I 111th CONGRESS 1st Session H. R. 3616 IN THE HOUSE OF REPRESENTATIVES September 22, 2009 Ms. Fallin introduced the following bill; which was referred to the Committee on Natural Resources A BILL To expedite the exploration and development of oil and gas from Federal lands, and for other purposes.

1.

Short title

This Act may be cited as the Federal Exploration and Production Reform Act of 2009.

2.

Review of Outer Continental Shelf exploration plans

Subsections (c) and (d) of section 11 of the Outer Continental Shelf Lands Act (43 U.S.C. 1340) are amended to read as follows: (c)

Plan review; plan provisions

(1)Except as otherwise provided in this Act, prior to commencing exploration pursuant to any oil and gas lease issued or maintained under this Act, the holder thereof shall submit an exploration plan (hereinafter in this section referred to as a plan) to the Secretary for review which shall include all information and documentation required under paragraphs (2) and (3). The Secretary shall review the plan for completeness within 10 days of submission. If the Secretary finds that the plan is not complete, the Secretary shall notify the lessee with a detailed explanation and require such modifications of such plan as are necessary to achieve completeness. The Secretary shall have 10 days to review a modified plan for completeness. Such plan may apply to more than one lease held by a lessee in any one region of the outer Continental Shelf, or by a group of lessees acting under a unitization, pooling, or drilling agreement, and the lessee shall certify that such plan is consistent with the terms of the lease and is consistent with all statutory and regulatory requirements in effect on the date of issuance of the lease, and any regulations promulgated under this Act to the conservation of resources after the date of the lease issuances. The Secretary shall have 30 days from the date the plan is deemed complete to conduct a review of the plan. If the Secretary finds the plan is not consistent with the lease and all such statutory and regulatory requirements, the Secretary shall notify the lessee with a detailed explanation of such modifications of such plan as are necessary to achieve compliance. The Secretary shall have 30 days to review any modified plan submitted by the lessee. The lessee shall not take any action under the exploration plan within the 30-day review period, or thereafter until the plan has been modified to achieve compliance as so notified. (2)An exploration plan submitted under this subsection shall include, in the degree of detail which the Secretary may by regulation require— (A)a schedule of anticipated exploration activities to be undertaken; (B)a description of equipment to be used for such activities; (C)the general location of each well to be drilled; and (D)such other information deemed pertinent by the Secretary. (3)The Secretary may, by regulation, require that such plan be accompanied by a general statement of development and production intentions which shall be for planning purposes only and which shall not be binding on any party. (d)

Plan revisions; conduct of exploration activities

(1)If a significant revision of an exploration plan under this subsection is submitted to the Secretary, the process to be used for the review of such revision shall be the same as set forth in subsection (c) of this section. (2)All exploration activities pursuant to any lease shall be conducted in accordance with an exploration plan or a revised plan which has been submitted to and reviewed by the Secretary. .

3.

Review of Outer Continental Shelf development and production plans

Section 25 of the Outer Continental Shelf Lands Act (43 U.S.C. 1351(a)) is amended to read as follows:

25.

Review of Outer Continental Shelf development and production plans

(a)

Development and production plans; submission to Secretary; statement of facilities and operation; submission to Governors of affected States and local governments

(1)Prior to development and production pursuant to an oil and gas lease issued on or after September 18, 1978, for any area of the outer Continental Shelf, or issued or maintained prior to September 18, 1978, for any area of the outer Continental Shelf, with respect to which no oil or gas has been discovered in paying quantities prior to September 18, 1978, the lessee shall submit a development and production plan (hereinafter in this section referred to as a plan) to the Secretary for review. (2)A plan shall be accompanied by a statement describing all facilities and operations, other than those on the outer Continental Shelf, proposed by the lessee and known by the lessee (whether or not owned or operated by such lessee) that will be constructed or utilized in the development and production of oil or gas from the lease area, including the location and site of such facilities and operations, the land, labor, material, and energy requirements associated with such facilities and operations, and all environmental and safety safeguards to be implemented. (3)Except for any privileged or proprietary information (as such term is defined in regulations issued by the Secretary), the Secretary, within 30 days after receipt of a plan and statement, shall— (A)submit such plan and statement to the Governor of any affected State, and upon request to the executive of any affected local government; and (B)make such plan and statement available to any appropriate interstate regional entity and the public. (b)

