Short title

This Act may be cited as the

Oil and Gas Lease Reform Act of 2008

Environmental review process

(a)

Preemption of State law

No State environmental or pollution control law regulating the emission of pollutants or protecting human health or the environment shall apply to any activity under a lease for the exploration, development, or production of oil or natural gas on Federal lands (including submerged lands), including any such State law that is expressly applicable to such activity under any other provision of Federal law. (b)

Conforming amendments

(1)Section 25 of the Outer Continental Shelf Lands Act (43 U.S.C. 1351) is amended— (A)by striking subsection (d); and (B)in subsection (h)— (i)in paragraph (1) by striking Any modification required by the Secretary and all that follows through the end of the sentence; (ii)in paragraph (1) by striking subparagraph (B); (iii)in paragraph (2)(A) by striking clause (ii); and (iv)in paragraph (2)(B) by striking clause (ii). (2)Section 202(c) of the Federal Land Policy and Management Act of 1976 (43 U.S.C. 1712(c)) is amended— (A)in paragraph (8), by striking State and; and (B)in paragraph (9)— (i)by striking and of the States and all that follows through 897), as amended, ; (ii)by striking of approved State and; (iii)by striking State, local, and; (iv)by striking non-Federal Governmental; and (v)by striking the last sentence.

Prevention of unnecessary or undue degradation of public lands

Section 302(b) of the Federal Land Policy and Management Act of 1976 (43 U.S.C. 1732(b)) is amended by inserting (1) before the first sentence, and by adding at the end the following:

(2)For purposes of application of this subsection with respect to a lease for the exploration, development, or production of oil or natural gas, the term unnecessary or undue degradation means (A) surface or submerged disturbance greater than what would normally result when an activity is being accomplished by a prudent operator in usual, customary, and proficient operations of similar character and taking into considerations the effect of operations on other resources and land uses, including those resources and uses outside the area of operations; (B) failure to initiate and complete reasonable mitigation measures, including the attainment of a level of protection or reclamation required by specific Federal law in areas such as the California Desert Conservation Area, Wild and Scenic Rivers, Bureau of Land Management-administered portions of the National Wilderness System, and Bureau of Land Management-administered National Monuments and National Conservation Areas; (C) failure to comply with applicable Federal environmental statutes and regulations thereunder; or (D) failure to abide by the terms and conditions of an approved plan of operations and operations described in a complete notice.

Condition for suspension of lease

(a)

Federal Land Policy and Management Act of 1976

Section 302(c) of the Federal Land Policy and Management Act of 1976 (43 U.S.C. 1732(c)) is amended by inserting (1) before the first sentence, and by adding at the end the following:

(2)(A)The Secretary may not suspend any lease for the exploration, development, or production of oil or natural gas, unless— (i)the Secretary determines, based on clear proof, that operations under the lease will present an imminent threat or harm to public safety or will significantly damage the public lands outside lease stipulations; or (ii)the suspension is requested by the lessee. (B)The Secretary shall review any suspension of a lease under subparagraph (A)(i) at least once every 30 days, and may renew such a suspension only after such a review. (C)Any suspension by the Secretary of a lease under subparagraph (A)(i) for more than a total of 90 days in any 6-month period is deemed to be a breach of a contractual obligation of the United States, if— (i)the lessee is taking action to mitigate the condition that was the reason for the suspension; and (ii)such action is preventing the imminent threat, harm, or significant damage. (D)In the case of a breach under of contractual obligation, under subparagraph (C)— (i)the lessee shall be awarded contract damages; and (ii)the lessee may— (I)retain the lease, and reapply upon submission to the Secretary of an application that includes procedures to address the reasons for the suspensions; or (II)surrender the lease and be refunded the amounts paid by the lessee to the United States as a bonus bid for the lease. (E)The term of a lease shall be extended by the period of each suspension of the lease under subparagraph (A). (F)The maximum period of time a lease may be suspended by request under subparagraph (A)(ii) is 2 years for each 5-year period of the original term of the lease. (G)In this paragraph the term significantly damage means destroy 5 percent of more of wildlife and flora in the area that is subject to a the lease, or destroy historical structures in excess of the terms under permits and plans approved by the Secretary pursuant to the lease.

