[House Report 108-302]
[From the U.S. Government Publishing Office]
108th Congress Report
HOUSE OF REPRESENTATIVES
1st Session 108-302
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COMBINED HYDROCARBON LEASING
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October 7, 2003.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
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Mr. Pombo, from the Committee on Resources, submitted the following
R E P O R T
[To accompany H.R. 3062]
[Including cost estimate of the Congressional Budget Office]
The Committee on Resources, to whom was referred the bill
(H.R. 3062) to amend the Mineral Leasing Act to authorize the
Secretary of the Interior to issue separately, for the same
area, a lease for tar sand and a lease for oil and gas, and for
other purposes, having considered the same, report favorably
thereon without amendment and recommend that the bill do pass.
Purpose of the Bill
The purpose of H.R. 3062 is to amend the Mineral Leasing
Act to authorize the Secretary of the Interior to issue
separately, for the same area, a lease for tar sand and a lease
for oil and gas, and for other purposes.
Background and Need for Legislation
On November 16, 1981 Congress passed the Combined
Hydrocarbon Leasing Act (CHLA). The Act was intended to
encourage production of tar sands and other hydrocarbon
deposits. At the time of enactment, the Secretary of the
Interior identified 11 designated tar sand areas, all located
in Utah, covering over one million acres of federal land.
However, since the Act was passed, only one lease sale has
occurred on tar sand lands.
The CHLA has failed to accomplish its goal of increased
energy production. A combined hydrocarbon lease contemplates
not only oil and gas production, but production of tar sands,
which is similar to mining. The Bureau of Land Management
(BLM), which administers the program, does not fully understand
how to implement the CHLA regulations so nominated lands are
rarely leased. Complex National Environmental Policy Act (NEPA)
documentation needed for tar sands development prohibit the
issuance of leases for natural gas and oil in the designated
tar sand areas. As a result, vast natural gas resources have
not been developed in eastern Utah.
H.R. 3062 would amend the CHLA and allow the Secretary to
issue separate leases for tar sands and for oil and gas
development. The bill would promote the development of the
natural gas and oil resource in the region. Under H.R. 3062, no
environmental regulations would be modified or circumvented in
any way, nor would there be any change to existing wilderness
designations. BLM would remain the steward of the land and
would determine adequate level NEPA documentation.
Committee Action
H.R. 3062 was introduced on September 10, 2003, by
Congressman Chris Cannon (R-UT). The bill was referred to the
Committee on Resources. On September 24, 2003, the Full
Resources Committee met to consider the bill. No amendments
were offered and the bill was then ordered favorably reported
to the House of Representatives by unanimous consent.
Committee Oversight Findings and Recommendations
Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of
rule XIII of the Rules of the House of Representatives, the
Committee on Resources' oversight findings and recommendations
are reflected in the body of this report.
Constitutional Authority Statement
Article I, section 8 of the Constitution of the United
States grants Congress the authority to enact this bill.
Compliance With House Rule XIII
1. Cost of Legislation. Clause 3(d)(2) of rule XIII of the
Rules of the House of Representatives requires an estimate and
a comparison by the Committee of the costs which would be
incurred in carrying out this bill. However, clause 3(d)(3)(B)
of that rule provides that this requirement does not apply when
the Committee has included in its report a timely submitted
cost estimate of the bill prepared by the Director of the
Congressional Budget Office under section 402 of the
Congressional Budget Act of 1974.
2. Congressional Budget Act. As required by clause 3(c)(2)
of rule XIII of the Rules of the House of Representatives and
section 308(a) of the Congressional Budget Act of 1974, this
bill does not contain any new budget authority, spending
authority, credit authority, or an increase or decrease in
revenues or tax expenditures.
3. General Performance Goals and Objectives. This bill does
not authorize funding and therefore, clause 3(c)(4) of rule
XIII of the Rules of the House of Representatives does not
apply.
4. Congressional Budget Office Cost Estimate. Under clause
3(c)(3) of rule XIII of the Rules of the House of
Representatives and section 403 of the Congressional Budget Act
of 1974, the Committee has received the following cost estimate
for this bill from the Director of the Congressional Budget
Office:
U.S. Congress,
Congressional Budget Office,
Washington, DC, October 2, 2003.
