[Senate Report 114-137]
[From the U.S. Government Publishing Office]
Calendar No. 217
114th Congress } { Report
SENATE
1st Session } { 114-137
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THE OFFSHORE PRODUCTION AND ENERGIZING NATIONAL SECURITY ACT OF 2015
_______
September 9, 2015.--Ordered to be printed
_______
Ms. Murkowski, from the Committee on Energy and Natural Resources,
submitted the following
R E P O R T
together with
MINORITY VIEWS
[To accompany S. 2011]
The Committee on Energy and Natural Resources, having
considered an original bill (S. 2011) to provide for reforms of
the administration of the Outer Continental Shelf of the United
States, and for other purposes, reports favorably thereon and
recommends that the bill do pass.
CONTENTS
Page
Purpose of the Measure........................................... 1
Background and Need.............................................. 2
Legislative History.............................................. 4
Committee Recommendation and Tabulation of Votes................. 4
Section-by-Section Analysis...................................... 5
Cost and Budgetary Considerations................................ 9
Regulatory Impact Evaluation..................................... 9
Congressionally Directed Spending................................ 10
Executive Communications......................................... 10
Minority Views................................................... 11
Changes in Existing Law.......................................... 16
Purpose
The purpose of this measure is to provide for reforms of
the administration of the Outer Continental Shelf of the United
States, to provide for revenue sharing for coastal producing
states, to lift the ban on crude oil exports, and to support
Tribal resilience efforts.
Background and Need
The outer continental shelf (OCS) of the United States is a
significant source of domestic oil and natural gas production.
Following the Supreme Court's decision in United States v.
California in 1947 that all of the submerged lands and their
oil and gas resources beyond the nation's coastline belonged to
the nation as a whole and not to the adjacent state, Congress
gave the coastal states the first three nautical miles of
submerged lands beyond their shores in 1953. At the same time,
Congress expressly retained control over the submerged lands
and their resources beyond the three-nautical-mile area ceded
to the coastal states. In 1986, Congress gave the coastal
states an additional 27 percent of the federal oil and gas
royalties from leases in the second three nautical miles from
the coastline to compensate the states for any drainage of
state resources that might occur from oil and gas development
on adjacent federal leases. In 2006, pursuant to the Gulf of
Mexico Energy Security Act (GOMESA), Congress gave four coastal
states--Louisiana, Texas, Alabama, and Mississippi--37.5
percent of the federal royalties from new leases in a limited
area (Phase I) of the Gulf of Mexico beginning in 2007, and
beginning in fiscal year 2017 from all leases in the Gulf of
Mexico entered into after 2006 (Phase II). Phase II revenue
sharing for the four Gulf states is currently subject to an
annual cap of $500 million. Under current law, Alaska, Florida,
and the Atlantic and Pacific Ocean coastal states are not
eligible to receive a share of lease revenues for leasing that
may occur off their shores.
Oil and gas lease sales
According to the U.S. Energy Information Administration
(EIA), crude oil production from the Federal OCS in the Gulf of
Mexico (GOM) averaged 1.4 million barrels per day in 2014,
which accounts for roughly 16 percent of domestic crude oil
production. Offshore production also contributes substantial
revenues to the Federal Treasury. According to the Office of
Natural Resources Revenue, royalties from crude oil production
in the offshore GOM for fiscal year 2014 were $4.65 billion
dollars. In the same fiscal year, $3.4 million dollars were
shared with the four coastal states pursuant to GOMESA,
accounting for roughly 0.07 percent of the royalties from GOM
crude oil production. In addition to crude oil, the OCS is an
important source of natural gas, natural gas liquids, and
condensate that also provide domestic energy and revenues for
the treasury. In addition to direct revenues, producing oil and
gas from the OCS supports local businesses and employment; the
Bureau of Ocean Energy Management (BOEM) estimates that the GOM
supports approximately 250,000 jobs and that increased leasing
may increase local employment opportunities associated with
development and production.
Lease sales form the foundation of future OCS production by
providing access to prospective acreage. In lease sales,
companies competitively bid for the right to explore for oil
and gas on the lease and--should they discover commercially
viable quantities of oil and gas--the right to pursue
development, and ultimately production. Lease sales are held by
the BOEM based on Five-Year Plans developed according to the
Outer Continental Shelf Lands Act (OCSLA). The current Draft
Proposed Program (DPP) issued by BOEM recommends 14 lease sales
over the period from 2017 through 2022. BOEM proposes a single
lease sale in the Beaufort (2020), one in the Cook Inlet
(2021), and one in the Chukchi (2022) sea off Alaska over the
five year period. Similarly, in the Mid-Atlantic and South-
Atlantic the DPP calls for a single sale (2021). The remaining
lease sales are proposed for the GOM regions not currently
subject to Congressional moratorium--primarily the Eastern Gulf
of Mexico (EGOM). It is important to note that inclusion of a
sale in the DPP does not guarantee that a sale will be included
in the final plan. The Committee believes this legislation is
necessary to improve our economy, strengthen national energy
security, and provide more funding for land and water
conservation.
Oil exports
A complex regulatory and legal framework imposes a general
prohibition on the export of domestic crude oil. The Energy
Policy and Conservation Act of 1975 requires the President to
``promulgate a rule'' prohibiting oil exports. Additional
statutory restrictions are imposed by the Mineral Leasing Act,
as amended in 1973; the Outer Continental Shelf Lands Act, as
amended in 1978; and the Naval Petroleum Reserves Production
Act of 1976. In the past, Presidents Ronald Reagan, George H.W.
Bush, and Bill Clinton determined oil exports to be in the
national interest under certain conditions. The United States
is the only member of the International Energy Agency that
generally prohibits exporting oil.
Despite rising supply and falling net imports, companies
that produce oil in the United States are unable to access
global markets. Refined products, however, may be exported
without a license and are currently at record levels. The EIA
reported that light grades of oil constitute the majority of
new production, which the bulk of refineries in the U.S. are
not optimized to process, and that domestic gasoline prices
correlate to the international benchmark price of oil, which
would likely decrease as a result of greater domestic oil
exports. The Congressional Budget Office and the Government
Accountability Office (GAO) have concluded that repealing the
general prohibition on exporting oil would likely not raise
gasoline prices.
The Committee believes that domestic crude oil exports are
in the best interest of the country. This legislation would
authorize exports of domestic crude oil without a license
although exports of oil from the Strategic Petroleum Reserve
would still require a license. Exports to countries that are
subject to sanctions by the United States would be prohibited.
This legislation also preserves the emergency authority of the
President to prohibit exports.
Tribal resilience
The Committee recognizes the need to provide support to
Indian Tribes to protect their land and resources from weather-
related events. This legislation builds off existing
Administration planning and education programs to focus on
capital investment in the restoration or construction of
infrastructure, energy systems that reduce emissions and social
or cultural infrastructure that supports resilience.
Legislative History
During the 113th Congress, the Committee on Energy and
Natural Resources conducted two oversight hearings (January 30,
2014 and March 25, 2014) to examine the issue of crude oil
exports. Numerous measures in both the Senate and the House of
Representatives were introduced dealing with oil and gas
development in the OCS. The House of Representatives passed
H.R. 2231, the Offshore Energy and Jobs Act on June 28, 2013
and it was referred to the Committee but no further action was
taken.
In the 114th Congress, the Committee of Energy and Natural
Resources conducted an oversight hearing on crude oil export
policy (March 19, 2015). The Full Committee held a legislative
hearing on energy supply (S. Hrg. 114-17, May 19, 2015) to
consider a number of measures, including: S. 1276, the Gulf of
Mexico Offshore Energy and Jobs Act, S. 1278, the Alaska Outer
Continental Shelf Lease Sale Act; and S. 1279, the Southern
Atlantic Energy Security Act. The Committee also held a
legislation hearing to consider energy accountability and
reform measures (June 9, 2015), including S. 1312, the Energy
Supply and Distribution Act.
