House Report 112-73 - PROVIDING FOR CONSIDERATION OF THE BILL (H.R. 1229) TO AMEND THE OUTER CONTINENTAL SHELF LANDS ACT TO FACILITATE THE SAFE AND TIMELY PRODUCTION OF AMERICAN ENERGY RESOURCES FROM THE GULF OF MEXICO, AND PROVIDING FOR CONSIDERATION OF THE BILL (H.R. 1230) TO REQUIRE THE SECRETARY OF THE INTERIOR TO CONDUCT CERTAIN OFFSHORE OIL AND GAS LEASE SALES, AND FOR OTHER PURPOSES

[House Report 112-73]
[From the U.S. Government Publishing Office]

112th Congress Report
HOUSE OF REPRESENTATIVES
1st Session 112-73

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

PROVIDING FOR CONSIDERATION OF THE BILL (H.R. 1229) TO AMEND THE OUTER
CONTINENTAL SHELF LANDS ACT TO FACILITATE THE SAFE AND TIMELY
PRODUCTION OF AMERICAN ENERGY RESOURCES FROM THE GULF OF MEXICO, AND
PROVIDING FOR CONSIDERATION OF THE BILL (H.R. 1230) TO REQUIRE THE
SECRETARY OF THE INTERIOR TO CONDUCT CERTAIN OFFSHORE OIL AND GAS LEASE
SALES, AND FOR OTHER PURPOSES

_______

May 4, 2011.--Referred to the House Calendar and ordered to be printed

_______

Mr. Bishop of Utah, from the Committee on Rules,
submitted the following

R E P O R T

[To accompany H. Res. 245]

The Committee on Rules, having had under consideration
House Resolution 245, by a record vote of 9 to 3, report the
same to the House with the recommendation that the resolution
be adopted.

SUMMARY OF PROVISIONS OF THE RESOLUTION

The resolution provides for consideration of H.R. 1229, the
Putting the Gulf of Mexico Back to Work Act, under a structured
rule. The resolution provides for one hour of general debate
equally divided and controlled by the chair and ranking
minority member of the Committee on Natural Resources. The
resolution waives all points of order against consideration of
the bill. The resolution provides that the amendment
recommended by the Committee on Natural Resources now printed
in the bill shall be considered as adopted in the House and in
the Committee of the Whole. The resolution provides that the
bill as amended shall be considered as read. The resolution
waives all points of order against provisions in the bill, as
amended. The resolution makes in order only those amendments to
H.R. 1229 printed in Part A of this report. The resolution
provides that each such amendment may be offered only in the
order printed in this report, may be offered only by a Member
designated in this report, shall be considered as read, shall
be debatable for the time specified in this report equally
divided and controlled by the proponent and an opponent, shall
not be subject to amendment, and shall not be subject to a
demand for division of the question in the House or in the
Committee of the Whole. All points of order against the
amendments printed in Part A of this report are waived. The
resolution provides one motion to recommit the bill with or
without instructions.
The resolution further provides for consideration of H.R.
1230, the Restarting American Offshore Leasing Now Act, under a
structured rule. The resolution provides one hour of general
debate equally divided and controlled by the chair and ranking
minority member of the Committee on Natural Resources. The
resolution waives all points of order against consideration of
the bill and provides that the bill shall be considered as
read. The resolution waives all points of order against
provisions in the bill. The resolution makes in order only
those amendments to H.R. 1230 printed in Part B of this report.
The resolution provides that each such amendment may be offered
only in the order printed in this report, may be offered only
by a Member designated in this report, shall be considered as
read, shall be debatable for the time specified in this report
equally divided and controlled by the proponent and an
opponent, shall not be subject to amendment, and shall not be
subject to a demand for division of the question in the House
or in the Committee of the Whole. All points of order against
the amendments printed in Part B of this report are waived. The
resolution provides one motion to recommit the bill with or
without instructions.
Finally, the resolution directs the Clerk to, in the
engrossment of H.R. 1229, add the text of H.R. 1230, as passed
by the House, as new matter at the end of H.R. 1229. The
resolution also directs the Clerk to make conforming
modifications in the engrossment.

