H.R. 1503 — what changed

added “17. Leasing of land containing oil or gas deposits

“(a) Leasing authority

“(1) In general—All lands subject to disposition under this Act that are known or believed to contain oil or gas deposits may be leased by the Secretary.

“(2) Receipt of fair market value—Leasing activities under this Act shall be conducted to assure receipt of fair market value for the lands and resources leased and the rights conveyed by the United States.”

added “(b) Bidding

added “(1) In general

“(A) Competitive bidding

“(i) In general—All lands to be leased under this section shall be leased as provided in this paragraph to the highest responsible qualified bidder by competitive bidding by sealed bid.

“(ii) Geographic limitation—The Secretary shall lease lands under this paragraph in units of not more than 2,560 acres, except in Alaska, where units shall be not more than 5,760 acres. Such units shall be as nearly compact as possible.

“(iii) Frequency—Lease sales under this section shall be held for each State in which there are lands eligible for leasing no more than 3 times each year and on a rotating basis such that the lands under the responsibility of any Bureau of Land Management field office are available for leasing no more than one time each year.

“(iv) Royalty—A lease under this section shall be conditioned upon the payment of a royalty at a rate of not less than 18.75 percent in amount or value of the production removed or sold from the lease, except as otherwise provided in this Act.

“(v) Issuance of lease—The Secretary may issue a lease under this section to the responsible qualified bidder with the highest bid that is equal to or greater than the national minimum acceptable bid. The Secretary shall decide whether to accept a bid and issue a lease within 90 days following payment by the successful bidder of the remainder of the bonus bid, if any, and annual rental for the first lease year.

“(vi) Rejection of bid—The Secretary may reject a bid above the national minimum acceptable bid if, after evaluation of the value of the lands proposed for lease, the Secretary determines that the bid amount does not ensure that fair market value is obtained for the lease.”

“(B) National minimum acceptable bid

changed “(i) In general—Except as provided in clause (ii), for purposes of subparagraph (A), the national minimum acceptable bid shall be $5 $10 per acre. All bids under this section for less than the national minimum acceptable bid shall be rejected.

“(ii) Raising the national minimum acceptable bid—The Secretary may establish a higher national minimum acceptable bid—

“(I) beginning at the end of the 4-year period that begins on the date of enactment of the Restoring Community Input and Public Protection in Oil and Gas Leasing Act of 2021, and once every 4 years thereafter, to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics; and

“(II) at any time, if the Secretary finds that such a higher amount is necessary to enhance financial returns to the United States or to promote more efficient management of oil and gas resources on Federal lands.

“(iii) Not a major Federal action—The proposal or issuance of any regulation to establish a higher national minimum acceptable bid under clause (ii) shall not be considered a major Federal action that is subject to the requirements of section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)).”

“(d) Annual rentals—All leases issued under this section shall be conditioned upon the payment by the lessee of a rental of—

changed “(1) not less than $3.00 per acre per year during the 2-year 5-year period beginning on the date the lease begins for new leases, and after the end of such two 5 year period not less than $5 per acre per year; or

“(2) such higher rental rate as the Secretary may establish if the Secretary finds that such action is necessary to enhance financial returns to the United States and promote more efficient management of oil and gas and alternative energy resources on Federal lands.”

changed “(c) Lands for which no bid is accepted—Lands made available for leasing under subsection (b)(1) but for which no bid is accepted may be made available by the Secretary for a new round of sealed bidding under such subsection.”

added “(g) Other leasing requirements

added “(1) In general—The Secretary of the Interior”

“(2) Limitation—The Secretary shall not issue a lease or approve the assignment of any lease to any person, or to any subsidiary or affiliate of such person or any other person controlled by or under common control with such person, unless such person has the demonstrated capability to explore and produce oil and gas under the lease.

“(3) Protection of leased lands for other uses—Each lease under this section shall include such terms as are necessary to preserve the United States flexibility to control or prohibit activities that pose serious and unacceptable impacts to the value of the leased lands for uses other than production of oil and gas.”

“(3) Bidder identity—The Secretary—

“(A) shall require that each expression of interest to bid for a lease under this section and each bid for a lease under this section shall include the name of the person for whom such expression of interest or bid is submitted; and

“(B) shall promptly publish each such name.”

added “(f) Requirements prior to offering lands for lease

“(1) Required notice—At least 45 days before offering lands for lease under this section, and at least 30 days before approving applications for permits to drill under the provisions of a lease, modifying the terms of any lease issued under this section, or granting a waiver, exception, or modification of any stipulation of a lease issued under this section, the Secretary shall provide notice of the proposed action to—

“(A) the general public by posting such notice in the appropriate local office and on the electronic website of the leasing and land management agencies offering the lands for lease;

“(B) all surface land owners in the area of the lands being offered for lease; and

“(C) the holders of special recreation permits for commercial use, competitive events, and other organized activities on the lands being offered for lease.