On July 22, 2015, the Chairman circulated to Members of the
Committee a draft of an original bill drawn from the text of S.
1276. S. 1278, S. 1279, and S. 1312.
The Committee on Energy and Natural Resources met in open
business session on July 30, 2015 to consider the draft, and
ordered an original bill favorably reported.
Committee Recommendation and Tabulation of Votes
The Senate Committee on Energy and Natural Resources, in an
open business session on July 30, 2015, by a majority voice
vote of a quorum present, recommended that the Senate pass an
original bill, as described herein.
The roll call vote on reporting the measure was 12 yeas, 10
nays, as follows:
YEAS NAYS
Ms. Murkowski Ms. Cantwell
Mr. Barrasso Mr. Wyden*
Mr. Risch Mr. Sanders*
Mr. Lee* Ms. Stabenow
Mr. Flake* Mr. Franken
Mr. Daines Mr. Manchin
Mr. Cassidy Mr. Heinrich
Mr. Gardner Ms. Hirono
Mr. Portman Mr. King
Mr. Hoeven Ms. Warren
Mr. Alexander*
Mrs. Capito
*Indicates vote by proxy.
Section-by-Section Analysis
Section 1. Short title; Table of contents
Section 1 provides a short title and table of contents.
Section 2. Definition of Secretary
Section 2 defines ``Secretary'' for purposes of the Act as
the Secretary of the Interior.
TITLE 1: THE GULF OF MEXICO OFFSHORE ENERGY AND JOBS ACT OF 2015
Section 101. Outer Continental Shelf leasing program reforms
Section 101 amends section 18 of the OCSLA by defining the
term ``available unleased acreage'' and requiring the Secretary
to make available unleased acreage in each proposed oil and gas
leasing program in the Gulf of Mexico based on the most recent
geologic assessment. It also requires the Secretary to include
any State subdivision requested by a Governor of the State in
each proposed oil and gas leasing program in the Gulf of
Mexico; prohibits the Secretary from removing such subdivision
from the proposed program until publication of the final
program; and requires the Secretary to include in each proposed
oil and gas leasing program in the Gulf of Mexico any OCS area
that is estimated to include more than a specified quantity of
oil or gas resources and specifies the guidelines to be used by
the Secretary in estimating the resources.
Section 102. Moratorium on oil and gas leasing in certain areas of the
Gulf of Mexico
Section 102(a) amends section 102 of GOMESA to define the
military mission line in the western border of the Eastern
Planning Area. Section 102(b) amends section 104(a) of that Act
by adjusting the moratorium in the Eastern Planning Area from
125 miles off the coast of the State of Florida to 50 miles and
the area of the moratorium in the Central Planning Area from
within 100 miles to within 50 miles off the Florida coastline.
Section 103. Requirement to implement proposed 2017-2022 oil and gas
leasing program
Section 103 requires the Secretary to implement the
Proposed Final Outer Continental Shelf Oil and Gas Leasing
Program (2017-2022) with certain revisions and adds three lease
sales in the Eastern Gulf of Mexico Planning Area in fiscal
years 2018, 2019, and 2020.
Section 104. Disposition of outer Continental Shelf revenues to Gulf
producing States
Section 104 amends section 102 of GOMESA to include the
State of Florida as a Gulf producing State beginning in fiscal
year 2017 and to provide for revenue sharing to the State from
sales in the Eastern Gulf of Mexico Planning Area from leases
entered into on, or after October 1, 2016. Section 104(b)
amends section 105(a) of GOMESA to direct the 25 percent of the
50 percent of revenues from the Gulf of Mexico not reserved to
the treasury or to states to be considered as income to the
Land and Water Conservation Fund for financial assistance to
States. Section 104(d) amends section 105(f) of GOMESA to
increase the cap on revenue sharing to Gulf Producing States
from $500 million to $699 million from fiscal years 2018
through 2025 and from $699 million to $999 million from fiscal
years 2026 through 2055.
Section 105. National defense
Section 105 clarifies that the authority of the Secretary
of Defense to designate national defense areas on the OCS
remains unaffected, and prohibits conflicts between
exploration, development or production of oil and gas on the
OCS with any military operation.
Section 106. Environmental impact statement requirement
Section 106 directs the Secretary to prepare a multi-state
environmental impact statement for the lease sales required
under the title that are not included in the Proposed Final
Outer Continental Shelf Oil and Gas Leasing Program (2017-2022)
and specifies the actions to be considered.
Section 107. State authorization
Section 107 allows a State to enter into a leasing program
prior to the publication of an environmental impact statement
for the Proposed Final Outer Continental Shelf Oil and Gas
Leasing Program if the legislature of that State enacts a law
approving inclusion in the program.
Section 108. Air emissions from outer Continental Shelf activities
Section 108 amends section 328 of the Clean Air Act to
create consistency with the rest of the Gulf of Mexico for the
Eastern Gulf of Mexico Planning Area for the purposes of air
permitting.
Section 109. Offshore certainty
Section 109 adopts time requirements for the Secretary's
consideration of requests for an Incidental Harassment
Authorization (IHA) and clarifies the treatment of an IHA for
the purposes of the Endangered Species Act.
Section 110. Continuous operations rule
Section 110 requires the Secretary to amend the regulatory
requirement for continuous operations to maintain a lease from
180 to 365 days.
Section 111. GAO report on cumulative cost of regulation for offshore
energy production
Section 111 requires the Comptroller General to prepare a
report estimating the cost of complying with major Federal
rules relating to offshore energy development and submit the
report to the Congressional committees of jurisdiction.
TITLE II: THE ALASKA OUTER CONTINENTAL SHELF LEASE SALE ACT
Section 201. Lease sales in Nearshore Beaufort Sea Planning Area, Cook
Inlet Planning Area
Section 201 establishes the Nearshore Beaufort Sea Planning
Area and requires the Secretary to conduct lease sales in that
Planning Area and the Cook Inlet Planning Area in fiscal years
2018, 2019, and 2020.
Section 202. Lease terms of certain Chukchi and Beaufort leases
Section 202 amends section 8(b)(2) of OCSLA to revise the
term of leases issued in the Beaufort Sea Planning Area or the
Chukchi Sea Planning Area to 20 years and provides the
Secretary explicit authority to extend existing lease terms in
the Chukchi and Beaufort to 20 years.
Section 203. Distribution of revenue to Alaska
Section 203 amends section 9 of OCSLA to direct the
disposition of revenues from the OCS of Alaska for fiscal years
2016 through 2026 to the Treasury; the State of Alaska; coastal
political subdivisions; the North Slope Science Initiative;
institutions of higher education and workforce investment
boards; a special account in the Treasury to support offshore
leasing and development programs and the development of rights
of way needed for transportation purposes; and to the Tribal
Resilience Fund established in section 402 of this bill. It
directs the disposition of revenues from the OCS of Alaska to
the Treasury, the State of Alaska, coastal political
subdivisions and the Tribal Resilience Fund beginning in fiscal
year 2027.
Section 204. Inclusion of Beaufort, Nearshore Beaufort, Cook Inlet, and
Chukchi lease sales in 5-year leasing programs
Section 304 amends section 18 of OCSLA to require at least
three lease sales in each of the Beaufort Planning Area and the
Chukchi Planning Area, and annually in the Nearshore Beaufort
Planning Area and Cook Inlet Planning area in any 5-year
proposed oil and gas leasing program, beginning with the oil
and gas leasing program for 2023 to 2027.
