Restoring Community Input and Public Protections in Oil and Gas Leasing Act of 2021
Bill: H.R.1503 | Sponsor: Rep. Levin, Mike (D-CA)
Policy area: Energy

Summary:
Restoring Community Input and Public Protections in Oil and Gas Leasing Act of 2021
This bill modifies several provisions related to oil and gas leasing on public lands.
Among other requirements, the bill replaces the competitive auction process with a competitive-sealed bidding process. It also eliminates non-competitive bidding.
Additionally, the bill increases royalty rates, rental rates, and the minimum bid amount. Further, the bill creates a fee for nominating lands for leasing.
Lease sales must be held in each state no more than three times per year instead of quarterly. The bill also decreases lease term durations from 10 to 5 years. Certain lease information must be made available on public websites, including the names of all current and former lessees and operators.
The bill also adds a number of new provisions related to protection of private surface estate owners.
Finally, the bill establishes requirements to protect water resources, including by requiring oil or gas operators to replace certain water supplies affected by drilling, hydraulic fracturing (i.e., fracking), or production operations. In addition, the Bureau of Land Management must issue regulations governing the use of fracking under oil and gas leases for federal lands. The regulations must require (1) baseline water testing, and (2) public disclosure of each chemical used for fracking.

To amend the Mineral Leasing Act to make certain adjustments in leasing 
   on Federal lands for oil and gas drilling, and for other purposes.


 


    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Restoring Community Input and Public 
Protections in Oil and Gas Leasing Act of 2021''.

SEC. 2. LEASING PROCESS.

    (a) Onshore Oil and Gas Leasing.--Section 17 of the Mineral Leasing 
Act (30 U.S.C. 226(a)) is amended by striking the matter preceding 
``(a) All lands'' and all that follows through the end of subsection 
(a) and inserting the following:

``SEC. 17. LEASING OF LAND CONTAINING OIL OR GAS DEPOSITS.

