122 
(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 
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
123 
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. 
‘‘(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 production or utilization of steam 
under the lease; 
‘‘(B) require that in each year to which 
work commitment requirements under the regu-
lations apply, the lessee shall significantly re-
duce the amount of work that remains to be 
done to achieve such production or utilization;
124 
‘‘(C) describe specific work that must be 
completed by a lessee by the end of each year 
to which the work commitment requirements 
apply and factors, such as force majeure events, 
that suspend or modify the work commitment 
obligation; 
‘‘(D) carry forward and apply to work 
commitment requirements for a year, work 
completed in any year in the preceding 3-year 
period that was in excess of the work required 
to be performed in that preceding year; 
‘‘(E) 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— 
‘‘(i) to allow achievement of produc-
tion under the lease; or 
‘‘(ii) to allow the lease to be included 
in a producing unit; and 
‘‘(F) 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
125 
will not impair achieving diligent development 
of the geothermal resource. 
‘‘(3) 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 geothermal 
steam is produced or 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-
126 
pleted in a prior year that is carried forward 
pursuant to subsection (b)(2)(D). 
‘‘(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 AFTER COMMERCIAL PRODUC-
TION OR UTILIZATION.—If geothermal steam is produced 
or utilized in commercial quantities within the primary 
term of the lease under subsection (a) (including any ex-
tension of the lease under subsection (a)), such lease shall 
continue until the date on which geothermal steam is no 
longer produced or utilized in commercial quantities.
127 
‘‘(f) CONVERSION OF GEOTHERMAL LEASE TO MIN-
ERAL LEASE.—The lessee under a lease that has produced 
geothermal steam for electrical generation, has been deter-
mined by the Secretary to be incapable of any further com-
mercial production or utilization of geothermal steam, and 
that is producing any valuable byproduct in payable quan-
tities 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.’’. 
SEC. 224. 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