Section 205. North Slope science initiative
Section 205 amends section 348 of the Energy Policy Act of
2005 to include the Beaufort and Chukchi Seas in the
jurisdiction of the North Slope Science Initiative (NSSI) and
to expand the membership of the NSSI to include the Northwest
Arctic Borough and NANA Regional Corporation.
TITLE III: THE SOUTHERN ATLANTIC ENERGY SECURITY ACT
Section 301. Definition
Section 301 defines key terms for the title and establishes
the South Atlantic Planning Area.
Section 302. Preserving coastal viewsheds
Section 302(a) creates protections for coastal viewsheds by
requiring consultation by the Secretary with a Governor prior
to conducting a lease sale within 30 nautical miles of the
coastline of a State to consider the establishment of lease
stipulations for the management of surface occupancy of the
areas between the coastline and 30 nautical miles. Section
302(b) sets forth consideration for production facilities.
Section 302(c) establishes restrictions on the installation of
permanent production facilities in the area up to 30 nautical
miles off coastline.
Section 303. 2017-2022 leasing program
Section 303 requires the Secretary to include the South
Atlantic Planning Area in the OCS leasing program for fiscal
years 2017 through 2022 and conduct lease sales in the South
Atlantic Planning Area in fiscal years 2021 and 2022.
Section 304. Balancing of military and energy production goals
Section 304(a) recognizes that the OCS is integral to
national security, requires the Secretary to work with the
Secretary of Defense in implementing lease sales to preserve
the ability of the Armed Forces of the United States to use the
OCS and to allow effective oil, gas and renewable energy
exploration, development and production from the OCS. Section
304(b) clarifies that nothing in this title or amendment
affects the authority of the Secretary of Defense to designate
national defense areas on the OCS. Prohibits exploration,
development, or production of oil and gas on the OCS that would
conflict with any military operation.
Section 305. Disposition of revenues to Atlantic States
Section 305 amends section 9 of OCSLA to direct the
disposition of revenues from the South Atlantic Planning Area
to the Treasury, States, the Department of Energy for projects
that enhance the safety, security, resiliency and reliability
of energy supply, research, transmission, storage or
distribution infrastructure, the Energy Efficiency and
Renewable Energy program at the Department of Energy, and to
high priority maintenance needs at the National Park Service
that support critical infrastructure and visitor services. It
provides for a Governor to direct revenues received by a State
to enhance State land and water conservation efforts, improve
public transportation projects, establish alternative,
renewable and clean energy production, enhance beach
nourishment and coastal dredging, and enhance geological and
geophysical education programs.
Section 306. Enhancing geological and geophysical education for
America's energy future
Section 306(a) requires the Secretary to partner with
institutions of higher education to facilitate the study of
geological and geophysical sciences in support of exploration
and development of the OCS. Section 306(b) provides direction
for the focus of activities amended under this section. Section
306(c) provides direction for a Governor's nomination of
institutions of higher education, authorizes an institution of
higher education to conduct research under this section,
requires a permit to conduct certain research that uses any
solid or liquid explosive, establishes requirements for data
development, and establishes reporting requirements.
Section 307. Atlantic regional office
Section 307 requires the Director of the BOEM to establish
an Atlantic Regional Office and provides criteria for the
location of the office.
TITLE IV: TRIBAL RESILIENCE PROGRAM
Section 401. Tribal Resilience Program
Section 401 requires the Secretary to establish the Tribal
Resilience Program, authorizes grants, defines eligible program
activities, specifies the uses of program funds, requires
interagency cooperation and creates a Tribal Resilience Liaison
position.
Section 402. Tribal Resilience Fund
Section 402 establishes the Tribal Resilience Fund, defines
deposits to the fund, and authorizes appropriations.
TITLE V: MISCELLANEOUS
Section 501. Access to markets
Section 501(a) authorizes all crude oil to be exported
without a Federal license to countries not sanctioned by the
United States, except crude oil stored in the Strategic
Petroleum Reserve. Section 501(b) preserves the emergency
authorities of the President to prohibit exports. Section
501(d) specifies that the President may prohibit exports on an
annual basis if the Secretary of Commerce and the Secretary
Energy determine that exports are causing supply shortages or
price spikes that threaten the U.S. economy. Section 501(e)
requires the GAO to report biannually on the effects of oil
exports.
Section 502. Reports
Section 502(a) requires the Secretary to submit to the
relevant Congressional Committees an analysis of the proposed
regulations of the Bureau of Safety and Environmental
Enforcement relating to blowout preventer systems and well
control and exploratory drilling in the arctic. Section 501(b)
provides direction for the contents of such analysis, and
prohibits the Secretary from issuing any proposed, interim or
final regulation until submission of the required report.
Section 501(c) further prohibits the Secretary from issuing any
final regulation or rule that does not take into account the
report's findings.
Cost and Budgetary Considerations
The Congressional Budget Office estimate of the costs of
this measure has been requested but was not received at the
time the report was filed. When the report is available, the
Chairman will request it to be printed in the Congressional
Record for the advice of the Senate.
Regulatory Impact Evaluation
In compliance with paragraph 11(b) of rule XXVI of the
Standing Rules of the Senate, the Committee makes the following
evaluation of the regulatory impact which would be incurred in
carrying out the legislation.
The bill is not a regulatory measure in the sense of
imposing Government-established standards or significant
economic responsibilities on private individuals and
businesses.
The provides that an institute of higher education selected
for a grant under this section may only conduct research under
this section using any solid or liquid explosive upon
authorization by a permit issued by the Director.
The bill also provides that the President may impose export
licensing requirements or other restrictions on the export of
crude oil from the United States in certain emergency
circumstances. This emergency authority mirrors existing law
and any economic and regulatory burden would only apply in
times of emergency.
No personal information would be collected in administering
programs authorized under the bill. Therefore, there would be
no impact on personal privacy.
Little, if any, additional paperwork would result from the
enactment of the bill, as ordered reported.
Congressionally Directed Spending
The bill, as reported, does not contain any congressionally
directed spending items, limited tax benefits, or limited
tariff benefits as defined in rule XLIV of the Standing Rules
of the Senate.
Executive Communications
Executive views on the original bill have not been
received.
MINORITY VIEWS
The best thing that can be said for the Offshore Production
and Energizing National Security Act, or OPENS Act, is that it
has an appropriate acronym. It opens the doors to the United
States Treasury to a few chosen states; it opens new offshore
areas to oil and gas development upon demand, heedless of
rational planning; and it opens access to our domestic oil
supplies to foreign buyers, leaving the American people open to
paying higher gasoline prices.
THE ROYALTY GIVE-AWAY
All of the lands submerged beneath the territorial sea
beyond our shores and the oil and natural gas resources they
contain once belonged to the nation and to its people as a
whole. More than sixty years ago, a few coastal states tried to
claim those submerged lands and their resources for themselves
alone. But the Supreme Court rejected the coastal states'
claims and held that the submerged lands and their resources
belonged to the nation as a whole. ``National interests,
national responsibilities, national concerns are involved,''
the Court said.\1\
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\1\United States v. Louisiana, 339 U.S. 699, 704 (1950), citing
United States v. California, 332 U.S. 19 (1947).
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In spite of the Supreme Court's decision, Congress voted to
give the submerged lands beneath our territorial seas to the
adjacent coastal states in 1953. The Submerged Lands Act,
dubbed the ``Oil Give-Away'' Law by its opponents, gave the
coastal states all of the submerged lands to a distance of
three nautical miles from the coastline (and in the case of
Florida and Texas, nine nautical miles into the Gulf of
Mexico). The Oil Give-Away Law also gave the coastal states the
right to develop the oil and natural gas resources beneath
these submerged lands and to retain all of the royalties from
those resources for themselves.