    ``(a) Leasing Authority.--
            ``(1) In general.--All lands subject to disposition under 
        this Act that are known or believed to contain oil or gas 
        deposits may be leased by the Secretary.
            ``(2) Receipt of fair market value.--Leasing activities 
        under this Act shall be conducted to assure receipt of fair 
        market value for the lands and resources leased and the rights 
        conveyed by the United States.''.
    (b) Competitive Bidding.--Section 17(b)(1) of the Mineral Leasing 
Act (30 U.S.C. 226(b)(1)(A)) is amended by striking all that precedes 
``(A) All lands'' and all that follows through the end of subparagraph 
(A) and inserting the following:
    ``(b) Bidding.--
            ``(1) In general.--
                    ``(A) Competitive bidding.--
                            ``(i) In general.--All lands to be leased 
                        under this section shall be leased as provided 
                        in this paragraph to the highest responsible 
                        qualified bidder by competitive bidding by 
                        sealed bid.
                            ``(ii) Geographic limitation.--The 
                        Secretary shall lease lands under this 
                        paragraph in units of not more than 2,560 
                        acres, except in Alaska, where units shall be 
                        not more than 5,760 acres. Such units shall be 
                        as nearly compact as possible.
                            ``(iii) Frequency.--Lease sales under this 
                        section shall be held for each State in which 
                        there are lands eligible for leasing no more 
                        than 3 times each year and on a rotating basis 
                        such that the lands under the responsibility of 
                        any Bureau of Land Management field office are 
                        available for leasing no more than one time 
                        each year.
                            ``(iv) Royalty.--A lease under this section 
                        shall be conditioned upon the payment of a 
                        royalty at a rate of not less than 18.75 
                        percent in amount or value of the production 
                        removed or sold from the lease, except as 
                        otherwise provided in this Act.
                            ``(v) Issuance of lease.--The Secretary may 
                        issue a lease under this section to the 
                        responsible qualified bidder with the highest 
                        bid that is equal to or greater than the 
                        national minimum acceptable bid. The Secretary 
                        shall decide whether to accept a bid and issue 
                        a lease within 90 days following payment by the 
                        successful bidder of the remainder of the bonus 
                        bid, if any, and annual rental for the first 
                        lease year.
                            ``(vi) Rejection of bid.--The Secretary may 
                        reject a bid above the national minimum 
                        acceptable bid if, after evaluation of the 
                        value of the lands proposed for lease, the 
                        Secretary determines that the bid amount does 
                        not ensure that fair market value is obtained 
                        for the lease.''.
    (c) National Minimum Acceptable Bid.--Subparagraph (B) of section 
17(b)(1) of the Mineral Leasing Act (30 U.S.C. 226(b)(1)), is amended 
to read as follows:
                    ``(B) National minimum acceptable bid.--
                            ``(i) In general.--Except as provided in 
                        clause (ii), for purposes of subparagraph (A), 
                        the national minimum acceptable bid shall be 
                        $10 per acre. All bids under this section for 
                        less than the national minimum acceptable bid 
                        shall be rejected.
                            ``(ii) Raising the national minimum 
                        acceptable bid.--The Secretary may establish a 
                        higher national minimum acceptable bid--
                                    ``(I) beginning at the end of the 
                                4-year period that begins on the date 
                                of enactment of the Restoring Community 
                                Input and Public Protection in Oil and 
                                Gas Leasing Act of 2021, and once every 
                                4 years thereafter, to reflect the 
                                change in the Consumer Price Index for 
                                All Urban Consumers published by the 
                                Bureau of Labor Statistics; and
                                    ``(II) at any time, if the 
