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112th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     112-395

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



 
              ENERGY SECURITY AND TRANSPORTATION 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. 3410]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Natural Resources, to whom was referred 
the bill (H.R. 3410) to require the Secretary of the Interior 
to conduct certain offshore oil and gas lease sales, to provide 
fair and equitable revenue sharing for all coastal States, to 
formulate future offshore energy development plans in areas 
with the most potential, to generate revenue for American 
infrastructure, 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 ``Energy Security and Transportation 
Jobs Act''.

SEC. 2. TABLE OF CONTENTS.

  The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.

             TITLE I--EXPANDING OFFSHORE ENERGY DEVELOPMENT

Sec. 101. Outer Continental Shelf leasing program.
Sec. 102. Domestic oil and natural gas production goal.

            TITLE II--CONDUCTING PROMPT OFFSHORE LEASE SALES

Sec. 201. Requirement to conduct proposed oil and gas Lease Sale 216 in 
the Central Gulf of Mexico.
Sec. 202. Requirement to conduct proposed oil and gas Lease Sale 220 on 
the Outer Continental Shelf offshore Virginia.
Sec. 203. Requirement to conduct oil and gas lease Sale 222 in the 
Central Gulf of Mexico.
Sec. 204. Lease sale offshore California with no new offshore impact.
Sec. 205. Requirement to conduct oil and gas Lease Sale 214 in the 
North Aleutian Basin offshore Alaska.
Sec. 206. Additional leases.
Sec. 207. Definitions.

                TITLE III--LEASING IN NEW OFFSHORE AREAS

Sec. 301. Leasing in the Eastern Gulf of Mexico.
Sec. 302. Reforming oil and gas leasing in the Eastern Gulf of Mexico.
Sec. 303. Areas added to Central Gulf of Mexico Planning Area.
Sec. 304. Application of Outer Continental Shelf Lands Act with respect 
to territories of the United States.

           TITLE IV--OUTER CONTINENTAL SHELF REVENUE SHARING

Sec. 401. Disposition of Outer Continental Shelf revenues to coastal 
States.

                   TITLE V--MISCELLANEOUS PROVISIONS

Sec. 501. Policies regarding buying, building, and working for America.
Sec. 502. Regulations.

             TITLE I--EXPANDING OFFSHORE ENERGY DEVELOPMENT

SEC. 101. OUTER CONTINENTAL SHELF LEASING PROGRAM.

  Section 18(a) of the Outer Continental Shelf Lands Act (43 U.S.C. 
1344(a)) is amended by adding at the end the following:
          ``(5)(A) In each oil and gas leasing program under this 
        section, the Secretary shall make available for leasing and 
        conduct lease sales including--
                  ``(i) at least 50 percent of the available unleased 
                acreage within each outer Continental Shelf planning 
                area considered to have the largest undiscovered, 
                technically recoverable oil and gas resources (on a 
                total btu basis) based upon the most recent national 
                geologic assessment of the outer Continental Shelf, 
                with an emphasis on offering the most geologically 
                prospective parts of the planning area; and
                  ``(ii) any State subdivision of an outer Continental 
                Shelf planning area that the Governor of the State that 
                represents that subdivision requests be made available 
                for leasing.
          ``(B) In this paragraph the term `available unleased acreage' 
        means that portion of the outer Continental Shelf that is not 
        under lease at the time of a proposed lease sale, and that has 
        not otherwise been made unavailable for leasing by law.
          ``(6)(A) In the 2012-2017 5-year oil and gas leasing program, 
        the Secretary shall make available for leasing any outer 
        Continental Shelf planning areas that--
                  ``(i) are estimated to contain more than 
                2,500,000,000 barrels of oil; or
                  ``(ii) are estimated to contain more than 
                7,500,000,000,000 cubic feet of natural gas.
          ``(B) To determine the planning areas described in 
        subparagraph (A), the Secretary shall use the document entitled 
        `Minerals Management Service Assessment of Undiscovered 
        Technically Recoverable Oil and Gas Resources of the Nation's 
        Outer Continental Shelf, 2006'.''.