But in giving the coastal states the first three nautical
miles of the continental shelf, Congress made it clear that it
was retaining for the nation as a whole the so-called ``outer''
continental shelf, the rest of the continental shelf outside
the area given to the coastal states. The Outer Continental
Shelf Lands Act, enacted just three months after the Oil Give-
Away Law, gave the federal government exclusive ownership and
control over the mineral wealth of the outer continental shelf.
Royalties from the oil and natural leases on the outer
continental shelf are now one of the federal government's
largest sources of non-tax income.
Not satisfied with the generous gift of the inner
continental shelf, four of the five Gulf Coast states persuaded
Congress in 2006 to give them 37.5 percent of the federal
government's royalties from certain new federal leases in the
Gulf of Mexico beginning in fiscal year 2007, and 37.5 percent
of the federal royalties from all leases in the central and
western planning areas of the Gulf of Mexico beginning in
fiscal year 2017, up to a total of $500 million per year.
The OPENS Act will compound this huge loss to the Federal
Treasury. It begins by raising the $500 million annual cap on
the payment of federal royalties to the Gulf Coast states to
$699 million per year beginning in October 2017, and then
raising it again to $999 million per year, nearly double its
current level, beginning in October 2025.
But the OPENS Act does not stop there. It extends the
payment of federal royalties to six more coastal states:
Alaska, Florida, Georgia, North Carolina, South Carolina, and
Virginia. It commits 37.5 percent of the federal royalties from
oil and gas leases on the outer continental shelf beneath the
Atlantic Ocean to the four Atlantic coastal states, without any
cap on the total payments. It commits 22.5 percent of the
federal royalties from oil and gas leases on the outer
continental shelf surrounding Alaska to Alaska and 2.5 percent
to Indian tribes beginning this October, and 37.5 percent to
Alaska and 12.5 percent to Indian tribes beginning in October
2026, without any cap on total payments. All of these amounts
are in addition to the state royalties collected by the coastal
states for oil and gas leases on the inner continental shelf
given to them by the Submerged Lands Act in 1953. They are
taken from the federal royalties the Act reserved to the
federal government for the benefit of all Americans.
THE PLANNING GIVE-AWAY
Under current law, ``the outer Continental Shelf is a vital
national reserve held by the Federal Government for the public,
which should be made available for expeditious and orderly
development, subject to environmental safeguards, in a manner
which is consistent with . . . national needs.'' 43 U.S.C.
Sec. 1332(3). To that end, the Outer Continental Shelf Lands
Act establishes an orderly planning process. It requires the
Secretary of the Interior, as the guardian of this public
trust, to maintain an ongoing leasing program in five-year
planning increments. The Act commands her to conduct the
leasing program ``in a manner which considers economic, social,
and environmental values . . ., and the potential impact of oil
and gas'' development on ``the marine, coastal, and human
environments.'' 43 U.S.C. Sec. 1344(a)(1).
The OCS Lands Act entrusts the responsibility for
conducting the leasing program to the Secretary of the
Interior. She is entrusted to ``select the timing and location
of leasing, to the maximum extent practicable, so as to obtain
a proper balance between the potential for environmental
damage, the potential for discovery of oil and gas, and the
potential for adverse impact on the coastal zone.'' 43 U.S.C.
Sec. 1344(a)(3). Governors may make recommendations to the
Secretary, but she alone bears the responsibility for striking
``a reasonable balance between the national interest and the
well-being of the citizens of the affected state.'' 43 U.S.C.
Sec. 1345(c). It is the Secretary, not the Governors or the oil
and gas industry, who must determine ``the size, timing, and
location of leasing activity which . . . will best meet
national energy needs . . .'' 43 U.S.C. Sec. 1344(a).
The OPENS Act upends this balance by requiring the
Secretary to conduct mandatory lease sales. To begin with,
under the Gulf of Mexico Energy Security Act of 2006, the
Secretary may not lease any area within 125 miles of the
Florida coastline in the eastern planning area or within 100
miles of the Florida coastline in the central planning area
before July 2022. Nor may she lease, before July 2022, any area
east of the Military Mission Line, a line drawn south from
Eglin Air Force Base nearly 30 years ago to avoid conflicts
between oil and gas leasing and military testing and training
activities in the Eastern Gulf of Mexico. Congress put these
areas off limits by statute in 2006 out of concern for military
preparedness and the potential environmental consequences of
oil and gas development in the Eastern Gulf.
The OPENS Act opens up a vast part of the Eastern Gulf
currently protected by current law by shrinking the statutory
125- and 100-mile exclusion areas to only 50 miles, and by
shortening the Military Mission line to only 50 miles from the
Florida coastline. It then mandates three lease sales in the
Eastern Gulf, one each in fiscal years 2018, 2019, and 2020,
without regard to the Secretary's determination of national
energy needs or her balancing of national interests.
Similarly, the OPENS Act requires the Secretary to make
available for leasing all ``available unleased acreage'' within
each of the three planning areas in the Gulf of Mexico thought
``to have the largest undiscovered, technically recoverable oil
and gas resources,'' as well as any subdivision of a planning
area requested by a Governor. It mandates three lease sales,
one each in fiscal years 2018, 2019, and 2020, in a new
``Nearshore'' planning area in the Beaufort Sea, and three
additional lease sales, one each in fiscal years 2018, 2019,
and 2020, in the Cook Inlet planning area in Alaska. It
requires the Secretary to conduct at least 3 lease sales in the
existing Beaufort planning area and at least 3 lease sales in
the Chukchi planning area during the 2023-2027 planning period.
It requires her to conduct one lease sale in the new
``Nearshore'' planning area in the Beaufort Sea and one lease
sale in the Cook Inlet planning area in each of the five years
during the 2023-2027 planning period. And it requires her to
conduct at least one lease sale during fiscal year 2021 and two
lease sales during fiscal year 2022 in the South Atlantic
planning area. That adds up to 28 mandatory lease sales that
the Secretary must conduct without regard to whether she
believes they ``will best meet national energy needs,'' or
whether they will strike a ``proper balance between the
potential for environmental damage, the potential for the
discovery of oil and gas, and the potential for adverse impact
on the coastal zone.''
To make matters worse, the OPENS Act goes on to weaken air
pollution controls, marine mammal protections, endangered
species protections, due diligence requirements, and National
Environmental Policy Act requirements, and it quadruples the
length of leases in the Arctic in its headlong rush to produce
more oil for sale abroad.
THE OIL GIVE-AWAY
The OPENS Act also lifts the crude oil export ban. The
current ban on crude oil exports stems from three separate laws
within the Committee's jurisdiction: section 103 of the Energy
Policy and Conservation Act; section 28 of the Mineral Leasing
Act; and section 28 of the OCS Lands Act. All three of these
laws rest on the Export Administration Act of 1979, which by
its terms expired in 2001, but remains in effect under
emergency authority granted to the President by the
International Emergency Economic Powers Act. President Bush
invoked this emergency authority to continue the Export
Administration Act's export controls in 2001, saying that it
was necessary to protect the domestic economy. President Bush
and President Obama have continued to use the emergency
authority to continue export controls each year since 2001.
The Energy Policy and Conservation Act was enacted in 1975
to conserve energy supplies following the Arab oil embargo of
1973. EPCA does not bar crude oil export directly, but instead
directs the President to prohibit crude oil exports by use of
the export control procedures established by the Export
Administration Act of 1979. Similarly, the Mineral Leasing Act
subjects the export of any domestically produced crude oil that
is transported by pipeline over a right-of-way granted under
that Act across public lands to the licensing requirements of
the Export Administration Act. And the OCS Lands Act subjects
oil and gas produced from the outer continental shelf to the
requirements of the Export Administration Act.
