H.R. 2231 — what changed
Offshore Energy and Jobs Act
From Introduced in House to Reported in House. 4 sections amended between Introduced in House and Reported in House.
Sec. 201 Requirement to conduct proposed oil and gas Lease Sale 220 on the Outer Continental Shelf offshore Virginia
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In general— Notwithstanding the inclusion exclusion of Lease Sale 220 in the Final Outer Continental Shelf Oil & Gas Leasing Program 2012–2017, the Secretary of the Interior shall conduct offshore oil and gas Lease Sale 220 under section 8 of the Outer Continental Shelf Lands Act (43 U.S.C. 1337) as soon as practicable, but not later than one year after the date of enactment of this Act.
Requirement To make replacement lease blocks available— For each lease block in a proposed lease sale under this section for which the Secretary of Defense, in consultation with the Secretary of the Interior, under the Memorandum of Agreement referred to in section 205(b), issues a statement proposing deferral from a lease offering due to defense-related activities that are irreconcilable with mineral exploration and development, the Secretary of the Interior, in consultation with the Secretary of Defense, shall make available in the same lease sale one other lease block in the Virginia lease sale planning area that is acceptable for oil and gas exploration and production in order to mitigate conflict.
Balancing military and energy production goals— In recognition that the Outer Continental Shelf oil and gas leasing program and the domestic energy resources produced therefrom are integral to national security, the Secretary of the Interior and the Secretary of Defense shall work jointly in implementing this section in order to ensure achievement of the following common goals:
Preserving the ability of the Armed Forces of the United States to maintain an optimum state of readiness through their continued use of the Outer Continental Shelf.
Allowing effective exploration, development, and production of our Nation’s oil, gas, and renewable energy resources.
Definitions— In this section:
Lease sale 220— The term “Lease Sale 220” means such lease sale referred to in the Request for Comments on the Draft Proposed 5-Year Outer Continental Shelf (OCS) Oil and Gas Leasing Program for 2010–2015 and Notice of Intent To Prepare an Environmental Impact Statement (EIS) for the Proposed 5-Year Program published January 21, 2009 (74 Fed. Reg. 3631).
Virginia lease sale planning area— The term “Virginia lease sale planning area” means the area of the outer Continental Shelf (as that term is defined in the Outer Continental Shelf Lands Act (33 U.S.C. 1331 et seq.)) that is bounded by—
a northern boundary consisting of a straight line extending from the northernmost point of Virginia’s seaward boundary to the point on the seaward boundary of the United States exclusive economic zone located at 37 degrees 17 minutes 1 second North latitude, 71 degrees 5 minutes 16 seconds West longitude; and
a southern boundary consisting of a straight line extending from the southernmost point of Virginia’s seaward boundary to the point on the seaward boundary of the United States exclusive economic zone located at 36 degrees 31 minutes 58 seconds North latitude, 71 degrees 30 minutes 1 second West longitude.
Sec. 301 Disposition of Outer Continental Shelf revenues to coastal States
In general— Section 9 of the Outer Continental Shelf Lands Act (43 U.S.C. 1338) is amended—
in the existing text—
in the first sentence, by striking “All rentals,” and inserting the following:
“(c) Disposition of revenue under old leases—All rentals,”
in subsection (c) (as designated by the amendment made by subparagraph (A) of this paragraph), by striking “for the period from June 5, 1950, to date, and thereafter” and inserting “in the period beginning June 5, 1950, and ending on the date of enactment of the Offshore Energy and Jobs Act”;
by adding after subsection (c) (as so designated) the following:
“(d) Definitions—In this section:
“(1) Coastal State—The term “coastal State” includes a territory of the United States.
