S. 1278 – Reading Mode

114th CONGRESS

1st Session

S. 1278

IN THE SENATE OF THE UNITED STATES

May 11, 2015

Ms. Murkowski introduced the following bill; which was read twice and referred to the Committee on Energy and Natural Resources

A BILL

To amend the Outer Continental Shelf Lands Act to provide for the conduct of certain lease sales in the Alaska outer Continental Shelf region, to make certain modifications to the North Slope Science Initiative, and for other purposes.

Short title

This Act may be cited as the Alaska Outer Continental Shelf Lease Sale Act.

Authorization of Beaufort and Cook Inlet lease sales

Beginning in fiscal year 2016 and each fiscal year thereafter, the Secretary shall conduct under the Outer Continental Shelf Lands Act (43 U.S.C. 1331 et seq.) 1 or more oil and gas lease sales in—

(1)

the Cook Inlet Planning Area; and

(2)

the portion of the Beaufort Planning Area located within 3 nautical miles of the seaward boundary of Alaska.

Lease terms of certain Chukchi and Beaufort leases

(a)

In general

Section 8(b)(2) of the Outer Continental Shelf Lands Act (43 U.S.C. 1337(b)(2)) is amended—

(1)

in subparagraph (A), by striking or at the end;

(2)

in subparagraph (B), by striking ; and inserting ; or; and

(3)

by adding at the end the following:

(C)

in the case of an oil and gas lease in the portion of the Beaufort Planning Area or Chukchi Planning Area that is beyond 3 nautical miles of the seaward boundary of the State of Alaska, 20 years;

(b)

Extension of existing leases

(1)

In general

The Secretary, with the consent of the holder of a covered lease described in paragraph (2), shall extend the initial term of the covered lease to 20 years.

(2)

Description of covered lease

A covered lease referred to in paragraph (1) is a lease for oil and gas production in effect on the date of enactment of this Act that was issued under section 8 of the Outer Continental Shelf Lands Act (43 U.S.C. 1337) for a portion of the Beaufort Planning Area or Chukchi Planning Area that is beyond 3 nautical miles of the seaward boundary of the State.

Distribution of revenue to Alaska

Section 9 of the Outer Continental Shelf Lands Act (43 U.S.C. 1338) is amended—

(1)

by striking All rentals, and inserting the following:

(a)

In general

Except as provided in subsection (b), all rentals,

; and

(2)

by adding at the end the following:

(b)

Distribution of revenue to Alaska

(1)

Definitions

In this subsection:

(A)

Coastal political subdivision

The term coastal political subdivision means a county-equivalent subdivision of the State—

(i)

all or part of which lies within the coastal zone of the State (as defined in section 304 of the Coastal Zone Management Act of 1972 (16 U.S.C. 1453)); and

(ii)

(I)

the closest point of which is not more than 200 nautical miles from the geographical center of any leased tract in the Alaska outer Continental Shelf region; or

(II)

(aa)

the closest point of which is more than 200 nautical miles from the geographical center of a leased tract in the Alaska outer Continental Shelf region; and

(bb)

that is determined by the State to be a significant staging area for oil and gas servicing, supply vessels, operations, suppliers, or workers.

(B)

Institution of higher education

The term institution of higher education has the meaning given the term in section 102 of the Higher Education Act of 1965 (20 U.S.C. 1002).

(C)

Qualified revenues

(i)

In general

The term qualified revenues means all revenues derived from all rentals, royalties, bonus bids, and other sums due and payable to the United States from energy development in the Alaska outer Continental Shelf region.

(ii)

Exclusions

The term qualified revenues does not include revenues generated from leases subject to section 8(g).

(D)

State

The term State means the State of Alaska.

(E)

Workforce investment board

The term workforce investment board means a State or local workforce investment board established under subtitle B of title I of the Workforce Investment Act of 1998 (29 U.S.C. 2811 et seq.).