EXPLANATION OF WAIVERS

The waiver of all points of order against consideration of
H.R. 1229 includes a waiver of Section 302(f) of the
Congressional Budget Act, which prohibits the consideration of
legislation that exceeds a committee's allocation of new
entitlement authority. This budgetary violation will be cured
when, pursuant to the resolution, H.R. 1230 is added as new
matter at the end of H.R. 1229. In accordance to clause 10(b)
of rule XXI, the provisions of H.R. 1230 will offset the breach
in allocation of entitlement authority for a total net
reduction in direct spending of $34 million over the 2011-2021
period. The waiver of all points of order against consideration
of H.R. 1229 also includes a waiver of Section 303(a) of the
Congressional Budget Act, which prohibits the consideration of
legislation, as reported, providing new budget authority,
change in revenues, change in the public debt, new entitlement
authority, or new credit authority for a fiscal year until the
budget resolution for that year has been agreed to. The waiver
of all points of order against consideration of H.R. 1229 also
includes a waiver of clause 3(c)(4) of rule XIII, which
requires the inclusion of general performance goals and
objectives in a committee report.
Although the rule waives all points of order against
provisions in the H.R. 1229, as amended, the Committee is not
aware of any points of order against its provisions. The waiver
is prophylactic in nature.
Although the rule waives all points of order against
consideration of H.R. 1230, the Committee is not aware of any
points of order against consideration of the bill. The waiver
of all points of order against consideration of H.R. 1230 is
prophylactic in nature.
Although the rule waives all points of order against
provisions in the H.R. 1230, the Committee is not aware of any
points of order against its provisions. The waiver is
prophylactic in nature.
Although the rule waives all points of order against the
amendments printed in Part A and Part B of this report, the
Committee is not aware of any points of order against such
amendments. The waivers are prophylactic in nature.

COMMITTEE VOTES

The results of each record vote on an amendment or motion
to report, together with the names of those voting for and
against, are printed below:

Rules Committee record vote No. 88

Motion by Mr. McGovern to amend the rule to add a new
section at the end of rule to provide for the immediate
consideration, upon the adoption of the rule, of amendment #1,
offered by Reps. McGovern (MA), Blumenauer (OR) and Welch (VT)
as a standalone bill under an open rule. Defeated: 3-9

----------------------------------------------------------------------------------------------------------------
Majority Members Vote Minority Members Vote
----------------------------------------------------------------------------------------------------------------
Mr. Sessions.................................... Nay Mr. McGovern...................... Yea
Ms. Foxx........................................ Nay Mr. Hastings of Florida........... Yea
Mr. Bishop of Utah.............................. Nay Mr. Polis......................... Yea
Mr. Woodall..................................... Nay
Mr. Nugent...................................... Nay
Mr. Scott of South Carolina..................... Nay
Mr. Webster..................................... Nay
Mr. Reed........................................ Nay
Mr. Dreier, Chairman............................ Nay
----------------------------------------------------------------------------------------------------------------

Rules Committee record vote No. 89

Motion by Mr. McGovern to amend the rule to H.R. 1230 to
make in order and provide the appropriate waivers for amendment
#10, offered by Rep. Markey (MA), which would require that
companies bidding on new leases pursuant to H.R. 1230 first
renegotiate any royalty-free leases they own. This amendment
would raise more than $2 billion over 10 years. Defeated: 3-9

Rules Committee record vote No. 90

Motion by Mr. Polis to amend the rule to report an open
rule for consideration of H.R. 1229 and H.R. 1230. Defeated: 3-
9

Rules Committee record vote No. 91

Motion by Mr. Sessions to report one rule for the
consideration of both H.R. 1229 and H.R. 1230, each under a
structured process. Adopted: 9-3

----------------------------------------------------------------------------------------------------------------
Majority Members Vote Minority Members Vote
----------------------------------------------------------------------------------------------------------------
Mr. Sessions.................................... Yea Mr. McGovern...................... Nay
Ms. Foxx........................................ Yea Mr. Hastings of Florida........... Nay
Mr. Bishop of Utah.............................. Yea Mr. Polis......................... Nay
Mr. Woodall..................................... Yea
Mr. Nugent...................................... Yea
Mr. Scott of South Carolina..................... Yea
Mr. Webster..................................... Yea
Mr. Reed........................................ Yea
Mr. Dreier, Chairman............................ Yea
----------------------------------------------------------------------------------------------------------------

