[Congressional Record Volume 156, Number 155 (Wednesday, December 1, 2010)]
[Senate]
[Pages S8349-S8350]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. WYDEN (for himself, Mr. Risch, Mr. Crapo, and Mr. 
        Merkley):
  S. 3993. A bill to expand geothermal production, and for other 
purposes; to the Committee on Energy and Natural Resources.
  Mr. WYDEN. Mr. President, I am pleased to join with my colleagues 
from Idaho and Oregon, Senator James Risch, Senator Mike Crapo, and 
Senator Jeff Merkley, in introducing the Geothermal Production 
Expansion Act of 2010. This legislation will amend an already existing 
law--the Geothermal Steam Act--governing the way the Federal Government 
leases public lands for the development of geothermal energy projects.
  Geothermal energy facilities provide a continuous supply of renewable 
energy with very few environmental impacts. Although the United States 
has more geothermal capacity than any other country, this potential has 
been barely tapped. This shortfall is partly due to the high initial 
cost and risk involved in locating and developing geothermal resources. 
Like oil and natural gas exploration, until exploration and production 
wells are actually drilled, the true energy value of the site is not 
known nor is the full extent of the underground reservoir or energy 
source.
  This legislation is intended to expand the future production of 
geothermal energy on federally-owned lands by taking some of the 
uncertainty and guess work out of the leasing and development process 
by allowing the Interior Department to issue geothermal leases for 
adjacent lands on a non-competitive basis, based on fair-market value. 
This would allow a geothermal developer to expand a successful 
geothermal lease without being forced into a bidding war with 
speculators or uncooperative competitors who might threaten project 
expansion or even prevent the project from reaching commercial scale.
  Under current law, the Department of Interior is charged with issuing 
geothermal energy leases through a competitive lease sale. There are, 
however, several situations where the Department is allowed to issue 
non-competitive leases, for example, if there were no competitive bids 
offered, or where there is an already existing mining claim, or where 
the geothermal energy will be used directly on site for heating or 
other uses and not sold as electricity. This legislation would add an 
additional category of non-competitive leases for lands that are 
immediately adjacent to an existing, competitively-awarded, geothermal 
lease where there is an identified, validated geothermal energy 
discovery. They would not just be given away to an existing lease 
holder. These non-competitive leases would be made at fair-market value 
as independently determined by the Department of Interior. They could 
also not be taken away from any existing lease holder, if they were 
already leased, nor could they be removed from competitive leasing if 
they had already been nominated to be competitively leased.
  These safeguards are intended to insure that this new non-competitive 
lease authority is a limited exception to the general policy of 
competitive leasing for geothermal resources on our public lands. At 
the same time, this new authority will help ensure that when and where 
a geothermal resource has been discovered, the project developer will 
be able to tap that resource and turn it into a viable, commercial 
energy business and provide clean, renewable energy for our country.
  This bill is a companion to bipartisan legislation sponsored by 
Representative Jay Inslee in the House of Representatives. The House 
Committee on Natural Resources held hearings on the underlying House 
bill, H.R. 3709, in February of this year. The legislation Sen. Risch 
and I are introducing today incorporates changes resulting from those 
hearings, primarily making it clear that any non-competitive leases 
issued under this authority would be at fair-market value.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the additional material was ordered to be 
printed in the Record, as follows:

                                S. 3993

       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 ``Geothermal Production 
     Expansion Act of 2010''.

     SEC. 2. FINDINGS.

       Congress finds that--
       (1) it is in the best interest of the United States to 
     develop clean renewable geothermal energy;
       (2) development of that energy should be promoted on 
     appropriate Federal land;
       (3) under the Energy Policy Act of 2005 (42 U.S.C. 15801 et 
     seq.), the Bureau of Land Management is authorized to issue 3 
     different types of noncompetitive leases for production of 
     geothermal energy on Federal land, including--
       (A) noncompetitive geothermal leases to mining claim 
     holders that have a valid operating plan;
       (B) direct use leases; and
       (C) leases on parcels that do not sell at a competitive 
     auction;
       (4) Federal geothermal energy leasing activity should be 
     directed towards persons seeking to develop the land as 
     opposed to persons seeking to speculate on geothermal 
     resources and artificially raising the cost of legitimate 
     geothermal energy development;
       (5) developers of geothermal energy on Federal land that 
     have invested substantial capital and made high risk 
     investments should be allowed to secure a discovery of 
     geothermal energy resources; and
       (6) successful geothermal development on Federal land will 
     provide increased revenue to the Federal Government, with the 
     payment of production royalties over decades.

     SEC. 3. NONCOMPETITIVE LEASING OF ADJOINING AREAS FOR 
                   DEVELOPMENT OF GEOTHERMAL RESOURCES.

