I 111th CONGRESS 2d Session H. R. 6043 IN THE HOUSE OF REPRESENTATIVES July 30, 2010 Mr. Klein of Florida (for himself, Mr. Kirk, Mr. Rothman of New Jersey, Mr. Deutch, Mr. McMahon, Ms. Berkley, Ms. Wasserman Schultz, and Mr. Engel) introduced the following bill; which was referred to the Committee on Natural Resources, and in addition to the Committee on Foreign Affairs, 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 restrict participation in offshore oil and gas leasing by a person who engages in any activity for which sanctions may be imposed under section 5 of the Iran Sanctions Act of 1996, to require the lessee under an offshore oil and gas lease to disclose any participation by the lessee in certain energy-related joint ventures, investments, or partnerships located outside Iran, and for other purposes.

1.

Short title

This Act may be cited as the Gulf Security and Iran Sanctions Enforcement Act.

2.

Findings

Congress makes the following findings: (1)The illicit nuclear activities of the Government of Iran—combined with its development of unconventional weapons and ballistic missiles and support for international terrorism—represent a serious threat to the security of the United States and United States allies in Europe, the Middle East, and around the world. (2)Executive Order 12959, issued on May 8, 1995, banned all new investment in Iran by United States individuals and companies. (3)On August 5, 1996, the Iran and Libya Sanctions Act of 1996 (later re-titled the Iran Sanctions Act of 1996) was enacted in order, among other purposes, to encourage foreign persons to withdraw from the Iranian market. (4)United Nations Security Council Resolution 1929 (June 9, 2010) notes, the potential connection between Iran’s revenues derived from its energy sector and the funding of Iran’s proliferation-sensitive nuclear activities, and further notes that chemical process equipment and materials required for the petrochemical industry have much in common with those required for certain sensitive nuclear fuel cycle activities. (5)Through its sanctions regime, the United States Government seeks to prevent the Iranian Government and engineers and scientists employed by state-owned Iranian energy companies or companies affiliated with Iran’s Revolutionary Guard Corps from gaining access to key domain expertise, technology and equipment that could aid the development of Iran’s energy sector and also assist Iran in certain proliferation activities. (6)The Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010, which was signed into law on July 1, 2010, included sanctions against goods, services, and technology to modernize Iran’s oil and natural gas sector. (7)The threat of sanctions has constrained the supply of capital, technology, and services to the Iranian petroleum sector, and several companies have withdrawn their business from Iran. (8)The Government of Iran is pursuing partnerships outside Iran with foreign energy-related companies, including joint ventures, investments, and partnerships.

3.

Sense of Congress

It is the sense of Congress that— (1)the United States should continue to support diplomatic efforts in the International Atomic Energy Agency and the United Nations Security Council to end the Government of Iran’s illicit nuclear activities; (2)international diplomatic efforts to address the Government of Iran’s illicit nuclear efforts and support for international terrorism are more likely to be effective if strong additional sanctions are imposed on the Government of Iran; (3)the concerns of the United States regarding the Government of Iran are strictly the result of the actions of the Government of Iran; (4)Iranian partnerships outside Iran with foreign energy-related companies, including joint ventures, investments and partnerships, could give the Iranian Government and engineers and scientists employed by state-owned Iranian energy companies or companies affiliated with Iran’s Revolutionary Guard Corps access to key domain expertise, technology and equipment that could aid the development of Iran’s energy sector and also assist Iran in certain proliferation activities; (5)joint ventures with Iranian state-owned energy companies serve to interfere with international attempts to build a consensus for action regarding the Government of Iran’s ongoing refusal to comply with its international obligations regarding its nuclear program; and (6)in order for sanctions to be effective and enabling a diplomatic solution, the Government of Iran should be prevented from disregarding their international obligations by prohibiting foreign companies from receiving Iranian capital, technology, and expertise, and by blocking foreign energy-related companies from entering into joint ventures, investments, and partnerships for energy and energy-related projects outside of Iran.

4.

Restriction on participation in offshore oil and gas leasing

(a)

Certification requirement

The Secretary of the Interior shall— (1)include in each lease issued after the date of enactment of this Act that authorizes drilling for oil and gas on the Outer Continental Shelf a provision that requires that— (A)the person that is the lessee to certify annually to the Secretary that the person does not engage in any activity for which sanctions may be imposed under section 5 of the Iran Sanctions Act of 1996 (50 U.S.C. 1701 note); and (B)authorizes the Secretary to cancel the lease if the person fails to make such a certification or makes such a certification that is false; and (2)upon determination by the Secretary, in consultation with the Secretary of the Treasury, that the person has failed to make a certification required under such provision or made such a certification that is false, shall cancel the lease. (b)

Disclosure requirement

The Secretary of the Interior shall— (1)include in each lease issued after the date of enactment of this Act that authorizes drilling for oil and gas on the Outer Continental Shelf a provision that— (A)requires the person that is the lessee to disclose to the Secretary any participation by the person in any energy-related joint venture, investment, or partnership located outside Iran that involves— (i)any person whose property and interests in property are blocked pursuant to Executive Order 13224 (66 Fed. Reg. 49079; relating to blocking property and prohibiting transacting with persons who commit, threaten to commit, or support terrorism); (ii)any person whose property and interests in property are blocked pursuant to Executive Order 13382 (70 Fed. Reg. 38567; relating to blocking of property of weapons of mass destruction proliferators and their supporters); or (iii)any entity listed on appendix A to part 560 of title 31, Code of Federal Regulations (relating to the Iranian Transactions Regulations); and (B)authorizes the Secretary to cancel the lease if the person fails to make such a disclosure or makes such a disclosure that is false; and (2)upon determination by the Secretary, in consultation with the Secretary of the Treasury, that the person has failed to make a disclosure required under such provision or made such a disclosure that is false, shall cancel the lease. (c)

Waiver

(1)

In general

The Secretary of the Interior may waive the requirement of subsection (a) or (b) (or both) on a case-by-case basis if the Secretary determines and certifies in writing to the appropriate congressional committees that it is in the national interest of the United States to do so. (2)

Reporting requirement

Not later than 120 days after the date of the enactment of this Act and semi-annually thereafter, the Secretary of the Interior shall submit to the appropriate congressional committees a report on waivers granted under paragraph (1). (d)

Reporting requirement

The Secretary of the Interior shall promptly report to the appropriate congressional committees any cancellation of a lease under this section, including an explanation of the reasons for the cancellation. (e)

Definitions

In this section— (1)the term appropriate congressional committees means— (A)the Committee on Natural Resources and the Committee on Foreign Affairs of the House of Representatives; and (B)the Committee on Energy and Natural Resources and the Committee on Foreign Relations of the Senate; and (2)the term person has the meaning given such term in section 14(14) of the Iran Sanctions Act of 1996 (50 U.S.C. 1701 note).

5.

Sunset

This Act shall terminate 30 days after the date on which the President certifies to Congress that the Government of Iran— (1)has permanently ceased— (A)providing support for acts of international terrorism and no longer satisfies the requirements for designation as a state sponsor of terrorism for purposes of section 6(j) of the Export Administration Act of 1979, section 620A of the Foreign Assistance Act of 1961, section 40 of the Arms Export Control Act, or any other provision of law; and (B)the pursuit, acquisition, and development of nuclear, biological, and chemical weapons and missiles; and (2)poses no significant threat to United States national security, interests, or allies.