“(2) New leasing revenues—The term new leasing revenues—
changed “(A) means amounts received by the United States as bonuses, rents, and royalties under leases for oil and gas, wind, tidal, or other energy exploration, development, and production on new areas of the outer Continental Shelf that are authorized to be made available for leasing as a result of enactment of the Offshore Energy and Jobs Act and leasing under that Act; and
“(B) does not include amounts received by the United States under any lease of an area located in the boundaries of the Central Gulf of Mexico and Western Gulf of Mexico Outer Continental Shelf Planning Areas on the date of enactment of the Offshore Energy and Jobs Act, including a lease issued before, on, or after such date of enactment.”
by inserting before subsection (c) (as so designated) the following:
“(a) Payment of new leasing revenues to coastal States
“(1) In general—Except as provided in paragraph (2), of the amount of new leasing revenues received by the United States each fiscal year, 37.5 percent shall be allocated and paid in accordance with subsection (b) to coastal States that are affected States with respect to the leases under which those revenues are received by the United States.
“(2) Phase-in
“(A) In general—Except as provided in subparagraph (B), paragraph (1) shall be applied—
“(i) with respect to new leasing revenues under leases awarded under the first leasing program under section 18(a) that takes effect after the date of enactment of the Offshore Energy and Jobs Act, by substituting “12.5 percent” for “37.5 percent”; and
“(ii) with respect to new leasing revenues under leases awarded under the second leasing program under section 18(a) that takes effect after the date of enactment of the Offshore Energy and Jobs Act, by substituting “25 percent” for “37.5 percent”.
“(B) Exempted lease sales—This paragraph shall not apply with respect to any lease issued under title II of the Offshore Energy and Jobs Act.
“(b) Allocation of payments
“(1) In general—The amount of new leasing revenues received by the United States with respect to a leased tract that are required to be paid to coastal States in accordance with this subsection each fiscal year shall be allocated among and paid to coastal States that are within 200 miles of the leased tract, in amounts that are inversely proportional to the respective distances between the point on the coastline of each such State that is closest to the geographic center of the lease tract, as determined by the Secretary.
“(2) Minimum and maximum allocation—The amount allocated to a coastal State under paragraph (1) each fiscal year with respect to a leased tract shall be—
“(A) in the case of a coastal State that is the nearest State to the geographic center of the leased tract, not less than 25 percent of the total amounts allocated with respect to the leased tract;
“(B) in the case of any other coastal State, not less than 10 percent, and not more than 15 percent, of the total amounts allocated with respect to the leased tract; and
“(C) in the case of a coastal State that is the only coastal State within 200 miles of a least tract, 100 percent of the total amounts allocated with respect to the leased tract.
“(3) Administration—Amounts allocated to a coastal State under this subsection—
“(A) shall be available to the coastal State without further appropriation;
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“(B) shall remain available until expended; andexpended;
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“(C) shall be in addition to any other amounts available to the coastal State under this Act.Act; and
added “(D) shall be distributed in the fiscal year following receipt.
“(4) Use of funds
“(A) In general—Except as provided in subparagraph (B), a coastal State may use funds allocated and paid to it under this subsection for any purpose as determined by the laws of that State.
“(B) Restriction on use for matching—Funds allocated and paid to a coastal State under this subsection may not be used as matching funds for any other Federal program.”
Limitation on application— This section and the amendment made by this section shall not affect the application of section 105 of the Gulf of Mexico Energy Security Act of 2006 (title I of division C of Public Law 109–432; (43 U.S.C. 1331 note)), as in effect before the enactment of this Act, with respect to revenues received by the United States under oil and gas leases issued for tracts located in the Western and Central Gulf of Mexico Outer Continental Shelf Planning Areas, including such leases issued on or after the date of the enactment of this Act.
Sec. 407 Conforming amendments to Executive Schedule pay rates
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Under Secretary for Energy, Lands, and Minerals— Section 5314 of title 5, United States Code, is amended by inserting after the item relating to “Under Secretaries of the Treasury (3)” (3).” the following:
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Assistant Secretaries— Section 5315 of title 5, United States Code, is amended by striking “Assistant Secretaries, Department Secretaries of the Interior (6)” (6).” and inserting the following:
Directors— Section 5316 of title 5, United States Code, is amended by striking “Director, Bureau of Mines, Department of the Interior.” and inserting the following new items:
Sec. 409 Outer Continental Shelf inspection fees
Section 22 of the Outer Continental Shelf Lands Act (43 U.S.C. 1348) is amended by adding at the end of the section the following:
“(g) Inspection fees
“(1) Establishment—The Secretary of the Interior shall collect from the operators of facilities subject to inspection under subsection (c) non-refundable fees for such inspections—
“(A) at an aggregate level equal to the amount necessary to offset the annual expenses of inspections of outer Continental Shelf facilities (including mobile offshore drilling units) by the Department of the Interior; and
“(B) using a schedule that reflects the differences in complexity among the classes of facilities to be inspected.
