Oil and gas leases; award to highest responsible qualified bidder; method of bidding; royalty relief; Congressional consideration of bidding system; notice
Terms and provisions of oil and gas leases
Antitrust review of lease sales
Due diligence
No bid for a lease may be submitted if the Secretary finds, after notice and hearing, that the bidder is not meeting due diligence requirements on other leases.
Secretary’s approval for sale, exchange, assignment, or other transfer of leases
No lease issued under this subchapter may be sold, exchanged, assigned, or otherwise transferred except with the approval of the Secretary. Prior to any such approval, the Secretary shall consult with and give due consideration to the views of the Attorney General.
Antitrust immunity or defenses
Nothing in this subchapter shall be deemed to convey to any person, association, corporation, or other business organization immunity from civil or criminal liability, or to create defenses to actions, under any antitrust law.
Leasing of lands within three miles of seaward boundaries of coastal States; deposit of revenues; distribution of revenues
State claims to jurisdiction over submerged lands
Nothing contained in this section shall be construed to alter, limit, or modify any claim of any State to any jurisdiction over, or any right, title, or interest in, any submerged lands.
Sulphur leases; award to highest bidder; method of bidding
section 1335(a) of this titleIn order to meet the urgent need for further exploration and development of the sulphur deposits in the submerged lands of the outer Continental Shelf, the Secretary is authorized to grant to the qualified persons offering the highest cash bonuses on a basis of competitive bidding sulphur leases on submerged lands of the outer Continental Shelf, which are not covered by leases which include sulphur and meet the requirements of , and which sulphur leases shall be offered for bid by sealed bids and granted on separate leases from oil and gas leases, and for a separate consideration, and without priority or preference accorded to oil and gas lessees on the same area.
Terms and provisions of sulphur leases
A sulphur lease issued by the Secretary pursuant to this section shall (1) cover an area of such size and dimensions as the Secretary may determine, (2) be for a period of not more than ten years and so long thereafter as sulphur may be produced from the area in paying quantities or drilling, well reworking, plant construction, or other operations for the production of sulphur, as approved by the Secretary, are conducted thereon, (3) require the payment to the United States of such royalty as may be specified in the lease but not less than 5 per centum of the gross production or value of the sulphur at the wellhead, and (4) contain such rental provisions and such other terms and provisions as the Secretary may by regulation prescribe at the time of offering the area for lease.
Other mineral leases; award to highest bidder; terms and conditions; agreements for use of resources for shore protection, beach or coastal wetlands restoration, or other projects
Publication of notices of sale and terms of bidding
Notice of sale of leases, and the terms of bidding, authorized by this section shall be published at least thirty days before the date of sale in accordance with rules and regulations promulgated by the Secretary.
Disposition of revenues
section 1338 of this titleAll moneys paid to the Secretary for or under leases granted pursuant to this section shall be deposited in the Treasury in accordance with .
Issuance of lease as nonprejudicial to ultimate settlement or adjudication of controversies
section 1336 of this titleThe issuance of any lease by the Secretary pursuant to this subchapter, or the making of any interim arrangements by the Secretary pursuant to shall not prejudice the ultimate settlement or adjudication of the question as to whether or not the area involved is in the outer Continental Shelf.
Cancellation of leases for fraud
The Secretary may cancel any lease obtained by fraud or misrepresentation.
Leases, easements, or rights-of-way for energy and related purposes
In general
Payments and revenues
Competitive or noncompetitive basis
Except with respect to projects that meet the criteria established under section 388(d) of the Energy Policy Act of 2005, the Secretary shall issue a lease, easement, or right-of-way under paragraph (1) on a competitive basis unless the Secretary determines after public notice of a proposed lease, easement, or right-of-way that there is no competitive interest.
Requirements
Lease duration, suspension, and cancellation
The Secretary shall provide for the duration, issuance, transfer, renewal, suspension, and cancellation of a lease, easement, or right-of-way under this subsection.
Security
Coordination and consultation with affected State and local governments
The Secretary shall provide for coordination and consultation with the Governor of any State or the executive of any local government that may be affected by a lease, easement, or right-of-way under this subsection.
