[Congressional Record Volume 151, Number 126 (Monday, October 3, 2005)]
[Senate]
[Pages S10824-S10826]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
By Mr. WARNER:
S. 1810. A bill to amend the Outer Continental Shelf Lands Act to
allow certain coastal States to share in qualified Outer Continental
Shelf revenues; to the Committee on Energy and Natural Resources.
Mr. WARNER. Mr. President, I rise to introduce the Outer Continental
Shelf Revenue Sharing Act of 2005.
Earlier this year, the Congress passed a bill, and the President
signed it into law. It is the first comprehensive energy package in
over a decade.
Great strides were made in addressing the Nation's energy needs. This
new law contains a number of valuable conservation measures and, as the
chairman of the Energy Committee once stated, passage of this
legislation means we will need 170 fewer powerplants by 2020. On the
energy supply side, however, we still have much work to do. The recent
disruptions in the Nation's energy supply caused by Hurricanes Katrina
and Rita--tragedies, natural disasters of proportions never really seen
before in this county--underscore the fragility of our energy supply
system. The estimates are that 20 to 25 percent of our energy needs
come in through that narrow nexus of Louisiana and Mississippi, right
in that area.
During debate on the bill, I offered an amendment to provide for an
increased domestic supply of oil and natural gas from Outer Continental
Shelf lands. Regrettably, my amendment and other similar measures were
not successful.
I thank the distinguished manager of that bill, Mr. Domenici, and
others. They gave me a great deal of encouragement, as did the Senators
from Louisiana, who likewise participated in that debate. But,
nevertheless, I was not successful. I did say--and I suppose in a
prophetic way--and I remember beckoning to fellow Senators on the
floor, ``The day will come when I will once again stand on this floor
and offer this same legislation, not knowing, of course, of the
tragedies of Katrina. But that did give this Nation a serious wake-up
call as to the fragility of our energy system.
Again, the tragic events of the past month along the gulf coast have
thrust the issue of energy supplies back into the spotlight. We need
only look at the rising gas prices all over our pumps in this Nation's
land, where people--men and women--on small budgets are struggling to
find the resources to meet their daily requirements of the use of the
automobile and to inject these increased gasoline prices into their
budgets. Prices at the pump have climbed quickly, and with the winter
heating season approaching, we can expect natural gas and home heating
oil prices to increase, perhaps going as high as 50 percent more than
last year's level.
We need to address our inadequate refining capacity and expand
conservation incentives. With more than 30 percent of our domestic
supply of oil coming in from the Gulf of Mexico and a significant
portion of our refining capacity located in the Gulf States, we must
also look at ways to increase and diversify the location and sources of
our domestic supplies of energy, as well as the refining capabilities;
and natural gas, likewise.
Before passage of the energy bill, production revenues totaling more
than $7.5 billion annually from offshore oil and gas belonged to the
Federal Government. This is an inconsistent policy, however, because 55
percent of the revenues from land-based oil and gas production has
always been returned to the States. The one exception to this rule is
Alaska, which receives back 90 percent of such revenues. Thanks to the
diligence of my colleagues from Louisiana, this inequity was partially
addressed in the energy bill by providing that current offshore energy-
producing States will now share in the Federal Government's royalties.
Indeed, it is a matter of fairness that these revenues be shared with
the energy producing States. After all, it is the states closest to oil
and gas production facilities that are assuming the risks that those
production facilities will not have harmful environmental or economical
impacts. Tourism is often the lifeblood of these regions which could be
adversely affected by any environmental accidents. So it is very
appropriate that they should receive a share of the revenues derived
from offshore oil and gas production.
While the issue of revenue sharing was addressed in the energy bill
for States currently producing oil and gas off their coasts, it does
not include a comprehensive policy for offshore production
opportunities.
Specifically, the bill does not allow other States to share revenues
when and if they ever become producing regions. As we all know, the
production of oil and natural gas has been subject to a moratorium
along most of the Nation's coastline. While this moratorium has been in
effect for some time, many Americans believe that it is now time to
reevaluate its need. This past year in Virginia, both houses of the
state legislature passed legislation asking for production to occur off
the Virginia coast if the State is allowed to receive a share of the
revenue. I think the rising costs of oil and gas are now leading other
States to consider the same possibility.
The bill I am introducing today would provide a portion of revenues
to States under the current moratorium that may decide to undertake
future offshore exploration and production activities. My legislation
is based, in large part, on the hard work of my colleagues who achieved
a revenue-sharing proposal for their States and local governments in
the recently enacted energy bill. The new law provides State and local
governments with a share of the royalties from offshore energy
production, but it is limited only to the five States that are
currently exempt from the moratorium on offshore oil and gas leases.
As provided by current law, my bill requires the Federal Government
to transfer 50 percent of the revenues received from any offshore
leases to the States based upon the production levels. This would put
oil and gas production in coastal areas on par with the production on
other Federal lands throughout the United States. It is a matter of
equity for all producing regions and represents a fair revenue-sharing
model for the Federal and State governments.
