[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 817 Introduced in House (IH)]







104th CONGRESS
  1st Session
                                H. R. 817

 To authorize the Secretary of Energy to lease lands within the naval 
    oil shale reserves to private entities for the development and 
                   production of oil and natural gas.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            February 3, 1995

  Mr. Hefley introduced the following bill; which was referred to the 
 Committee on National Security and, in addition, to the Committee on 
 Resources, for a period to be subsequently determined by the Speaker, 
 in each case for consideration of such provisions as fall within the 
                jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
 To authorize the Secretary of Energy to lease lands within the naval 
    oil shale reserves to private entities for the development and 
                   production of oil and natural gas.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. OIL AND GAS LEASES INVOLVING NAVAL OIL SHALE RESERVES.

    (a) Authority To Enter into Leases.--(1) Chapter 641 of title 10, 
United States Code, is amended by adding at the end the following new 
section:
``Sec. 7439. Naval oil shale reserves: lease of lands for oil and gas 
              exploration, development, and production
    ``(a) Authority To Lease.--The Secretary of Energy may lease lands 
owned or controlled by the United States inside a naval oil shale 
reserve to a private entity for the purpose of the exploration for, and 
development and production of, petroleum (other than in the form of oil 
shale) from such lands. In leasing lands under this subsection, the 
Secretary shall use competitive bidding procedures.
    ``(b) Use of BLM as Leasing Agent.--For the purpose of exercising 
the authority provided by subsection (a), the Secretary of Energy may 
enter into a cooperative agreement with the Secretary of the Interior 
under which employees of the Bureau of Land Management serve as leasing 
agents of the Secretary of Energy. Use of Bureau of Land Management 
employees shall not relieve the Secretary of Energy of management 
responsibilities over the naval oil shale reserves.
    ``(c) Royalty.--A lease of lands under subsection (a) in an oil 
shale reserve shall be conditioned upon the payment of a royalty at a 
rate, to be established by the Secretary, equivalent to the prevailing 
royalty rate for similar leases in the State in which the reserve is 
located. The royalty rate shall be expressed as a percentage of the 
amount or value of the production removed or sold pursuant to the 
lease. The Secretary may require all or a portion of the United States 
share of the royalty to be paid in the form of petroleum produced 
pursuant to the lease. At the request of the Secretary of Defense, the 
Secretary may provide petroleum obtained under this subsection to the 
Department of Defense for the purposes and in the manner specified in 
section 7430(l) of this title, including the requirement of appropriate 
reimbursement.
    ``(d) Share of Royalty to State.--Notwithstanding section 7433(b) 
of this title or any other provision of law, 50 percent of the proceeds 
received from royalty and other payments made by a lessee pursuant to a 
lease under subsection (a) shall be paid to the State within the 
boundaries of which the leased lands are located. A payment under this 
subsection shall be made in the manner, and at the times, provided in 
section 35 of the Mineral Leasing Act (30 U.S.C. 191).
    ``(e) Transfer of Existing Equipment.--The lease of lands by the 
Secretary under subsection (a) may include the transfer of wells, 
gathering lines, and related equipment owned by the United States 
inside a naval oil shale reserve and suitable for use in the 
exploration, development, or production of petroleum on such lands upon 
the condition that the lessee assume responsibility for any 
maintenance, repair, or environmental restoration required in 
connection with the equipment.
    ``(f) Exception From Consultation and Approval Requirements.--
Section 7431 of this title shall not apply to the lease of lands by the 
Secretary under subsection (a).''.
    (2) The table of sections at the beginning of such chapter is 
amended by adding at the end the following new item:

``7439. Naval oil shale reserves: lease of lands for oil and gas 
                            exploration, development, and 
                            production.''.
    (b) Conforming Amendment.--Section 7430(a) of such title is amended 
to read as follows:
    ``(a) In administering the naval petroleum reserves under this 
chapter, except for those reserves covered by leases under section 
7439, the President shall use, store, or sell the petroleum produced 
from the naval petroleum reserves and lands covered by joint, unit, or 
other cooperative plans.''.
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