Regulations
Not later than 270 days after , the Secretary, in consultation with the Secretary of Defense, the Secretary of the Department in which the Coast Guard is operating, the Secretary of Commerce, heads of other relevant departments and agencies of the Federal Government, and the Governor of any affected State, shall issue any necessary regulations to carry out this subsection.
Effect of subsection
Nothing in this subsection displaces, supersedes, limits, or modifies the jurisdiction, responsibility, or authority of any Federal or State agency under any other Federal law.
Applicability
This subsection does not apply to any area on the outer Continental Shelf within the exterior boundaries of any unit of the National Park System, National Wildlife Refuge System, or National Marine Sanctuary System, or any National Monument.
Aug. 7, 1953, ch. 345, § 867 Stat. 468Pub. L. 95–372, title II, § 205(a)92 Stat. 640Pub. L. 99–272, title VIII, § 8003100 Stat. 148Pub. L. 100–202, § 101(g) [title I, § 100]101 Stat. 1329–213Pub. L. 103–426, § 1(a)108 Stat. 4371Pub. L. 104–58, title III109 Stat. 563Pub. L. 105–362, title IX, § 901(k)112 Stat. 3290Pub. L. 106–53, title II, § 215(b)(1)113 Stat. 292Pub. L. 109–58, title III119 Stat. 704Pub. L. 117–58, div. D, title III135 Stat. 1003Pub. L. 117–169, title V, § 50261136 Stat. 2056Pub. L. 119–21, title V, § 50102(d)139 Stat. 141(, ; , (b), , , 644; , , ; , , , 1329–225; , , ; , §§ 302, 303, , , 565; , , ; , , ; , §§ 346, 388(a), (c), , , 744, 747; , §§ 40307(b), 40343, , , 1033; , , ; , , .)
Editorial Notes
References in Text
Pub. L. 93–15987 Stat. 628section 760g of Title 15The Emergency Petroleum Allocation Act of 1973, referred to in subsec. (b)(7), is , , , which was classified generally to chapter 16A (§ 751 et seq.) of Title 15, Commerce and Trade, and was omitted from the Code pursuant to , which provided for the expiration of the President’s authority under that chapter on .
section 8004(b)(1)(B) of Pub. L. 99–272Section 8004(b)(1)(B) of the Outer Continental Shelf Lands Act Amendments of 1985, referred to in subsec. (g)(5)(A), is , which is set out as a note below.
Pub. L. 93–62788 Stat. 2126section 1501 of Title 33The Deepwater Port Act of 1974, referred to in subsec. (p)(1), is , , , which is classified principally to chapter 29 (§ 1501 et seq.) of Title 33, Navigation and Navigable Waters. For complete classification of this Act to the Code, see Short Title note set out under and Tables.
Pub. L. 96–32094 Stat. 974section 9101 of Title 42The Ocean Thermal Energy Conversion Act of 1980, referred to in subsec. (p)(1), is , , , which is classified principally to chapter 99 (§ 9101 et seq.) of Title 42, The Public Health and Welfare. For complete classification of this Act to the Code, see Short Title note set out under and Tables.
section 388(d) of Pub. L. 109–58Section 388(d) of the Energy Policy Act of 2005, referred to in subsec. (p)(3), is , which is set out as a note under this section.
Codification
section 702 of title 55 U.S.C. 702Pub. L. 89–554, § 7(b)80 Stat. 631In subsec. (a)(3)(C)(ii), “” substituted for “section 10(a) of the Administrative Procedures Act ()” on authority of , , , the first section of which enacted Title 5, Government Organization and Employees.
Pub. L. 109–58, referred to in subsec. (p)(2)(B), was in the original “the date of enactment of this section”, which was translated as meaning the date of enactment of , which enacted subsec. (p) of this section, to reflect the probable intent of Congress.
Amendments
Pub. L. 119–21, § 50102(d)(1)Pub. L. 117–1692025—, repealed 117–169, § 50261, and provided that any provision of law amended or repealed by that section is restored or revived as if that section had not been enacted. See 2022 Amendment and Repeal of notes below.
Pub. L. 119–21, § 50102(d)(2)(A)Subsec. (a)(1)(A), (C). , (B), substituted “not less than 12½ percent, but not more than 16⅔ percent,” for “not less than 12½ per centum”.