       Section 4(b) of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1003(b)) is amended by adding at the end the following:
       ``(4) Adjoining land.--
       ``(A) Definitions.--In this paragraph:
       ``(i) Fair market value per acre.--The term `fair market 
     value per acre' means a dollar amount per acre that--

       ``(I) except as provided in this clause, shall be equal to 
     the market value per acre as determined by the Secretary 
     under regulations issued under this paragraph;
       ``(II) shall be determined by the Secretary with respect to 
     a lease under this paragraph, by not later than the end of 
     the 90-day period beginning on the date the Secretary 
     receives an application for the lease; and
       ``(III) shall be not less than the greater of--

       ``(aa) 4 times the median amount paid per acre for all land 
     leased under this Act during the preceding year; or
       ``(bb) $50.
       ``(ii) Industry standards.--The term `industry standards' 
     means the standards by which a qualified geothermal 
     professional assesses whether downhole or flowing temperature 
     measurements with indications of permeability are sufficient 
     to produce energy from geothermal resources, as determined 
     through flow or injection testing or measurement of lost 
     circulation while drilling.
       ``(iii) Qualified federal land.--The term `qualified 
     Federal land' means land that is otherwise available for 
     leasing under this Act.
       ``(iv) Qualified geothermal professional.--The term 
     `qualified geothermal professional' means an individual who 
     is an engineer or geoscientist in good professional standing 
     with at least 5 years of experience in geothermal 
     exploration, development, or project assessment.
       ``(v) Qualified lessee.--The term `qualified lessee' means 
     a person that may hold a geothermal lease under part 3202.10 
     of title 43, Code of Federal Regulations, as in effect on the 
     date of enactment of the Geothermal Production Expansion Act 
     of 2010.
       ``(vi) Valid discovery.--The term `valid discovery' means a 
     discovery of a geothermal resource by a new or existing slim 
     hole or production well, that exhibits downhole or flowing 
     temperature measurements with indications of permeability 
     that are sufficient to meet industry standards.
       ``(B) Authority.--An area of qualified Federal land that 
     adjoins other land for which a qualified lessee holds a legal 
     right to develop geothermal resources may be available for a 
     noncompetitive lease under this section to the qualified 
     lessee at the fair market value per acre, if--
       ``(i) the area of qualified Federal land--

       ``(I) consists of not less than 1 acre and not more than 
     640 acres; and
       ``(II) is not already leased under this Act or nominated to 
     be leased under subsection (a);

       ``(ii) the qualified lessee has not previously received a 
     noncompetitive lease under this paragraph in connection with 
     the valid discovery for which data has been submitted under 
     clause (iii)(I); and

[[Page S8350]]

       ``(iii) sufficient geological and other technical data 
     prepared by a qualified geothermal professional has been 
     submitted by the qualified lessee to the applicable Federal 
     land management agency that would lead individuals who are 
     experienced in the subject matter to believe that--

       ``(I) there is a valid discovery of geothermal resources on 
     the land for which the qualified lessee holds the legal right 
     to develop geothermal resources; and
       ``(II) that thermal feature extends into the adjoining 
     areas.

       ``(C) Determination of fair market value.--
       ``(i) In general.--The Secretary shall--

       ``(I) publish a notice of any request to lease land under 
     this paragraph;
       ``(II) determine fair market value for purposes of this 
     paragraph in accordance with procedures for making those 
     determinations that are established by regulations issued by 
     the Secretary;
       ``(III) provide to a qualified lessee and publish any 
     proposed determination under this subparagraph of the fair 
     market value of an area that the qualified lessee seeks to 
     lease under this paragraph;
       ``(IV) provide to the qualified lessee the opportunity to 
     appeal the proposed determination during the 30-day period 
     beginning on the date that the proposed determination is 
     provided to the qualified lessee; and
       ``(V) provide to any interested member of the public the 
     opportunity to appeal the proposed determination in 
     accordance with the process established under parts 4 and 
     1840, and section 3200.5, of title 43, Code of Federal 
     Regulations (as in effect on the date of enactment of the 
     Geothermal Production Expansion Act of 2010) during the 30-
     day period beginning on the date that the proposed 
     determination is published.

       ``(ii) Limitation on nomination.--After publication of a 
     notice of request to lease land under this paragraph, the 
     Secretary may not accept under subsection (a) any nomination 
     of the land for leasing unless the request has been denied or 
     withdrawn.
       ``(D) Regulations.--Not later than 180 days after the date 
     of enactment of the Geothermal Production Expansion Act of 
     2010, the Secretary shall issue regulations to carry out this 
     paragraph.''.
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