SEC. 102. DOMESTIC OIL AND NATURAL GAS PRODUCTION GOAL.

  Section 18(b) of the Outer Continental Shelf Lands Act (43 U.S.C. 
1344(b)) is amended to read as follows:
  ``(b) Domestic Oil and Natural Gas Production Goal.---
          ``(1) In general.--In developing a 5-year oil and gas leasing 
        program, and subject to paragraph (2), the Secretary shall 
        determine a domestic strategic production goal for the 
        development of oil and natural gas as a result of that program. 
        Such goal shall be--
                  ``(A) the best estimate of the possible increase in 
                domestic production of oil and natural gas from the 
                outer Continental Shelf;
                  ``(B) focused on meeting domestic demand for oil and 
                natural gas and reducing the dependence of the United 
                States on foreign energy; and
                  ``(C) focused on the production increases achieved by 
                the leasing program at the end of the 15-year period 
                beginning on the effective date of the program.
          ``(2) 2012-2017 program goal.--For purposes of the 2012-2017 
        5-year oil and gas leasing program, the production goal 
        referred to in paragraph (1) shall be an increase by 2027, from 
        the levels of oil and gas produced as of the date of enactment 
        of this paragraph, of--
                  ``(A) no less than 3,000,000 barrels in the amount of 
                oil produced per day; and
                  ``(B) no less than 10,000,000,000 cubic feet in the 
                amount of natural gas produced per day.
          ``(3) Reporting.--The Secretary shall report annually, 
        beginning at the end of the 5-year period for which the program 
        applies, to the Committee on Natural Resources of the House of 
        Representatives and the Committee on Energy and Natural 
        Resources of the Senate on the progress of the program in 
        meeting the production goal. The Secretary shall identify in 
        the report projections for production and any problems with 
        leasing, permitting, or production that will prevent meeting 
        the goal.''.

            TITLE II--CONDUCTING PROMPT OFFSHORE LEASE SALES

SEC. 201. REQUIREMENT TO CONDUCT PROPOSED OIL AND GAS LEASE SALE 216 IN 
                    THE CENTRAL GULF OF MEXICO.

  (a) In General.--The Secretary of the Interior shall conduct offshore 
oil and gas Lease Sale 216 under section 8 of the Outer Continental 
Shelf Lands Act (43 U.S.C. 1337) as soon as practicable, but not later 
than 4 months after the date of enactment of this Act.
  (b) Environmental Review.--For the purposes of that lease sale, the 
Environmental Impact Statement for the 2007-2012 5 Year Outer 
Continental Shelf Plan and the Multi-Sale Environmental Impact 
Statement are deemed to satisfy the requirements of the National 
Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.).

SEC. 202. REQUIREMENT TO CONDUCT PROPOSED OIL AND GAS LEASE SALE 220 ON 
                    THE OUTER CONTINENTAL SHELF OFFSHORE VIRGINIA.