Pub. L. 119–21, § 50102(d)(2)(C)Subsec. (a)(1)(F). , substituted “not less than 12½ percent, but not more than 16⅔ percent,” for “no less than 12½ per centum”.
Pub. L. 119–21, § 50102(d)(2)(D)Subsec. (a)(1)(H). , substituted “not less than 12½ percent, but not more than 16⅔ percent,” for “no less than 12 and ½ per centum”.
Pub. L. 117–169, § 50261(1)Pub. L. 119–21, § 50102(d)(1)2022—Subsec. (a)(1)(A), (C). , which substituted “not less than 16⅔ percent, but not more than 18¾ percent, during the 10-year period beginning on , and not less than 16⅔ percent thereafter,” for “not less than 12½ per centum”, was repealed by .
Pub. L. 117–169, § 50261(2)Pub. L. 119–21, § 50102(d)(1)Subsec. (a)(1)(F). , which substituted “not less than 16⅔ percent, but not more than 18¾ percent, during the 10-year period beginning on , and not less than 16⅔ percent thereafter,” for “no less than 12½ per centum”, was repealed by .
Pub. L. 117–169, § 50261(3)Pub. L. 119–21, § 50102(d)(1)Subsec. (a)(1)(H). , which substituted “not less than 16⅔ percent, but not more than 18¾ percent, during the 10-year period beginning on , and not less than 16⅔ percent thereafter,” for “no less than 12 and ½ per centum”, was repealed by .
Pub. L. 117–58, § 403432021—Subsec. (p)(1)(C). , inserted “storage,” before “or transmission”.
Pub. L. 117–58, § 40307(b)Subsec. (p)(1)(E). , added subpar. (E).
Pub. L. 109–58, § 388(c)2005—, substituted “Leases, easements, and rights-of-way on the outer Continental Shelf” for “Grant of leases by Secretary” in section catchline.
Pub. L. 109–58, § 346Subsec. (a)(3)(B). , inserted “and in the Planning Areas offshore Alaska” after “West longitude” in introductory provisions.
Pub. L. 109–58, § 388(a)Subsec. (p). , added subsec. (p).
Pub. L. 106–531999—Subsec. (k)(2)(B). substituted “a Federal, State, or local government agency” for “an agency of the Federal Government”.
Pub. L. 105–3621998—Subsec. (a)(9). struck out par. (9) which related to report to Congress by Secretary of Energy on bidding options for oil and gas leases on outer Continental Shelf land.
Pub. L. 104–58, § 3031995—Subsec. (a)(1)(H), (I). , added subpar. (H) and redesignated former subpar. (H) as (I).
Pub. L. 104–58, § 302Subsec. (a)(3). , designated existing provisions as subpar. (A) and added subpars. (B) and (C).
Pub. L. 103–4261994—Subsec. (k). designated existing provisions as par. (1) and added par. (2).
Pub. L. 100–202section 1336 of this title1987—Subsec. (g)(5)(A). substituted “an escrow account established pursuant to an agreement under ” for “such account” in second sentence, added cl. (i), designated existing indented par. as cl. (ii), substituted “a boundary” for “any boundary”, “any additional moneys” for “all moneys”, and inserted “or credited to” before “the escrow account”.
Pub. L. 99–2721986—Subsec. (g)(1). amended par. (1) generally. Prior to amendment, par. (1) read as follows: “At the time of soliciting nominations for the leasing of lands within three miles of the seaward boundary of any coastal State, the Secretary shall provide the Governor of such State—
“(A) an identification and schedule of the areas and regions proposed to be offered for leasing;
“(B) all information concerning the geographical, geological, and ecological characteristics of such regions;
“(C) an estimate of the oil and gas reserves in the areas proposed for leasing; and
“(D) an identification of any field, geological structure, or trap located within three miles of the seaward boundary of such coastal State.”
Pub. L. 99–272Subsec. (g)(2). amended par. (2) generally. Prior to amendment, par. (2) read as follows: “After receipt of nominations for any area of the outer Continental Shelf within three miles of the seaward boundary of any coastal State, the Secretary shall inform the Governor of such coastal State of any such area which the Secretary believes should be given further consideration for leasing. The Secretary, in consultation with the Governor of the coastal State, shall then, determine whether any such area may contain one or more oil or gas pools or fields underlying both the outer Continental Shelf and lands subject to the jurisdiction of such State. If, with respect to such area, the Secretary selects a tract or tracts which may contain one or more oil or gas pools or fields underlying both the outer Continental Shelf and lands subject to the jurisdiction of such State, the Secretary shall offer the Governor of such coastal State the opportunity to enter into an agreement concerning the disposition of revenues which may be generated by a Federal lease within such area in order to permit their fair and equitable division between the State and Federal Government.”