Development and production activities in accordance with plan as lease requirement

After enactment of the Federal Exploration and Production Reform Act of 2008, no oil and gas lease may be issued pursuant to this Act in any region of the outer Continental Shelf, unless such lease requires that development and production activities be carried out in accordance with a plan that complies with the requirements of this section. This section shall also apply to leases that do not have an approved development and production plan as of the date of enactment of the Federal Exploration and Production Reform Act of 2008. (c)

Scope and Contents of Plan

A plan may apply to more than one oil and gas lease, and shall set forth, in the degree of detail established by regulations issued by the Secretary— (1)the general work to be performed; (2)a description of all facilities and operations located on the outer Continental Shelf that are proposed by the lessee or known by the lessee (whether or not owned or operated by such lessee) to be directly related to the proposed development, including the location and size of such facilities and operations, and the land, labor, material, and energy requirements associated with such facilities and operations; (3)the environmental safeguards to be implemented on the outer Continental Shelf and how such safeguards are to be implemented; (4)all safety standards to be met and how such standards are to be met; (5)an expected rate of development and production and a time schedule for performance; and (6)such other relevant information as the Secretary may by regulation require. (d)

Completeness review of the plan

(1)Prior to commencing any activity under a development and production plan pursuant to any oil and gas lease issued or maintained under this Act, the lessee shall certify that the plan is consistent with the terms of the lease and that it is consistent with all statutory and regulatory requirements in effect on the date of issuance of the lease, and any regulations promulgated under this Act related to the conservation of resources after the date of lease issuance. The plan shall include all required information and documentation required under subsection (c). (2)The Secretary shall review the plan for completeness within 30 days of submission. If the Secretary finds that the plan is not complete, the Secretary shall notify the lessee with a detailed explanation of such modifications of such plan as are necessary to achieve completeness. The Secretary shall have 30 days to review a modified plan for completeness. (e)

Review for consistency of the plan

(1)After a determination that a plan is complete, the Secretary shall have 120 days to conduct a review of the plan, to ensure that it is consistent with the terms of the lease, and that it is consistent with all such statutory and regulatory requirements applicable to the lease. The review shall ensure that the plan is consistent with lease terms, and statutory and regulatory requirements applicable to the lease, related to national security or national defense, including any military operating stipulations or other restrictions. The Secretary shall seek the assistance of the Department of Defense in the conduct of the review of any plan prepared under this section for a lease containing military operating stipulations or other restrictions and shall accept the assistance of the Department of Defense in the conduct of the review of any plan prepared under this section for any other lease when the Secretary of Defense requests an opportunity to participate in the review. If the Secretary finds that the plan is not consistent, the Secretary shall notify the lessee with a detailed explanation of such modifications of such plan as are necessary to achieve consistency. (2)The Secretary shall have 120 days to review a modified plan. (3)The lessee shall not conduct any activities under the plan during any 120-day review period, or thereafter until the plan has been modified to achieve compliance as so notified. (4)After review by the Secretary provided for by this section, a lessee may operate pursuant to the plan without further review or approval by the Secretary. (f)

Review of revision of the approved plan

The lessee may submit to the Secretary any revision of a plan if the lessee determines that such revision will lead to greater recovery of oil and natural gas, improve the efficiency, safety, and environmental protection of the recovery operation, is the only means available to avoid substantial economic hardship to the lessee, or is otherwise not inconsistent with the provisions of this Act, to the extent such revision is consistent with protection of the human, marine, and coastal environments. The process to be used for the review of any such revision shall be the same as that set forth in subsections (d) and (e). (g)