SUMMARY OF AMENDMENTS PRINTED IN PART A

1. Polis (CO): Would require safety review of permits to
take into consideration all applicable safety, environmental
and fisheries laws. (10 minutes)
2. Garamendi (CA): Would implement the Commission's
recommendation by requiring that in reviewing a drilling
permit, the Secretary consult with an independent drilling
safety organization not affiliated with the oil industry trade
association. (10 minutes)
3. Markey (MA): Would implement basic offshore drilling
safety reforms recommended by the independent BP spill
commission. The Commission found that the root causes of the BP
spill were ``systematic'' and could have been prevented. The
Markey amendment would set specific new minimum standards for
blow-out preventers, cementing and well design. (10 minutes)
4. Hanabusa (HI): Would state that the Secretary shall not
issue an offshore drilling permit without certifying that the
applicant has calculated a worst-case discharge scenario for
the proposed drilling operations; and has demonstrated to the
satisfaction of the Secretary that the applicant possesses the
capability and technology to respond immediately and
effectively to such worst-case discharge scenario. (10 minutes)
5. Jackson Lee (TX): Would ensure a reasonable period for
review of applications and eliminate the language that could
result in the automatic approval of applications. (10 minutes)
6. Holt (NJ): Would strike a provision in the underlying
bill that would ``deem'' drilling permits approved after 60
days even if the necessary safety and environmental reviews
have not be completed. Would leave in place a timeline for
approving drilling permits, but prevents permits from being
``deemed'' approved before the safety review has been
completed. (10 minutes)
7. Polis (CO): Would lift timeline requirements if the
agency lacks an adequate budget or lacks staff expertise to
properly review permits. (10 minutes)
8. Hastings, Alcee (FL): Would require a detailed
description of the extent to which and by when any oil found on
the leased property will decrease the price of crude oil and at
the pump for hardworking Americans. (10 minutes)
9. Deutch (FL): Would strike section 202 of H.R. 1229, so
that states outside of the 5th Circuit can have their courts
hear civil actions relating to energy projects in the Gulf of
Mexico. (10 minutes)
10. Polis (CO): Would amend bill to emphasize quality of
court decisions instead of speed of court decisions. (10
minutes)
11. Hastings, Alcee (FL): Would strike Section 207, the
limitation on attorneys' fees. (10 minutes)

SUMMARY OF AMENDMENTS PRINTED IN PART B

1. Holt (NJ): Would remove provisions in the bill that
would ``deem'' the safety and environmental review done in
2007, prior to the BP spill, sufficient for new offshore oil
and gas leasing. The amendment would allow lease sales to go
forward, but require new environmental and safety reviews,
following the BP spill. (10 minutes)
2. Connolly (VA), Moran (VA), Sarbanes (MD): Would ensure
that Lease Sale 220 does not interfere with Naval or other DOD
operations. (10 minutes)

PART A--TEXT OF AMENDMENTS MADE IN ORDER

1. An Amendment To Be Offered by Representative Polis of Colorado or
His Designee, Debatable for 10 Minutes

Page 4, strike ``and'' after the semicolon at line 4, strike
the period at line 6 and insert ``; and'', and after line 6
insert the following new subparagraph:
``(C) all requirements of all applicable
statutes and regulations, including the
National Environmental Policy Act of 1969, the
Endangered Species Act of 1973, the Marine
Mammal Protection Act of 1972, and any law
protecting fishing and recreation jobs.
----------

2. An Amendment To Be Offered by Representative Garamendi of California
or His Designee, Debatable for 10 Minutes

Page 4, after line 6, insert the following (and redesignate
accordingly):
``(3) Consultation with independent safety
organization.--In making any determination under
paragraph (2), the Secretary shall consult with one or
more independent safety organizations that are not
affiliated with the American Petroleum Institute.
----------

