[House Report 112-393]
[From the U.S. Government Publishing Office]


112th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     112-393

======================================================================



 
                  ALASKAN ENERGY FOR AMERICAN JOBS ACT

                                _______
                                

February 9, 2012.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Hastings of Washington, from the Committee on Natural Resources, 
                        submitted the following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 3407]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Natural Resources, to whom was referred 
the bill (H.R. 3407) to direct the Secretary of the Interior to 
establish and implement a competitive oil and gas leasing 
program for the exploration, development, and production of the 
oil and gas resources of the Coastal Plain of Alaska, to ensure 
secure energy supplies for the continental Pacific Coast of the 
United States, lower prices, and reduce imports, and for other 
purposes, having considered the same, report favorably thereon 
with an amendment and recommend that the bill as amended do 
pass.
    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Alaskan Energy for American Jobs 
Act''.

SEC. 2. DEFINITIONS.

  In this Act:
          (1) Coastal plain.--The term ``Coastal Plain'' means that 
        area described in appendix I to part 37 of title 50, Code of 
        Federal Regulations.
          (2) Peer reviewed.--The term ``peer reviewed'' means 
        reviewed--
                  (A) by individuals chosen by the National Academy of 
                Sciences with no contractual relationship with, or 
                those who have no application for a grant or other 
                funding pending with, the Federal agency with leasing 
                jurisdiction; or
                  (B) if individuals described in subparagraph (A) are 
                not available, by the top individuals in the specified 
                biological fields, as determined by the National 
                Academy of Sciences.
          (3) Secretary.--The term ``Secretary'', except as otherwise 
        provided, means the Secretary of the Interior or the 
        Secretary's designee.

SEC. 3. LEASING PROGRAM FOR LANDS WITHIN THE COASTAL PLAIN.

  (a) In General.--The Secretary shall take such actions as are 
necessary--
          (1) to establish and implement, in accordance with this Act 
        and acting through the Director of the Bureau of Land 
        Management in consultation with the Director of the United 
        States Fish and Wildlife Service, a competitive oil and gas 
        leasing program that will result in the exploration, 
        development, and production of the oil and gas resources of the 
        Coastal Plain; and
          (2) to administer the provisions of this Act through 
        regulations, lease terms, conditions, restrictions, 
        prohibitions, stipulations, and other provisions that ensure 
        the oil and gas exploration, development, and production 
        activities on the Coastal Plain will result in no significant 
        adverse effect on fish and wildlife, their habitat, subsistence 
        resources, and the environment, including, in furtherance of 
        this goal, by requiring the application of the best 
        commercially available technology for oil and gas exploration, 
        development, and production to all exploration, development, 
        and production operations under this Act in a manner that 
        ensures the receipt of fair market value by the public for the 
        mineral resources to be leased.
  (b) Repeal of Existing Restriction.--
          (1) Repeal.--Section 1003 of the Alaska National Interest 
        Lands Conservation Act (16 U.S.C. 3143) is repealed.
          (2) Conforming amendment.--The table of contents in section 1 
        of such Act is amended by striking the item relating to section 
        1003.
  (c) Compliance With Requirements Under Certain Other Laws.--
          (1) Compatibility.--For purposes of the National Wildlife 
        Refuge System Administration Act of 1966 (16 U.S.C. 668dd et 
        seq.), the oil and gas leasing program and activities 
        authorized by this section in the Coastal Plain are deemed to 
        be compatible with the purposes for which the Arctic National 
        Wildlife Refuge was established, and no further findings or 
        decisions are required to implement this determination.
          (2) Adequacy of the department of the interior's legislative 
        environmental impact statement.--The ``Final Legislative 
        Environmental Impact Statement'' (April 1987) on the Coastal 
        Plain prepared pursuant to section 1002 of the Alaska National 
        Interest Lands Conservation Act (16 U.S.C. 3142) and section 
        102(2)(C) of the National Environmental Policy Act of 1969 (42 
        U.S.C. 4332(2)(C)) is deemed to satisfy the requirements under 
        the National Environmental Policy Act of 1969 that apply with 
        respect to prelease activities under this Act, including 
        actions authorized to be taken by the Secretary to develop and 
        promulgate the regulations for the establishment of a leasing 
        program authorized by this Act before the conduct of the first 
        lease sale.
          (3) Compliance with nepa for other actions.--Before 
        conducting the first lease sale under this Act, the Secretary 
        shall prepare an environmental impact statement under the 
        National Environmental Policy Act of 1969 with respect to the 
        actions authorized by this Act that are not referred to in 
        paragraph (2). Notwithstanding any other law, the Secretary is 
        not required to identify nonleasing alternative courses of 
        action or to analyze the environmental effects of such courses 
        of action. The Secretary shall only identify a preferred action 
        for such leasing and a single leasing alternative, and analyze 
        the environmental effects and potential mitigation measures for 
        those two alternatives. The identification of the preferred 
        action and related analysis for the first lease sale under this 
        Act shall be completed within 18 months after the date of 
        enactment of this Act. The Secretary shall only consider public 
        comments that specifically address the Secretary's preferred 
        action and that are filed within 20 days after publication of 
        an environmental analysis. Notwithstanding any other law, 
        compliance with this paragraph is deemed to satisfy all 
        requirements for the analysis and consideration of the 
        environmental effects of proposed leasing under this Act.
  (d) Relationship to State and Local Authority.--Nothing in this Act 
shall be considered to expand or limit State and local regulatory 
authority.
  (e) Special Areas.--
          (1) In general.--The Secretary, after consultation with the 
        State of Alaska, the city of Kaktovik, and the North Slope 
        Borough, may designate up to a total of 45,000 acres of the 
        Coastal Plain as a Special Area if the Secretary determines 
        that the Special Area is of such unique character and interest 
        so as to require special management and regulatory protection. 
        The Secretary shall designate as such a Special Area the 
        Sadlerochit Spring area, comprising approximately 4,000 acres.
          (2) Management.--Each such Special Area shall be managed so 
        as to protect and preserve the area's unique and diverse 
        character including its fish, wildlife, and subsistence 
        resource values.
          (3) Exclusion from leasing or surface occupancy.--The 
        Secretary may exclude any Special Area from leasing. If the 
        Secretary leases a Special Area, or any part thereof, for 
        purposes of oil and gas exploration, development, production, 
        and related activities, there shall be no surface occupancy of 
        the lands comprising the Special Area.
          (4) Directional drilling.--Notwithstanding the other 
        provisions of this subsection, the Secretary may lease all or a 
        portion of a Special Area under terms that permit the use of 
        horizontal drilling technology from sites on leases tracts 
        located outside the Special Area.
  (f) Limitation on Closed Areas.--The Secretary's sole authority to 
close lands within the Coastal Plain to oil and gas leasing and to 
exploration, development, and production is that set forth in this Act.
  (g) Regulations.--
          (1) In general.--The Secretary shall prescribe such 
        regulations as may be necessary to carry out this Act, 
        including regulations relating to protection of the fish and 
        wildlife, their habitat, subsistence resources, and environment 
        of the Coastal Plain, by no later than 15 months after the date 
        of enactment of this Act.
          (2) Revision of regulations.--The Secretary shall, through a 
        rule making conducted in accordance with section 553 of title 
        5, United States Code, periodically review and, if appropriate, 
        revise the regulations issued under subsection (a) to reflect a 
        preponderance of the best available scientific evidence that 
        has been peer reviewed and obtained by following appropriate, 
        documented scientific procedures, the results of which can be 
        repeated using those same procedures.