  (a) In General.--Notwithstanding the inclusion of Lease Sale 220 in 
the Proposed Outer Continental Shelf Oil & Gas Leasing Program 2012-
2017, the Secretary shall conduct offshore oil and gas Lease Sale 220 
under section 8 of the Outer Continental Shelf Lands Act (43 U.S.C. 
1337) as soon as practicable, but not later than one year after the 
date of enactment of this Act.
  (b) Requirement to Make Replacement Lease Blocks Available.--
          (1) In general.--For each lease block in a proposed lease 
        sale under this section for which the Secretary of Defense, in 
        consultation with the Secretary of the Interior, under the 
        Memorandum of Agreement referred to in subsection (c)(2), 
        issues a statement proposing deferral from a lease offering due 
        to defense-related activities that are irreconcilable with 
        mineral exploration and development, the Secretary of the 
        Interior, in consultation with the Secretary of Defense, shall 
        make available in the same lease sale two other lease blocks in 
        the Virginia lease sale planning area that are acceptable for 
        oil and gas exploration and production in order to mitigate 
        conflict.
          (2) Virginia lease sale planning area defined.--In this 
        subsection the term ``Virginia lease sale planning area'' means 
        the area of the outer Continental Shelf (as that term is 
        defined in the Outer Continental Shelf Lands Act (33 U.S.C. 
        1331 et seq.)) that is bounded by--
                  (A) a northern boundary consisting of a straight line 
                extending from the northernmost point of Virginia's 
                seaward boundary to the point on the seaward boundary 
                of the United States exclusive economic zone located at 
                37 degrees 17 minutes 1 second North latitude, 71 
                degrees 5 minutes 16 seconds West longitude; and
                  (B) a southern boundary consisting of a straight line 
                extending from the southernmost point of Virginia's 
                seaward boundary to the point on the seaward boundary 
                of the United States exclusive economic zone located at 
                36 degrees 31 minutes 58 seconds North latitude, 71 
                degrees 30 minutes 1 second West longitude.
  (c) Balancing Military and Energy Production Goals.--
          (1) Joint goals.--In recognition that the Outer Continental 
        Shelf oil and gas leasing program and the domestic energy 
        resources produced therefrom are integral to national security, 
        the Secretary of the Interior and the Secretary of Defense 
        shall work jointly in implementing this section in order to 
        ensure achievement of the following common goals:
                  (A) Preserving the ability of the Armed Forces of the 
                United States to maintain an optimum state of readiness 
                through their continued use of the Outer Continental 
                Shelf.
                  (B) Allowing effective exploration, development, and 
                production of our Nation's oil, gas, and renewable 
                energy resources.
          (2) Prohibition on conflicts with military operations.--No 
        person may engage in any exploration, development, or 
        production of oil or natural gas off the coast of Virginia that 
        would conflict with any military operation, as determined in 
        accordance with the Memorandum of Agreement between the 
        Department of Defense and the Department of the Interior on 
        Mutual Concerns on the Outer Continental Shelf signed July 20, 
        1983, and any revision or replacement for that agreement that 
        is agreed to by the Secretary of Defense and the Secretary of 
        the Interior after that date but before the date of issuance of 
        the lease under which such exploration, development, or 
        production is conducted.

SEC. 203. REQUIREMENT TO CONDUCT OIL AND GAS LEASE SALE 222 IN THE 
                    CENTRAL GULF OF MEXICO.

  (a) In General.--The Secretary shall conduct offshore oil and gas 
Lease Sale 222 under section 8 of the Outer Continental Shelf Lands Act 
(43 U.S.C. 1337) by as soon as practicable, but not later than 
September 1, 2012.
  (b) Environmental Review.--For the purposes of that lease sale, the 
Environmental Impact Statement for the 2007-2012 5 Year Outer 
Continental Shelf Plan and the Multi-Sale Environmental Impact 
Statement are deemed to satisfy the requirements of the National 
Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.).

SEC. 204. LEASE SALE OFFSHORE CALIFORNIA WITH NO NEW OFFSHORE IMPACT.