Cancellation of lease on failure To submit plan or comply with a plan

Whenever the owner of any lease fails to submit a plan in accordance with regulations issued under this section, or fails to comply with a plan, the lease may be canceled in accordance with sections 5(c) and (d). Termination of a lease because of failure to comply with a plan, including required modifications or revisions, shall not entitle a lessee to any compensation. (h)

Production and transportation of natural gas; submission of plan to federal energy regulatory commission; impact statement

If any development and production plan submitted to the Secretary pursuant to this section provides for the production and transportation of natural gas, the lessee shall contemporaneously submit to the Federal Energy Regulatory Commission that portion of such plan that relates to the facilities for transportation of natural gas. The Secretary and the Federal Energy Regulatory Commission shall agree as to which of them shall prepare an environmental impact statement pursuant to the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) applicable to such portion of such plan, or conduct studies as to the effect on the environment of implementing it. Thereafter, the findings and recommendations by the agency preparing such environmental impact statement or conducting such studies pursuant to such agreement shall be adopted by the other agency, and such other agency shall not independently prepare another environmental impact statement or duplicate such studies with respect to such portion of such plan, but the Federal Energy Regulatory Commission, in connection with its review of an application for a certificate of public convenience and necessity applicable to such transportation facilities pursuant to section 7 of the Natural Gas Act (15 U.S.C. 717f), may prepare such environmental studies or statement relevant to certification of such transportation facilities as have not been covered by an environmental impact statement or studies prepared by the Secretary. The Secretary, in consultation with the Federal Energy Regulatory Commission, shall promulgate rules to implement this subsection, but the Federal Energy Regulatory Commission shall retain sole authority with respect to rules and procedures applicable to the filing of any application with the Commission and to all aspects of the Commission's review of, and action on, any such application.

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4.

Regulation of onshore surface-disturbing activities

(a)Section 17(g) of the Mineral Leasing Act (30 U.S.C. 226(g)) is amended to read as follows: (g)

Regulation of surface-Disturbing activities

(1)

Regulation of surface-disturbing activities

The Secretary of the Interior, or for National Forest lands, the Secretary of Agriculture, shall regulate all surface-disturbing activities conducted pursuant to any lease issued under this Act, and shall determine reclamation and other actions as required in the interest of conservation of surface resources. (2)

Submission of exploration plan; completion review; compliance review

(A)Prior to beginning oil and gas exploration activities, a lessee shall submit an exploration plan to the Secretary of the Interior for review. (B)The Secretary shall review the plan for completeness within 10 days of submission. (C)In the event the exploration plan is determined to be incomplete, the Secretary shall notify the lessee in writing and specify the items or information needed to complete the exploration plan. (D)The Secretary shall have 10 days to review any modified exploration plan submitted by the lessee. (E)To be deemed complete, an exploration plan shall include, in the degree of detail to be determined by the Secretary by rule or regulation— (i)a drilling plan containing a description of the drilling program; (ii)the surface and projected completion zone location; (iii)pertinent geologic data; (iv)expected hazards, and proposed mitigation measures to address such hazards; (v)a schedule of anticipated exploration activities to be undertaken; (vi)a description of equipment to be used for such activities; (vii)a certification from the lessee stating that the exploration plan complies with all lease, regulatory and statutory requirements in effect on the date of the issuance of the lease and any regulations promulgated after the date of lease issuance related to the conservation of resources; (viii)evidence that the lessee has secured an adequate bond, surety, or other financial arrangement prior to commencement of any surface-disturbing activity; (ix)a plan that details the complete and timely reclamation of the lease tract; and (x)such other relevant information as the Secretary may by regulation require. (F)Upon a determination that the exploration plan is complete, the Secretary shall have 30 days from the date the plan is deemed complete to conduct a review of the plan. (G)If the Secretary finds the exploration plan is not consistent with all statutory and regulatory requirements described in subparagraph (E)(vii), the Secretary shall notify the lessee with a detailed explanation of such modifications of the exploration plan as are necessary to achieve compliance. (H)The lessee shall not take any action under the exploration plan within a 30-day review period, or thereafter until the plan has been modified to achieve compliance as so notified. (I)After review by the Secretary provided by this subsection, a lessee may operate pursuant to the plan without further review or approval by the Secretary. (3)