(b)

Mineral Leasing Act

Section 17 of the Mineral Leasing Act (30 U.S.C. 226) is amended by adding at the end the following:

(q)(1)The Secretary may not suspend any lease under this Act for the exploration, development, or production of oil or natural gas, unless— (A)the Secretary determines, based on clear proof, that operations under the lease will present an imminent threat or harm to public safety or will significantly damage the public lands; or (B)the suspension is requested by the lessee. (2)The Secretary shall review any suspension of a lease under paragraph (1)(A) at least once every 30 days, and may renew such a suspension only after such a review. (3)Any suspension by the Secretary of a lease under paragraph (1)(A) for more than a total of 90 days in any 6-month period is deemed to be a breach of a contractual obligation of the United States, if— (A)the lessee is taking action to mitigate the condition that was the reason for the suspension; and (B)such action is preventing the imminent threat, harm, or significant damage. (4)In the case of a breach under of contractual obligation, under paragraph (3)— (A)the lessee shall be awarded contract damages; and (B)the lessee may— (i)retain the lease, and reapply upon submission to the Secretary of an application that includes procedures to address the reasons for the suspension; or (ii)surrender the lease and be refunded the amounts paid by the lessee to the United States as a bonus bid for the lease. (5)The term of a lease shall be extended by the period of each suspension of the lease under paragraph (1). (6)The maximum period of time a lease may be suspended by request under paragraph (1)(B) is 2 years for each 5-year period of the original term of the lease. (7)In this subsection the term significantly damage means destroy 5 percent of more of wildlife and flora in the area that is subject to a the lease, or destroy historical structures in excess of the terms under permits and plans approved by the Secretary pursuant to the lease.

(c)

Outer Continental Shelf Lands Act

Section 5 of the Outer Continental Shelf Lands Act (43 U.S.C. 1334) is amended— (1)in subsection (a)— (A)in paragraph (1) by striking (A) at the request and all that follows through the end of the paragraph and inserting in accordance with subsection (k); and (B)by amending paragraph (2) to read as follows:

(2)with respect to cancellation of any lease or permit, that comply with subsection (k);

; and

(2)by adding at the end the following:

(k)(1)The Secretary may not suspend any lease under this Act for the exploration, development, or production of oil or natural gas, unless— (A)the Secretary determines, based on clear proof, that operations under the lease will present an imminent threat or harm to public safety or will significantly damage the public lands; or (B)the suspension is requested by the lessee. (2)The Secretary shall review any suspension of a lease under paragraph (1)(A) at least once every 30 days, and may renew such a suspension only after such a review. (3)Any suspension by the Secretary of a lease under paragraph (1)(A) for more than a total of 90 days in any 6-month period is deemed to be a breach of a contractual obligation of the United States, if— (A)the lessee is taking action to mitigate the condition that was the reason for the suspension; and (B)such action is preventing the imminent threat, harm, or significant damage. (4)In the case of a breach under of contractual obligation, under paragraph (3)— (A)the lessee shall be awarded contract damages; and (B)the lessee may— (i)retain the lease, and reapply upon submission to the Secretary of an application that includes procedures to address the reasons for the suspension; or (ii)surrender the lease and receive such compensation as the lessee shows necessary to the Secretary as being greater of— (I)the fair value of the canceled rights as of the date of cancellation, taking account of both anticipated revenues from the lease and anticipated costs, including costs of compliance with all applicable regulations and operating orders, liability for cleanup costs or damages, or both, in the case of an oil spill, and all other costs reasonably anticipated on the lease, or (II)the excess, if any, over the lessee's revenues, from the lease (plus interest thereon from the date of receipt to date of reimbursement) of all consideration paid for the lease and all direct expenditures made by the lessee after the date of issuance of such lease and in connection with exploration or development, or both, pursuant to the lease (plus interest on such consideration and such expenditures from date of payment to date of reimbursement),

except that with respect to leases issued before September 18, 1978, such compensation shall be equal to the amount specified in subclause (I) of this clause, and that in the case of joint leases which are canceled due to the failure of one or more partners to exercise due diligence, the innocent parties shall have the right to seek damages for such loss from the responsible party or parties and the right to acquire the interests of the negligent party or parties and be issued the lease in question.

(5)The term of a lease shall be extended by the period of each suspension of the lease under paragraph (1). (6)The maximum period of time a lease may be suspended by request under paragraph (1)(B) is 2 years for each 5-year period of the original term of the lease. (7)In this subsection the term significantly damage means— (A)destroy 5 percent or more of fish and other aquatic life in the area that is subject to the lease; (B)destroy 5 percent or more of the marine environment within one mile of the area that is subject to the lease, including the area within the lease; or (C)destroy 5 percent or more of the coastal environment that is nearest to the area that is subject to the lease.