“(2) Required information”

“(r) Post-Lease surface use agreement

“(1) In general—Except as provided in paragraph (2), the Secretary may not authorize any operator to conduct exploration and drilling operations on lands with respect to which title to oil and gas resources is held by the United States but title to the surface estate is not held by the United States, until the operator has filed with the Secretary a document, signed by the operator and the surface owner or owners, showing that the operator has secured a written surface use agreement between the operator and the surface owner or owners that meets the requirements of subparagraph (B).

“(2) Contents—The surface use agreement shall provide for—

“(A) the use of only such portion of the surface estate as is reasonably necessary for exploration and drilling operations based on site-specific conditions;

“(B) the accommodation of the surface estate owner to the maximum extent practicable, including the location, use, timing, and type of exploration and drilling operations, consistent with the operator’s right to develop the oil and gas estate;

“(C) the reclamation of the site to a condition capable of supporting the uses which such lands were capable of supporting prior to exploration and drilling operations; and

“(D) compensation for damages as a result of exploration and drilling operations, including—

“(i) loss of income and increased costs incurred;

“(ii) damage to or destruction of personal property, including crops, forage, and livestock; and

“(iii) failure to reclaim the site in accordance with clause (iii).

changed “(3) ProcedureAuthorized exploration and drilling operations

removed “(A) Notice of intent to conclude agreement—An operator shall notify the surface estate owner or owners of the operator’s desire to conclude an agreement under this section. If the surface estate owner and the operator do not reach an agreement within 90 days after the operator has provided such notice, the operator may submit the matter to third-party arbitration for resolution within a period of 90 days. The cost of such arbitration shall be the responsibility of the operator.

removed “(B) List of arbitrators—The Secretary shall identify persons with experience in conducting arbitrations and shall make this information available to operators.

removed “(C) Referral—Referral of a matter for arbitration by an operator to an arbitrator identified by the Secretary pursuant to clause (ii) shall be sufficient to constitute compliance with clause (i).

removed “(4) Attorneys’ fees—If action is taken to enforce or interpret any of the terms and conditions contained in a surface use agreement, the prevailing party shall be reimbursed by the other party for reasonable attorneys’ fees and actual costs incurred, in addition to any other relief which a court or arbitration panel may grant.

removed “(5) Authorized exploration and drilling operations

“(A) Authorization without surface use agreement—The Secretary may authorize an operator to conduct exploration and drilling operations on lands covered by paragraph (1) in the absence of an agreement with the surface estate owner or owners, if—

“(i) the Secretary makes a determination in writing that the operator made a good faith attempt to conclude such an agreement, including referral of the matter to arbitration pursuant to paragraph (1)(C), but that no agreement was concluded within 90 days after the referral to arbitration;

“(ii) the operator submits a plan of operations that provides for the matters specified in paragraph (1)(B) and for compliance with all other applicable requirements of Federal and State law; and

“(iii) the operator posts a bond or other financial assurance in an amount the Secretary determines to be adequate to ensure compensation to the surface estate owner for any damages to the site, in the form of a surety bond, trust fund, letter of credit, government security, certificate of deposit, cash, or equivalent.

“(B) Surface owner participation—The Secretary shall provide surface estate owners with an opportunity to—

“(i) comment on plans of operations in advance of a determination of compliance with this Act;

“(ii) participate in bond level determinations and bond release proceedings under this section;

“(iii) attend an on-site inspection during such determinations and proceedings;

“(iv) file written objections to a proposed bond release; and

“(v) request and participate in an on-site inspection when they have reason to believe there is a violation of the terms and conditions of a plan of operations.

“(C) Payment of financial guarantee—A surface estate owner with respect to any land subject to a lease may petition the Secretary for payment of all or any portion of a bond or other financial assurance required under this section as compensation for any damages as a result of exploration and drilling operations. Pursuant to such a petition, the Secretary may use such bond or other guarantee to provide compensation to the surface estate owner for such damages.