3. An Amendment To Be Offered by Representative Markey of Massachusetts
or His Designee, Debatable for 10 Minutes

Page 4, after line 6, insert the following (and redesignate
accordingly):
``(3) Other safety and environmental requirements.--
The regulations required under paragraph (1) shall
ensure that the proposed drilling operations meet
requirements for--
``(A) third-party certification of safety
systems related to well control, such as
blowout preventers;
``(B) performance of blowout preventers,
including quantitative risk assessment
standards, subsea testing, and secondary
activation methods;
``(C) independent third-party certification
of well casing and cementing programs and
procedures;
``(D) mandatory safety and environmental
management systems by operators on the outer
Continental Shelf;
``(E) procedures and technologies to be used
during drilling operations to minimize the risk
of ignition and explosion of hydrocarbons; and
``(F) ensuring compliance with other
applicable environmental and natural resource
conservation laws, including the response plan
requirements of section 311(j) of the Federal
Water Pollution Control Act (33 U.S.C.
1321(j)).
``(4) Regulatory standards for blowout preventers,
well design, and cementing.--
``(A) In general.--In promulgating
regulations under this subsection related to
blowout preventers, well design, and cementing,
the Secretary shall ensure that such
regulations include the minimum standards
included in subparagraphs (B), (C), and (D),
unless, after notice and an opportunity for
public comment, the Secretary determines that a
standard required under this subsection would
be less effective in ensuring safe operations
than an available alternative technology or
practice. Such regulations shall require
independent third-party certification, pursuant
to subparagraph (E), of blowout preventers,
well design, and cementing programs and
procedures prior to the commencement of
drilling operations. Such regulations shall
also require recertification by an independent
third-party certifier, pursuant to subparagraph
(E), of a blowout preventer upon any material
modification to the blowout preventer or well
design and of a well design upon any material
modification to the well design.
``(B) Blowout preventers.--Subject to
subparagraph (A), regulations issued under this
subsection for blowout preventers shall include
at a minimum the following requirements:
``(i) Two sets of blind shear rams
appropriately spaced to prevent blowout
preventer failure if a drill pipe joint
or drill tool is across one set of
blind shear rams during a situation
that threatens loss of well control.
``(ii) Redundant emergency backup
control systems capable of activating
the relevant components of a blowout
preventer, including when the
communications link or other critical
links between the drilling rig and the
blowout preventer are destroyed or
inoperable.
``(iii) Regular testing of the
emergency backup control systems,
including testing during deployment of
the blowout preventer.
``(iv) As appropriate, remotely
operated vehicle intervention
capabilities for secondary control of
all subsea blowout preventer functions,
including adequate hydraulic capacity
to activate blind shear rams, casing
shear rams, and other critical blowout
preventer components.
``(v) Technologies to prevent a
blowout preventer failure if the drill
pipe is moved out of position due to a
situation that poses a threat of loss
of well control.
``(C) Well design.--Subject to subparagraph
(A), regulations issued under this subsection
for well design standards shall include at a
minimum the following requirements:
``(i) In connection with the
installation of the final casing
string, the installation of at least
two independent, tested mechanical
barriers, in addition to a cement
barrier, across each flow path between
hydrocarbon bearing formations and the
blowout preventer.
``(ii) That wells shall be designed
so that a failure of one barrier does
not significantly increase the
likelihood of another barrier's
failure.
``(iii) That the casing design is
appropriate for the purpose for which
it is intended under reasonably
expected wellbore conditions.
``(iv) The installation and
verification with a pressure test of a
lockdown device at the time the casing
is installed in the wellhead.
``(D) Cementing.--Subject to subparagraph
(A), regulations issued under this subsection
for cementing standards shall include at a
minimum the following requirements:
``(i) Adequate centralization of the
casing to ensure proper distribution of
cement.
``(ii) A full circulation of drilling
fluids prior to cementing.
``(iii) The use of an adequate volume
of cement to prevent any unintended