Limitation on requirement to conduct environmental reviews for a lease

(a)

In general

No statement is required under section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)) for a lease for the exploration, development, or production of oil or natural gas on Federal lands (including any lease under the Outer Continental Shelf Lands Act, the Mineral Leasing Act, the Mineral Leasing Act for Acquired Lands, or any other Federal law), except for— (1)sale of the lease by the lessee; and (2)as provided in subsection (b). (b)

Permits for exploration, development, production and infrastructure

(1)

In general

The Secretary of the Interior shall prepare a single statement under such section, and conduct a single review for that purpose, with respect to all plans and permits required for exploration, development, production, and construction of infrastructure to be carried out under the lease, upon submission by the lessee of a request under this subsection. (2)

Contents of request

The lessee shall include in the request a comprehensive plan that includes all plans and applications for all permits referred to in paragraph (1). (3)

Limitation on other reviews

Upon submission of a request under this subsection, no Federal agency or official, other than the Secretary, may conduct any review or issue any other statement under 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)) for activities under the lease. (4)

Submission of comment

The head of any Federal agency with authority to administer any Federal law that applies to activities under such a lease may submit comments to the Secretary regarding such request. (5)

Requirement to issue permits

If the Secretary determines, after reviewing all comments submitted under paragraph (4), that the comprehensive plan complies with the requirements of such section— (A)each Federal official responsible for administering any law under which a such a permit is required shall issue such permit within the 60-day period beginning on the date the Secretary issues the determination, unless such official files an appeal of the determination in the District of Columbia Court of Appeals filed before the end of that period; and (B)operations under the lease and such permits may commence immediately upon the issuance of a final decision in all such appeals, except as otherwise provided in such a decision. (6)

Period to begin production

For purposes of any requirement under Federal law that production of oil or gas under such a lease begin within a specified period, such period shall begin upon the later of— (A)the expiration of the period referred to in paragraph (5)(A); and (B)this issuance of a final decision in all appeals filed in accordance with that paragraph. (7)

Regulations

The Secretary shall issue such regulations as are necessary to issue this subsection.

Appeals process

Notwithstanding section 554(f) of title 5, United States Code, any appeal of a decision of an officer of the Department of the Interior or an administrative law judge regarding any lease for the exploration, development, or production of oil or natural gas on Federal lands (including submerged lands) or an matter under or with respect to such a lease shall be in accordance with the following: (1)Within 60 days after the issuance of the decision, the appellant shall file a notice of appeal with the appellee and the Secretary of the Interior that includes a statement of reasons, arguments, briefs, and a request for a hearing. (2)Within 30 days after receipt of such notice of appeal, the Secretary shall decide whether to hold an administrative hearing pursuant to the request. If the Secretary decides not to hold such a hearing, the decision of the officer or judge is a final agency action. (3)Within 60 days after the Secretary holds such a hearing, the Secretary shall issue a final decision on the appeal. If the Secretary fails to issue a final decision in that period, the Secretary is deemed to have found in favor of the appellee. Such final decision or finding is deemed to be a final agency action. (4)Any judicial appeal by the appellant of such a final agency action may only be filed— (A)in the District of Columbia Court of Appeals; and (B)within 60 days after the end of the period referred to in paragraph (3). (5)If a final decision by the District of Columbia Court of Appeals in such judicial appeal is not issued within 1 year after the date the judicial appeal is filed— (A)the court is deemed to have decided the appeal in favor of the appellee; and (B)no court has jurisdiction over the appeal except the Supreme Court. (6)Any administrative or judicial appeal of a decision by the Department of the Interior regarding a statement under section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)) or any similar environmental analysis must be countered by a similar assessment conducted by the appellant that shows that the Department— (A)did not follow accepted scientific methods in reaching its decision; and (B)is arbitrary and capricious. (7)If the suit is determined by the court to have no basis in fact or law, the appellant shall be liable to the appellee for attorney and witness fees and court costs, except in the case of an indigent party. If one or more 3rd parties contributed assistance to the indigent party to bring suit or reasonable incident actions related to suit, then 3rd parties shall be liable for such fees and costs. If any of such assistance was directly paid to the indigent party, the indigent party may be held liable for fees and costs to the extent of the amount received.

