Source: https://casetext.com/statute/united-states-code/title-30-mineral-lands-and-mining/chapter-3a-leases-and-prospecting-permits/subchapter-iv-oil-and-gas/section-226-lease-of-oil-and-gas-lands?ref=Sjd!0uMZyl
Timestamp: 2019-09-21 07:47:46
Document Index: 704853947

Matched Legal Cases: ['§ 226', '§ 226', '§17', '§1', '§1', '§3', '§1', '§1', '§5102', '§5101', '§4321', '§5107', '§5101', '§201', '§5106', '§5101', '§5110', '§5101', '§5111', '§3']

Section 226 - Lease of oil and gas lands, 30 U.S.C. § 226 | Casetext
30 U.S.C. § 226
Section 226 - Lease of oil and gas lands
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(A) All lands to be leased which are not subject to leasing under paragraphs (2) and (3) of this subsection shall be leased as provided in this paragraph to the highest responsible qualified bidder by competitive bidding under general regulations 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. Lease sales shall be conducted by oral bidding, except as provided in subparagraph (C). Lease sales shall be held for each State where eligible lands are available at least quarterly and more frequently if the Secretary of the Interior determines such sales are necessary. A lease shall be conditioned upon the payment of a royalty at a rate of not less than 12.5 percent in amount or value of the production removed or sold from the lease. The Secretary shall accept the highest bid from a responsible qualified bidder which is equal to or greater than the national minimum acceptable bid, without evaluation of the value of the lands proposed for lease. Leases shall be issued within 60 days following payment by the successful bidder of the remainder of the bonus bid, if any, and the annual rental for the first lease year. All bids for less than the national minimum acceptable bid shall be rejected. Lands for which no bids are received or for which the highest bid is less than the national minimum acceptable bid shall be offered promptly within 30 days for leasing under subsection (c) of this section and shall remain available for leasing for a period of 2 years after the competitive lease sale.
(B) The national minimum acceptable bid shall be $2 per acre for a period of 2 years from December 22, 1987. Thereafter, the Secretary, subject to paragraph (2)(B), may establish by regulation a higher national minimum acceptable bid for all leases based upon a finding that such action is necessary:
(i) to enhance financial returns to the United States; and
(ii) to promote more efficient management of oil and gas resources on Federal lands. Ninety days before the Secretary makes any change in the national minimum acceptable bid, the Secretary shall notify the Committee on Natural Resources of the United States House of Representatives and the Committee on Energy and Natural Resources of the United States Senate. The proposal or promulgation of any regulation to establish a national minimum acceptable bid shall not be considered a major Federal action subject to the requirements of section 4332(2)(C) of title 42.
(i) If the lands to be leased are within a special tar sand area, they shall be leased to the highest responsible qualified bidder by competitive bidding under general regulations in units of not more than 5,760 acres, which shall be as nearly compact as possible, upon the payment by the lessee of such bonus as may be accepted by the Secretary.
(B) For any area that contains any combination of tar sand and oil or gas (or both), the Secretary may issue under this chapter, separately-
(A) If the United States held a vested future interest in a mineral estate that, immediately prior to becoming a vested present interest, was subject to a lease under which oil or gas was being produced, or had a well capable of producing, in paying quantities at an annual average production volume per well per day of either not more than 15 barrels per day of oil or condensate, or not more than 60,000 cubic feet of gas, the holder of the lease may elect to continue the lease as a noncompetitive lease under subsection (c)(1).
(B) An election under this paragraph is effective-
(A) Lands (i) which were posted for sale under subsection (b)(1) of this section but for which no bids were received or for which the highest bid was less than the national minimum acceptable bid and (ii) for which, at the end of the period referred to in subsection (b)(1) of this section no lease has been issued and no lease application is pending under paragraph (1) of this subsection, shall again be available for leasing only in accordance with subsection (b)(1) of this section.
(A) The owner of (1) an oil and gas lease issued prior to November 16, 1981, or (2) a valid claim to any hydrocarbon resources leasable under this section based on a mineral location made prior to January 21, 1926, and located within a special tar sand area shall be entitled to convert such lease or claim to a combined hydrocarbon lease for a primary term of ten years upon the filing of an application within two years from November 16, 1981, containing an acceptable plan of operations which assures reasonable protection of the environment and diligent development of those resources requiring enhanced recovery methods of development or mining. For purposes of conversion, no claim shall be deemed invalid solely because it was located as a placer location rather than a lode location or vice versa, notwithstanding any previous adjudication on that issue.
