S.Amdt. 846

1. Adds SEC. 347. LEASE EXCHANGES ON THE ROCKY MOUNTAIN FRONT on page 296, line 25

   Adds a sectionPrinted page

   Inserted: SEC. 347. LEASE EXCHANGES ON THE ROCKY MOUNTAIN FRONT.

   Inserted: (a) Findings.--Congress finds that--

   Inserted: (1) the Rocky Mountain Front in the State of Montana, bordered by Glacier National Park, wilderness, and the Blackfeet Indian Reservation, is--

   Inserted: (A) 1 of the last intact wild places in the lower 48 states;

   Inserted: (B) home to prized populations of elk, deer, bighorn sheep, grizzly bears, multiple bird species, and other fish and wildlife; and

   Inserted: (C) highly valued by the local community and the State of Montana as a vital recreation, hunting, and fishing destination;

   Inserted: (2) the Badger-Two Medicine area of the Front is sacred ground to the Blackfeet Indian Tribe;.

   Inserted: (3) past attempts to carry out oil and gas development in the Front have met with limited or no success and as of the date of enactment of this Act it has been more than a decade since any development activity actually occurred in the Front; and

   Inserted: (4) in order to promote and enhance the recovery of the domestic oil and gas reserves of the United States in the most efficient manner possible, Congress should encourage holders of leases in the Front to cancel the leases in exchange for incentives to carry out oil and gas production activities in more readily available and appropriate areas.

   Inserted: (b) Definitions.--In this section:

   Inserted: (1) Badger-two medicine area.--The term "Badger-Two Medicine Area" means the Forest Service land located in--

   Inserted: (A) T. 31 N., R. 12-13 W.;

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   Inserted: (B) T. 30 N., R. 11-13 W.;

   Inserted: (C) T. 29 N., R. 10-16 W.; and

   Inserted: (D) T. 28 N., R. 10-14 W.

   Inserted: (2) Blackleaf area.--The term "Blackleaf Area" means the Federal land owned by the Forest Service and Bureau of Land Management that is located in--

   Inserted: (A) T. 27 N., R. 9 W.;

   Inserted: (B) T. 26 N., R. 9-10 W.;

   Inserted: (C) T. 25 N., R. 8-10 W.; and

   Inserted: (D) T. 24 N., R. 8-9 W.

   Inserted: (3) Eligible lessee.--The term "eligible lessee" means a lessee under a nonproducing lease.

   Inserted: (4) Nonproducing lease.--The term "nonproducing lease" means a Federal oil or gas lease that is--

   Inserted: (A) in existence and in good standing on the date of enactment of this Act; and

   Inserted: (B) located in the Badger-Two Medicine Area or the Blackleaf Area.

   Inserted: (5) Secretary.--The term "Secretary" means the Secretary of the Interior.

   Inserted: (6) State.--The term "State" means the State of Montana.

   Inserted: (c) Opportunities for Cancellation Nonproducing Leases.--

   Inserted: (1) In general.--An eligible lessee may elect to cancel a nonproducing lease in exchange for either--

   Inserted: (A) oil and gas lease tracts of comparable value in the State;

   Inserted: (B) the issuance of bidding, royalty, or rental credits for Federal onshore oil and gas leases in the State equal to the fair market value of the nonproducing lease; or

   Inserted: (C) a tax credit under subsection (e).

   Inserted: (2) Implementing regulations and valuation of nonproducing leases.--For the purpose of evaluating either of the options in subparagraph (A) or (B) of paragraph (1), the Secretary shall, not later than 180 days after the date of enactment of this Act--

   Inserted: (A) issue--

   Inserted: (i) regulations establishing a methodology for determining the fair market value of nonproducing leases, including consideration of established standards and practices in the oil and gas industry; and

   Inserted: (ii) such other regulations as are necessary to carry out this section; and

   Inserted: (B) identify suitable lease tracts available in the State for exchange under paragraph (1).

   Inserted: (3) Effect of cancellation of nonproducing lease.--A nonproducing lease canceled for any reason, including under this Act, shall be permanently withdrawn from future oil and gas leasing activity.

   Inserted: (4) Suspension of leases in the badger-two medicine area.--To facilitate consideration of the options under paragraph (1), the terms of nonproducing leases in the Badger-Two Medicine Area shall be suspended for a 3-year period beginning on the date of enactment of this Act.

   Inserted: (5) Sunset.--The authority provided under this subsection terminates on December 31, 2009.

   Inserted: (d) Grants to Support Sustainable Economic Development.--

   Inserted: (1) In general.--Out of any funds in the Treasury not otherwise appropriated, the Secretary shall use $5,000,000 to make a grant in that amount to Teton County, Montana.

   Inserted: (2) Use of grant funds.--The grant recipient shall use the grant funds to support sustainable economic development in Teton County.

   Inserted: (e) Tax Credit.--

   Inserted: (1) In general.--In the case of an eligible lessee who makes an election under subsection (c), there shall be allowed as a credit against the tax imposed by chapter 1 of the Internal Revenue Code of 1986 for the taxable year an amount equal to the fair market value of a nonproducing lease which is canceled pursuant to this section.

   Inserted: (2) Carryforward of unused credit.--If the credit allowable under paragraph (1) for any taxable year exceeds the limitation imposed by section 26(a) of the Internal Revenue Code of 1986 for such taxable year reduced by the sum of the credits allowable under subpart A of part IV of chapter 1 of such Code, such excess shall be carried to the succeeding taxable year and added to the credit allowable under paragraph (1) for such taxable year.

   Inserted: (3) Valuation of lease.--For purposes of this subsection, the fair market value of a nonproducing lease shall be determined by the Secretary of the Treasury in consultation with the Secretary of the Interior, based on the regulation under subsection (c)(2).

   Inserted: (f) Authorization of Appropriations.--There are authorized to be appropriated such sums as are necessary to carry out this section.

   Original wording

   On page 296, after line 25, add the following:

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As printed