 
prior to January 1, 2018.
898
(3) AMOUNT OF RELIEF.—The Secretary shall 
grant royalty relief under this section as a suspen-
sion volume of at least 50 billion cubic feet of nat-
ural gas produced from gas hydrate resources per 9 
square mile leased tract. Such relief shall be in addi-
tion to any other royalty relief under any other pro-
vision applicable to the lease that does not specifi-
cally grant a gas hydrate production incentive. The 
minimum suspension volume under this section for 
leased tracts that are smaller or larger than nine 
square miles shall be adjusted on a proportional 
basis. 
(4) LIMITATION.—The Secretary may place lim-
itations on the suspension of royalty relief granted 
based on market price. 
(c) APPLICATION.—This section shall apply to any el-
igible lease issued before, on, or after the date of enact-
ment of this Act. 
(d) RULEMAKINGS.—The Secretary shall complete 
any rulemakings implementing this section within 1 year 
after the date of enactment of this Act. 
(e) GAS HYDRATE RESOURCES DEFINED.—In this 
section, the term ‘‘gas hydrate resources’’ includes both 
the natural gas content of gas hydrates within the hydrate
899
stability zone and free natural gas trapped by and beneath 
the hydrate stability zone. 
SEC. 2016. ONSHORE DEEP GAS PRODUCTION INCENTIVE. 
(a) PURPOSE.—The purpose of this section is to pro-
mote natural gas production from the abundant onshore 
deep gas resources on Federal lands by providing royalty 
incentives. 
(b) SUSPENSION OF ROYALTIES.—
(1) IN GENERAL.—The Secretary shall grant 
royalty relief in accordance with this section for nat-
ural gas produced from deep wells spudded after the 
date of enactment of this Act under any onshore 
Federal oil and gas lease. 
(2) AMOUNT OF RELIEF.—The Secretary shall 
grant royalty relief under this section as a suspen-
sion volume determined by the Secretary in an 
amount necessary to maximize production of natural 
gas volumes. The maximum suspension volume shall 
be 50 billion cubic feet of natural gas per lease. 
Such royalty suspension volume shall be applied be-
ginning with the first dollar of royalty obligation for 
production on or after the date of enactment of this 
Act.
900
(3) LIMITATION.—The Secretary may place lim-
itations on the suspension of royalty relief granted 
based on market price. 
(c) APPLICATION.—This section shall apply to any 
onshore Federal oil and gas lease issued before, on, or 
after the date of enactment of this Act. 
(d) RULEMAKINGS.—
(1) REQUIREMENT.—The Secretary shall com-
plete any rulemakings implementing this section 
within 1 year after the date of enactment of this 
Act. 
(2) DEFINITION OF DEEP WELL.—Such regula-
tions shall include a definition of the term ‘‘deep 
well’’ for purposes of this section. 
SEC. 2017. ENHANCED OIL AND NATURAL GAS PRODUCTION 
INCENTIVE. 
(a) FINDINGS.—Congress finds the following: 
(1) Approximately two-thirds of the original oil 
in place in the United States remains unproduced. 
(2) Enhanced oil and natural gas production 
from the sequestering of carbon dioxide and other 
appropriate gases has the potential to increase oil 
and natural gas production in the United States by 
2 million barrels of oil equivalent per day, or more.
901
(3) Collection of carbon dioxide and other ap-
propriate gases from industrial facilities could pro-
vide a significant source of these gases that could be 
permanently sequestered into oil and natural gas 
fields. 
(4) Such collection could be made economic by 
providing production incentives to oil and natural 
gas lessees. 
(5) Providing production incentives for en-
hanced oil and natural gas production would pro-
mote significant advances in emissions control and 
capture technology. 
(6) Capturing and productively using industrial 
emissions of carbon dioxide would help reduce the 
carbon intensity of the economy. 
(7) Enhanced production of oil and natural gas 
lessens the potential for environmental impacts when 
compared with development of new oil and natural 
gas fields because the infrastructure, such as wells, 
pipelines, and platforms, is generally already in 
place. 
(b) PURPOSE.—The purpose of this section is—
(1) to promote the capturing, transportation, 
and injection of produced carbon dioxide, natural
902
carbon dioxide, and other appropriate gases for se-
questration into oil and gas fields; and 
(2) to promote oil and natural gas production 
from the abundant resources on the outer Conti-
nental Shelf and onshore Federal lands by enhanc-
ing recovery of oil or natural gas (or both). 