Significantly, though, EPCA, the Mineral Leasing Act, and
the OCS Lands Act all provide a national interest exception to
the export ban. EPCA exempts crude oil exports from the ban if
the President determines they are consistent with the national
interest. The Mineral Leasing Act permits crude oil exports if
they will not diminish domestic oil supplies. The OCS Lands Act
permits exports if they will not increase our dependence on
imported oil. Both the Mineral Leasing Act and the OCS Lands
Act also require that any exports be in the national interest
and in accord with the Export Administration Act.
Plainly, then, the President can loosen or lift the ban on
crude oil exports under these statutes without any additional
legislative authority simply by finding that crude oil exports
are consistent with the national interest and will not diminish
domestic supplies or increase dependence on foreign imports.
Under this authority, President Reagan authorized crude oil
exports to Canada in 1985 and 1988, President George H. W. Bush
authorized exports of California heavy crude oil in 1992, and
President Clinton authorized exports of Alaskan North Slope
crude oil in 1996. In addition, the Commerce Department has
recently announced its decision to permit the export of light,
sweet crude produced in this country to Mexico, in exchange for
heavy Mexican crude. Several Presidents have found relaxing the
ban on crude oil exports is in the national interest, but none
has yet been able to find that lifting it entirely is. The fact
that our dependence on foreign oil has declined since its peak
in 2005 may suggest to some that the ban can now be lifted. But
the fact that we still need to import about a quarter of the
oil we consume argues strongly against lifting the ban
completely.
The OPENS Act sweeps away the crude oil export ban based
upon its own self-declared findings. But the bill's wishful
thinking is no substitute for the Presidential determination
required by current law that exports must be in the national
interest, must not diminish domestic supplies, and must not
increase our dependence on foreign imports. The bill contains a
savings clause that would allow the President to reinstate the
ban if exports harm the economy. But it would be better not to
lift the ban until the President can make the necessary
determinations that the ban will do no harm in the first place,
rather than promising to reinstate the ban after harm is done.
CONCLUSION
Under current law, the Outer Continental Shelf ``is a vital
natural resource reserve held by the Federal Government for the
public.'' It is ``available for expeditious and orderly
development,'' but ``subject to environmental safeguards,'' and
``in a manner which is consistent with . . . national needs.''
43 U.S.C. Sec. 1332(3). Congress should use the wealth that
comes from developing this national resource to meet national
needs, for the benefit of the nation as a whole, and not turn
it over to a few select coastal states. It should ensure the
orderly development of those resources, in a manner that
safeguards our fisheries and the environment, and on a schedule
designed to ``best meet national energy needs.'' We should not
``mindlessly . . . lease every square foot of seabottom at
whatever risk''\2\ to satisfy world oil demand. We should not
lift the ban on crude oil exports unless we can first establish
that doing so will not reduce our domestic oil supplies,
increase our dependence on foreign imports, or harm our
national interest.
---------------------------------------------------------------------------
\2\Massachusetts v. Andrus, 594 F.2d 872, 889 (1st Cir. 1979).
---------------------------------------------------------------------------
The OPENS Act would give federal royalties that belong to
the nation as a whole to a select group of coastal states, it
would force the leasing of areas without regard to our national
energy needs, and it would export domestic crude oil without
regard for the national interest. For all of these reasons, it
should not be enacted.
Maria Cantwell.
Changes in Existing Law
In compliance with paragraph 12 of Rule XXVI of the
Standing Rules of the Senate, changes in existing law made by
the original bill, as ordered reported, are shown as follows:
existing law proposed to be omitted is enclosed in black
brackets, new matter is printed in italic, existing law in
which no changes is proposes is shown in roman):
Table of Contents
Page
1. Clean Air Act, Act of July 14, 1955, Chapter 360, as Amended. 16
2. Energy Policy Act of 2005, Public Law 109-58, as Amended..... 17
3. Gulf of Mexico Energy Security Act of 2005, Division C of
Public Law 109-432............................................. 18
4. The Outer Continental Shelf Lands Act, Act of August 7, 1953,
Chapter 345, as Amended........................................ 22
CLEAN AIR ACT
Act of July 14, 1955, Chapter 360, as amended
* * * * * * *
SEC. 328. AIR POLLUTION FROM OUTER CONTINENTAL SHELF ACTIVITIES.
(a)(1) Applicable Requirements for Certain Areas.--Not
later than 12 months after the enactment of the Clean Air Act
Amendments of 1990, following consultation with the Secretary
of the Interior and the Commandant of the United States Coast
Guard, the Administrator, by rule, shall establish requirements
to control air pollution from Outer Continental Shelf sources
located offshore of the States along the Pacific, Arctic and
Atlantic Coasts (other than Outer Continental Shelf sources
located offshore of the North Slope Borough of the State of
Alaska), [and along the United States Gulf Coast off the State
of Florida eastward of longitude 87 degrees and 30 minutes]
(``OCS sources'') to attain and maintain Federal and State
ambient air quality standards and to comply with the provisions
of part C of title I. For such sources located within 25 miles
of the seaward boundary of such States, such requirements shall
be the same as would be applicable if the source were located
in the corresponding onshore area, and shall include, but not
be limited to, State and local requirements for emission
controls, emission limitations, offsets, permitting,
monitoring, testing, and reporting. New OCS sources shall
comply with such requirements on the date of promulgation and
existing OCS sources shall comply on the date 24 months
thereafter. The Administrator shall update such requirements as
necessary to maintain consistency with onshore regulations. The
authority of this subsection shall supersede section 5(a)(8) of
the Outer Continental Shelf Lands Act but shall not repeal or
modify any other Federal, State, or local authorities with
respect to air quality. Each requirement established under this
section shall be treated, for purposes of sections 113, 114,
116, 120, and 304, as a standard under section 111 and a
violation of any such requirement shall be considered a
violation of section 111(e).
* * * * * * *
(b) Requirements for Other Offshore Areas.--For portions of
the United States Outer Continental Shelf that are adjacent to
the States not covered by subsection (a) which are Texas,
Louisiana, Mississippi, the United States Gulf Coast off the
State of Florida, and Alabama or are adjacent to the North
Slope Borough of the State of Alaska, the Secretary shall
consult with the Administrator to assure coordination of air
pollution control regulation for Outer Continental Shelf
emissions and emissions in adjacent onshore areas. Concurrently
with this obligation, the Secretary shall complete within 3
years of enactment of this section a research study examining
the impacts of emissions from Outer Continental Shelf
activities in such areas that fail to meet the national ambient
air quality standards for either ozone or nitrogen dioxide.
Based on the results of this study, the Secretary shall consult
with the Administrator and determine if any additional actions
are necessary. There are authorized to be appropriated such
sums as may be necessary to provide funding for the study
required under this section.
* * * * * * *
ENERGY POLICY ACT OF 2005
Public Law 109-58, as amended
* * * * * * *
SEC. 348. NORTH SLOPE SCIENCE INITIATIVE.
(a) Establishment.--
(1) In general.--The Secretary of the Interior
(referred to in this section as the ``Secretary'')
shall establish a long-term initiative to be known as
the ``North Slope Science Initiative'' (referred to in
this section as the ``Initiative'').
(2) Purpose.--The purpose of the Initiative shall be
to implement efforts to coordinate collection of
scientific data that will provide a better
understanding of the terrestrial, aquatic, and marine
ecosystems of the North Slope of Alaska (including the
Beaufort and Chukchi seas).
