CHAPTER 5 STREAMLINING FEDERAL AGENCY REVIEW OF PERMITS TO DRILL AND OTHER OIL AND GAS USE AUTHORIZATIONS; MANDATES AND TIMEFRAMES FOR AGENCY RULEMAKING, STUDIES, AND MEMORANDA OF UNDERSTANDING
| Jurisdiction | United States |
(Oct 2005)
STREAMLINING FEDERAL AGENCY REVIEW OF PERMITS TO DRILL AND OTHER OIL AND GAS USE AUTHORIZATIONS; MANDATES AND TIMEFRAMES FOR AGENCY RULEMAKING, STUDIES, AND MEMORANDA OF UNDERSTANDING
Principal Deputy Assistant Secretary for Land and Minerals Management
U.S. Department of the Interior
Washington, D.C.
Peter J. Schaumberg
Deputy Associate Solicitor
Division of Mineral Resources
U.S. Department of the Interior
Washington, D.C.
Chad Calvert is Principal Deputy Assistant Secretary for Land and Minerals Management, U.S. Department of the Interior, Washington, D.C. He was a member of the Bush-Cheney transition team, where he worked on Interior policy and coordinated outreach with external groups. He also assisted in preparing the Secretary of the Interior for her Senate confirmation hearings and has worked with each of the presidential appointees at Interior to get them through their confirmations.
As one of the Bush administration's earliest appointees to the Department, Calvert has been serving as deputy director of the Office of Congressional and Legislative Affairs since January 2001. In that post he assisted the Secretary of the Interior and the Director of Congressional Affairs in liaison activities with congressional committees and members of Congress. He coordinated departmental legislative policy with the Assistant Secretary for Land and Minerals Management and the Assistant Secretary for Indian Affairs, with their Bureau Directors and with the Office of Management and Budget.
Calvert previously served as director of the U.S. House Western Caucus, an organization of 58 house members. He also served as senior legislative assistant to Sen. Mike Enzi (R-WY), where he was engaged in energy, environmental and resource issues and served as legislative assistant and legislative director for Sen.
Alan Simpson (R-WY).
Calvert is a graduate of Georgetown University and he is currently enrolled at George Mason University Law School.
Peter J. Schaumberg is Deputy Associate Solicitor for the Division of Mineral Resources at the U.S. Department of the Interior in Washington, D.C. He joined the Solicitor's Office in 1981, and is a principal legal advisor to the Minerals Management Service, the Bureau of Land Management and the Office of Surface Mining.
He received his B.A. degree from Tulane University in 1972, and his J.D. from George Washington National Law Center in 1975.
He is a member of the bar of the District of Columbia and the Supreme Court.
Selections from Energy Policy Act of 2005, Pub. L. 109-58:
Sec. 225. COORDINATION OF GEOTHERMAL LEASING AND PERMITTING ON FEDERAL LANDS.
(a) In General.--Not later than 180 days after the date of enactment of this section, the Secretary of the Interior and the Secretary of Agriculture shall enter into and submit to Congress a memorandum of understanding in accordance with this section, the Geothermal Steam Act of 1970 (as amended by this Act), and other applicable laws, regarding coordination of leasing and permitting for geothermal development of public lands and National Forest System lands under their respective jurisdictions.
(b) Lease and Permit Applications.--The memorandum of understanding shall--
(1) establish an administrative procedure for processing geothermal lease applications, including lines of authority, steps in application processing, and time limits for application procession;
(2) establish a 5-year program for geothermal leasing of lands in the National Forest System, and a process for updating that program every 5 years; and
(3) establish a program for reducing the backlog of geothermal lease application pending on January 1, 2005, by 90 percent within the 5-year period beginning on the date of enactment of this Act, including, as necessary, by issuing leases, rejecting lease applications for failure to comply with the provisions of the regulations under which they were filed, or determining that an original applicant (or the applicant's assigns, heirs, or estate) is no longer interested in pursuing the lease application.
(c) Data Retrieval System.--The memorandum of understanding shall establish a joint data retrieval system that is capable of tracking lease and permit applications and providing to the applicant information as to their status within the Departments of the Interior and Agriculture, including an estimate of the time required for administrative action.
Sec. 343. MARGINAL PROPERTY PRODUCTION INCENTIVES.