                                Secretary finds that such a higher 
                                amount is necessary to enhance 
                                financial returns to the United States 
                                or to promote more efficient management 
                                of oil and gas resources on Federal 
                                lands.
                            ``(iii) Not a major federal action.--The 
                        proposal or issuance of any regulation to 
                        establish a higher national minimum acceptable 
                        bid under clause (ii) shall not be considered a 
                        major Federal action that is subject to the 
                        requirements of section 102(2)(C) of the 
                        National Environmental Policy Act of 1969 (42 
                        U.S.C. 4332(2)(C)).''.
    (d) Rentals.--Section 17(d) of the Mineral Leasing Act (30 U.S.C. 
226(d)) is amended to read as follows:
    ``(d) Annual Rentals.--All leases issued under this section shall 
be conditioned upon the payment by the lessee of a rental of--
            ``(1) not less than $3.00 per acre per year during the 5-
        year period beginning on the date the lease begins for new 
        leases, and after the end of such 5 year period not less than 
        $5 per acre per year; or
            ``(2) such higher rental rate as the Secretary may 
        establish if the Secretary finds that such action is necessary 
        to enhance financial returns to the United States and promote 
        more efficient management of oil and gas and alternative energy 
        resources on Federal lands.''.
    (e) Elimination of Noncompetitive Leasing.--The Mineral Leasing Act 
(30 U.S.C. 181 et seq.) is amended--
            (1) in section 17(b) (30 U.S.C. 226(b)), by striking 
        paragraph (3);
            (2) by amending section 17(c) (30 U.S.C. 226(c)) to read as 
        follows:
    ``(c) Lands for Which No Bid Is Accepted.--Lands made available for 
leasing under subsection (b)(1) but for which no bid is accepted may be 
made available by the Secretary for a new round of sealed bidding under 
such subsection.'';
            (3) in section 17(e) (30 U.S.C. 226(e))--
                    (A) by striking ``Competitive and noncompetitive 
                leases'' and inserting ``Leases, including leases for 
                tar sand areas,''; and
                    (B) by striking ``Provided, however'' and all that 
                follows through ``ten years.'';
            (4) in section 31(d)(1) (30 U.S.C. 188(d)(1)) by striking 
        ``or section 17(c)'';
            (5) in section 31(e) (30 U.S.C. 188(e))--
                    (A) in paragraph (2) by striking ``, or the 
                inclusion'' and all that follows and inserting a 
                semicolon; and
                    (B) in paragraph (3) by striking ``(A)'' and by 
                striking subparagraph (B);
            (6) by striking section 31(f) (30 U.S.C. 188(f)); and
            (7) in section 31(g) (30 U.S.C. 188(g))--
                    (A) in paragraph (1) by striking ``as a 
                competitive'' and all that follows through the period 
                and inserting ``in the same manner as the original 
                lease issued pursuant to section 17.'';
                    (B) by striking paragraph (2) and redesignating 
                paragraphs (3) and (4) as paragraphs (2) and (3), 
                respectively; and
                    (C) in paragraph (2), as redesignated, by striking 
                ``, applicable to leases issued under subsection 17(c) 
                of this Act (30 U.S.C. 226(c)) except,'' and inserting 
                ``, except''.
    (f) Lease Term.--Section 17(e) of the Mineral Leasing Act (30 
U.S.C. 226(e)) is amended by striking ``10 years:'' and inserting ``5 
years.''.
    (g) Other Leasing Requirements.--Section 17(g) of the Mineral 
Leasing Act (30 U.S.C. 226(g)), as amended by section 8 of this Act, is 
further amended--
            (1) by striking ``(g) The Secretary of the Interior'' and 
        inserting the following:
    ``(g) Other Leasing Requirements.--
            ``(1) In general.--The Secretary of the Interior''; and
            (2) by adding at the end the following:
            ``(2) Limitation.--The Secretary shall not issue a lease or 
        approve the assignment of any lease to any person, or to any 
        subsidiary or affiliate of such person or any other person 
        controlled by or under common control with such person, unless 
        such person has the demonstrated capability to explore and 
        produce oil and gas under the lease.
            ``(3) Protection of leased lands for other uses.--Each 
        lease under this section shall include such terms as are 
        necessary to preserve the United States flexibility to control 
        or prohibit activities that pose serious and unacceptable 
        impacts to the value of the leased lands for uses other than 
        production of oil and gas.''.