(b) Objectives.--To ensure that the Initiative is conducted
through a comprehensive science strategy and implementation
plan, the Initiative shall, at a minimum--
(1) identify and prioritize information needs for
inventory, monitoring, and research activities to
address the individual and cumulative effects of past,
ongoing, and anticipated development activities and
environmental change on the North Slope (including the
Beaufort and Chukchi seas);
(2) [develop an understanding of] identify
information needs for regulatory and land management
agencies, local governments, and the public;
* * * * * * *
(c) Membership.--
(1) In general.--To ensure comprehensive collection
of scientific data, in carrying out the Initiative, the
Secretary shall consult and coordinate with Federal,
State, and local agencies that have responsibilities
for land and resource management across the North
Slope.
(2) Cooperative agreements.--The Secretary shall
enter into cooperative agreements with the State of
Alaska, the North Slope Borough, the Arctic Slope
Regional Corporation, the Northwest Arctic Borough, the
NANA Regional Corporation, and other Federal agencies
as appropriate to coordinate efforts, share resources,
and fund projects under this section.
* * * * * * *
GULF OF MEXICO ENERGY SECURITY ACT OF 2006
Division C of Public Law 109-432
* * * * * * *
SEC. 102. DEFINITIONS.
In this title:
* * * * * * *
[(7) Gulf producing state.--The term ``Gulf producing
State'' means each of the States of Alabama, Louisiana,
Mississippi, and Texas.]
(7) Gulf producing state.--The term ``Gulf producing
State'' means--
(A) each of the States of Alabama, Louisiana,
Mississippi, and Texas; and
(B) effective beginning in fiscal year 2017,
the State of Florida.
[(8) Military mission line.--The term ``Military
Mission Line'' means the north-south line at 86+ 41, W.
longitude.]
(8) Military mission line.--The term ``Military
Mission Line'' means the western border of the Eastern
Planning Area extending from the State of Florida
waters to the point that is 50 miles south in the Gulf
of Mexico.
(9) Qualified outer continental shelf revenues.--
(A) In general.--The term ``qualified outer
Continental Shelf revenues'' means--
(i) in the case of each of fiscal
years 2007 through 2016, all rentals,
royalties, bonus bids, and other sums
due and payable to the United States
from leases entered into on or after
the date of enactment of this Act for--
(I) areas in the 181 Area
located in the Eastern Planning
Area; and
(II) the 181 South Area;
[and]
[(ii) in the case of fiscal year 2017
and each fiscal year thereafter, all
rentals, royalties, bonus bids, and
other sums due and payable to the
United States received on or after
October 1, 2016, from leases entered
into on or after the date of enactment
of this Act for--
[(I) the 181 Area;
[(II) the 181 South Area; and
[(III) the 2002-2007 planning
area.]
(ii) in the case of fiscal year 2017
and each fiscal year thereafter, all
rentals, royalties, bonus bids, and
other sums due and payable to the
United States received on or after
October 1, 2016, from leases entered
into on or after December 20, 2006 in--
(I) areas in the 181 Area
located in the Eastern Planning
Region;
(II) the 181 South Area;
(III) the Central Planning
Area, as described in paragraph
(6)(A)(ii); and
(IV) the Western Planning
Area, as described in paragraph
(6)(A)(iii); and
(iii) in the case of fiscal year 2017
and each fiscal year thereafter, all
eligible rentals, royalties, bonus
bids, and other sums due and payable to
the United States from leases entered
into on or after October 1, 2016, in
the Eastern Planning Area, as described
in paragraph (6)(A)(i).
* * * * * * *
SEC. 104. MORATORIUM ON OIL AND GAS LEASING IN CERTAIN AREAS OF GULF OF
MEXICO.
(a) In General.--Effective during the period beginning on
the date of enactment of this Act and ending on June 30, 2022,
the Secretary shall not offer for leasing, preleasing, or any
related activity--
(1) any area east of the Military Mission Line in the
Gulf of Mexico;
(2) any area in the Eastern Planning Area that is
within [125] 50 miles of the coastline of the State of
Florida; or
[(3) any area in the Central Planning Area that is--
[(A) within--
[(i) the 181 Area; and
[(ii) 100 miles of the coastline of
the State of Florida; or
[(B)(i) outside the 181 Area;
[(ii) east of the western edge of the
Pensacola Official Protraction Diagram (UTM X
coordinate 1,393,920 (NAD 27 feet)); and
[(iii) within 100 miles of the coastline of
the State of Florida.]
(3) any area in the Central Planning Area that is
within--
(A) the 181 Area; and
(B) 50 miles off the coastline of the State
of Florida.
* * * * * * *
SEC. 105. DISPOSITION OF QUALIFIED OUTER CONTINENTAL SHELF REVENUES
FROM 181 AREA, 181 SOUTH AREA, AND 2002-2007
PLANNING AREAS OF GULF OF MEXICO.
(a) In General.--Notwithstanding section 9 of the Outer
Continental Shelf Lands Act (43 U.S.C. 1338) and subject to the
other provisions of this section, for each applicable fiscal
year, the Secretary of the Treasury shall deposit--
(1) 50 percent of qualified outer Continental Shelf
revenues in the general fund of the Treasury; [and]
[(2) 50 percent of qualified outer Continental Shelf
revenues in a special account in the Treasury from
which the Secretary shall disburse--]
[(A) 75 percent to Gulf producing States in
accordance with subsection (b); and]
[(B) 25 percent to provide financial
assistance to States in accordance with section
200305 of title 54, United States Code, which
shall be considered income to the Land and
Water Conservation Fund for purposes of section
200302 of that title.]
(2) in the case of qualified outer Continental Shelf
revenues described in section 102(9)(A)(ii) generated
from outer Continental Shelf areas adjacent to the Gulf
producing States described in section 102(7)(A), 50
percent in a special account in the Treasury from which
the Secretary shall disburse--
(A) 75 percent to those Gulf producing States
in accordance with subsection (b); and
(B) 25 percent to provide financial
assistance to States in accordance with section
200305 of title 54, United States Code, which
shall be considered income to the Land and
Water Conservation Fund for purposes of section
200302 of that title.
(3) in the case of qualified outer Continental Shelf
revenues described in section 102(9)(A)(iii) generated
from outer Continental Shelf areas adjacent to the Gulf
producing States described in section 102(7), 50
percent in a special account in the Treasury from which
the Secretary shall disburse--
(A) 75 percent to those Gulf producing States
in accordance with subsection (b); and
(B) 25 percent to provide financial
assistance to States in accordance with section
200305 of title 54, United States Code, which
shall be considered income to the Land and
Water Conservation Fund for purposes of section
200302 of that title.
* * * * * * *
(b) Allocation Among Gulf Producing States and Coastal
Political Subdivisions.--
(1) Allocation among gulf producing states for fiscal
years 2007 through 2016.--
(A) In general.--Subject to subparagraph (B),
effective for each of fiscal years 2007 through
2016, the amount made available under
subsection (a)(2)(A) shall be allocated to each
Gulf producing State in amounts (based on a
formula established by the Secretary by
regulation) that are inversely proportional to
the respective distances between the point on
the coastline of each Gulf producing State that
is closest to the geographic center of the
applicable leased tract and the geographic
center of the leased tract.
(B) Minimum allocation.--The amount allocated
to a Gulf producing State each fiscal year
under subparagraph (A) shall be at least 10
percent of the amounts available under
subsection (a)(2)(A).
