[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4521 Introduced in House (IH)]

111th CONGRESS
  2d Session
                                H. R. 4521

To direct the Secretary of the Interior to agree to requests by lessees 
to amend certain oil and gas leases issued for Central and Western Gulf 
of Mexico tracts, to incorporate price thresholds applicable to royalty 
             suspension provisions, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 26, 2010

Mr. Markey of Massachusetts (for himself and Mr. Van Hollen) introduced 
  the following bill; which was referred to the Committee on Natural 
                               Resources

_______________________________________________________________________

                                 A BILL


 
To direct the Secretary of the Interior to agree to requests by lessees 
to amend certain oil and gas leases issued for Central and Western Gulf 
of Mexico tracts, to incorporate price thresholds applicable to royalty 
             suspension provisions, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Royalty Relief for American 
Consumers Act of 2010''.

SEC. 2. PRICE THRESHOLDS FOR ROYALTY SUSPENSION PROVISIONS.

    The Secretary of the Interior shall agree to a request by any 
lessee to amend any lease issued for any Central and Western Gulf of 
Mexico tract during the period of January 1, 1998, through December 31, 
1999, to incorporate price thresholds applicable to royalty suspension 
provisions, that are equal to or less than the price thresholds 
described in clauses (v) through (vii) of section 8(a)(3)(C) of the 
Outer Continental Shelf Lands Act (43 U.S.C. 1337(a)(3)(C)). Any 
amended lease shall impose the new or revised price thresholds 
effective October 1, 2010. Existing lease provisions shall prevail 
through September 30, 2010.

SEC. 3. ELIGIBILITY FOR NEW LEASES AND THE TRANSFER OF LEASES; 
              CONSERVATION OF RESOURCES FEES.