Pub. L. 99–272Subsec. (g)(3). amended par. (3) generally. Prior to amendment, par. (3) read as follows: “Within ninety days after the offer by the Secretary pursuant to paragraph (2) of this subsection, the Governor shall elect whether to enter into such agreement and shall notify the Secretary of his decision. If the Governor accepts the offer, the terms of any lease issued shall be consistent with the provisions of this subchapter, with applicable regulations, and, to the maximum extent practicable, with the applicable laws of the coastal State. If the Governor declines the offer, or if the parties cannot agree to terms concerning the disposition of revenues from such lease (by the time the Secretary determines to offer the area for lease), the Secretary may nevertheless proceed with the leasing of the area.”
Pub. L. 99–272Subsec. (g)(4). amended par. (4) generally. Prior to amendment, par. (4) read as follows: “Notwithstanding any other provision of this subchapter, the Secretary shall deposit in a separate account in the Treasury of the United States all bonuses, royalties, and other revenues attributable to oil and gas pools underlying both the outer Continental Shelf and submerged lands subject to the jurisdiction of any coastal State until such time as the Secretary and the Governor of such coastal State agree on, or if the Secretary and the Governor of such coastal State cannot agree, as a district court of the United States determines, the fair and equitable disposition of such revenues and any interest which has accrued and the proper rate of payments to be deposited in the treasuries of the Federal Government and such coastal State.”
Pub. L. 99–272Subsec. (g)(5) to (7). added pars. (5) to (7).
Pub. L. 95–372, § 205(a)1978—Subsec. (a). , designated existing provisions as par. (1)(A) and (B), and in par. (1)(A) as so redesignated, struck out provisions which restricted authority of Secretary to grant oil and gas leases to situations involving the urgent need for further exploration and development of oil and gas deposits of the submerged lands of the outer Continental Shelf and inserted provisions permitting the promulgation of regulations for the deposit of cash bids in interest-bearing accounts until the Secretary announces his decision on whether to accept the bids with the earned interest paid either to the Treasury or to unsuccessful bidders, in par. (1)(B) as so redesignated, substituted provisions relating to variable royalty bids based on a per centum in amount or value of the production saved, removed, or sold, with either a fixed work commitment based on dollar amount covering exploration or a fixed cash bonus as determined by the Secretary or both for provisions relating to straight royalty bids at not less than 12½ per centum with a cash bonus fixed by the Secretary, and added pars. (1)(C) to (H) and pars. (2) to (9).
Pub. L. 95–372, § 205(a)Subsec. (b). , redesignated cls. (1) to (4) as pars. (1), (2), (3), and (6) respectively, added pars. (4), (5), and (7), and in par. (1) as so redesignated, inserted provisions authorizing the Secretary to lease tracts larger than 5760 acres if a larger area is necessary to comprise a reasonable economic production unit and in par. (2) as so redesignated, inserted provision to allow up to a 10 year initial period if the longer period is necessary to encourage exploration and development in areas because of unusually deep water or other unusually adverse conditions, and in par. (3) as so redesignated, substituted “payment of amount or value as determined by one of the bidding systems set forth in subsection (a) of this section” for “payment of a royalty of not less than 12½ per centum, in the amount or value of the production saved, removed, or sold from the lease”.
Pub. L. 95–372, § 205(b)Subsecs. (c) to (h). , added subsecs. (c) to (h). Former subsecs. (c) to (h) redesignated (i) to (n).
Pub. L. 95–372, § 205(b)oSubsec. (i). , redesignated former subsec. (c) as (i). Former subsec. (i) redesignated ().
Pub. L. 95–372, § 205(b)section 1349 of this titleSubsec. (j). , redesignated former subsec. (d) as (j). Former subsec. (j), which provided that any person complaining of the cancellation of a lease by the Secretary could have the Secretary’s action reviewed in the United States District Court for the District of Columbia by filing a petition for review, was struck out. See .
oPub. L. 95–372, § 205(b)oSubsecs. (k) to (). , redesignated former subsecs. (e) to (i) as (k) to (), respectively.