My proposal does not affect the current moratorium on offshore energy
production. As the moratorium expires, however, my legislation enables
States that wish to pursue oil and gas production to be eligible for a
portion of the royalty payments that otherwise would go exclusively to
the Federal Government.
The amendment does not supersede a State's ability to veto any
production proposals under their authority of the Coastal Zone
Management Act, CZMA. It does not change the manner in which the
Federal Government grants these production leases, and it does not lift
the moratorium for any OCS land that is currently in place.
While I believe very strongly that the States should have a role in
determining whether or not to utilize these resources, I also believe
that they should receive a fair share of the revenues from any
production that may follow.
I understand the concerns of some of my colleagues and their desire
to avoid drawing specific boundary lines. While this amendment does not
address all of the concerns, it offers a fair starting point to discuss
this issue. It is my hope that we can all work together in addressing
these concerns that will result in a commonsense approach to expand our
domestic supply of oil and gas, to diversify the geographic
concentration of our current industry, and to allow the States to have
a role in the process.
[[Page S10825]]
Mr. President, the time has come for the Senate to speak boldly. We
can all agree that more supply is needed and that there is a vast
resource yet to be tapped. My proposal offers a fair way to encourage
production in States that wish to do so. In the long term our Nation
will benefit by reducing its dependence on foreign sources of energy
and by diversifying the geographic source of our domestic supply.
I believe this proposal will solve a necessary part of the energy
puzzle. I believe it is essential for our energy security, our economic
security, and our national security to evaluate this, and other
proposals, that address our energy supply needs.
Mr. President, as I say, today I introduce, again, this bill, which I
put in a few months ago. It provides for the offshore drilling of oil.
I recognize the sensitivity of that, but I say to my colleagues, we can
not continually ignore these warnings, whether they are brought about
by Mother Nature or political problems or wars or conflicts across our
shores. Now is the time to lay down that framework of legislation for
those States which, by actions taken by the Governor and the State
legislature, say: We will permit offshore drilling off of this State's
boundaries. Hopefully, we can receive for those States, should that
take place, an additional source of revenue.
I ask unanimous consent that the text of the bill be printed in the
Record, and I will seek to have it considered by the Senate as a whole
at the earliest possible opportunity.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1810
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 ``Outer Continental Shelf
Revenue Sharing Act of 2005''.
SEC. 2. OUTER CONTINENTAL SHELF REVENUE SHARING.
Section 31 of the Outer Continental Shelf Lands Act (43
U.S.C. 1356a) is amended--
(1) in subsection (a)--
(A) by striking paragraph (7);
(B) by redesignating paragraphs (8), (9), and (10) as
paragraphs (7), (8), and (9), respectively;
(C) in paragraph (8) (as redesignated by subparagraph (B)),
by striking subparagraph (B) and inserting the following:
``(B) Inclusion.--The term `producing State' includes any
State that begins production on a leased tract on or after
the date of enactment of the Outer Continental Shelf Revenue
Sharing Act of 2005, regardless of whether the leased tract
was on any date subject to a leasing moratorium.''; and
(D) in paragraph (9) (as redesignated by subparagraph (B)),
by striking subparagraph (C); and
(2) in subsection (b)(4), by striking subparagraph (E).
SEC. 3. ESTABLISHMENT OF SEAWARD LATERAL BOUNDARIES FOR
COASTAL STATES.
Section 4(a)(2)(A) of the Outer Continental Shelf Lands Act
(43 U.S.C. 1333(a)(2)(A)) is amended--
(1) by inserting ``(i)'' after ``(A)'';
(2) in the first sentence--
(A) by striking ``President shall'' and inserting
``Secretary shall by regulation''; and
(B) by inserting before the period at the end the
following: ``not later than 180 days after the date of
enactment of the Outer Continental Shelf Revenue Sharing Act
of 2005''; and
(3) by adding at the end the following:
``(ii)(I) For purposes of this Act (including determining
boundaries to authorize leasing and preleasing activities and
any attributing revenues under this Act and calculating
payments to producing States and coastal political
subdivisions under section 31), the Secretary shall delineate
the lateral boundaries between coastal States in areas of the
Outer Continental shelf under exclusive Federal jurisdiction,
to the extent of the exclusive economic zone of the United
States, in accordance with article 15 of the United Nations
Convention on the Law of the Sea of December 10, 1982.
``(II) This clause shall not affect any right or title to
Federal submerged land on the outer Continental Shelf.''.
SEC. 4. OPTION TO PETITION FOR LEASING WITHIN CERTAIN AREAS
ON THE OUTER CONTINENTAL SHELF.
Section 12 of the Outer Continental Shelf Lands Act (43
U.S.C. 1341) is amended by adding at the end the following:
``(g) Leasing Within the Seaward Lateral Boundaries of
Coastal States.--
``(1) Definition of affected area.--In this subsection, the
term `affected area' means any area located--
``(A) in the areas of northern, central, and southern
California and the areas of Oregon and Washington;
``(B) in the north, middle, or south planning area of the
Atlantic Ocean;
``(C) in the eastern Gulf of Mexico planning area and
lying--
``(i) south of 26 degrees north latitude; and
``(ii) east of 86 degrees west longitude; or
``(D) in the Straits of Florida.