SEC. 4. LEASE SALES.

  (a) In General.--Lands may be leased under this Act to any person 
qualified to obtain a lease for deposits of oil and gas under the 
Mineral Leasing Act (30 U.S.C. 181 et seq.).
  (b) Procedures.--The Secretary shall, by regulation and no later than 
180 days after the date of enactment of this Act, establish procedures 
for--
          (1) receipt and consideration of sealed nominations for any 
        area of the Coastal Plain for inclusion in, or exclusion (as 
        provided in subsection (c)) from, a lease sale;
          (2) the holding of lease sales after such nomination process; 
        and
          (3) public notice of and comment on designation of areas to 
        be included in, or excluded from, a lease sale.
  (c) Lease Sale Bids.--Lease sales under this Act may be conducted 
through an Internet leasing program, if the Secretary determines that 
such a system will result in savings to the taxpayer, an increase in 
the number of bidders participating, and higher returns than oral 
bidding or a sealed bidding system.
  (d) Sale Acreages and Schedule.--
          (1) The Secretary shall offer for lease under this Act those 
        tracts the Secretary considers to have the greatest potential 
        for the discovery of hydrocarbons, taking into consideration 
        nominations received pursuant to subsection (b)(1).
          (2) The Secretary shall offer for lease under this Act no 
        less than 50,000 acres for lease within 22 months after the 
        date of the enactment of this Act.
          (3) The Secretary shall offer for lease under this Act no 
        less than an additional 50,000 acres at 6-, 12-, and 18-month 
        intervals following offering under paragraph (2).
          (4) The Secretary shall conduct four additional sales under 
        the same terms and schedule no later than two years after the 
        date of the last sale under paragraph (3), if sufficient 
        interest in leasing exists to warrant, in the Secretary's 
        judgment, the conduct of such sales.
          (5) The Secretary shall evaluate the bids in each sale and 
        issue leases resulting from such sales, within 90 days after 
        the date of the completion of such sale.

SEC. 5. GRANT OF LEASES BY THE SECRETARY.

  (a) In General.--The Secretary may grant to the highest responsible 
qualified bidder in a lease sale conducted under section 4 any lands to 
be leased on the Coastal Plain upon payment by the such bidder of such 
bonus as may be accepted by the Secretary.
  (b) Subsequent Transfers.--No lease issued under this Act may be 
sold, exchanged, assigned, sublet, or otherwise transferred except with 
the approval of the Secretary. Prior to any such approval the Secretary 
shall consult with, and give due consideration to the views of, the 
Attorney General.

SEC. 6. LEASE TERMS AND CONDITIONS.

  (a) In General.--An oil or gas lease issued under this Act shall--
          (1) provide for the payment of a royalty of not less than 
        12\1/2\ percent in amount or value of the production removed or 
        sold under the lease, as determined by the Secretary under the 
        regulations applicable to other Federal oil and gas leases;
          (2) provide that the Secretary may close, on a seasonal 
        basis, portions of the Coastal Plain to exploratory drilling 
        activities as necessary to protect caribou calving areas and 
        other species of fish and wildlife based on a preponderance of 
        the best available scientific evidence that has been peer 
        reviewed and obtained by following appropriate, documented 
        scientific procedures, the results of which can be repeated 
        using those same procedures;
          (3) require that the lessee of lands within the Coastal Plain 
        shall be fully responsible and liable for the reclamation of 
        lands within the Coastal Plain and any other Federal lands that 
        are adversely affected in connection with exploration, 
        development, production, or transportation activities conducted 
        under the lease and within the Coastal Plain by the lessee or 
        by any of the subcontractors or agents of the lessee;
          (4) provide that the lessee may not delegate or convey, by 
        contract or otherwise, the reclamation responsibility and 
        liability to another person without the express written 
        approval of the Secretary;
          (5) provide that the standard of reclamation for lands 
        required to be reclaimed under this Act shall be, as nearly as 
        practicable, a condition capable of supporting the uses which 
        the lands were capable of supporting prior to any exploration, 
        development, or production activities, or upon application by 
        the lessee, to a higher or better use as certified by the 
        Secretary;
          (6) contain terms and conditions relating to protection of 
        fish and wildlife, their habitat, subsistence resources, and 
        the environment as required pursuant to section 3(a)(2);
          (7) provide that the lessee, its agents, and its contractors 
        use best efforts to provide a fair share, as determined by the 
        level of obligation previously agreed to in the 1974 agreement 
        implementing section 29 of the Federal Agreement and Grant of 
        Right of Way for the Operation of the Trans-Alaska Pipeline, of 
        employment and contracting for Alaska Natives and Alaska Native 
        corporations from throughout the State;
          (8) prohibit the export of oil produced under the lease; and
          (9) contain such other provisions as the Secretary determines 
        necessary to ensure compliance with this Act and the 
        regulations issued under this Act.
  (b) Negotiated Labor Agreements.--The Secretary, as a term and 
condition of each lease under this Act, shall require that the lessee 
and its agents and contractors negotiate to obtain an agreement for the 
employment of laborers and mechanics on production, maintenance, and 
construction under the lease.

SEC. 7. POLICIES REGARDING BUYING, BUILDING, AND WORKING FOR AMERICA.

  (a) Congressional Intent.--It is the intent of the Congress that--
          (1) this Act will support a healthy and growing United States 
        domestic energy sector that, in turn, helps to reinvigorate 
        American manufacturing, transportation, and service sectors by 
        employing the vast talents of United States workers to assist 
        in the development of energy from domestic sources; and
          (2) Congress will monitor the deployment of personnel and 
        material onshore and offshore to encourage the development of 
        American technology and manufacturing to enable United States 
        workers to benefit from this Act through good jobs and careers, 
        as well as the establishment of important industrial facilities 
        to support expanded access to American resources.
  (b) Requirement.--The Secretary of the Interior shall when possible, 
and practicable, encourage the use of United States workers and 
equipment manufactured in the United States in all construction related 
to mineral development on the Coastal Plain.

SEC. 8. COASTAL PLAIN ENVIRONMENTAL PROTECTION.