(2) Allocation among gulf producing states for fiscal
year 2017 and thereafter.--
(A) In general.--Subject to subparagraphs (B)
and (C), effective for fiscal year 2017 and
each fiscal year thereafter--
(i) the amount made available under
subsection (a)(2)(A) from any lease
entered into within the 181 Area or the
181 South Area shall be allocated to
each Gulf producing State, as described
in section 102(7)(A), in amounts (based
on a formula established by the
Secretary by regulation) that are
inversely proportional to the
respective distances between the point
on the coastline of each Gulf producing
State, as described in section
102(7)(A), that is closest to the
geographic center of the applicable
leased tract and the geographic center
of the leased tract; [and]
(ii) the amount made available under
subsection (a)(2)(A) from any lease
entered into within the 2002-2007
planning area shall be allocated to
each Gulf producing State, as described
in section 102(7)(A), in amounts that
are inversely proportional to the
respective distances between the point
on the coastline of each Gulf producing
State, as described in section
102(7)(A), that is closest to the
geographic center of each historical
lease site and the geographic center of
the historical lease site, as
determined by the Secretary[.]; and
(iii) the amount made available under
subsection (a)(3)(A) from any lease
entered into within the Eastern
Planning Area, as described in section
102(6)(A)(i), shall be allocated to
each Gulf producing State, as described
in section 102(7), in amounts that are
inversely proportional to the
respective distances between the point
on the coastline of each Gulf producing
State, as described in section 102(7),
that is closest to the geographic
center of each historical lease site
and the geographic center of the
historical lease site, as determined by
the Secretary.
(B) Minimum allocation.--The amount allocated
to a Gulf producing State [each fiscal year
under subparagraph (A)] described in section
102(7)(A) each fiscal year under clauses (i)
and (ii) of subparagraph (A) shall be at least
10 percent of the amounts available under
subsection (a)(2)(A).
* * * * * * *
(f) Limitations on Amount of Distributed Qualified Outer
Continental Shelf Revenues.--
[(1) In general.--Subject to paragraph (2), the total
amount of qualified outer Continental Shelf revenues
made available under subsection (a)(2) shall not exceed
$500,000,000 for each of fiscal years 2016 through
2055.]
(1) In general.--Subject to paragraph (2), the total
amount of qualified outer Continental Shelf revenues
described in section 102(9)(A)(ii) that are made
available under subsection (a)(2)(A) shall not exceed--
(A) for fiscal year 2017, $500,000,000;
(B) for each of fiscal years 2018 through
2025, $699,000,000; and
(C) for each of fiscal years 2026 through
2055, $999,000,000.
* * * * * * *
THE OUTER CONTINENTAL SHELF LANDS ACT
Act of August 7, 1953, Chapter 345, as amended
* * * * * * *
SEC. 8. LEASING OF OUTER CONTINENTAL SHELF.--
(a) * * *
* * * * * * *
(b) An oil and gas lease issued pursuant to this section
shall--
(1) be for a tract consisting of a compact area not
exceeding five thousand seven hundred and sixty acres,
as the Secretary may determine, unless the Secretary
finds that a larger area is necessary to comprise a
reasonable economic production unit;
(2) be for an initial period of--
(A) five years; [or]
(B) not to exceed ten years where the
Secretary finds that such longer period is
necessary to encourage exploration and
development in areas because of unusually deep
water or other unusually adverse conditions,
and as long after such initial period as oil or gas is
produced from the area in paying quantities, or
drilling or well reworking operations as approved by
the Secretary are conducted thereon[;]; or
(C) in the case of an oil and gas lease in
the Beaufort Planning Area or the portion of
the Chukchi Planning Area that is beyond 3
nautical miles of the seaward boundary of the
State of Alaska, 20 years;''.
* * * * * * *
SEC. 9. DISPOSITION OF REVENUES.--[ALL RENTALS,]
(a) In General._Except as provided in subsections (b) and
(c), all rentals, royalties, and other sums paid to the
Secretary or the Secretary of the Navy under any lease on the
outer Continental Shelf for the period from June 5, 1950, to
date, and thereafter shall be deposited in the Treasury of the
United States and credited to miscellaneous receipts.
(b) Distribution of Revenue to Alaska.--
(1) Definitions.--In this subsection:
(A) Coastal political subdivision.--The term
``coastal political subdivision'' means a
county-equivalent subdivision of the State--
(i) all or part of which lies within
the coastal zone of the State (as
defined in section 304 of the Coastal
Zone Management Act of 1972 (16 U.S.C.
1453)); and
(ii)(I) the closest coastal point of
which is not more than 200 nautical
miles from the geographical center of
any leased tract in the Alaska outer
Continental Shelf region; or
(II)(aa) the closest point of which
is more than 200 nautical miles from
the geographical center of a leased
tract in the Alaska outer Continental
Shelf region; and
(bb) that is determined by the State
to be a significant staging area for
oil and gas servicing, supply vessels,
operations, suppliers, or workers.
(B) Institution of higher education.--The
term `institution of higher education' has the
meaning given the term in section 102 of the
Higher Education Act of 1965 (20 U.S.C. 1002).
(C) Qualified revenues.--
(i) In general.--The term `qualified
revenues' means all revenues derived
from all rentals, royalties, bonus
bids, and other sums due and payable to
the United States from energy
development in the Alaska outer
Continental Shelf region.
(ii) Exclusions.--The term `qualified
revenues' does not include revenues
generated from leases subject to
section 8(g).
(D) State.--The term `State' means the State
of Alaska.
(E) Workforce investment board.--The term
`workforce investment board' means a State or
local workforce investment board established
under subtitle B of title I of the Workforce
Investment Act of 1998 (29 U.S.C. 2811 et
seq.).
(2) Fiscal years 2016-2026.--For each of fiscal years
2016 through 2026, the Secretary shall deposit--
(A) 75 percent of qualified revenues in the
general fund of the Treasury;
(B) 7.5 percent of qualified revenues in a
special account in the Treasury, to be
distributed by the Secretary to the State;
(C) 7.5 percent of qualified revenues in a
special account in the Treasury, to be
distributed by the Secretary to coastal
political subdivisions;
(D) 2.5 percent of qualified revenues in a
special account in the Treasury, to be used to
carry out the North Slope Science Initiative
established under section 348(a)(1) of the
Energy Policy Act of 2005 (42 U.S.C.
15906(a)(1));
(E) 2.5 percent of qualified revenues in a
special account in the Treasury, to be used by
the Secretary to provide grants on a
competitive basis to eligible institutions of
higher education and workforce investment
boards in the State to establish and providing
funding for--
(i) programs to ensure an adequately
skilled workforce to construct,
operate, or maintain oil or gas
pipelines; or
(ii) programs to ensure an adequately
skilled workforce to operate, maintain,
and perform all environmental processes
relating to existing or future oil and
gas infrastructure;
(F) 2.5 percent of qualified revenues in a
special account in the Treasury to provide
financial assistance for--
(i) offshore leasing and development
programs in the State; and
(ii) the development of rights-of-way
for pipelines to transport oil or gas
produced offshore through land under
the jurisdiction of the Secretary in
the State; and
(G) 2.5 percent of qualified revenues in the
Tribal Resilience Fund established by section
402 of the Offshore Production and Energizing
National Security Act of 2015.
(3) Subsequent Fiscal Years.--For fiscal year 2027
and each subsequent fiscal year, the Secretary shall
deposit--
(A) 50 percent of qualified revenues in
general fund of the Treasury;
(B) 30 percent of qualified revenues in a
special account in the Treasury, to be
distributed by the Secretary to the State;
(C) 12.5 percent of qualified revenues in the
Tribal Resilience Fund established by section
402 of the Offshore Production and Energizing
National Security Act of 2015; and
(D) 7.5 in a special account in the Treasury,
to be distributed by the Secretary to coastal
political subdivisions.