(c) SUSPENSION OF ROYALTIES.—
(1) IN GENERAL.—The Secretary of the Inte-
rior shall grant a royalty relief in accordance with 
this section for production of oil or natural gas (or 
both) from lands subject to an eligible lease into 
which the lessee injects carbon dioxide, or other ap-
propriate gas or other matter approved by the Sec-
retary, for the purpose of enhancing recovery of oil 
or natural gas (or both) from the eligible lease. 
(2) ELIGIBLE LEASES.—A lease shall be an eli-
gible lease for purposes of this section if it is a lease 
for production of oil or gas (or both) from Federal 
outer Continental Shelf or onshore lands that the 
Secretary determines may contain a volume of oil or 
natural gas that would not likely be produced with-
out royalty relief under this subsection. 
(3) AMOUNT OF RELIEF.—The Secretary shall 
grant royalty relief under this section as a suspen-
sion volume determined by the Secretary in an
903
amount necessary to maximize production of oil and 
natural gas volumes. The maximum suspension vol-
ume shall be 50 billion cubic feet of natural gas, or 
equivalent oil volume on a Btu basis, or a combina-
tion thereof, per eligible lease. 
(4) LIMITATION.—The Secretary may place lim-
itations on the suspension of royalty relief granted 
based on market price. 
(d) APPLICATION.—This section shall apply to any 
eligible lease issued before, on, or after the date of enact-
ment of this Act. 
(e) RULEMAKINGS.—The Secretary shall complete 
any rulemakings implementing this provision within 1 year 
after the date of enactment of this Act. 
SEC. 2018. OIL SHALE. 
(a) FINDING.—Congress finds that oil shale re-
sources located within the United States—
(1) total almost 2 trillion barrels of oil in place; 
and 
(2) are a strategically important domestic re-
source that should be developed on an accelerated 
basis to reduce our growing reliance on politically 
and economically unstable sources of foreign oil im-
ports.
904
(b) REQUIREMENT TO DEVELOP OIL SHALE LEAS-
ING PROGRAM.—The Secretary of the Interior shall de-
velop a Federal commercial oil shale leasing program as 
soon as practicable and publish a final regulation imple-
menting such program by not later than December 31, 
2006. 
(c) COMMENCEMENT OF LEASE SALES.—The Sec-
retary shall hold the first oil shale lease sale under such 
program within 180 days after publishing the final regula-
tion. 
(d) REPORT.—Within 90 days after the date of en-
actment of this Act, the Secretary shall report to the Com-
mittee on Resources of the House of Representatives and 
the Committee on Energy and Natural Resources of the 
Senate on- 
(1) the interim actions necessary to— 
(A) develop the program under subsection 
(b); 
(B) promulgate the final regulation under 
subsection (b); and 
(C) conduct the first lease sale under the 
program under subsection (b); and 
(2) a schedule for completing such actions. 
(e) OIL SHALE LAND EXCHANGES.—
905
(1) REQUIREMENT.—The Secretary shall iden-
tify and pursue to completion oil shale land ex-
changes, on a value-for-value basis, that will allow 
qualified oil shale developers to have early access to 
currently owned Federal oil shale lands and to com-
mence commercial oil shale development. 
(2) APPLICABLE
LAW.—The Secretary shall 
conduct land exchanges under this subsection in ac-
cordance with the Federal Land Policy Management 
Act of 1976 (43 U.S.C. 1701 et seq.) and the Fed-
eral Land Exchange Facilitation Act of 1988 (43 
U.S.C. 1701 note). 
SEC. 2019. USE OF INFORMATION ABOUT OIL AND GAS PUB-
LIC CHALLENGES. 
(a) FINDINGS.—Congress finds the following: 
(1) The Government Accountability Office (in 
this section referred to as the ‘‘GAO’’), in report 
GAO–05–124, found that the Bureau of Land Man-
agement does not systematically gather and use na-
tionwide information on public challenges to manage 
its oil and gas program. 
(2) The GAO found that this failure prevents 
the Director of the Bureau from assessing the im-
pact of public challenges on the workload of the Bu-
reau of Land Management State offices and elimi-