  (a) No Significant Adverse Effect Standard To Govern Authorized 
Coastal Plain Activities.--The Secretary shall, consistent with the 
requirements of section 3, administer this Act through regulations, 
lease terms, conditions, restrictions, prohibitions, stipulations, and 
other provisions that--
          (1) ensure the oil and gas exploration, development, and 
        production activities on the Coastal Plain will result in no 
        significant adverse effect on fish and wildlife, their habitat, 
        and the environment;
          (2) require the application of the best commercially 
        available technology for oil and gas exploration, development, 
        and production on all new exploration, development, and 
        production operations; and
          (3) ensure that the maximum amount of surface acreage covered 
        by production and support facilities, including airstrips and 
        any areas covered by gravel berms or piers for support of 
        pipelines, does not exceed 10,000 acres on the Coastal Plain 
        for each 100,000 acres of area leased.
  (b) Site-Specific Assessment and Mitigation.--The Secretary shall 
also require, with respect to any proposed drilling and related 
activities, that--
          (1) a site-specific analysis be made of the probable effects, 
        if any, that the drilling or related activities will have on 
        fish and wildlife, their habitat, subsistence resources, and 
        the environment;
          (2) a plan be implemented to avoid, minimize, and mitigate 
        (in that order and to the extent practicable) any significant 
        adverse effect identified under paragraph (1); and
          (3) the development of the plan shall occur after 
        consultation with the agency or agencies having jurisdiction 
        over matters mitigated by the plan.
  (c) Regulations To Protect Coastal Plain Fish and Wildlife Resources, 
Subsistence Users, and the Environment.--Before implementing the 
leasing program authorized by this Act, the Secretary shall prepare and 
promulgate regulations, lease terms, conditions, restrictions, 
prohibitions, stipulations, and other measures designed to ensure that 
the activities undertaken on the Coastal Plain under this Act are 
conducted in a manner consistent with the purposes and environmental 
requirements of this Act.
  (d) Compliance With Federal and State Environmental Laws and Other 
Requirements.--The proposed regulations, lease terms, conditions, 
restrictions, prohibitions, and stipulations for the leasing program 
under this Act shall require compliance with all applicable provisions 
of Federal and State environmental law, and shall also require the 
following:
          (1) Standards at least as effective as the safety and 
        environmental mitigation measures set forth in items 1 through 
        29 at pages 167 through 169 of the ``Final Legislative 
        Environmental Impact Statement'' (April 1987) on the Coastal 
        Plain.
          (2) Seasonal limitations on exploration, development, and 
        related activities, where necessary, to avoid significant 
        adverse effects during periods of concentrated fish and 
        wildlife breeding, denning, nesting, spawning, and migration 
        based on a preponderance of the best available scientific 
        evidence that has been peer reviewed and obtained by following 
        appropriate, documented scientific procedures, the results of 
        which can be repeated using those same procedures.
          (3) That exploration activities, except for surface 
        geological studies, be limited to the period between 
        approximately November 1 and May 1 each year and that 
        exploration activities shall be supported, if necessary, by ice 
        roads, winter trails with adequate snow cover, ice pads, ice 
        airstrips, and air transport methods, except that such 
        exploration activities may occur at other times if the 
        Secretary finds that such exploration will have no significant 
        adverse effect on the fish and wildlife, their habitat, and the 
        environment of the Coastal Plain.
          (4) Design safety and construction standards for all 
        pipelines and any access and service roads, that--
                  (A) minimize, to the maximum extent possible, adverse 
                effects upon the passage of migratory species such as 
                caribou; and
                  (B) minimize adverse effects upon the flow of surface 
                water by requiring the use of culverts, bridges, and 
                other structural devices.
          (5) Prohibitions on general public access and use on all 
        pipeline access and service roads.
          (6) Stringent reclamation and rehabilitation requirements, 
        consistent with the standards set forth in this Act, requiring 
        the removal from the Coastal Plain of all oil and gas 
        development and production facilities, structures, and 
        equipment upon completion of oil and gas production operations, 
        except that the Secretary may exempt from the requirements of 
        this paragraph those facilities, structures, or equipment that 
        the Secretary determines would assist in the management of the 
        Arctic National Wildlife Refuge and that are donated to the 
        United States for that purpose.
          (7) Appropriate prohibitions or restrictions on access by all 
        modes of transportation.
          (8) Appropriate prohibitions or restrictions on sand and 
        gravel extraction.
          (9) Consolidation of facility siting.
          (10) Appropriate prohibitions or restrictions on use of 
        explosives.
          (11) Avoidance, to the extent practicable, of springs, 
        streams, and river systems; the protection of natural surface 
        drainage patterns, wetlands, and riparian habitats; and the 
        regulation of methods or techniques for developing or 
        transporting adequate supplies of water for exploratory 
        drilling.
          (12) Avoidance or minimization of air traffic-related 
        disturbance to fish and wildlife.
          (13) Treatment and disposal of hazardous and toxic wastes, 
        solid wastes, reserve pit fluids, drilling muds and cuttings, 
        and domestic wastewater, including an annual waste management 
        report, a hazardous materials tracking system, and a 
        prohibition on chlorinated solvents, in accordance with 
        applicable Federal and State environmental law.
          (14) Fuel storage and oil spill contingency planning.
          (15) Research, monitoring, and reporting requirements.
          (16) Field crew environmental briefings.
          (17) Avoidance of significant adverse effects upon 
        subsistence hunting, fishing, and trapping by subsistence 
        users.
          (18) Compliance with applicable air and water quality 
        standards.
          (19) Appropriate seasonal and safety zone designations around 
        well sites, within which subsistence hunting and trapping shall 
        be limited.
          (20) Reasonable stipulations for protection of cultural and 
        archeological resources.
          (21) All other protective environmental stipulations, 
        restrictions, terms, and conditions deemed necessary by the 
        Secretary.
  (e) Considerations.--In preparing and promulgating regulations, lease 
terms, conditions, restrictions, prohibitions, and stipulations under 
this section, the Secretary shall consider the following:
          (1) The stipulations and conditions that govern the National 
        Petroleum Reserve-Alaska leasing program, as set forth in the 
        1999 Northeast National Petroleum Reserve-Alaska Final 
        Integrated Activity Plan/Environmental Impact Statement.
          (2) The environmental protection standards that governed the 
        initial Coastal Plain seismic exploration program under parts 
        37.31 to 37.33 of title 50, Code of Federal Regulations.
          (3) The land use stipulations for exploratory drilling on the 
        KIC-ASRC private lands that are set forth in appendix 2 of the 
        August 9, 1983, agreement between Arctic Slope Regional 
        Corporation and the United States.
  (f) Facility Consolidation Planning.--
          (1) In general.--The Secretary shall, after providing for 
        public notice and comment, prepare and update periodically a 
        plan to govern, guide, and direct the siting and construction 
        of facilities for the exploration, development, production, and 
        transportation of Coastal Plain oil and gas resources.
          (2) Objectives.--The plan shall have the following 
        objectives:
                  (A) Avoiding unnecessary duplication of facilities 
                and activities.
                  (B) Encouraging consolidation of common facilities 
                and activities.
                  (C) Locating or confining facilities and activities 
                to areas that will minimize impact on fish and 
                wildlife, their habitat, and the environment.
                  (D) Utilizing existing facilities wherever 
                practicable.
                  (E) Enhancing compatibility between wildlife values 
                and development activities.
  (g) Access to Public Lands.--The Secretary shall--
          (1) manage public lands in the Coastal Plain subject to 
        section 811 of the Alaska National Interest Lands Conservation 
        Act (16 U.S.C. 3121); and
          (2) ensure that local residents shall have reasonable access 
        to public lands in the Coastal Plain for traditional uses.