    (a) Issuance of New Leases.--
            (1) In general.--The Secretary shall not issue any new 
        lease that authorizes the production of oil or natural gas in 
        the Gulf of Mexico under the Outer Continental Shelf Lands Act 
        (43 U.S.C. 1331 et seq.) to a person described in paragraph (2) 
        unless--
                    (A) the person has renegotiated each covered lease 
                with respect to which the person is a lessee, to modify 
                the payment responsibilities of the person to include 
                price thresholds that are equal to or less than the 
                price thresholds described in clauses (v) through (vii) 
                of section 8(a)(3)(C) of the Outer Continental Shelf 
                Lands Act (43 U.S.C. 1337(a)(3)(C)); or
                    (B) the person has--
                            (i) paid all fees established by the 
                        Secretary under subsection (b) that are due 
                        with respect to each covered lease for which 
                        the person is a lessee; or
                            (ii) entered into an agreement with the 
                        Secretary under which the person is obligated 
                        to pay such fees.
            (2) Persons described.--A person referred to in paragraph 
        (1) is a person that--
                    (A) is a lessee that--
                            (i) holds a covered lease on the date on 
                        which the Secretary considers the issuance of 
                        the new lease; or
                            (ii) was issued a covered lease before the 
                        date of enactment of this Act, but transferred 
                        the covered lease to another person or entity 
                        (including a subsidiary or affiliate of the 
                        lessee) after the date of enactment of this 
                        Act; or
                    (B) any other person or entity who has any direct 
                or indirect interest in, or who derives any benefit 
                from, a covered lease.
            (3) Multiple lessees.--
                    (A) In general.--For purposes of paragraph (1), if 
                there are multiple lessees that own a share of a 
                covered lease, the Secretary may implement separate 
                agreements with any lessee with a share of the covered 
                lease that modifies the payment responsibilities with 
                respect to the share of the lessee to include price 
                thresholds that are equal to or less than the price 
                thresholds described in clauses (v) through (vii) of 
                section 8(a)(3)(C) of the Outer Continental Shelf Lands 
                Act (43 U.S.C. 1337(a)(3)(C)).
                    (B) Treatment of share as covered lease.--Beginning 
                on the effective date of an agreement under 
                subparagraph (A), any share subject to the agreement 
                shall not constitute a covered lease with respect to 
                any lessees that entered into the agreement.
    (b) Conservation of Resources Fees.--
            (1) In general.--Not later than 60 days after the date of 
        enactment of this Act, the Secretary of the Interior by 
        regulation shall establish--
                    (A) a conservation of resources fee for producing 
                Federal oil and gas leases in the Gulf of Mexico; and
                    (B) a conservation of resources fee for 
                nonproducing Federal oil and gas leases in the Gulf of 
                Mexico.
            (2) Producing lease fee terms.--The fee under paragraph 
        (1)(A)--
                    (A) subject to subparagraph (C), shall apply to 
                covered leases that are producing leases;
                    (B) shall be set at $9 per barrel for oil and $1.25 
                per million Btu for gas, respectively, in 2005 dollars; 
                and
                    (C) shall apply only to production of oil or gas 
                occurring--
                            (i) in any calendar year in which the 
                        arithmetic average of the daily closing prices 
                        for light sweet crude oil on the New York 
                        Mercantile Exchange (NYMEX) exceeds $34.73 per 
                        barrel for oil and $4.34 per million Btu for 
                        gas in 2005 dollars; and
                            (ii) on or after October 1, 2010.
            (3) Nonproducing lease fee terms.--The fee under paragraph 
        (1)(B)--
                    (A) subject to subparagraph (C), shall apply to 
                leases that are nonproducing leases;
                    (B) shall be set at $3.75 per acre per year in 2005 
                dollars; and
                    (C) shall apply on and after October 1, 2010.
            (4) Treatment of receipts.--Amounts received by the United 
        States as fees under this subsection shall be treated as 
        offsetting receipts.
    (c) Transfers.--A lessee or any other person who has any direct or 
indirect interest in, or who derives a benefit from, a lease shall not 
be eligible to obtain by sale or other transfer (including through a 
swap, spinoff, servicing, or other agreement) any covered lease, the 
economic benefit of any covered lease, or any other lease for the 
production of oil or natural gas in the Gulf of Mexico under the Outer 
Continental Shelf Lands Act (43 U.S.C. 1331 et seq.), unless--
            (1) the lessee or other person has--
                    (A) renegotiated all covered leases of the lessee 
                or other person; and
                    (B) entered into an agreement with the Secretary to 
                modify the terms of all covered leases of the lessee or 
                other person to include limitations on royalty relief 
                based on market prices that are equal to or less than 
                the price thresholds described in clauses (v) through 
                (vii) of section 8(a)(3)(C) of the Outer Continental 
                Shelf Lands Act (43 U.S.C. 1337(a)(3)(C)); or
            (2) the lessee or other person has--
                    (A) paid all fees established by the Secretary 
                under subsection (b) that are due with respect to each 
                covered lease for which the person is a lessee; or
                    (B) entered into an agreement with the Secretary 
                under which the person is obligated to pay such fees.
    (d) Definitions.--In this section--
            (1) Covered lease.--The term ``covered lease'' means a 
        lease for oil or gas production in the Gulf of Mexico that is--
                    (A) in existence on the date of enactment of this 
                Act;
                    (B) issued by the Department of the Interior under 
                section 304 of the Outer Continental Shelf Deep Water 
                Royalty Relief Act (43 U.S.C. 1337 note; Public Law 
                104-58); and
                    (C) not subject to limitations on royalty relief 
                based on market price that are equal to or less than 
                the price thresholds described in clauses (v) through 
                (vii) of section 8(a)(3)(C) of the Outer Continental 
                Shelf Lands Act (43 U.S.C. 1337(a)(3)(C)).
            (2) Lessee.--The term ``lessee'' includes any person or 
        other entity that controls, is controlled by, or is in or under 
        common control with, a lessee.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of the Interior.
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