  (a) Southern California Lease Sale.--The Secretary shall offer for 
sale leases of tracts in the Southern California Planning Area in the 
Santa Maria and Santa Barbara/Ventura Basins in accordance with section 
8 of the Outer Continental Shelf Lands Act (43 U.S.C. 1337) as soon as 
practicable, but not later than July 1, 2014.
  (b) Use of Existing Structures or Onshore-based Drilling.--Leases 
offered for sale under this section shall include such terms and 
conditions as are necessary to require that development and production 
may occur only from existing offshore infrastructure or from onshore-
based drilling.
  (c) Relationship to Leasing Program.--Areas shall be offered for 
lease under this section notwithstanding the omission of the Southern 
California Planning Area from any outer Continental Shelf leasing 
program under section 18 of the Outer Continental Shelf Lands Act (43 
U.S.C. 1344).
  (d) Relationship to State Coastal Zone Management Program.--Section 
307(c) of the Coastal Zone Management Act of 1972 (16 U.S.C. 1456(c)) 
shall not apply to lease sales under this section and activities 
conducted under leases issued in such sales, including exploration, 
development, and production.
  (e) Environmental Impact Statement Requirement.--
          (1) In general.--Before conducting the first lease sale under 
        this section, the Secretary shall prepare an environmental 
        impact statement for the lease sales required under this 
        section, under section 102 of the National Environmental Policy 
        Act of 1969 (42 U.S.C. 4332).
          (2) Actions to be considered.--
                  (A) In general.--Notwithstanding section 102 of the 
                National Environmental Policy Act of 1969 (42 U.S.C. 
                4332), in such statement--
                          (i) the Secretary is not required to identify 
                        nonleasing alternative courses of action or to 
                        analyze the environmental effects of such 
                        alternative courses of action; and
                          (ii) the Secretary shall only--
                                  (I) identify a preferred action for 
                                leasing and not more than one 
                                alternative leasing proposal; and
                                  (II) analyze the environmental 
                                effects and potential mitigation 
                                measures for such preferred action and 
                                such alternative leasing proposal.
                  (B) Deadline.--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.
          (3) Consideration of public comments.--In preparing such 
        statement, 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.
          (4) Compliance.--Compliance with this subsection is deemed to 
        satisfy all requirements for the analysis and consideration of 
        the environmental effects of proposed leasing under this 
        section.

SEC. 205. REQUIREMENT TO CONDUCT OIL AND GAS LEASE SALE 214 IN THE 
                    NORTH ALEUTIAN BASIN OFFSHORE ALASKA.

  (a) In General.--The Secretary of the Interior shall conduct the 
lease sale formerly known as Lease Sale 214, for the tracts located in 
the North Aleutian Basin Outer Continental Shelf Planning Area, not 
later than 1 year after the date of enactment of this Act.
  (b) Relationship to Leasing Program.--Areas shall be offered for 
lease under this section notwithstanding inclusion of areas referred to 
in subsection (a) in the Proposed Outer Continental Shelf Oil & Gas 
Leasing Program 2012-2017.

SEC. 206. ADDITIONAL LEASES.

  Section 18 of the Outer Continental Shelf Lands Act (43 U.S.C. 1344) 
is amended by adding at the end the following:
  ``(i) Additional Lease Sales.--In addition to lease sales in 
accordance with a leasing program in effect under this section, the 
Secretary may hold lease sales for areas identified by the Secretary to 
have the greatest potential for new oil and gas development as a result 
of local support, new seismic findings, or nomination by interested 
persons.''.

SEC. 207. DEFINITIONS.

  In this title:
          (1) The term ``Environmental Impact Statement for the 2007-
        2012 5 Year Outer Continental Shelf Plan'' means the Final 
        Environmental Impact Statement for Outer Continental Shelf Oil 
        and Gas Leasing Program: 2007-2012 (April 2007) prepared by the 
        Secretary.
          (2) The term ``Multi-Sale Environmental Impact Statement'' 
        means the Environmental Impact Statement for Proposed Western 
        Gulf of Mexico Outer Continental Shelf Oil and Gas Lease Sales 
        204, 207, 210, 215, and 218, and Proposed Central Gulf of 
        Mexico Outer Continental Shelf Oil and Gas Lease Sales 205, 
        206, 208, 213, 216, and 222 (September 2008) prepared by the 
        Secretary.
          (3) The term ``Secretary'' means the Secretary of the 
        Interior.

                TITLE III--LEASING IN NEW OFFSHORE AREAS

SEC. 301. LEASING IN THE EASTERN GULF OF MEXICO.

  Section 104 of division C of the Tax Relief and Health Care Act of 
2006 (Public Law 109-432; 120 Stat. 3003) is repealed.

SEC. 302. REFORMING OIL AND GAS LEASING IN THE EASTERN GULF OF MEXICO.