SEC. 3. TRANSPARENCY AND LANDOWNER PROTECTIONS.

    (a) Disclosure of Identities Filing Disclosures of Interest and 
Bids.--Section 17(b) of the Mineral Leasing Act (30 U.S.C. 226(b)), as 
amended by this Act, is further amended by adding at the end the 
following:
            ``(3) Bidder identity.--The Secretary--
                    ``(A) shall require that each expression of 
                interest to bid for a lease under this section and each 
                bid for a lease under this section shall include the 
                name of the person for whom such expression of interest 
                or bid is submitted; and
                    ``(B) shall promptly publish each such name.''.
    (b) Notice Requirements.--Section 17(f) of the Mineral Leasing Act 
(30 U.S.C. 226(f)) is amended by striking ``(f) At least'' and all that 
follows through ``agencies.'' and inserting the following:
    ``(f) Requirements Prior to Offering Lands for Lease.--
            ``(1) Required notice.--At least 45 days before offering 
        lands for lease under this section, and at least 30 days before 
        approving applications for permits to drill under the 
        provisions of a lease, modifying the terms of any lease issued 
        under this section, or granting a waiver, exception, or 
        modification of any stipulation of a lease issued under this 
        section, the Secretary shall provide notice of the proposed 
        action to--
                    ``(A) the general public by posting such notice in 
                the appropriate local office and on the electronic 
                website of the leasing and land management agencies 
                offering the lands for lease;
                    ``(B) all surface land owners in the area of the 
                lands being offered for lease; and
                    ``(C) the holders of special recreation permits for 
                commercial use, competitive events, and other organized 
                activities on the lands being offered for lease.
            ``(2) Required information.--''.
    (c) Surface Owner Protection.--Section 17 of the Mineral Leasing 
Act (30 U.S.C. 226), is amended by adding at the end the following:
    ``(r) Post-Lease Surface Use Agreement.--
            ``(1) In general.--Except as provided in paragraph (2), the 
        Secretary may not authorize any operator to conduct exploration 
        and drilling operations on lands with respect to which title to 
        oil and gas resources is held by the United States but title to 
        the surface estate is not held by the United States, until the 
        operator has filed with the Secretary a document, signed by the 
        operator and the surface owner or owners, showing that the 
        operator has secured a written surface use agreement between 
        the operator and the surface owner or owners that meets the 
        requirements of subparagraph (B).
            ``(2) Contents.--The surface use agreement shall provide 
        for--
                    ``(A) the use of only such portion of the surface 
                estate as is reasonably necessary for exploration and 
                drilling operations based on site-specific conditions;
                    ``(B) the accommodation of the surface estate owner 
                to the maximum extent practicable, including the 
                location, use, timing, and type of exploration and 
                drilling operations, consistent with the operator's 
                right to develop the oil and gas estate;
                    ``(C) the reclamation of the site to a condition 
                capable of supporting the uses which such lands were 
                capable of supporting prior to exploration and drilling 
                operations; and
                    ``(D) compensation for damages as a result of 
                exploration and drilling operations, including--
                            ``(i) loss of income and increased costs 
                        incurred;
                            ``(ii) damage to or destruction of personal 
                        property, including crops, forage, and 
                        livestock; and
                            ``(iii) failure to reclaim the site in 
                        accordance with clause (iii).
            ``(3) Authorized exploration and drilling operations.--
                    ``(A) Authorization without surface use 
                agreement.--The Secretary may authorize an operator to 
                conduct exploration and drilling operations on lands 
                covered by paragraph (1) in the absence of an agreement 
                with the surface estate owner or owners, if--
                            ``(i) the Secretary makes a determination 
                        in writing that the operator made a good faith 
                        attempt to conclude such an agreement, 
                        including referral of the matter to arbitration 
                        pursuant to paragraph (1)(C), but that no 
                        agreement was concluded within 90 days after 
                        the referral to arbitration;
                            ``(ii) the operator submits a plan of 
                        operations that provides for the matters 
                        specified in paragraph (1)(B) and for 
                        compliance with all other applicable 
                        requirements of Federal and State law; and
                            ``(iii) the operator posts a bond or other 
                        financial assurance in an amount the Secretary 
                        determines to be adequate to ensure 
                        compensation to the surface estate owner for 
                        any damages to the site, in the form of a 
                        surety bond, trust fund, letter of credit, 
                        government security, certificate of deposit, 
                        cash, or equivalent.
                    ``(B) Surface owner participation.--The Secretary 
                shall provide surface estate owners with an opportunity 
                to--
                            ``(i) comment on plans of operations in 
                        advance of a determination of compliance with 
                        this Act;
                            ``(ii) participate in bond level 
                        determinations and bond release proceedings 
                        under this section;
                            ``(iii) attend an on-site inspection during 
                        such determinations and proceedings;
                            ``(iv) file written objections to a 
                        proposed bond release; and
                            ``(v) request and participate in an on-site 
                        inspection when they have reason to believe 
                        there is a violation of the terms and 
                        conditions of a plan of operations.
                    ``(C) Payment of financial guarantee.--A surface 
                estate owner with respect to any land subject to a 
                lease may petition the Secretary for payment of all or 
                any portion of a bond or other financial assurance 
                required under this section as compensation for any 
                damages as a result of exploration and drilling 
                operations. Pursuant to such a petition, the Secretary 
                may use such bond or other guarantee to provide 
                compensation to the surface estate owner for such 
                damages.
                    ``(D) Bond release.--Upon request and after 
                inspection and opportunity for surface estate owner 
                review, the Secretary may release the financial 
                assurance required under this section if the Secretary 
                determines that exploration and drilling operations are 
                ended and all damages have been fully compensated.
            ``(4) Surface owner notification.--The Secretary shall 
        notify surface estate owners in writing--
                    ``(A) not less than 45 days before lease sales;
                    ``(B) of the identity of the lessee, not more than 
                10 business days after a lease is issued;
                    ``(C) concerning any subsequent request or decision 
                regarding a lease not more than 5 business days after 
                such request or decision, including regarding 
                modification of a lease, waiver of a stipulation, or 
                approval of a right of way; and
                    ``(D) not more than 5 business days after issuance 
                of a drilling permit under a lease.''.

SEC. 4. LEASE STIPULATIONS.