SEC. 9. EXPEDITED JUDICIAL REVIEW.

  (a) Filing of Complaint.--
          (1) Deadline.--Subject to paragraph (2), any complaint 
        seeking judicial review--
                  (A) of any provision of this Act shall be filed by 
                not later than 1 year after the date of enactment of 
                this Act; or
                  (B) of any action of the Secretary under this Act 
                shall be filed--
                          (i) except as provided in clause (ii), within 
                        the 90-day period beginning on the date of the 
                        action being challenged; or
                          (ii) in the case of a complaint based solely 
                        on grounds arising after such period, within 90 
                        days after the complainant knew or reasonably 
                        should have known of the grounds for the 
                        complaint.
          (2) Venue.--Any complaint seeking judicial review of any 
        provision of this Act or any action of the Secretary under this 
        Act may be filed only in the United States Court of Appeals for 
        the District of Columbia.
          (3) Limitation on scope of certain review.--Judicial review 
        of a Secretarial decision to conduct a lease sale under this 
        Act, including the environmental analysis thereof, shall be 
        limited to whether the Secretary has complied with this Act and 
        shall be based upon the administrative record of that decision. 
        The Secretary's identification of a preferred course of action 
        to enable leasing to proceed and the Secretary's analysis of 
        environmental effects under this Act shall be presumed to be 
        correct unless shown otherwise by clear and convincing evidence 
        to the contrary.
  (b) Limitation on Other Review.--Actions of the Secretary with 
respect to which review could have been obtained under this section 
shall not be subject to judicial review in any civil or criminal 
proceeding for enforcement.
  (c) Limitation on Attorneys' Fees and Court Costs.--No person seeking 
judicial review of any action under this Act shall receive payment from 
the Federal Government for their attorneys' fees and other court costs, 
including under any provision of law enacted by the Equal Access to 
Justice Act (5 U.S.C. 504 note).

SEC. 10. TREATMENT OF REVENUES.

  Notwithstanding any other provision of law, 50 percent of the amount 
of bonus, rental, and royalty revenues from Federal oil and gas leasing 
and operations authorized under this Act shall be deposited in the 
Treasury.

SEC. 11. RIGHTS-OF-WAY ACROSS THE COASTAL PLAIN.

  (a) In General.--The Secretary shall issue rights-of-way and 
easements across the Coastal Plain for the transportation of oil and 
gas produced under leases under this Act--
          (1) except as provided in paragraph (2), under section 28 of 
        the Mineral Leasing Act (30 U.S.C. 185), without regard to 
        title XI of the Alaska National Interest Lands Conservation Act 
        (16 U.S.C. 3161 et seq.); and
          (2) under title XI of the Alaska National Interest Lands 
        Conservation Act (30 U.S.C. 3161 et seq.), for access 
        authorized by sections 1110 and 1111 of that Act (16 U.S.C. 
        3170 and 3171).
  (b) Terms and Conditions.--The Secretary shall include in any right-
of-way or easement issued under subsection (a) such terms and 
conditions as may be necessary to ensure that transportation of oil and 
gas does not result in a significant adverse effect on the fish and 
wildlife, subsistence resources, their habitat, and the environment of 
the Coastal Plain, including requirements that facilities be sited or 
designed so as to avoid unnecessary duplication of roads and pipelines.
  (c) Regulations.--The Secretary shall include in regulations under 
section 3(g) provisions granting rights-of-way and easements described 
in subsection (a) of this section.

SEC. 12. CONVEYANCE.

  In order to maximize Federal revenues by removing clouds on title to 
lands and clarifying land ownership patterns within the Coastal Plain, 
the Secretary, notwithstanding section 1302(h)(2) of the Alaska 
National Interest Lands Conservation Act (16 U.S.C. 3192(h)(2)), shall 
convey--
          (1) to the Kaktovik Inupiat Corporation the surface estate of 
        the lands described in paragraph 1 of Public Land Order 6959, 
        to the extent necessary to fulfill the Corporation's 
        entitlement under sections 12 and 14 of the Alaska Native 
        Claims Settlement Act (43 U.S.C. 1611 and 1613) in accordance 
        with the terms and conditions of the Agreement between the 
        Department of the Interior, the United States Fish and Wildlife 
        Service, the Bureau of Land Management, and the Kaktovik 
        Inupiat Corporation dated January 22, 1993; and
          (2) to the Arctic Slope Regional Corporation the remaining 
        subsurface estate to which it is entitled pursuant to the 
        August 9, 1983, agreement between the Arctic Slope Regional 
        Corporation and the United States of America.

                          Purpose of the Bill

    The purpose of H.R. 3407, as ordered reported, is to direct 
the Secretary of the Interior to establish and implement a 
competitive oil and gas leasing program for the exploration, 
development, and production of the oil and gas resources of the 
Coastal Plain of Alaska, to ensure secure energy supplies for 
the United States, lower prices, and reduce imports.

                  Background and Need for Legislation

    The Alaskan Energy for American Jobs Act (H.R. 3407) will 
encourage energy development, increase domestic energy security 
and create tens of thousands of American jobs. This legislation 
requires the Secretary of the Interior to implement a leasing 
program in the portion of the Arctic National Wildlife Refuge 
(ANWR) known as the 1002 area, which was specifically set aside 
for oil and gas development. No less than 50,000 acres shall be 
offered for leasing within 22 months of enactment and an 
additional 50,000 acres shall be offered in 6, 12, and 18 month 
intervals following the initial lease sale. This schedule is 
then repeated if the Secretary deems that there is interest. 
However, the physical surface impact of development is limited 
to a sliver of this acreage, only 10 percent of lands leased. 
The leasing program will ensure there are no adverse effects on 
fish and wildlife and allows the Secretary to create 
environmentally ``special areas'' that are not open to leasing 
due to environmental sensitivities and can limit oil and 
natural gas development due to seasonal environmental 
considerations.
    Further, H.R. 3407 includes a provision dealing with lease 
conditions that has long been included in bills to open ANWR to 
energy production. This language directs the Secretary of the 
Interior to include a provision in lease terms that ensures the 
holders of a lease in ANWR negotiate towards obtaining an 
agreement with those who will physically construct and maintain 
the infrastructure to produce this energy. This does not 
require that an agreement be reached, but it simply requires 
that it be discussed. This language has long been part of a 
bipartisan agreement on legislative text to open ANWR, and is 
included in this text out of respect for this longstanding 
bipartisan agreement and out of respect for Alaska's uniquely 
remote location in the Arctic.
    According to U.S. Geological Survey estimates, the north 
slope of ANWR contains an estimated 10.4 billion barrels of 
oil. This is more than the known oil reserves of entire 
countries that the U.S. currently imports from, including 
Mexico, Angola, Azerbaijan, Norway, India, Indonesia, Malaysia, 
Egypt, Australia, New Zealand, Turkmenistan, and Uzbekistan. At 
peak production, ANWR could supply up to 1.45 million barrels 
of oil per day, more than the U.S. imports from Saudi Arabia 
every day and over one quarter of what the U.S. imports from 
Organization of Petroleum Exporting Countries (OPEC) each year.
    Studies have shown that ANWR would create 55,000 to 130,000 
jobs. Furthermore, energy development in ANWR could generate an 
estimated $150 billion to $296 billion in new federal revenue, 
with total government revenue (including leases, royalties and 
taxes) for the life of ANWR as much as $440 billion. According 
to the Energy Information Administration, crude oil imports 
will decline by one barrel for every one barrel of ANWR 
production.
    In addition, the residents of Alaska have for generations 
strongly supported energy development, and both residents and 
State officials believe development in ANWR can be done safely 
and in an environmentally responsible manner. Multiple polls 
throughout the years have shown consistently that a minimum of 
70% of Alaskans support opening up ANWR for the jobs and 
economic developments it brings to their communities.