“(D) Bond release—Upon request and after inspection and opportunity for surface estate owner review, the Secretary may release the financial assurance required under this section if the Secretary determines that exploration and drilling operations are ended and all damages have been fully compensated.

added “(4) Surface owner notification—The Secretary shall notify surface estate owners in writing—

removed “(6) Surface owner notification—The Secretary shall notify surface estate owners in writing—

“(A) not less than 45 days before lease sales;

“(B) of the identity of the lessee, not more than 10 business days after a lease is issued;

“(C) concerning any subsequent request or decision regarding a lease not more than 5 business days after such request or decision, including regarding modification of a lease, waiver of a stipulation, or approval of a right of way; and

“(D) not more than 5 business days after issuance of a drilling permit under a lease.”

changed Section 17(a) of the Mineral Leasing Act (30 U.S.C. 226(a)), as amended by section 2, 2 of this Act, is further amended by adding at the end the following:

changed “(3) Master leasing plansParcel review—The Secretary shall issue oil and gas leases under this Act only in accordance with subsections C through I of section III of Bureau of Land Management Instruction Memorandum No. 2010–117, dated May 17, 2010, as in effect on April 24, 2017.”

removed “(A) In general—The Secretary may adopt and implement a master leasing plan to govern the issuance of oil and gas leases under this Act for any Federal lands, in accordance with Bureau of Land Management Instruction Memorandum No. 2010–117, dated May 17, 2010, as in effect on April 24, 2017.

removed “(B) Factors and considerations—In deciding whether to adopt and implement a master leasing plan, the Secretary—

removed “(i) shall consider the criteria set forth in Bureau of Land Management Instruction Memorandum No. 2010–117, dated May 17, 2010, as in effect on April 24, 2017; and

removed “(ii) shall consider the benefits of avoiding conflicts between mineral leasing and other land uses, including conservation, recreation, and protection of cultural and historic resources.

removed “(C) State request—The Secretary shall adopt and implement a master leasing plan under subparagraph (A) applicable to leases for Federal lands in a State or county of a State, if requested by the government of such State or county, respectively.

removed “(D) Request by an individual

removed “(i) In general—Any individual who is a resident of a State or county of a State may submit a petition to the Secretary requesting that the Secretary adopt and implement a master leasing plan under subparagraph (A) applicable to the issuance of leases for Federal lands in such State or county, respectively.

removed “(ii) Consideration—The Secretary shall, not later than 60 days after receiving such a petition, issue a determination of whether or not the adoption and implementation of such a master leasing plan is appropriate.”

changed Section 17(a) 27(d)(1) of the Mineral Leasing Act (30 U.S.C. 226(a)), as 184(d)(1)) is amended by sections 2 striking “, and 5 acreage under any lease any portion of this Act, is further amended by adding at the end which has been committed to a federally approved unit or cooperative plan or communitization agreement or for which royalty (including compensatory royalty or royalty in-kind) was paid in the following:preceding calendar year,”.

removed “(4) Parcel review—The Secretary shall issue oil and gas leases under this Act only in accordance with subsections C through I of section III of Bureau of Land Management Instruction Memorandum No. 2010–117, dated May 17, 2010, as in effect on April 24, 2017.”

changed Section 27(d)(1) 17(g) of the Mineral Leasing Act (30 U.S.C. 184(d)(1)) is 226(g)), as amended by striking “, and acreage under any lease any portion section 2(g) of which has been committed to a federally approved unit or cooperative plan or communitization agreement or for which royalty (including compensatory royalty or royalty in-kind) was paid in this Act, is further amended by adding at the preceding calendar year,”.end the following:

added “(4) Multiple-use management—The Secretary, and for National Forest lands, the Secretary of Agriculture, shall manage lands that are subject to an oil and gas lease under this Act in accordance with the principles, policies, and requirements relating to multiple use under the Federal Land Policy and Management Act of 1976 (43 U.S.C. 1701 et seq.), until the beginning of operations on such lease.”

changed Section 17(g) 17(a) of the Mineral Leasing Act (30 U.S.C. 226(g)), 226(a)), as amended by section 2(g) sections 2 and 5 of this Act, is further amended by adding at the end the following:

changed “(4) Multiple-use management—The Secretary, and for National Forest lands, the Secretary Transparency in management of Agriculture, shall manage lands that are subject to an oil and gas leases—For each lease under this Act in accordance with the principles, policies, and requirements relating to multiple use under the Federal Land Policy and Management Act of 1976 (43 U.S.C. 1701 et seq.), until section, the beginning of operations Secretary shall make available on such lease.”a public website—

added “(A) the identity of—

added “(i) each person who is or has been a lessee under the lease; and

added “(ii) each person who is or has been an operator under the lease;

added “(B) notice of each transfer of the lease; and

added “(C) notice of each suspension of operations, each suspension of production, and each suspension of operations and production.”