flow of hydrocarbons between any
hydrocarbon-bearing formation zone and
the wellhead.
``(iv) Cement bond logs for all
cementing jobs intended to provide a
barrier to hydrocarbon flow.
``(v) Cement bond logs or such other
integrity tests as the Secretary may
prescribe for cement jobs other than
those identified in clause (iv).
``(E) Independent third-party
certification.--The Secretary shall issue
regulations that establish appropriate
standards for the approval of independent
third-party certifiers capable of exercising
certification functions for blowout preventers,
well design, and cementing. For any
certification required for regulations related
to blowout preventers, well design, or
cementing, the operator shall use a qualified
independent third-party certifier chosen by the
Secretary. The costs of any certification shall
be borne by the operator. The regulations
issued under this subparagraph shall require
the following:
``(i) Prior to the commencement of
drilling through a blowout preventer at
any covered well, the operator shall
obtain a written and signed
certification from an independent third
party approved and assigned by the
appropriate Federal official pursuant
to paragraph (3) that the third party--
``(I) conducted or oversaw a
detailed physical inspection,
design review, system
integration test, and function
and pressure testing of the
blowout preventer; and
``(II) in the third-party
certifier's best professional
judgment, determined that--
``(aa) the blowout
preventer is designed
for the specific
drilling conditions,
equipment, and location
where it will be
installed and for the
specific well design;
``(bb) the blowout
preventer and all of
its components and
control systems will
operate effectively and
as designed when
installed;
``(cc) each blind
shear ram or casing
shear ram will function
effectively under
likely emergency
scenarios and is
capable of shearing the
drill pipe or casing,
as applicable, that
will be used when
installed;
``(dd) emergency
control systems will
function under the
conditions in which
they will be installed;
and
``(ee) the blowout
preventer has not been
compromised or damaged
from any previous
service.
``(ii) Not less than once every 180
days after commencement of drilling
through a blowout preventer at any
covered well, or upon implementation of
any material modification to the
blowout preventer or well design at
such a well, the operator shall obtain
a written and signed recertification
from an independent third party
approved and assigned by the
appropriate Federal official pursuant
to paragraph (3) that the requirements
in subclause (II) of clause (i)
continue to be met with the systems as
deployed. Such recertification
determinations shall consider the
results of tests required by the
appropriate Federal official, including
testing of the emergency control
systems of a blowout preventer.
``(iii) Certifications under clause
(i), recertifications under clause (i),
and results of and data from all tests
conducted pursuant to this paragraph
shall be promptly submitted to the
appropriate Federal official and made
publicly available.
``(5) Rulemaking dockets.--
``(A) Establishment.--Not later than the date
of proposal of any regulation under this
subsection, the Secretary shall establish a
publicly available rulemaking docket for such
regulation.
``(B) Documents to be included.--The
Secretary shall include in the docket--
``(i) all written comments and
documentary information on the proposed
rule received from any person in the
comment period for the rulemaking,
promptly upon receipt by the Secretary;
``(ii) the transcript of each public
hearing, if any, on the proposed rule,
promptly upon receipt from the person
who transcribed such hearing; and
``(iii) all documents that become
available after the proposed rule is
published and that the Secretary
determines are of central relevance to
the rulemaking, by as soon as possible
after their availability.
``(C) Proposed and draft final rule and
associated material.--The Secretary shall
include in the docket--
``(i) each draft proposed rule
submitted by the Secretary to the
Office of Management and Budget for any
interagency review process prior to
proposal of such rule, all documents
accompanying such draft, all written
comments thereon by other agencies, and
all written responses to such written
comments by the Secretary, by no later
than the date of proposal of the rule;
and
``(ii) each draft final rule
submitted by the Secretary for such
review process before issuance of the
final rule, all such written comments
thereon, all documents accompanying
such draft, and all written responses
thereto, by no later than the date of
issuance of the final rule.
----------