                            HISTORY OF ANWR

    Oil and natural gas development has been a key topic of the 
domestic energy debate for decades. Multiple Congresses and 
Administrations have made opening or closing ANWR to 
development a key component of their energy and/or 
environmental agendas.
    In 1980, President Jimmy Carter signed the Alaska National 
Interest Lands Conservation Act, which created more than 
104,000,000 acres of national parks, wildlife refuges and 
wilderness areas from federal lands in the State of Alaska. In 
the Act, Congress and President Carter set aside the 1002 area 
for future oil and natural gas development. A 1986 U.S. Fish 
and Wildlife Service report recommended that for the benefit of 
the country's economic and national security, ANWR should be 
opened for oil and gas development.
    Most recently, the House Natural Resources Committee 
included an ANWR development title in its portion of H.R. 6, 
the Energy Policy Act of 2005. The House passed H.R. 6 with the 
ANWR provisions; however, the Senate-passed version of H.R. 6 
did not contain ANWR development and the House ANWR language 
was removed in conference. In 2006, the House passed H.R. 5429 
to open ANWR to development. This legislation was very similar 
to the ANWR title in H.R. 6, but the measure was not taken up 
by the Senate.
    Rising gas prices increased interest in ANWR development in 
2008, but a Democratic-controlled House and Senate rejected 
several attempts to open ANWR. The 111th Congress never brought 
up the topic for consideration.

                     ANWR ENVIRONMENTAL PROTECTION

    Much of the ANWR debate has revolved around responsible, 
environmentally-sound development and protection. ANWR is 
approximately 19 million acres. The 1002 area covers 
approximately 1.5 million acres. Advancements in drilling 
technology, many of which have been developed on Alaska's North 
Slope, have greatly reduced the amount of acreage needed for 
drilling operations and allow drilling to be conducted with 
minimal environmental impact. A drill pad that would have been 
65 acres in 1977 can be less than nine acres today, and new 
extended reach drilling allows for a single drilling platform 
to cover a 28,000 foot radius--larger than the size of 
Washington, D.C.
    Regarding the environmental impact of drilling, at a June 
2011 legislative hearing, the Committee heard testimony from 
Joe Balash, Deputy Commissioner at the Alaska Department of 
Natural Resources. In his written testimony, Commissioner 
Balash stated that,

          ``Alaska has some of the most stringent environmental 
        policies and regulations in the world and we are a 
        leader in research for sound natural resource 
        development. We love our state, not only for its 
        economic opportunities, but also for its natural 
        beauty, and we are very focused on protecting our 
        environment.
          The State of Alaska strongly believes that 
        responsible resource development and protecting the 
        environment go hand in hand and we have a strong record 
        of upholding the Alaska Constitution's mandate that the 
        state pursue responsible resource development in a 
        manner that safeguards the environment.
          To ensure responsible resource development occurs in 
        Alaska, the state has devised a comprehensive system 
        that imposes rigorous environmental protections that 
        meet or exceed federal standards.''

    H.R. 3407 contains many protections to develop ANWR in an 
environmentally responsible fashion. It allows the Secretary to 
seasonally close portions of the 1002 area to exploratory 
drilling to protect caribou calving areas, fish, and other 
wildlife. It requires a site-specific analysis of the probable 
effects drilling and related activities will have on wildlife 
habitats and sets specific land surface acreage limitations for 
drilling activities on the 1002 area. Additionally, H.R. 3407 
sets stringent reclamation requirements and creates specific 
standards for facilities as to avoid rivers and streams, and to 
avoid potential disturbances to fish and wildlife.

                    CBO SCORING AND FEDERAL REVENUE

    The Committee has reviewed the fiscal score prepared for 
this bill by the Congressional Budget Office (CBO) and has 
serious concerns about both the assumptions and the totals 
reached in the CBO analysis.
    It is important to note that CBO's analysis and estimate 
represents a ``middle'' or ``most likely'' estimate of the 
revenue anticipated to come to the federal treasury. In 
addition, CBO's budget baseline makes assumptions about future 
revenues that reduce the amount of revenue estimated to be 
received by the federal treasury. For both these reasons, the 
Committee believes that the real revenue to the federal 
treasury will be far higher than the estimate provided by CBO.
    In 2009, CBO estimated that a sale in ANWR would generate 
approximately $6.2 billion in revenue to the federal treasury, 
while the estimate for this bill is only $5 billion. Oil prices 
are higher today and spare capacity in the Trans-Alaska 
pipeline is higher, which would allow for more marketing of oil 
produced in ANWR. Yet CBO has inexplicably lowered its score 
relative to 2009.
    Furthermore, the CBO score of $5 billion remains nearly 
identical to a score prepared in 2003 when oil prices were $28 
per barrel and companies had lower exploration budgets 
available. Both of these factors would point to a much higher 
revenue estimate for the federal treasury than the estimate 
given by CBO for this bill.
    While the Committee appreciates the hard work of CBO staff 
and understands that the precedents set by CBO are used over 
and over in the future, the Committee strongly believes that 
the CBO estimate in this case is much too low. Certainly the 
estimate for this bill should have been in line with the 2009 
estimate of $6.2 billion, if not closer to $7.5 billion, which 
would represent a 50% increase over the 2006 score of $5.2 
billion accounting for a nearly 100% increase in oil prices 
since that estimate.
    ANWR represents the largest undeveloped onshore oil and gas 
resource in the United States. In fact, ANWR's estimate of 10 
billion barrels of recoverable oil is one-third of the entire 
onshore federal estate of 31 billion. The onshore operations in 
Prudhoe Bay have provided oil for Alaska and the West Coast for 
nearly 30 years, and the resource estimates for ANWR are 
larger. This resource if developed responsibly could employ 
tens of thousands of workers, produce billions of barrels of 
oil and generate tens of billions of dollars in revenue to the 
federal treasury. A Congressional Research Service estimate 
produced in 2008 said that development of the median estimate 
of 7 billion barrels of oil from ANWR could at $100 per barrel 
oil provide nearly $50 billion to the federal treasury in the 
form of royalties alone over the next 30 years. ANWR has 
tremendous promise to provide jobs, energy and revenue to 
America for a generation.