changed Section 21(a) 31(b) of the Mineral Leasing Act (30 U.S.C. 241(a)) 188(b)) is amended—amended by inserting “if the lease was improperly issued or” after “30 days notice”.

removed “(6) Beginning on the date of enactment of the Restoring Community Input and Public Protections in Oil and Gas Leasing Act of 2021, The Secretary may not issue any lease for oil shale under this Act before the date the Secretary issues a finding that the technical and economic feasibility of development of and production from such deposit has been demonstrated under section 369 of the Energy Policy Act of 2005 (42 U.S.C. 15927).”

removed Section 17(a) of the Mineral Leasing Act (30 U.S.C. 226(a)), as amended by sections 2, 5, and 6 of this Act, is further amended by adding at the end the following:

removed “(5) Transparency in management of leases—For each lease under this section, the Secretary shall make available on a public website—

removed “(A) the identity of—

removed “(i) each person who is or has been a lessee under the lease; and

removed “(ii) each person who is or has been an operator under the lease;

removed “(B) notice of each transfer of the lease; and

removed “(C) notice of each suspension of operations, each suspension of production, and each suspension of operations and production.”

added “(p) Water requirements

added “(1) An operator producing oil or gas (including coalbed methane) under a lease issued under this Act shall—

added “(A) replace the water supply of a water user who obtains all or part of such user’s supply of water from an underground or surface source that has been affected by contamination, diminution, or interruption proximately resulting from drilling, fracking, or production operations for such production;

added “(B) ensure that if a surface or ground water source is affected by contamination, diminution, or interruption proximately resulting from such production, best management practices and appropriately available technologies are used to prevent, to the maximum extent possible, the long-term or permanent degradation of the surface or ground water source; and

added “(C) comply with all applicable requirements of Federal and State law with respect to—

added “(i) discharge of any water produced under the lease; and

added “(ii) activities that would divert or otherwise alter a surface or ground water source or lead to a discharge not covered by clause (i).

added “(2) An application for a permit to drill under a lease under this Act shall be accompanied by a proposed water management plan including provisions to—

added “(A) protect the quantity and quality of surface and ground water systems, both on-site and off-site, from adverse effects of the exploration, development, and reclamation processes or to provide alternative sources of water if such protection cannot be assured;

added “(B) protect the rights of present users of water that would be affected by operations under the lease, including the discharge of any water produced in connection with such operations that is not reinjected; and

added “(C) identify any agreements with other parties for the beneficial use of produced waters and the steps that will be taken to comply with State and Federal laws related to such use.

added “(3) The Secretary may not approve an application if the Secretary determines that the applicant did not submit a water management plan that meets the requirements described in paragraph (2).”

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

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

removed “(p) Water requirements

removed “(1) An operator producing oil or gas (including coalbed methane) under a lease issued under this Act shall—

removed “(A) replace the water supply of a water user who obtains all or part of such user’s supply of water from an underground or surface source that has been affected by contamination, diminution, or interruption proximately resulting from drilling, fracking, or production operations for such production;

removed “(B) ensure that if a surface or ground water source is affected by contamination, diminution, or interruption proximately resulting from such production, best management practices and appropriately available technologies are used to prevent, to the maximum extent possible, the long-term or permanent degradation of the surface or ground water source; and

removed “(C) comply with all applicable requirements of Federal and State law with respect to—

removed “(i) discharge of any water produced under the lease; and

removed “(ii) activities that would divert or otherwise alter a surface or ground water source or lead to a discharge not covered by clause (i).

removed “(2) An application for a permit to drill under a lease under this Act shall be accompanied by a proposed water management plan including provisions to—

removed “(A) protect the quantity and quality of surface and ground water systems, both on-site and off-site, from adverse effects of the exploration, development, and reclamation processes or to provide alternative sources of water if such protection cannot be assured;

removed “(B) protect the rights of present users of water that would be affected by operations under the lease, including the discharge of any water produced in connection with such operations that is not reinjected; and

removed “(C) identify any agreements with other parties for the beneficial use of produced waters and the steps that will be taken to comply with State and Federal laws related to such use.

removed “(3) The Secretary may not approve an application if the Secretary determines that the applicant did not submit a water management plan that meets the requirements described in paragraph (2).”

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