Plan revisions; conduct of exploration activities

(A)If a significant revision of an exploration plan under this subsection is submitted to the Secretary, the process to be used for the review of such revision shall be the same as set forth in paragraph (1) of this subsection. (B)All exploration activities pursuant to any lease shall be conducted in accordance with an exploration plan that has been submitted to and reviewed by the Secretary or a revision of such plan. (4)

Submission of development and production plan; completeness review; compliance review

(A)Prior to beginning oil and gas development and production activities, a lessee shall submit a development and exploration plan to the Secretary of the Interior. Upon submission, such plans shall be subject to a review for completeness. (B)The Secretary shall review the plan for completeness within 30 days of submission. (C)In the event a development and production plan is determined to be incomplete, the Secretary shall notify the lessee in writing and specify the items or information needed to complete the plan. (D)The Secretary shall have 30 days to review for completeness any modified development and production plan submitted by the lessee. (E)To be deemed complete, a development and production plan shall include, in the degree of detail to be determined by the Secretary by rule or regulation— (i)a drilling plan containing a description of the drilling program; (ii)the surface and projected completion zone location; (iii)pertinent geologic data; (iv)expected hazards, and proposed mitigation measures to address such hazards; (v)a statement describing all facilities and operations proposed by the lessee and known by the lessee (whether or not owned or operated by such lessee) that shall be constructed or utilized in the development and production of oil or gas from the leases areas, including the location and site of such facilities and operations, the land, labor, material, and energy requirements associated with such facilities and operations; (vi)the general work to be performed; (vii)the environmental safeguards to be implemented in connection with the development and production and how such safeguards are to be implemented; (viii)all safety standards to be met and how such standards are to be met; (ix)an expected rate of development and production and a time schedule for performance; (x)a certification from the lessee stating that the development and production plan complies with all lease, regulatory, and statutory requirements in effect on the date of issuance of the lease, and any regulations promulgated after the date of lease issuance related to the conservation of resources; (xi)evidence that the lessee has secured an adequate bond, surety, or other financial arrangement prior to commencement of any surface-disturbing activity; (xii)a plan that details the complete and timely reclamation of the lease tract; and (xiii)such other relevant information as the Secretary may by regulation require. (F)Upon a determination that the development and production plan is complete, the Secretary shall have 120 days from the date the plan is deemed complete to conduct a review of the plan. (G)If the Secretary finds the development and production plan is not consistent with all statutory and regulatory requirements described in subparagraph (E)(x), the Secretary shall notify the lessee with a detailed explanation of such modifications of the development and production plan as are necessary to achieve compliance. (H)The lessee shall not take any action under the development and production plan within a 120-day review period, or thereafter until the plan has been modified to achieve compliance as so notified. (5)

Plan revisions; conduct of development and production activities

(A)If a significant revision of a development and production plan under this subsection is submitted to the Secretary, the process to be used for the review of such revision shall be the same as set forth in paragraph (4) of this subsection. (B)All development and production activities pursuant to any lease shall be conducted in accordance with a development and production plan that has been submitted to and reviewed by the Secretary or a revision of such plan. (6)

Cancellation of lease on failure to submit plan or comply with approved plan

Whenever the owner of any lease fails to submit a plan in accordance with regulations issued under this section, or fails to comply with a plan, the lease may be canceled in accordance with section 31. Termination of a lease because of failure to comply with a plan, including required modifications or revisions, shall not entitle a lessee to any compensation. . (b)Section 17(p) of the Mineral Leasing Act (30 U.S.C. 226(p)) is repealed.