(4) The person proposing to develop oil and gas deposits on lands described under paragraph (5) shall either-
(A) The lands referred to in this subsection are those lands referenced in subparagraph (B) which are under the administration of the Secretary of Agriculture where the United States acquired an interest in such lands pursuant to the Act of March 1, 1911 (36 Stat. 961 and following), but does not have an interest in oil and gas deposits that may be present under such lands. This subsection does not apply to any such lands where, under the provisions of its acquisition of an interest in the lands, the United States is to acquire any oil and gas deposits that may be present under such lands in the future but such interest has not yet vested with the United States.
Not later than 10 days after the date on which the Secretary receives an application for any permit to drill, the Secretary shall-
Not later than 30 days after the applicant for a permit has submitted a complete application, the Secretary shall-
(A) issue the permit, if the requirements under the National Environmental Policy Act of 1969 [ 42 U.S.C. 4321 et seq.] and other applicable law have been completed within such timeframe; or
(B) defer the decision on the permit and provide to the applicant a notice-
Feb. 25, 1920, ch. 85, §17, 41 Stat. 443; July 3, 1930, ch. 854, §1, 46 Stat. 1007; Mar. 4, 1931, ch. 506, 46 Stat. 1523; Aug. 21, 1935, ch. 599, §1, 49 Stat. 676; Aug. 8, 1946, ch. 916, §3, 60 Stat. 951; July 29, 1954, ch. 644, §1(1)-(3), 68 Stat. 583; Pub. L. 86-507June 11, 1960, 74 Stat. 201; Pub. L. 86-705Sept. 2, 1960, 74 Stat. 781; Pub. L. 97-78, §1(6), (8), Nov. 16, 1981, 95 Stat. 1070, 1071; Pub. L. 100-203, title V, §5102(a)-(d)(1), Dec. 22, 1987, 101 Stat. 1330-256, 1330-257; Pub. L. 102-4861992; Pub. L. 103-4371994; Pub. L. 104-661995; Pub. L. 109-582005; Pub. L. 113-291Dec. 19, 2014, 128 Stat. 3762.
REFERENCES IN TEXTAct of March 1, 1911, referred to in subsecs. (b)(3)(E) and (o)(5)(A), is act Mar. 1, 1911, ch. 186, 36 Stat. 961, popularly known as the Weeks Law, which enacted former sections 513 and 514 and sections 515 to 519, 521, 552, and 563 of Title 16, Conservation, and amended sections 480 and 500 of Title 16. For complete classification of this Act to the Code, see Short Title note set out under section 552 of Title 16 and Tables.The Federal Onshore Oil and Gas Leasing Reform Act of 1987, referred to in subsec. (d), is subtitle B (§§5101 to 5113) of title V of Pub. L. 100-203, Dec. 22, 1987, 101 Stat. 1330-256. For complete classification of this Act to the Code, see Short Title of 1987 Amendment note set out under section 181 of this title and Tables.The Combined Hydrocarbon Leasing Act of 1981, referred to in subsec. (n)(2), is Pub. L. 97-78, Nov. 16, 1981, 95 Stat. 1070, which amended sections 181, 182, 184, 209, 226, 241, 351, and 352 of this title and enacted a provision set out as a note under section 181 of this title. For complete classification of this Act to the Code, see Short Title of 1981 Amendment note set out under section 181 of this title and Tables.The National Environmental Policy Act of 1969, referred to in subsec. (p)(2)(A), (3)(A), (B), is Pub. L. 91-190, Jan. 1, 1970, 83 Stat. 852, as amended, which is classified generally to chapter 55 (§4321 et seq.) of Title 42, The Public Health and Welfare. For complete classification of this Act to the Code, see Short Title note set out under section 4321 of Title 42 and Tables.