“(2) Ocean energy safety fund—There is established in the Treasury a fund, to be known as the “Ocean Energy Enforcement Fund” (referred to in this subsection as the “Fund”), into which shall be deposited all amounts collected as fees under paragraph (1) and which shall be available as provided under paragraph (3).
“(3) Availability of fees
“(A) In general—Notwithstanding section 3302 of title 31, United States Code, all amounts deposited in the Fund—
“(i) shall be credited as offsetting collections;
“(ii) shall be available for expenditure for purposes of carrying out inspections of outer Continental Shelf facilities (including mobile offshore drilling units) and the administration of the inspection program under this section;
“(iii) shall be available only to the extent provided for in advance in an appropriations Act; and
“(iv) shall remain available until expended.
“(B) Use for field offices—Not less than 75 percent of amounts in the Fund may be appropriated for use only for the respective Department of the Interior field offices where the amounts were originally assessed as fees.
“(4) Initial fees—Fees shall be established under this subsection for the fiscal year in which this subsection takes effect and the subsequent 10 years, and shall not be raised without advise and consent of the Congress, except as determined by the Secretary to be appropriate as an adjustment equal to the percentage by which the Consumer Price Index for the month of June of the calendar year preceding the adjustment exceeds the Consumer Price Index for the month of June of the calendar year in which the claim was determined or last adjusted.
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“(5) Annual fees—Annual fees shall be collected under this subsection for facilities that are above the waterline, excluding drilling rigs, and are in place at the start of the fiscal year. Fees for each fiscal year in the period of fiscal years 2013 through 2022 shall be—
“(A) $10,500 for facilities with no wells, but with processing equipment or gathering lines;
“(B) $17,000 for facilities with 1 to 10 wells, with any combination of active or inactive wells; and
“(C) $31,500 for facilities with more than 10 wells, with any combination of active or inactive wells.
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“(6) Fees for drilling rigs—Fees for drilling rigs shall be assessed under this subsection for all inspections completed in fiscal years 2013 through 2022. Fees for fiscal year 2013 shall be:be—
“(A) $30,500 per inspection for rigs operating in water depths of 1,000 feet or more; and
“(B) $16,700 per inspection for rigs operating in water depths of less than 1,000 feet.
“(7) Billing—The Secretary shall bill designated operators under paragraph (5) within 60 days after the date of the inspection, with payment required within 30 days of billing. The Secretary shall bill designated operators under paragraph (6) within 30 days of the end of the month in which the inspection occurred, with payment required within 30 days after billing.
“(8) Sunset—No fee may be collected under this subsection for any fiscal year after fiscal year 2022.
“(9) Annual reports
“(A) In general—Not later than 60 days after the end of each fiscal year beginning with fiscal year 2013, the Secretary shall submit to the Committee on Energy and Natural Resources of the Senate and the Committee on Natural Resources of the House of Representatives a report on the operation of the Fund during the fiscal year.
“(B) Contents—Each report shall include, for the fiscal year covered by the report, the following:
“(i) A statement of the amounts deposited into the Fund.
“(ii) A description of the expenditures made from the Fund for the fiscal year, including the purpose of the expenditures and the additional hiring of personnel.
“(iii) A statement of the balance remaining in the Fund at the end of the fiscal year.
“(iv) An accounting of pace of permit approvals.
“(v) If fee increases are proposed after the initial 10-year period referred to in paragraph (5), a proper accounting of the potential adverse economic impacts such fee increases will have on offshore economic activity and overall production, conducted by the Secretary.
“(vi) Recommendations to increase the efficacy and efficiency of offshore inspections.
“(vii) Any corrective actions levied upon offshore inspectors as a result of any form of misconduct.”