(2)

Fiscal years 2016–2026

For each of fiscal years 2016 through 2026, the Secretary shall deposit—

(A)

50 percent of qualified revenues in the general fund of the Treasury;

(B)

27.5 percent of qualified revenues in the Treasury, to be used for deficit reduction;

(C)

7.5 percent of qualified revenues in a special account in the Treasury, to be distributed by the Secretary to the State;

(D)

7.5 percent of qualified revenues in a special account in the Treasury, to be distributed by the Secretary to coastal political subdivisions;

(E)

2.5 percent of qualified revenues in a special account in the Treasury, to be used to carry out the North Slope Science Initiative established under section 6(a)(1) of the Alaska Outer Continental Shelf Lease Sale Act;

(F)

2.5 percent of qualified revenues in a special account in the Treasury, to be used by the Secretary to provide grants on a competitive basis to eligible institutions of higher education and workforce investment boards in the State to establish and providing funding for—

(i)

programs to ensure an adequately skilled workforce to construct, operate, or maintain oil or gas pipelines; or

(ii)

programs to ensure an adequately skilled workforce to operate, maintain, and perform all environmental processes relating to existing or future oil and gas infrastructure; and

(G)

2.5 percent of qualified revenues in a special account in the Treasury to provide financial assistance for—

(i)

offshore leasing and development programs in the State; and

(ii)

the development of rights-of-way for pipelines to transport oil or gas produced offshore through land under the jurisdiction of the Secretary in the State.

(3)

Subsequent fiscal years

For fiscal year 2027 and each subsequent fiscal year, the Secretary shall deposit—

(A)

50 percent of qualified revenues in general fund of the Treasury;

(B)

30 percent of qualified revenues in a special account in the Treasury, to be distributed by the Secretary to the State;

(C)

12.5 percent of qualified revenues in the Treasury, to be used for low-income home energy assistance, weatherization programs, and infrastructure in the Arctic; and

(D)

7.5 in a special account in the Treasury, to be distributed by the Secretary to coastal political subdivisions.

(4)

Allocation among coastal political subdivisions

Of the amount paid by the Secretary to coastal political subdivisions under paragraph (2)(D) or (3)(D)—

(A)

90 percent shall be allocated in amounts (based on a formula established by the Secretary by regulation) that are inversely proportional to the respective distances between the point in each coastal political subdivision that is closest to the geographic center of the applicable leased tract and the geographic center of the leased tract; and

(B)

10 percent shall be divided equally among each coastal political subdivision that—

(i)

is more than 200 nautical miles from the geographic center of a leased tract; and

(ii)

the State of Alaska determines to be a significant staging area for oil and gas servicing, supply vessels, operations, suppliers, or workers.

(5)

Timing

The amounts required to be deposited under paragraphs (2) and (3) for the applicable fiscal year shall be made available in accordance with those paragraphs during the fiscal year immediately following the applicable fiscal year.

(6)

Administration

Amounts made available under paragraphs (2) and (3) shall—

(A)

be made available, without further appropriation, in accordance with this subsection;

(B)

remain available until expended; and

(C)

be in addition to any amounts appropriated under any other provision of law.

Inclusion of Beaufort and Chukchi lease sales in 5-year leasing programs

Section 18 of the Outer Continental Shelf Lands Act (43 U.S.C. 1344) is amended by adding at the end the following:

(i)

Inclusion of certain lease sales

The Secretary shall include in any leasing program prepared in accordance with this section provisions for the conduct of at least 3 lease sales in each of the Beaufort Planning Area and the Chukchi Planning Area during the term of the leasing program.

North Slope science initiative

Section 348 of the Energy Policy Act of 2005 (42 U.S.C. 15906) is amended—

(1)

in subsection (a)—

(A)

in paragraph (1), by inserting (referred to in this section as the Secretary) after Secretary of the Interior; and

(B)

in paragraph (2), by inserting (including the Beaufort and Chukchi seas) after North Slope of Alaska;

(2)

in subsection (b)—

(A)

in paragraph (1), by inserting (including the Beaufort and Chukchi seas) after North Slope; and

(B)

in paragraph (2), by striking develop an understanding of and inserting identify; and

(3)

in subsection (c)(2), by inserting the Northwest Arctic Borough, the NANA Regional Corporation, after Arctic Slope Regional Corporation,.