(a) Definition of Marginal Property.--Until such time as the Secretary issues regulations under subsection (e) that prescribe a different definition, in this section, the term "marginal property" means an onshore unit, communitization agreement, or lease not within a unit or communitization agreement, that produces on average the combined equivalent of less than 15 barrels of oil per well per day or 90,000,000 British thermal units of gas per well per day calculated based on the average over the 3 most recent production months, including only wells that produce on more than half of the days during those 3 production months.
(b) Conditions for Reduction of Royalty Rate.--Until such time as the Secretary issues regulations under subsection (e) that prescribe different standards or requirements, the Secretary shall reduce the royalty rate on--
(1) oil production from marginal properties as prescribed in subsection (c) if the spot price of West Texas Intermediate crude oil at Cushing, Oklahoma, is, on average, less than $ 15 per barrel (adjusted in accordance with the Consumer Price Index for all-urban consumers, United States city average, as published by the Bureau of Labor Statistics) for 90 consecutive trading days; and
(2) gas production from marginal properties as prescribed in subsection (c) if the spot price of natural gas delivered at Henry Hub, Louisiana, is, on average, less than $ 2.00 per million British thermal units (adjusted in accordance with the Consumer Price Index for all-urban consumers, United States city average, as published by the Bureau of Labor Statistics) for 90 consecutive trading days.
(c) Reduced Royalty Rate.--
(1) In general.-- When a marginal property meets the conditions specified in subsection (b), the royalty rate shall be the lesser of--
(A) 5 percent; or
(B) the applicable rate under any other statutory or regulatory royalty relief provision that applies to the affected production.
(2) Period of effectiveness.-- The reduced royalty rate under this subsection shall be effective beginning on the first day of the production month following the date on which the applicable condition specified in subsection (b) is met.
(d) Termination of Reduced Royalty Rate.--A royalty rate prescribed in subsection (c)(1) shall terminate--
(1) with respect to oil production from a marginal property, on the first day of the production month following the date on which--
(A) the spot price of West Texas Intermediate crude oil at Cushing, Oklahoma, on average, exceeds $ 15 per barrel (adjusted in accordance with the Consumer Price Index for all-urban consumers, United States city average, as published by the Bureau of Labor Statistics) for 90 consecutive trading days; or
(B) the property no longer qualifies as a marginal property; and
(2) with respect to gas production from a marginal property, on the first day of the production month following the date on which--
(A) the spot price of natural gas delivered at Henry Hub, Louisiana, on average, exceeds $ 2.00 per million British thermal units (adjusted in accordance with the Consumer Price Index for all-urban consumers, United States city average, as published by the Bureau of Labor Statistics) for 90 consecutive trading days; or
(B) the property no longer qualifies as a marginal property.
(e) Regulations Prescribing Different Relief.--
(1) Discretionary regulations.-- The Secretary may by regulation prescribe different parameters, standards, and requirements for, and a different degree or extent of, royalty relief for marginal properties in lieu of those prescribed in subsections (a) through (d).
(2) Mandatory regulations.-- Unless a determination is made under paragraph (3), not later than 18 months after the date of enactment of this Act, the Secretary shall by regulation--
(A) prescribe standards and requirements for, and the extent of royalty relief for, marginal properties for oil and gas leases on the outer Continental Shelf; and
(B) define what constitutes a marginal property on the outer Continental Shelf for purposes of this section.
(3) Report.-- To the extent the Secretary determines that it is not practicable to issue the regulations referred to in paragraph (2), the Secretary shall provide a report to Congress explaining such determination by not later than 18 months after the date of enactment of this Act.
(4) Considerations.-- In issuing regulations under this subsection, the Secretary may consider--
(A) oil and gas prices and market trends;
(B) production costs;
(C) abandonment costs;
(D) Federal and State tax provisions and the effects of those provisions on production economics;
(E) other royalty relief programs;
(F) regional differences in average wellhead prices;
(G) national energy security issues; and
(H) other relevant matters, as determined by the Secretary.
(f) Savings Provision.--Nothing in this section prevents a lessee from receiving royalty relief or a royalty reduction pursuant to any other law (including a regulation) that provides more relief than the amounts provided by this section.
Sec. 361. FEDERAL ONSHORE OIL AND GAS LEASING AND PERMITTING PRACTICES.
(a) Review of Onshore Oil and Gas Leasing Practices.--
(1) In general.-- The Secretary of the Interior, in consultation with the Secretary of Agriculture with respect to National Forest System lands under the jurisdiction...
To continue reading
Request your trial