                            Committee Action

    H.R. 3407 was introduced on November 14, 2011, by Chairman 
Doc Hastings (R-WA) and Congressman Don Young (R-AK). The bill 
was referred to the Committee on Natural Resources, and within 
the Committee to the Subcommittee on Energy and Mineral 
Resources. On November 18, 2011, the Subcommittee held a 
hearing on a draft version of the bill. On February 1, 2012, 
the Full Natural Resources Committee met to consider the 
introduced version of H.R. 3407. The Subcommittee on Energy and 
Mineral Resources was discharged by unanimous consent. Chairman 
Doc Hastings (R-WA) offered an amendment in the nature of a 
substitute to the bill. Ranking Member Edward Markey (D-MA) 
offered amendment designated .001 to the amendment in the 
nature of a substitute; the amendment was not adopted by a 
bipartisan rollcall vote of 11 to 27, as follows:



    Congressman Raul Grijalva (D-AZ) offered amendment 
designated Holt.005 to the amendment in the nature of a 
substitute; the amendment was not adopted by a bipartisan 
rollcall vote of 13 to 28, as follows:



    Congressman John Garamendi (D-CA) offered amendment 
designated .002 to the amendment in the nature of a substitute; 
the amendment was withdrawn. Congressman Edward Markey (D-MA) 
offered amendment designated .004 to the amendment in the 
nature of a substitute; the amendment was not adopted by a 
bipartisan rollcall vote of 14 to 28, as follows:



    Congressman Paul Broun (R-GA) offered amendment designated 
.082 to the amendment in the nature of a substitute; the 
amendment was withdrawn. No further amendments to the amendment 
in the nature of a substitute were offered and the Hastings 
amendment in the nature of a substitute was adopted by voice 
vote. The bill, as amended, was then adopted and ordered 
favorably reported to the House of Representatives by a 
bipartisan rollcall vote of 29 to 13, as follows:



                      Section-by-Section Analysis


Section 1. Short title

    This Act is designated as the ``Alaskan Energy for American 
Jobs Act.''

Section 2. Definitions

    This section provides definitions for terms used in the 
bill.

Section 3. Leasing program for lands within the Coastal Plain

    This section requires the Secretary of the Interior to 
implement a competitive leasing program for oil and gas 
development of the Coastal Plain and ensure there is no 
significant adverse effect on wildlife. The section repeals as 
unnecessary Section 1003 of the Alaska National Interest Lands 
Conservation Act of 1980, which conditions leasing of the 
Coastal Plain on an Act of Congress. It also deems the ``Final 
Legislative Environmental Impact Statement'' (April 1987) as 
satisfying the National Environmental Policy Act (NEPA) with 
respect to prelease activities.
    Before conducting the first lease sale, the Secretary shall 
prepare a new environmental impact statement under NEPA. The 
Secretary is not required to identify a non-leasing alternative 
course of action and shall only identify a preferred action for 
leasing and a single alternative and analyze the environmental 
effects and potential mitigation measures for the two 
alternatives.
    The Secretary, after consultation with the State of Alaska, 
the City of Kaktovik, and the North Slope Borough, may 
designate up to 45,000 acres as a ``Special Area'' of unique 
character and interest requiring special management and 
regulatory protection. The Secretary may exclude any Special 
Area from leasing, but if it is leased there shall be no 
surface area occupancy of the lands. The Secretary may lease 
all or a portion of Special Areas for horizontal drilling from 
sites outside the areas. The Secretary is directed to prepare 
regulations to carry out the Act within 15 months after 
enactment, and may periodically review and revise them to 
reflect any significant biological, environmental or 
engineering data.

Section 4. Lease sales

    This section provides that no later than 180 days after 
enactment of the Act, the Secretary shall establish procedures 
for lease sales.
    No less than 50,000 acres shall be offered for lease within 
22 months after the date of enactment of this Act. These acres 
should be the tracts that the Secretary believes has the 
greatest potential for discovery. An additional (no less than) 
50,000 acres should be offered for leasing in 6, 12, and 18 
month intervals following the initial lease sale. Four 
additional sales shall be conducted on the same schedule no 
later than two years after the date of the last sale. All bids 
received in each sale shall be evaluated by the Secretary 
within 90 days of the sale.

Section 5. Grant of leases by the Secretary

    This section provides that the Secretary must grant the 
lease upon payment of a bonus. No lease can be transferred, 
sold or changed without approval by the Secretary in 
consultation with the Attorney General.

Section 6. Lease terms and conditions

    This section stipulates that the royalty payment for the 
leases issued under this Act should not be less than 12\1/2\ 
percent.
    The Secretary may close on a seasonal basis a portion of 
the Coastal Plain to exploratory drilling as necessary to 
protect caribou calving and fish and wildlife. The lessee is 
responsible for reclamation and may not delegate reclamation 
responsibility or liability to another entity. This section 
also requires the negotiation of project labor agreements as a 
condition of each lease issued under this Act.

Section 7. Policies regarding buying, building and working for America

    This section expresses Congressional intent that the Act 
will help invigorate American manufacturing, transportation and 
service sectors. It also states the Congress will monitor the 
use of personnel and materials to encourage the development of 
American technology and manufacturing. This section provides 
that to the extent possible, the Secretary will encourage the 
hiring of American workers and the use of equipment and 
materials manufactured in the United States.

Section 8. Coastal Plain environmental protection

    The section provides that the Secretary should ensure oil 
and gas activities result in no significant adverse effect on 
fish and wildlife and require the application of best 
commercially available technology. The Secretary will ensure 
the maximum amount of surface acreage covered by production and 
support facilities, does not exceed 10,000 acres per 100,000 
acres leased.
    The Secretary must require a site-specific analysis be made 
of the probable effects that the drilling activities will have 
on fish and wildlife and implement a plan to avoid and mitigate 
adverse effects.
    Additionally, the leasing program will require the 
following:
    (1) Compliance with all applicable provisions of federal 
and State environmental law and standards at least as effective 
as the mitigation measures in the Final Legislative 
environmental impact statement on the Coastal Plain. There will 
be seasonal limitations on activities to avoid adverse effects 
on wildlife activities. Exploration activities are limited to 
between November 1 and May 1 and the use of ice roads are 
encouraged.
    (2) Safety and construction standards for pipelines and 
access and service roads that will minimize adverse effects on 
the passage of migratory species and the flow of surface water.
    (3) Prohibitions on general public access and use on 
pipeline access and service roads.
    (4) Stringent reclamation and rehabilitation requirements.
    (5) Appropriate prohibitions or restrictions on access by 
all modes of transportation.
    (6) Appropriate prohibitions on sand and gravel extraction 
and the use of explosives.
    (7) Consolidation of facility siting, avoidance of springs, 
streams and river systems and air traffic related disturbance 
to fish and wildlife.
    (8) Proper treatment and disposal of hazardous and toxic 
wastes, fuel storage and oil spill contingency planning, 
research, monitoring and reporting requirements, and field crew 
environmental briefings.
    (9) Avoidance of significant adverse effects upon 
subsistence hunting, fishing and trapping.
    (10) Compliance with air and water standards, appropriate 
seasonal and safety zone designations, protection of cultural 
and archeological resources.
    In preparing and promulgating regulations the Secretary 
shall consider the stipulations and conditions that govern the 
National Petroleum Reserve-Alaska leasing program, the 
environmental protection standards that governed the initial 
Coastal Plain seismic exploration program, and the land 
stipulations for exploratory drilling on the KIC-ASRC private 
lands.
    The Secretary should prepare and periodically update a plan 
to govern, guide and direct the consolidated siting and 
construction of facilities. Finally, the Secretary shall manage 
public lands and ensure local residents have access to public 
lands for traditional uses.