4. An Amendment To Be Offered by Representative Hanabusa of Hawaii or
Her Designee, Debatable for 10 Minutes

Page 4, after line 6, insert the following (and redesignate
the succeeding paragraph accordingly):
``(3) Worst-case discharge scenario certification.--
The Secretary shall not issue a permit under paragraph
(1) without certifying that the applicant--
``(A) has calculated a worst-case discharge
scenario for the proposed drilling operations;
and
``(B) has demonstrated to the satisfaction of
the Secretary that the applicant possesses the
capability and technology to respond
immediately and effectively to such worst-case
discharge scenario.
----------

5. An Amendment To Be Offered by Representative Jackson Lee of Texas or
Her Designee, Debatable for 10 Minutes

Page 4, line 9, strike ``30'' and insert ``60''.
Page 4, line 12, strike ``15'' and insert ``30''.
Page 5, strike lines 5 through 9 and insert closing quotation
marks and a following period.
----------

6. An Amendment To Be Offered by Representative Holt of New Jersey or
His Designee, Debatable for 10 Minutes

Page 5, strike lines 5 through 9 and insert closing quotation
marks and a following period.
----------

7. An Amendment To Be Offered by Representative Polis of Colorado or
His Designee, Debatable for 10 Minutes

Page 5, strike the closing quotation marks and second period
at line 9, and after line 9 insert the following new
subparagraph:
``(D) This paragraph shall not apply before
the date the Secretary publishes a
determination that the agency or bureau of the
Department of the Interior that administers
this section has been given adequate staff and
budget resources to properly review and process
every application for a permit under this
subsection in order to ensure that no
application is processed without thorough
review.''.
----------

8. An Amendment To Be Offered by Representative Hastings of Florida or
His Designee, Debatable for 10 Minutes

Page 5, line 9, before the closing quotation marks insert the
following:
``(4) Estimations required in permit applications.--
The Secretary shall require that each application for a
permit to drill a well include detailed estimations
of--
``(A) the amount of oil and gas that is
expected--
``(i) to be found in the area where
the well is drilled, in the case of an
exploration well; or
``(ii) to be produced by the well, in
the case of a production well; and
``(B) the amount by which crude oil prices
and consumer prices would be reduced as a
result of oil and gas found or produced by the
well, and by when the reductions would occur.
----------

9. An Amendment To Be Offered by Representative Deutch of Florida or
His Designee, Debatable for 10 Minutes

Page 9, beginning at line 1, strike section 202 (and
redesignate the succeeding sections accordingly).
----------

10. An Amendment To Be Offered by Representative Polis of Colorado or
His Designee, Debatable for 10 Minutes

Page 9, line 11, strike ``EXPEDITION'' and insert ``QUALITY
ABOVE SPEED''.
Page 9, line 14, strike ``expeditiously'' and insert
``justly''.
----------

11. An Amendment To Be Offered by Representative Hastings of Florida or
His Designee, Debatable for 10 Minutes

Page 10, beginning at line 3, strike section 207.

PART B--TEXT OF AMENDMENTS MADE IN ORDER

1. An Amendment To Be Offered by Representative Holt of New Jersey or
His Designee, Debatable for 10 Minutes

Page 3, beginning at line 6, amend sections 2 and 3 to read
as follows:

SEC. 2. REQUIREMENT TO CONDUCT PROPOSED OIL AND GAS LEASE SALE 216 IN
THE CENTRAL GULF OF MEXICO.

The Secretary of the Interior shall conduct offshore oil and
gas lease sale 216 under section 8 of the Outer Continental
Shelf Lands Act (33 U.S.C. 1337) as soon as practicable after
compliance with the National Environmental Policy Act of 1969
(42 U.S.C. 4321 et seq.).

SEC. 3. REQUIREMENT TO CONDUCT PROPOSED OIL AND GAS LEASE SALE 218 IN
THE WESTERN GULF OF MEXICO.

The Secretary of the Interior shall conduct offshore oil and
gas lease sale 218 under section 8 of the Outer Continental
Shelf Lands Act (33 U.S.C. 1337) as soon as practicable after
compliance with the National Environmental Policy Act of 1969
(42 U.S.C. 4321 et seq.).
Page 5, beginning at line 1, amend section 5 to read as
follows:

SEC. 5. REQUIREMENT TO CONDUCT PROPOSED OIL AND GAS LEASE SALE 222 IN
THE CENTRAL GULF OF MEXICO.

The Secretary of the Interior shall conduct offshore oil and
gas lease sale 222 under section 8 of the Outer Continental
Shelf Lands Act (33 U.S.C. 1337) as soon as practicable after
compliance with the National Environmental Policy Act of 1969
(42 U.S.C. 4321 et seq.).
Page 5, beginning at line 15, strike section 6.
----------

2. An Amendment To Be Offered by Representative Connolly of Virginia or
His Designee, Debatable for 10 Minutes

Page 4, beginning at line 19, strike ``if the President,
through the Secretary of Defense, determines that drilling
activity on that tract would create an unreasonable conflict''
and insert ``until the President, in consultation with the
Secretary of Defense, certifies that drilling activity on that
tract would not create a conflict''.