    (a) Energy Policy Act of 2005.--Section 363(b)(3)(C) of the Energy 
Policy Act of 2005 (42 U.S.C. 15922(b)(3)(C)) is amended to read as 
follows:
                    ``(C) adequately protective of the resource for 
                which the stipulations are applied;''.
    (b) Revision of Existing Memorandum.--Not later than 180 days after 
the date of the enactment of this Act the Secretary of the Interior and 
the Secretary of Agriculture shall revise the memorandum of 
understanding under section 363(b)(3)(C) of the Energy Policy Act of 
2005 (42 U.S.C. 15922) in accordance with the amendment made by 
subsection (a).

SEC. 5. PARCEL REVIEW.

    Section 17(a) of the Mineral Leasing Act (30 U.S.C. 226(a)), as 
amended by section 2 of this Act, is further amended by adding at the 
end the following:
            ``(3) Parcel review.--The Secretary shall issue oil and gas 
        leases under this Act only in accordance with subsections C 
        through I of section III of Bureau of Land Management 
        Instruction Memorandum No. 2010-117, dated May 17, 2010, as in 
        effect on April 24, 2017.''.

SEC. 6. ACREAGE LIMITATIONS.

    Section 27(d)(1) of the Mineral Leasing Act (30 U.S.C. 184(d)(1)) 
is amended by striking ``, and acreage under any lease any portion of 
which has been committed to a federally approved unit or cooperative 
plan or communitization agreement or for which royalty (including 
compensatory royalty or royalty in-kind) was paid in the preceding 
calendar year,''.

SEC. 7. LAND MANAGEMENT.

    Section 17(g) of the Mineral Leasing Act (30 U.S.C. 226(g)), as 
amended by section 2(g) of this Act, is further amended by adding at 
the end the following:
            ``(4) Multiple-use management.--The Secretary, and for 
        National Forest lands, the Secretary of Agriculture, shall 
        manage lands that are subject to an oil and gas lease under 
        this Act in accordance with the principles, policies, and 
        requirements relating to multiple use under the Federal Land 
        Policy and Management Act of 1976 (43 U.S.C. 1701 et seq.), 
        until the beginning of operations on such lease.''.

SEC. 8. TRANSPARENCY IN MANAGEMENT OF LEASES.

    Section 17(a) of the Mineral Leasing Act (30 U.S.C. 226(a)), as 
amended by sections 2 and 5 of this Act, is further amended by adding 
at the end the following:
            ``(4) Transparency in management of leases.--For each lease 
        under this section, the Secretary shall make available on a 
        public website--
                    ``(A) the identity of--
                            ``(i) each person who is or has been a 
                        lessee under the lease; and
                            ``(ii) each person who is or has been an 
                        operator under the lease;
                    ``(B) notice of each transfer of the lease; and
                    ``(C) notice of each suspension of operations, each 
                suspension of production, and each suspension of 
                operations and production.''.

SEC. 9. LEASE CANCELLATION FOR IMPROPER ISSUANCE.

    Section 31(b) of the Mineral Leasing Act (30 U.S.C. 188(b)) is 
amended by inserting ``if the lease was improperly issued or'' after 
``30 days notice''.

SEC. 10. FEES FOR EXPRESSIONS OF INTEREST.

    (a) In General.--The Secretary shall charge any person who submits 
an expression of interest, as that term is defined by the Secretary, a 
fee, in an amount determined by the Secretary under paragraph (2).
    (b) Amount.--The fee authorized under paragraph (1) shall be 
established by the Secretary in an amount that is determined by the 
Secretary to be appropriate to cover the aggregate cost of processing 
an expression of interest under this section, but not less than $15 per 
acre of the area covered by the applicable expression of interest.
    (c) Adjustment of Fees.--The Secretary shall, by regulation at 
least every 4 years, establish a higher expression of interest fee--
            (1) to reflect the change in the Consumer Price Index for 
        All Urban Consumers published by the Bureau of Labor 
        Statistics; and
            (2) as the Secretary determines to be necessary to enhance 
        financial returns to the United States or to promote more 
        efficient management of oil and gas resources on Federal land.

SEC. 11. PROTECTION OF WATER RESOURCES.