Statutory Notes and Related Subsidiaries
Regulations
section 40307(b) of Pub. L. 117–58section 40307(d) of Pub. L. 117–58section 1331 of this titleSecretary of the Interior required to promulgate regulations to carry out amendment by not later than 1 year after , see , set out as a note under .
Pub. L. 104–58, title III, § 305109 Stat. 566
Pub. L. 117–169Repeal of
Pub. L. 119–21, title V, § 50102(d)(1)139 Stat. 141
Savings Provision
Pub. L. 109–58, title III, § 388(d)119 Stat. 747
Pub. L. 104–58, title III, § 306109 Stat. 566
Abolition of House Committee on Merchant Marine and Fisheries
section 1(b)(3) of Pub. L. 104–14section 21 of Title 2Committee on Merchant Marine and Fisheries of House of Representatives abolished and its jurisdiction transferred by House Resolution No. 6, One Hundred Fourth Congress, . For treatment of references to Committee on Merchant Marine and Fisheries, see , set out as a note preceding , The Congress.
Transfer of Functions
section 100 of Pub. L. 97–25796 Stat. 841section 7152 of Title 42Functions vested in, or delegated to, Secretary of Energy and Department of Energy under or with respect to subsec. (a)(4) of this section, transferred to, and vested in, Secretary of the Interior, by , , set out as a note under , The Public Health and Welfare.
section 7152(b) of Title 42Section 7152(b) of Title 42Pub. L. 97–100, title II, § 20195 Stat. 1407Functions of Secretary of the Interior to promulgate regulations under this subchapter which relate to fostering of competition for Federal leases, implementation of alternative bidding systems authorized for award of Federal leases, establishment of diligence requirements for operations conducted on Federal leases, setting of rates for production of Federal leases, and specifying of procedures, terms, and conditions for acquisition and disposition of Federal royalty interests taken in kind, transferred to Secretary of Energy by . was repealed by , , , and functions of Secretary of Energy returned to Secretary of the Interior. See House Report No. 97–315, pp. 25, 26, .
Wage Rate Requirements
Pub. L. 117–58section 18851 of Title 42For provisions relating to rates of wages to be paid to laborers and mechanics on projects for construction, alteration, or repair work funded under div. D or an amendment by div. D of , including authority of Secretary of Labor, see , The Public Health and Welfare.
Clarification
Pub. L. 117–58, div. D, title III, § 40307(c)135 Stat. 1003
Coordinated OCS Mapping Initiative
Pub. L. 109–58, title III, § 388(b)119 Stat. 746
In general .—
Use of data .—
Inclusions .—
State Claims to Jurisdiction Over Submerged Lands
Pub. L. 109–58, title III, § 388(e)119 Stat. 747
Reimbursement of Local Interests
Pub. L. 106–53, title II, § 215(b)(2)113 Stat. 293
Fees for Royalty Rate Relief Applications
Pub. L. 104–134, title I, § 101(c) [title I]110 Stat. 1321–156Pub. L. 104–140, § 1(a)110 Stat. 1327
Lease Sales
Pub. L. 104–58, title III, § 304109 Stat. 565
Distribution of Section 1337(g) Account
Pub. L. 99–272, title VIII, § 8004100 Stat. 150
| ($ million) |
|---|---|
Louisiana | 572 |
Texas | 382 |
California | 338 |
Alabama | 66 |
Alaska | 51 |
Mississippi | 14 |
Florida | 0.03 |
as well as 27 percent of the royalties, derived from any lease of Federal lands, which have been deposited through , in the separate account described in this paragraph and interest thereon accrued through , and shall transmit any remaining amounts to the miscellaneous receipts account of the Treasury of the United States; and
from the funds which were deposited in the separate account in the Treasury of the United States under section 8(g)(4) of the Outer Continental Shelf Lands Act () which was in effect prior to the date of enactment of [] the following sums:
| ($ million) |
|---|---|
Louisiana | 84 |
Texas | 134 |
California | 289 |
Alabama | 7 |
Alaska | 134 |
Mississippi | 2. |