Hon. Richard W. Pombo,
Chairman, Committee on Resources,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 3062, a bill to
amend the Mineral Leasing Act to authorize the Secretary of the
Interior to issue separately, for the same area, a lease for
tar sand and a lease for oil and gas, and for other purposes.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts are Megan
Carroll and Deborah Reis.
Sincerely,
Douglas Holtz-Eakin,
Director.
Enclosure.
H.R. 3062--A bill to amend the Mineral Leasing Act to authorize the
Secretary of the Interior to issue separately, for the same
area, a lease for tar sand and a lease for oil and gas, and for
other purposes
CBO estimates that H.R. 3062 would have no significant
impact on the federal budget. The bill would not affect direct
spending or revenues. H.R. 3062 contains no intergovernmental
or private-sector mandates as defined in the Unfunded Mandates
Reform Act and would impose no costs on state, local, or tribal
governments.
H.R. 3062 would amend section 17 of the Mineral Leasing Act
to allow the Secretary of the Interior to issue separate leases
for tar sand and for oil and gas resources that lie within the
same parcel of land. Under current law, these resources must be
leased together. According to the Bureau of Land Management,
the proposed change would not significantly affect the agency's
administrative costs or receipts from leasing those resources.
The CBO staff contacts for this estimate are Megan Carroll
and Deborah Reis. This estimate was approved by Peter H.
Fontaine, Deputy Assistant Director for Budget Analysis.
Compliance With Public Law 104-4
This bill contains no unfunded mandates.
Preemption of State, Local or Tribal Law
This bill is not intended to preempt any State, local or
tribal law.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (new matter is
printed in italic and existing law in which no change is
proposed is shown in roman):
SECTION 17 OF THE MINERAL LEASING ACT
Sec. 17. (a) * * *
(b)(1)(A) * * *
(B) The national minimum acceptable bid shall be $2 per acre
for a period of 2 years from the date of enactment of the
Federal Onshore Oil and Gas Leasing Reform Act of 1987.
Thereafter, the Secretary may establish by regulation a higher
national minimum acceptable bid for all leases based upon a
finding that such action is necessary: (i) to enhance financial
returns to the United States; and (ii) to promote more
efficient management of oil and gas resources on Federal lands.
Ninety days before the Secretary makes any change in the
national minimum acceptable bid, the Secretary shall notify the
Committee on Natural Resources of the United States House of
Representatives and the Committee on Energy and Natural
Resources of the United States Senate. The proposal or
promulgation of any regulation to establish a national minimum
acceptable bid shall not be considered a major Federal action
subject to the requirements of section 102(2)(C) of the
National Environmental Policy Act of 1969.
(2)(A) If the lands to be leased are within a special tar
sand area, they shall be leased to the highest responsible
qualified bidder by competitive bidding under general
regulations in units of not more than five thousand one hundred
and twenty acres, which shall be as nearly compact as possible,
upon the payment by the lessee of such bonus as may be accepted
by the Secretary. Royalty shall be 12\1/2\ per centum in amount
of value of production removed or sold from the lease subject
to section 17(k)(1)(c). The Secretary may lease such additional
lands in special tar sand areas as may be required in support
of any operations necessary for the recovery of tar sands.
(B) The Secretary may issue under this Act for the same area,
separately--
(i) a lease for exploration for and extraction of tar
sand; and
(ii) a lease for exploration for and development of
oil and gas.
(C) A lease issued under subparagraph (B)(ii) shall not be
further subject to the Combined Hydrocarbon Leasing Act of 1981
(30 U.S.C. 181 et seq.).
(D) A lease issued for tar sand shall be issued using the
same bidding process, annual rental, and posting period as a
lease issued for oil and gas, except that the minimum
acceptable bid required for a lease issued for tar sand shall
be $2 per acre.
(E) The Secretary may waive, suspend, or alter any
requirement under section 26 that a permittee under a permit
authorizing prospecting for tar sand must exercise due
diligence, to promote any resource covered by a combined
hydrocarbon lease.
* * * * * * *