    (a) Mineral Leasing Act Requirements.--Section 17 of the Mineral 
Leasing Act (30 U.S.C. 226) is amended--
            (1) in subsection (g) by striking ``lands or surface waters 
        adversely'' and inserting ``surface or ground waters or lands 
        adversely'';
            (2) by redesignating subsection (p) as subsection (q); and
            (3) by inserting after subsection (o) the following:
    ``(p) Water Requirements.--
            ``(1) An operator producing oil or gas (including coalbed 
        methane) under a lease issued under this Act shall--
                    ``(A) replace the water supply of a water user who 
                obtains all or part of such user's supply of water from 
                an underground or surface source that has been affected 
                by contamination, diminution, or interruption 
                proximately resulting from drilling, fracking, or 
                production operations for such production;
                    ``(B) ensure that if a surface or ground water 
                source is affected by contamination, diminution, or 
                interruption proximately resulting from such 
                production, best management practices and appropriately 
                available technologies are used to prevent, to the 
                maximum extent possible, the long-term or permanent 
                degradation of the surface or ground water source; and
                    ``(C) comply with all applicable requirements of 
                Federal and State law with respect to--
                            ``(i) discharge of any water produced under 
                        the lease; and
                            ``(ii) activities that would divert or 
                        otherwise alter a surface or ground water 
                        source or lead to a discharge not covered by 
                        clause (i).
            ``(2) An application for a permit to drill under a lease 
        under this Act shall be accompanied by a proposed water 
        management plan including provisions to--
                    ``(A) protect the quantity and quality of surface 
                and ground water systems, both on-site and off-site, 
                from adverse effects of the exploration, development, 
                and reclamation processes or to provide alternative 
                sources of water if such protection cannot be assured;
                    ``(B) protect the rights of present users of water 
                that would be affected by operations under the lease, 
                including the discharge of any water produced in 
                connection with such operations that is not reinjected; 
                and
                    ``(C) identify any agreements with other parties 
                for the beneficial use of produced waters and the steps 
                that will be taken to comply with State and Federal 
                laws related to such use.
            ``(3) The Secretary may not approve an application if the 
        Secretary determines that the applicant did not submit a water 
        management plan that meets the requirements described in 
        paragraph (2).''.
    (b) Relation to State Law.--Nothing in this section or any 
amendment made by this section shall be construed as--
            (1) impairing or in any manner affecting any right or 
        jurisdiction of any State with respect to the waters of such 
        State; or
            (2) limiting, altering, modifying, or amending any of the 
        interstate compacts or equitable apportionment decrees that 
        apportion water among and between States.

SEC. 12. FRACKING REGULATION ON FEDERAL LANDS.

    (a) In General.--Not later than 1 year after the date of enactment 
of this Act, the Secretary of the Interior, acting through the Bureau 
of Land Management, shall issue regulations governing the use of 
hydraulic fracturing under oil and gas leases for Federal lands.
    (b) Included Provisions.--The regulations under this section shall 
require--
            (1) baseline water testing, the results of which shall be 
        posted on an appropriate internet website; and
            (2) public disclosure of each chemical used for hydraulic 
        fracturing on an appropriate internet website.
    (c) Interim Application of Prior Rule.--The final rule entitled 
``Oil and Gas; Hydraulic Fracturing on Federal and Indian Lands'', as 
published in the Federal Register March 26, 2015 (80 Fed. Reg. 16128), 
and corrected by the rule published on March 30, 2015 (80 Fed. Reg. 
16577), shall apply until the effective date of a final rule under 
subsection (a).

SEC. 13. ENVIRONMENTAL ANALYSIS.

    Any environmental analysis pursuant to the National Environmental 
Policy Act (42 U.S.C. 4321 et seq.) required under this Act shall 
include the estimated total cost of preparing the environmental 
analysis, including full-time equivalent personnel hours, contractor 
costs, and other direct costs.

SEC. 14. TAXPAYER FUNDING STEWARDSHIP.

    In an effort to be good stewards of taxpayer dollars and 
conscientious of the demands placed upon public servants, no provisions 
contained within this Act shall require a duplication of analysis by 
any government agency, individual, or contractor, at any level 
including federal, state, local, or tribal and, if so determined, such 
provision shall be considered non-binding.
                                                 Union Calendar No. 452

117th CONGRESS

  2d Session

                               H. R. 1503

                      [Report No. 117-628, Part I]

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