Citizen suits, enforcement actions, and appeals under the Outer Continental Shelf Lands Act

(a)

Restriction on actions by noncitizens and Federal agencies

Section 23(a)(1) of the Outer Continental Shelf Lands Act (43 U.S.C. 1349(a)(1)) is amended by adding at the end the following: No such civil action may be commenced by a person that is not a United States citizen, a State, or a United States incorporated or unincorporated company or corporation established under the laws of a State. No such civil action may be commenced by a Federal officer or agency, except the Secretary of the Interior.. (b)

Limitation on actions and intervention in case of suits by attorney general

Section 23(a)(2)(B) of such Act (43 U.S.C. 1349(a)(2)(B)) is amended— (1)by inserting or criminal after civil; and (2)by striking , but in any such action and all that follows and inserting a period. (c)

Recovery for frivolous actions

(1)

Citizen suits

Section 23 of such Act (43 U.S.C. 1349) is amended by adding at the end the following:

(d)If an action under this section is determined by the court to have no basis in fact or law, the plaintiff shall be liable to the defendant for attorney and witness fees and court costs, except in the case of an indigent party. If one or more 3rd parties contributed assistance to the indigent party to bring suit or reasonable incident actions related to suit, then the 3rd parties shall be liable for such fees and costs. If any of such assistance was directly paid to the indigent party, the indigent party may be held liable for fees and costs to the extent of the amount received.

(2)

Civil enforcement actions

Section 24 of such Act (43 U.S.C. 1350) is amended by adding at the end the following:

(f)If an action under this section is determined by the court to have no basis in fact or law, the plaintiff shall be liable to the defendant for attorney and witness fees and court costs.

(d)

Appellate jurisdiction

(1)

Citizen suits

Section 23(b)(1) of such Act (43 U.S.C. 1349(b)(1)) is amended by adding at the end the following: Any appeal of a decision in such a proceeding brought against a Federal agency or a lessee under this Act shall be brought in the District of Columbia Court of Appeals.. (2)

Actions by Secretary on exploration or development and production plan

Section 23(c)(2) of such Act (43 U.S.C. 1349(c)(2)) is amended by striking shall be subject and all that follows and inserting shall be subject to judicial review only in the District of Columbia Court of Appeals.. (e)

Actions for damages

Section 23(b)(2) of such Act (43 U.S.C. 1349(b)(2)) is amended by striking resident of the United States who is injured and inserting citizen of the United States or United States incorporated or unincorporated company or corporation that is injured, or State that is injured,.

Review of restricting of drilling during certain periods of the year

Not later than 90 days after the date of the enactment of this Act, the Secretary of the Interior, acting through the Bureau of Land Management, shall review and report to the Congress regarding restricting drilling under oil and gas leases on Federal lands in the Intermountain West during certain periods of the year. The Secretary shall include in the report a determination of whether it would be better to limit such restrictions to allow drilling an area quickly, rather than causing extended disturbance by drilling over several years.

Reliance on environmental information

(a)

In general

Reliance by a Federal agency on environmental information included in the statement or other documents required under section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)) with respect to the leasing of Federal lands (including submerged lands) for exploration, development, or production of oil or natural gas, in taking any action to address a matter that arose after purchase of a lease by a lessee with respect to exploration, development, production, or transportation under the lease shall not invalidate such a lease, and shall not result in suspension of activities under the lease unless it presents an imminent threat to public safety. (b)

Review

The Secretary of the Interior may review any such action to determine what modifications should be made by lessee in activities under the a lease to resolve the matter. (c)

Judicial review

The District of Columbia Court of Appeals has exclusive jurisdiction over any action seeking review of any action by a Federal agency taken in reliance on information referred to in subsection (a). In any such action, the appellant has the burden to prove that the agency’s actions were not reasonable and clearly did not meet accepted standards for mitigation.

10.

Use of adjoining lease tract

In any case in which logical exploration for or development of oil or natural gas under a lease of Federal lands (including submerged lands) for that purpose cannot proceed without acquisition or participation of adjoining land that is not available, the Secretary of the Interior may allow temporary use of such land by the lessee for such exploration and development unless it is owned by or under lease to another person. No lease or statement under 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)) shall be required for such use if the use is minimal and will have minimal environmental effect on such adjoining Federal land.