AMENDMENTS 2014-Subsec. (b)(1)(A). Pub. L. 113-291inserted ", except as provided in subparagraph (C)" after "by oral bidding".Subsec. (b)(1)(C). Pub. L. 113-291added subpar. (C).2005-Subsec. (b)(1)(B). Pub. L. 109-58inserted ", subject to paragraph (2)(B)," after "Thereafter, the Secretary".Subsec. (b)(2). Pub. L. 109-58designated existing provisions as subpar. (A) and added subpars. (B) to (D).Subsec. (b)(2)(A). Pub. L. 109-58designated first sentence as cl. (i), substituted "5,760" for "five thousand one hundred and twenty", designated second and third sentences as cls. (ii) and (iii), respectively, and added cl. (iv).Subsec. (p). Pub. L. 109-58added subsec. (p).1995-Subsec. (j). Pub. L. 104-66 struck out at end "The Secretary shall report to Congress at the beginning of each regular session all such agreements entered into during the previous year which involve unleased Government lands."1994-Subsec. (b)(1)(B). Pub. L. 103-437 substituted "Natural Resources" for "Interior and Insular Affairs" before "of the United States House".1992-Subsec. (b)(1)(A). Pub. L. 102-486substituted "under paragraphs (2) and (3)" for "under paragraph (2)".Subsec. (b)(3). Pub. L. 102-486added par. (3).Subsec. (e). Pub. L. 102-486substituted "Competitive and noncompetitive leases issued under this section shall be for a primary term of 10 years: Provided, however," for "Competitive leases issued under this section shall be for a primary term of five years and noncompetitive leases for a primary term of ten years: Provided, however,".Subsec. (o). Pub. L. 102-486added subsec. (o).1987-Subsec. (b)(1). Pub. L. 100-203amended par. (1) generally. Prior to amendment, par. (1) read as follows: "If the lands to be leased are within any known geological structure of a producing oil or gas field, they shall be leased to the highest responsible qualified bidder by competitive bidding under general regulations in units of not more than six hundred and forty acres, which shall be as nearly compact in form as possible, upon the payment by the lessee of such bonus as may be accepted by the Secretary and of such royalty as may be fixed in the lease, which shall be not less than 12½ per centum in amount or value of the production removed or sold from the lease."Subsec. (c). Pub. L. 100-203amended subsec. (c) generally. Prior to amendment, subsec. (c) read as follows: "If the lands to be leased are not subject to leasing under subsection (b) of this section, the person first making application for the lease who is qualified to hold a lease under this chapter shall be entitled to a lease of such lands without competitive bidding. Such leases shall be conditioned upon the payment by the lessee of a royalty of 12½ per centum in amount or value of the production removed or sold from the lease."Subsec. (d). Pub. L. 100-203amended subsec. (d) generally. Prior to amendment, subsec. (d) read as follows: "All leases issued under this section shall be conditioned upon payment by the lessee of a rental of not less than 50 cents per acre for each year of the lease. Each year's lease rental shall be paid in advance. A minimum royalty of $1 per acre in lieu of rental shall be payable at the expiration of each lease year beginning on or after a discovery of oil or gas in paying quantities on the lands leased."Subsecs. (f) to (n). Pub. L. 100-203added subsecs. (f) to (h) and redesignated former subsecs. (f) to (k) as (i) to (n), respectively.1981-Subsec. (b). Pub. L. 97-78designated existing provisions as par. (1) and added par. (2).Subsec. (c). Pub. L. 97-78substituted "subject to leasing under subsection (b) of this section" for "within any known geological structure of a producing oil or gas field".Subsec. (e). Pub. L. 97-78inserted proviso that competitive leases in special tar sand areas be for a primary term of ten years.Subsec. (k). Pub. L. 97-78added subsec. (k).1960-Pub. L. 86-705 generally amended this section and sections 226d and 226e of this title, combining all three sections and subdividing provisions into subsections (a) to (j) of this section. Among other changes were: substitution of a fixed 10-year term for a renewable 5-year term for noncompetitive leases, the addition of subsec. (h) provisions with respect to the running of time against a lease during a contest of the claim, an increase in the minimum yearly rentals from 25 to 50 cents an acre, and striking out provisions that permitted a waiver of second-year and third-year rentals in certain situations.Pub. L. 86-507 authorized notice of withdrawal to be given by certified mail.1954-Act July 29, 1954, in second par., provided, that no lease shall terminate for nonproduction (1) if reworking or drilling operations are begun within 60 days after cessation of production, (2) if cessation of production is by order or with consent of the Secretary of the Interior, or (3) unless the lessee is given a reasonable time of at least 60 days to place a well, capable of producing paying quantities of oil or gas, on a producing status.Act July 29, 1954, in third par., made sure that if a lessee seasonably applies for an extension of the initial five-year term of the lease he will be given such extension for either 5 years or 2 years, depending on whether or not the land is in a producing structure.Act July 29, 1954, in fifth par., provided that the primary term of a lease which is effected by an agreement under which the United States received compensatory royalty remains in full force and effect for 1 year following discontinuance of compensatory royalty payments.1946-Act Aug. 8, 1946, principally substituted, with respect to the leasing of lands not within a known geological structure of a producing oil or gas field, a royalty rate of 12½ per cent without further provision as to lease terms or quality of production; substituted a minimum royalty of $1 per acre per annum after discovery for the advance rental of not less than 25 cents per acre per annum required prior to discovery; provided that all leases shall be for a primary term of 5 years which shall continue thereafter for so long as oil or gas is produced in paying quantities, and that leases, with certain exceptions, shall be subject to one renewal for 5 years, and, if not subject to renewal, shall extend for an additional 2 years if diligent operations are in progress at the lease expiration date.1935-Act Aug. 21, 1935, amended section generally.1931-Act Mar. 4, 1931, amended section generally.1930-Act July 3, 1930, amended section generally.