``(2) Restrictions on leasing.--The Secretary shall not
offer for offshore leasing, preleasing, or any related
activity--
``(A) any area located on the outer Continental Shelf that,
as of the date of enactment of this subsection, is designated
as a marine sanctuary under the Marine Protection, Research,
and Sanctuaries Act of 1972 (33 U.S.C. 1401 et seq.); or
``(B) except as provided in paragraphs (3) and (4), during
the period beginning on the date of enactment of this
subsection and ending on June 30, 2012, any affected area.
``(3) Resource assessments.--
``(A) In general.--Beginning on the date on which the
Secretary delineates seaward lateral boundaries under section
4(a)(2)(A)(ii), a Governor of a State in which an affected
area is located, with the consent of the legislature of the
State, may submit to the Secretary a petition requesting a
resource assessment of any area within the seaward lateral
boundary of the State.
``(B) Eligible resources.--A petition for a resource
assessment under subparagraph (A) may be for--
``(i) oil and gas leasing;
``(ii) gas-only leasing; or
``(iii) any other energy source leasing, including
renewable energy leasing.
``(C) Action by secretary.--Not later than 90 days after
receipt of a petition under subparagraph (A), the Secretary
shall approve the petition, unless the Secretary determines
that a resource assessment of the area would create an
unreasonable risk of harm to the marine, human, or coastal
environment of the State.
``(D) Failure to act.--If the Secretary fails to approve or
deny a petition in accordance with subparagraph (C)--
``(i) the petition shall be considered to be approved; and
``(ii) a resource assessment of any appropriate area shall
be carried out as soon as practicable.
``(E) Submission to state.--As soon as practicable after
the date on which a petition is approved under subparagraph
(C) or (D), the Secretary shall--
``(i) complete the resource assessment for the area; and
``(ii) submit the completed resource assessment to the
State.
``(4) Petition for leasing.--
``(A) In general.--On receipt of a resource assessment
under paragraph (3)(E)(ii), the Governor of a State in which
an affected area is located, with the consent of the
legislature of the State, may submit to the Secretary a
petition requesting that the Secretary make available any
land that is within the seaward lateral boundaries of the
State (as established under section 4(a)(2)(A)(ii)) and that
is greater than 20 miles from the coastline of the State for
the conduct of offshore leasing, pre-leasing, or related
activities with respect to--
``(i) oil and gas leasing;
``(ii) gas-only leasing; or
``(iii) any other energy source leasing, including
renewable energy leasing.
``(B) Action by secretary.--Not later than 90 days after
receipt of a petition under subparagraph (A), the Secretary
shall approve the petition, unless the Secretary determines
that leasing the area would create an unreasonable risk of
harm to the marine, human, or coastal environment of the
State.
``(C) Failure to act.--If the Secretary fails to approve or
deny a petition in accordance with subparagraph (B)--
``(i) the petition shall be considered to be approved; and
``(ii) any appropriate area shall be made available for oil
and gas leasing, gas-only leasing, or any other energy source
leasing, including renewable energy leasing.
``(5) Revenue sharing.--
``(A) In general.--Beginning on the date on which
production begins in an area under this subsection, the State
shall, without further appropriation, share in any qualified
outer Continental Shelf revenues of the production under
section 31.
``(B) Applicable law.--
``(i) In general.--Except as provided in clause (ii), a
State shall not be required to comply with subsections (c)
and (d) of section 31 to share in qualified outer Continental
Shelf revenues under subparagraph (A).
``(ii) Exception.--Of any qualified outer Continental Shelf
revenues received by a State (including a political
subdivision of a State) under subparagraph (A), at least 25
percent shall be used for 1 or more of the purposes described
in section 31(d)(1).
``(6) Effect.--Nothing in this subsection affects any right
relating to an area described in paragraph (1) or (2) under a
lease that was in existence on the day before the date of
enactment of this subsection.''.
SEC. 5. REGULATIONS.
(a) In General.--The Secretary of the Interior shall issue
such regulations as are necessary to carry out this Act and
the amendments made by this Act, including regulations
establishing procedures for entering into gas-only leases.
(b) Gas-Only Leases.--In issuing regulations establishing
procedures for entering into gas-only leases, the Secretary
shall--
(1) ensure that gas-only leases under the Outer Continental
Shelf Lands Act (43 U.S.C. 1331 et seq.) are not available in
a State that (as of the day before the date of enactment of
this Act) did not contain an affected area
[[Page S10826]]
(as defined in section 12(g)(1) of that Act (as added by
section 4)); and
(2) define ``natural gas'' as--
(A) unmixed natural gas; or
(B) any mixture of natural or artificial gas (including
compressed or liquefied petroleum gas) and condensate
recovered from natural gas.
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