(4) Allocation Among Coastal Political
Subdivisions.--Of the amount paid by the Secretary to
coastal political subdivisions under paragraph (2)(C)
or (3)(D)--
(A) 90 percent shall be allocated in amounts
(based on a formula established by the
Secretary by regulation) that are inversely
proportional to the respective distances
between the point in each coastal political
subdivision that is closest to the geographic
center of the applicable leased tract and not
more than 200 miles from the geographic center
of the leased tract; and
(B) 10 percent shall be divided equally among
each coastal political subdivision that--
(i) is more than 200 nautical miles
from the geographic center of a leased
tract; and
(ii) the State of Alaska determines
to be a significant staging area for
oil and gas servicing, supply vessels,
operations, suppliers, or workers.
(5) Timing.--The amounts required to be deposited
under paragraphs (2) and (3) for the applicable fiscal
year shall be made available in accordance with those
paragraphs during the fiscal year immediately following
the applicable fiscal year.
(6) Adminstration.--Amounts made available under
paragraphs (2) and (3) shall--
(A) be made available, without further
appropriation, in accordance with this
subsection;
(B) remain available until expended; and
(C) be in addition to any amounts
appropriated under any other provision of law.
(c) Distribution of Revenue to Atlantic States.--
(1) Definitions.--In this subsection:
(A) Atlantic state.--The term `Atlantic
State' means a State adjacent to the South
Atlantic Planning Area.
(B) Qualified revenues.--
(i) In general.--The term `qualified
revenues' means all revenues derived
from all rentals, royalties, bonus
bids, and other sums due and payable to
the United States from energy
development in the Atlantic planning
region.
(ii) Exclusions.--The term `qualified
revenues' does not include revenues
generated from leases subject to
section 8(g).
(2) Deposit.--For fiscal year 2017 and each fiscal
year thereafter, the Secretary shall deposit--
(A) 62.5 percent of any qualified revenues in
the general fund of the Treasury, of which--
(i) 5 percent shall be allocated to
the Department of Energy for projects
that enhance the safety, security,
resilience, and reliability of energy
supply, research, transmission,
storage, or distribution
infrastructure;
(ii) 5 percent shall be allocated to
the Energy Efficiency and Renewable
Energy program at the Department of
Energy; and
(iii) 2.5 percent shall be allocated
to high priority deferred maintenance
needs of the National Park Service that
support critical infrastructure and
visitor services; and
(B) 37.5 percent of any qualified revenues in
a special account in the Treasury from which
the Secretary shall disburse amounts to the
Atlantic States in accordance with paragraph
(3).
(3) Allocation to states.--
(A) In general.--Subject to subparagraphs (B)
and (C), effective for fiscal year 2017 and
each fiscal year thereafter, the Secretary of
the Treasury shall allocate the qualified
revenues described in paragraph (2)(B) to each
Atlantic State in amounts (based on a formula
established by the Secretary, by regulation)
that are inversely proportional to the
respective distances between--
(i) the point on the coastline of
each Atlantic State that is closest to
the geographical center of the
applicable leased tract; and
(ii) the geographical center of that
leased tract.
(B) Minimum allocation.--The amount allocated
to an Atlantic State for each fiscal year under
subparagraph (A) shall be not less than 10
percent of the amounts available under
paragraph (2)(B).
(C) State allocation.--Of the amounts
received by a State under subparagraph (A), the
Atlantic State may use, at the discretion of
the Governor of the State--
(i) 10 percent--
(I) to enhance State land and
water conservation efforts;
(II) to improve State public
transportation projects;
(III) to establish
alternative, renewable, and
clean energy production and
generation within each State;
and
(IV) to enhance beach
nourishment and costal
dredging; and
(ii) 2.5 percent to enhance
geological and geophysical education
for the energy future of the United
States in accordance with section 306
of the Offshore Production and
Energizing National Security Act of
2015.
* * * * * * *
SEC. 18. OUTER CONTINENTAL SHELF LEASING PROGRAM.--
(a) The Secretary, pursuant to procedures set forth in
subsections (c) and (d) of this section, shall prepare and
periodically revise, and maintain an oil and gas leasing
program to implement the policies of this Act. The leasing
program shall consist of a schedule of proposed lease sales
indicating, as precisely as possible, the size, timing, and
location of leasing activitiy which he determines will best
meet national energy needs for the five-year period following
its approval or reapproval. Such leasing program shall be
prepared and maintained in a manner consistent with the
following principles:
* * * * * * *
(2) Timing and location of exploration, development,
and production of oil and gas among the oil- and gas-
bearing physiographic regions of the outer Continental
Shelf shall be based on a consideration of--
(A) existing information concerning the
geographical, geological, and ecological
characteristics of such regions;
(B) an equitable sharing of developmental
benefits and environmental risks among the
various regions;
(C) the location of such regions with respect
to, and the relative needs of, regional and
national energy markets;
(D) the location of such regions with respect
to other uses of the sea and seabed, including
fisheries, navigation, existing or proposed
sealanes, potential sites of deepwater ports,
and other anticipated uses of the resources and
space of the outer Continental Shelf;
(E) the interest of potential oil and gas
producers in the development of oil and gas
resources as indicated by exploration or
nomination;
(F) laws, goals, and policies of affected
States which have been specifically identified
by the Governors of such States as relevant
matters for the Secretary's consideration;
(G) the relative environmental sensitivity
and marine productivity of different areas of
the outer Continental Shelf; and
(H) relevant environmental and predictive
information for different areas of the outer
Continental Shelf.
(3) The Secretary shall select the timing and
location of leasing, to the maximum extent practicable,
so as to obtain a proper balance between the potential
for environmental damage, the potential for the
discovery of oil and gas, and the potential for adverse
impact on the coastal zone.
(4) Leasing activities shall be conducted to assure
receipt of fair market value for the lands leased and
the rights conveyed by the Federal Government.
(5)(A) In this paragraph, the term `available
unleased acreage' means that portion of the outer
Continental Shelf that is not under lease at the time
of a proposed lease sale, and that has not otherwise
been made unavailable for leasing by law in the Gulf of
Mexico.
(B) In each oil and gas leasing program under this
section, the Secretary shall make available for
leasing, and conduct lease sales including, the
available unleased acreage within each outer
Continental Shelf planning area in the Gulf of Mexico
considered to have the largest undiscovered,
technically recoverable oil and gas resources (on a
total btu basis) based on the most recent national
geologic assessment of the outer Continental Shelf,
with an emphasis on offering the most geologically
prospective parts of the planning area.
(6)(A) The Secretary shall include in each proposed
oil and gas leasing program under this section any
State subdivision of an outer Continental Shelf
planning area in the Gulf of Mexico that the Governor
of the State that represents that subdivision requests
be made available for leasing.
(B) The Secretary may not remove a subdivision
described in subparagraph (A) from the program until
publication of the final program.
(7)(A) The Secretary shall make available for leasing
under each 5-year oil and gas leasing program under
this section any outer Continental Shelf planning area
in the Gulf of Mexico that--
(i) is estimated to contain more than
2,500,000,000 barrels of oil; or
(ii) is estimated to contain more than
7,500,000,000,000 cubic feet of natural gas.
(B) To determine which planning areas meet the
criteria described in subparagraph (A), the Secretary
shall use the document entitled `Bureau of Ocean Energy
Management Assessment of Undiscovered Technically
Recoverable Oil and Gas Resources of the Nation's Outer
Continental Shelf, 2011'.
* * * * * * *
(i) Inclusion of Certain Lease Sales.--Effective starting
with the leasing program for fiscal years 2023 through 2027,
the Secretary shall include in any leasing program prepared in
accordance with this section provisions for the conduct of at
least 3 lease sales in each of the Beaufort Planning Area and
the Chukchi Planning Area, and annual lease sales in the
Nearshore Beaufort Sea Planning Area and the Cook Inlet
Planning Area during the term of the leasing program.
* * * * * * *
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