Section 9. Expedited judicial review

    This section provides a one year deadline for any complaint 
seeking judicial review of the Act, and a 90-day deadline to 
challenge any action of the Secretary under the Act. Any 
complaint must be filed in the U.S. Court of Appeals of the 
District of Columbia. This section also provides for a 
limitation on attorney's fees.

Section 10. Treatment of revenues

    This section provides that 50 percent of bonus, rental, and 
royalty revenues generated by this Act go to the U.S. Treasury.

Section 11. Rights of way across the Coastal Plain

    This section provides that the Secretary shall issue rights 
of way across the Coastal Plain for transportation of oil and 
gas, and ensure they do not result in adverse effects to fish 
and wildlife.

Section 12. Conveyance

    To maximize federal revenues by removing clouds on title to 
lands and to clarify land ownership patterns in the Coastal 
Plain, this section provides that the Secretary will convey 
certain surface estates to the Kaktovik Inupiat Corporation and 
the remaining subsurface estate granted in an 1983 agreement 
with the Arctic Slope Regional Corporation.

            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 Natural Resources' oversight findings and 
recommendations are reflected in the body of this report.

                    Compliance With House Rule XIII

    1. Cost of Legislation. Clause 3(d)(1) 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)(2)(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. 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:

H.R. 3407--Alaskan Energy for American Jobs Act

    Summary: H.R. 3407 would direct the Secretary of the 
Interior to implement an oil and gas leasing program for the 
coastal plain of the Arctic National Wildlife Refuge (ANWR). 
Based on information provided by the Department of the Interior 
(DOT), the Energy Information Administration (EIA), and 
individuals working in the oil and gas industry, CBO estimates 
that implementing H.R. 3407 would increase net offsetting 
receipts (a credit against direct spending) by about $2.5 
billion over the 2014-2022 period; therefore, pay-as-you-go 
procedures apply. Enacting the legislation would not affect 
revenues.
    H.R. 3407 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would impose no costs on state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 3407 is shown in the following table. 
The costs of this legislation fall within budget functions 300 
(natural resources and environment) and 800 (general 
government).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         By fiscal year, in millions of dollars--
                                ------------------------------------------------------------------------------------------------------------------------
                                   2012     2013     2014     2015     2016     2017     2018     2019     2020     2021     2022   2012-2017  2012-2022
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                               CHANGES IN DIRECT SPENDINGa
 
Estimated Budget Authority.....        0        0     -375     -750     -375        *     -450     -450        *     -100        *     -1,500     -2,502
Estimated Outlays..............        0        0     -375     -750     -375        *     -450     -450        *     -100        *     -1,500    -2,502
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes: Components may not sum to totals because of rounding; * = between -$500,000 and $0.
aCBO estimates that implementing H.R. 3407 also would cost about $8 million over the 2012-2017 period, assuming availability of appropriated funds, for
  the administrative costs of conducting the lease sales.

    Basis of estimate: For this estimate, CBO assumes that the 
legislation will be enacted during 2012.
    H.R. 3407 would direct the Secretary of the Interior to 
implement an oil and gas leasing program for lands located 
within the coastal plain of ANWR, which includes about 1.5 
million acres of federal land on the northeast coast of Alaska. 
Because, under current law, activities related to oil and gas 
leasing in ANWR are prohibited, CBO estimates that implementing 
the bill would increase net offsetting receipts (a credit 
against direct spending) by about $2.5 billion over the 2014-
2022 period.
    The bill would require the Secretary to hold 8 lease sales 
over a 6-year period and to offer at least 50,000 acres of land 
in ANWR for lease at each sale. After completing those sales, 
DOT could choose to offer additional lands for leasing. Any 
lease sales in ANWR would be carried out in accordance with 
procedures used to conduct oil and gas leasing on other federal 
lands under current law. For each lease awarded, lessees would 
pay the federal government bonus bids to acquire the leases, 
annual rent to retain the leases, and royalties based on the 
value of any oil or gas production from the leases. Under the 
bill, Alaska would receive one-half of the gross proceeds 
generated from the leasing program.
    CBO estimates that implementing the legislation would cost 
$8 million over the 2012-2017 period for administrative costs 
associated with the leasing program subject to the availability 
of appropriated funds. Because the bill would deem a 
previously-completed environmental impact statement as 
sufficient to meet the requirements of certain environmental 
laws, CBO estimates that any additional costs associated with 
complying with those laws would be minimal. We estimate that 
other implementation costs would total between $1 million and 
$2 million per year.

Bonus bids

    CBO estimates that gross proceeds from bonus bids paid for 
the right to develop leases in ANWR would total $5 billion over 
the 2014-2022 period. That estimate is based on historical 
information about oil and gas leasing in the United States and 
on information from DOT, ETA, and individuals working in the 
oil and gas industry about factors affecting the amounts that 
companies are willing to pay to acquire oil and gas leases. In 
addition, CBO relied on estimates prepared by the United States 
Geological Survey of the amount of oil that might be produced 
from the coastal plain of ANWR. As specified in the 
legislation, one-half of all receipts from leases in ANWR would 
be paid to Alaska, leaving net federal receipts totaling $2.5 
billion over the 2014-2022 period.
    Estimates of bonus bids for leases in ANWR are uncertain. 
Potential bidders might make assumptions that are different 
from CBO's, including assumptions about long-term oil prices, 
production costs, the amount of oil and gas resources in ANWR, 
and alternative investment opportunities. In particular, oil 
companies have other domestic and overseas investment options 
that they would evaluate and compare with a potential 
investment in ANWR. The potential profitability for a wide 
range of such global investment options would likely be a 
significant factor in prospective bidders' ultimate choices of 
how much to bid for ANWR leases. The number of factors that 
affect companies' investment decisions result in a wide range 
of estimates for bonus bids. CBO's estimate reflects our best 
estimate of the midpoint of that range.

Other receipts

    In addition to receipts from bonus bids, CBO estimates that 
the federal government would collect net receipts from rental 
payments totaling less than $500,000 annually over the 2014-
2022 period. (Lease holders make an annual rental payment until 
production begins.) We also estimate that the federal 
government would receive royalty payments on oil produced from 
ANWR leases; however, based on information from ETA regarding 
the amount of time necessary to drill exploratory wells, 
complete production plans, and build the necessary 
infrastructure to produce and transport any oil produced in 
ANWR, CBO expects that no significant royalty payments would be 
made until after 2022.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays that are subject to those 
pay-as-you-go procedures are shown in the following table.

         CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 3407 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON NATURAL RESOURCES ON FEBRUARY 1, 2012
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           By fiscal year, in millions of dollars--
                                     -------------------------------------------------------------------------------------------------------------------
                                       2012    2013     2014     2015     2016    2017     2018     2019    2020     2021    2022   2012-2017  2012-2022
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       NET INCREASE OR DECREASE (-) IN THE DEFICIT
 
Statutory Pay-As-You-Go Impact......       0       0     -375     -750     -375       0     -450     -450       0     -100       0     -1,500     -2,502
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Intergovernmental and private-sector impact: H.R. 3407 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would impose no costs on state, local, or 
tribal governments.
    Estimate prepared by: Federal Costs: Jeff LaFave; Impact on 
State, Local, and Tribal Governments: Melissa Merrell; Impact 
on the Private Sector: Amy Petz.
    Estimate approved by: Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.
    2. Section 308(a) of 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. CBO estimates that 
implementing H.R. 3407 would increase net offsetting receipts 
(a credit against direct spending) by about $2.5 billion over 
the 2014-2022 period; therefore, pay-as-you-go procedures 
apply. Enacting the legislation would not affect revenues.
    3. General Performance Goals and Objectives. As required by 
clause 3(c)(4) of Rule XIII, the general performance goal or 
objective of this bill, as ordered reported, is to direct the 
Secretary of the Interior to establish and implement a 
competitive oil and gas leasing program for the exploration, 
development, and production of the oil and gas resources of the 
Coastal Plain of Alaska, to ensure secure energy supplies for 
the United States, lower prices, and reduce imports.

                           Earmark Statement

    This bill does not contain any Congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined 
under clause 9(e), 9(f), and 9(g) of rule XXI of the Rules of 
the House of Representatives.

                    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 (existing law 
proposed to be omitted is enclosed in black brackets and 
existing law in which no change is proposed is shown in roman):

                    ALASKA NATIONAL INTEREST LANDS 
                            CONSERVATION ACT

  Section 1. This Act may be cited as the ``Alaska National 
Interest Lands Conservation Act''.

                            TABLE OF CONTENTS

     * * * * * * *

TITLE X--FEDERAL NORTH SLOPE LANDS STUDIES, OIL AND GAS LEASING PROGRAM 
                         AND MINERAL ASSESSMENTS

Sec. 1001. Overall study program.
     * * * * * * *
[Sec. 1003. Prohibition on development.]

           *       *       *       *       *       *       *


TITLE X--FEDERAL NORTH SLOPE LANDS STUDIES, OIL AND GAS LEASING PROGRAM 
AND MINERAL ASSESSMENTS

           *       *       *       *       *       *       *


                      [PROHIBITION ON DEVELOPMENT

  [Sec. 1003. Production of oil and gas from the Arctic 
National Wildlife Refuge is prohibited and no leasing or other 
development leading to production of oil and gas from the range 
shall be undertaken until authorized by an Act of Congress.]

           *       *       *       *       *       *       *


                            DISSENTING VIEWS

    We oppose H.R. 3407 because it is part of a blatant attempt 
to use a funding shortfall for our nation's highway projects to 
force drilling in our nation's most pristine wildlife refuge. 
Unfortunately, this legislation combined with other Republican 
drilling proposals will not generate anywhere near sufficient 
revenue to pay for a surface transportation bill nor would it 
do so in the timeframe required.
    H.R. 3407 would open up the pristine Arctic National 
Wildlife Refuge in Alaska to oil and gas drilling. There is no 
reason to open up this national treasure when, according to the 
Department of the Interior, oil companies already hold the 
drilling rights to tens of millions of acres of public lands 
under which is more oil than we could ever produce from the 
Refuge. We believe that oil companies should start drilling for 
these billions of barrels that they already have access to and 
that they should do so safely.
    Allowing drilling in the Arctic Refuge would set a 
precedent that will allow the oil and gas industry to put a 
bull's-eye on each of the more than 550 units of the National 
Wildlife Refuge System in every state around the country. 
According to the Government Accountability Office, no leases 
have been issued in wildlife refuges for reasons other than for 
drainage--rare instances to prevent the theft of public 
minerals by a third party--since the Congress enacted the 
National Wildlife Refuge System Administration Act of 1966. 
Opening the crown jewel of the Wildlife Refuge System to 
drilling would set a new and disastrous precedent.
    This bill would turn this untrammeled wilderness into a 
network of roads, pipelines and rigs. For years, proponents of 
drilling in the Refuge argued that any oil development would be 
confined to a total of 2,000 acres. This artificial number 
always counted the area of the rigs and pipelines only as the 
area that actually touched the ground, which is like saying the 
area of a table is limited to the size of the space where its 
legs touch the floor. H.R. 3407 drops even the pretense of that 
myth, once and for all. Under this bill, the Majority 
acknowledges that oil industry's footprint could stretch across 
as much as 150,000 acres of the Coastal Plain.
    The Majority's claims also greatly exaggerate the revenue 
that could be generated by drilling in the Refuge. The 
Congressional Budget Office has estimated that drilling in this 
national treasure would raise only about $3 billion over the 
first ten years because the first oil production would take 
roughly a decade. In addition, while the bill seeks to send 50 
percent of any drilling revenue to the state and 50 percent to 
the Treasury, the Alaska Statehood Act requires that 90 percent 
of revenues from drilling on federal land must go to the state. 
If the State of Alaska successfully challenged the revenue 
split in H.R. 3408 in court, it would mean that taxpayers would 
receive much less.
    Ranking Member Markey offered an amendment that would have 
required that before oil companies could drill in this pristine 
wildlife refuge, they must pay their fair share on leases they 
already hold in the Gulf of Mexico on which they are drilling 
for free. This amendment would have generated $9.5 billion over 
ten years but was rejected on a largely party line vote. The 
Majority also rejected an amendment from Energy and Minerals 
Ranking Member Holt to ensure that if taxpayers do not actually 
receive their proper share of the revenues as a result of 
litigation over the division of revenue, drilling in the Refuge 
would not go forward. An amendment from Ranking Member Markey 
to at least ensure that all natural gas produced from drilling 
in the Arctic Refuge would stay in the United States for 
domestic use was similarly rejected.
    The fallacy of ``Drill, Baby, Drill'' has been proven. 
United States oil production is at its highest levels in nearly 
a decade. Natural gas production is at an all time high. Yet 
gasoline prices are still averaging well over $3 per gallon. 
H.R. 3407 would not change that reality, but it would risk 
destroying the crown jewel of our National Wildlife Refuge 
System.
                                   Edward J. Markey.
                                   Grace F. Napolitano.
                                   Rush Holt.
                                   Frank Pallone, Jr.
                                   Raul M. Grijalva.
                                   Niki Tsongas.
                                   John Garamendi.
                                   Ben R. Lujan.
                                   Dale E. Kildee.
                                   Peter DeFazio.

                                  
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