EFFECTIVE DATE OF 1992 AMENDMENTPub. L. 102-4861992, provided that: "The amendments made by subsection (a) [amending this section] apply with respect to those mineral estates in which the interest of the United States becomes a vested present interest after January 1, 1990."
REGULATIONSPub. L. 109-582005, provided that: "Not later than 45 days after the date of enactment of this Act [Aug. 8, 2005], the Secretary [of the Interior] shall issue final regulations to implement this section [amending this section]."Pub. L. 102-4861992, provided that: "Within 90 days after the enactment of this Act [Oct. 24, 1992] the Secretary of Agriculture shall promulgate regulations to implement the amendment made by subsection (a) [amending this section]."Pub. L. 100-203, title V, §5107, Dec. 22, 1987, 101 Stat. 1330-259, provided that:"(a) REGULATIONS.-The Secretary shall issue final regulations to implement this subtitle [subtitle B (§§5101-5113) of title V of Pub. L. 100-203, see Short Title of 1987 Amendment note set out under section 181 of this title] within 180 days after the enactment of this subtitle [Dec. 22, 1987]. The regulations shall be effective when published in the Federal Register."(b) TREATMENT UNDER OTHER LAW.-The proposal or promulgation of such regulations shall not be considered a major Federal action subject to the requirements of section 102(2)(C) of the National Environmental Policy Act of 1969 [42 U.S.C. 4332(2)(C)]."(c) TEST SALE.-The Secretary may hold one or more lease sales conducted in accordance with the amendments made by this subtitle before promulgation of regulations referred to in subsection (a). Sale procedures for such sale shall be established in the notice of sale."
SAVINGS PROVISIONPub. L. 86-705Sept. 2, 1960, 74 Stat. 791, provided that: "No amendment made by this Act [see Short Title of 1960 Amendment note set out under section 181 of this title] shall affect any valid right in existence on the effective date [Sept. 2, 1960] of the Mineral Leasing Act Revision of 1960."See note set out under section 181 of this title.
TRANSFER OF FUNCTIONSFunctions of Secretary of the Interior, referred to in subsec. (j), to promulgate regulations under this chapter relating to establishment of diligence requirements for operations conducted on Federal leases, setting of rates for production of Federal leases, and specifying of procedures, terms, and conditions for acquisition and disposition of Federal royalty interests taken in kind, transferred to Secretary of Energy by section 7152(b) of Title 42, The Public Health and Welfare. Section 7152(b) of Title 42 was repealed by Pub. L. 97-100, title II, §201, Dec. 23, 1981, 95 Stat. 1407, and functions of Secretary of Energy returned to Secretary of the Interior. See House Report No. 97-315, pp. 25, 26, Nov. 5, 1981.
PENDING APPLICATIONS, OFFERS, AND BIDSPub. L. 100-203, title V, §5106, Dec. 22, 1987, 101 Stat. 1330-259, provided that:"(a) Notwithstanding any other provision of this subtitle [subtitle B (§§5101-5113) of title V of Pub. L. 100-203, see Short Title of 1987 Amendment note set out under section 181 of this title] and except as provided in subsection (b) of this section, all noncompetitive oil and gas lease applications and offers and competitive oil and gas bids pending on the date of enactment of this subtitle [Dec. 22, 1987] shall be processed, and leases shall be issued under the provisions of the Act of February 25, 1920 [this chapter], as in effect before its amendment by this subtitle, except where the issuance of any such lease would not be lawful under such provisions or other applicable law."(b) No noncompetitive lease applications or offers pending on the date of enactment of this subtitle for lands within the Shawnee National Forest, Illinois; the Ouachita National Forest, Arkansas; Fort Chaffee, Arkansas; or Eglin Air Force Base, Florida; shall be processed until these lands are posted for competitive bidding in accordance with section 5102 of this subtitle [amending this section and section 188 of this title]. If any such tract does not receive a bid equal to or greater than the national minimum acceptable bid from a responsible qualified bidder then the noncompetitive applications or offers pending for such a tract shall be reinstated and noncompetitive leases issued under the Act of February 25, 1920, as in effect before its amendment by this subtitle, except where the issuance of any such lease would not be lawful under such provisions or other applicable law. If competitive leases are issued for any such tract, then the pending noncompetitive application or offer shall be rejected."(c) Except as provided in subsections (a) and (b) of this section, all oil and gas leasing pursuant to the Act of February 25, 1920, after the date of enactment of this subtitle shall be conducted in accordance with the provisions of this subtitle."
REPORT TO CONGRESSPub. L. 100-203, title V, §5110, Dec. 22, 1987, 101 Stat. 1330-261, provided that: "The Secretary shall submit annually for 5 years after enactment of this subtitle [Dec. 22, 1987] to the Congress a report containing appropriate information to facilitate congressional monitoring of this subtitle [subtitle B (§§5101-5113) of title V of Pub. L. 100-203, see Short Title of 1987 Amendment note set out under section 181 of this title]. Such report shall include, but not be limited to-"(1) the number of acres leased, and the number of leases issued, competitively and noncompetitively;"(2) the amount of revenue received from bonus bids, filing fees, rentals, and royalties;"(3) the amount of production from competitive and noncompetitive leases; and"(4) such other data and information as will facilitate-"(A) an assessment of the onshore oil and gas leasing system, and"(B) a comparison of the system as revised by this subtitle with the system in operation prior to the enactment of this subtitle."
LAND USE STUDYPub. L. 100-203, title V, §5111, Dec. 22, 1987, 101 Stat. 1330-262, provided that: "The National Academy of Sciences and the Comptroller General of the United States shall conduct a study of the manner in which oil and gas resources are considered in the land use plans developed by the Secretary of the Interior in accordance with provisions of the Federal Land Policy and Management Act of 1976 (90 Stat. 2743) [Pub. L. 94-579, see Short Title note under 43 U.S.C. 1701] and the Secretary of Agriculture in accordance with the Forest and Rangeland Renewable Resources Planning Act of 1974 (88 Stat. 476) [Pub. L. 93-378, 16 U.S.C. 1600 et seq.], as amended by the National Forest Management Act of 1976 (90 Stat. 2949) [Pub. L. 94-588, see Short Title of 1976 Amendment note under 16 U.S.C. 1600], and recommend any improvements that may be necessary to ensure that-"(1) potential oil and gas resources are adequately addressed in planning documents;"(2) the social, economic, and environmental consequences of exploration and development of oil and gas resources are determined; and"(3) any stipulations to be applied to oil and gas leases are clearly identified."
REINSTATEMENT AND EXTENSION OF CERTAIN TEN-YEAR OIL AND GAS LEASESAct July 14, 1952, ch. 742, 66 Stat. 630, provided: "That any lease issued for a ten-year term in exchange for an oil and gas prospecting permit pursuant to sections 13 and 17 of the Act entitled 'An Act to promote the mining of coal, phosphate, oil, oil shale, gas, and sodium on the public domain', approved February 25, 1920, as amended by the Act of August 21, 1935 (49 Stat. 674) [sections 221 and 226, respectively, of this title], and prior to amendment by the Act of August 8, 1946 [act Aug. 8, 1946, ch. 916, §3, 60 Stat. 951], and upon which drilling operations were being diligently prosecuted on the expiration date of such lease, prior to the effective date of this Act [July 14, 1952], is hereby reinstated effective from the expiration date of the lease and shall continue in effect for a period of two years after the effective date of this Act and so long thereafter as oil or gas is produced in paying quantities, if, within ninety days after the enactment of this Act, payment is made, under the terms of such lease as reinstated and extended, of any sums due the United States for prior years. This Act shall not be applicable to any lands which, subsequent to such expiration and prior to the enactment of this Act, have been withdrawn from leasing, leased, or otherwise disposed of."
OUTER CONTINENTAL SHELF; LEASESGrant by Secretary of the Interior of oil, gas, and other mineral leases on submerged lands of outer Continental Shelf, see section 1331 et seq. of Title 43, Public Lands.
Section 225 - Condition of lease, forfeiture for violation
Section 226-1 - Extension of noncompetitive oil or gas lease issued before September 2, 1960