  (a) Reforming Administrative Boundaries.--Effective July 1, 2012, for 
purposes of administering the Outer Continental Shelf Lands Act (43 
U.S.C. 1331 et seq.) the boundary between the Central Gulf of Mexico 
Outer Continental Shelf Planning Area and the Eastern Gulf of Mexico 
Outer Continental Shelf Planning Area shall be 86 degrees, 41 minutes 
west longitude.
  (b) Extending the Moratorium.--Effective during the period beginning 
on the date of enactment of this Act and ending June 30, 2025, the 
Secretary of the Interior shall not offer for leasing, preleasing, or 
any related activity any area in the Eastern Gulf of Mexico Outer 
Continental Shelf Planning Area except as required under subsection 
(c).
  (c) Limited New Leasing in the Eastern Gulf of Mexico.--
          (1) In general.--Notwithstanding the Proposed Outer 
        Continental Shelf Oil & Gas Leasing Program 2012-2017, the 
        Secretary shall conduct planning and leasing for one lease sale 
        in the Eastern Gulf of Mexico Outer Continental Shelf Planning 
        Area in each of 2013, 2014, and 2015. Each lease sale shall 
        only consist of 50 contiguous Outer Continental Shelf lease 
        blocks in those areas the Secretary considers to have the 
        greatest potential for oil and gas after issuing a request for, 
        receiving, and considering public comment. In reviewing 
        potential areas for such leasing, the Secretary shall focus on 
        those areas for which there are known quantities of 
        hydrocarbons that can be conventionally produced using existing 
        or reasonably foreseeable technology, and for which oil and gas 
        exploration, development, production, and marketing could be 
        carried out in an expeditious manner.
          (2) Lease conditions.--In addition to such requirements as 
        otherwise apply, each lease sale under this subsection shall be 
        subject to the following:
                  (A) The Secretary may include limits on permanent 
                surface occupancy on any lease block if surface 
                occupancy is incompatible with military operations.
                  (B) The Secretary may include limits on drilling 
                schedules and surface occupancy to accommodate defense 
                activities on a short-term or seasonal basis. Such 
                limits shall be treated as administrative suspensions 
                of a lease term.
                  (C) The Secretary may limit permanent surface 
                infrastructure on any Outer Continental Shelf lease 
                block that is closer than 12 nautical miles to the 
                coast of any State, unless that infrastructure is 
                approved by the State.
  (d) Requirement to Make Replacement Lease Blocks Available.--For each 
lease block in a proposed lease sale under this section for which the 
Secretary of Defense, in consultation with the Secretary of the 
Interior, under the Memorandum of Agreement referred to in subsection 
(e)(2) issues a statement proposing deferral from a lease offering due 
to defense-related activities that are irreconcilable with mineral 
exploration and development, the Secretary of the Interior, in 
consultation with the Secretary of Defense, shall make available in the 
same lease sale two other lease blocks in the same Outer Continental 
Shelf planning area that are acceptable for oil and gas exploration and 
production in order to mitigate conflict.
  (e) Balancing Military and Energy Production Goals.--
          (1) Joint goals.--In recognition that the Outer Continental 
        Shelf oil and gas leasing program and the domestic energy 
        resources produced therefrom are integral to national security, 
        the Secretary of the Interior and the Secretary of Defense 
        shall work jointly in implementing this section in order to 
        ensure achievement of the goals of--
                  (A) preserving the ability of the Armed Forces of the 
                United States to maintain an optimum state of readiness 
                through their continued use of the Outer Continental 
                Shelf; and
                  (B) allowing effective exploration, development, and 
                production of our Nation's oil, gas, and renewable 
                energy resources.
                  (C) recognizing the Outer Continental Shelf oil and 
                gas leasing program is an integral part of the Nation's 
                energy security program to develop domestic oil and gas 
                resources.
          (2) Prohibition on conflicts with military operations.--No 
        person may engage in any exploration, development, or 
        production of oil or natural gas in the Eastern Gulf of Mexico 
        Outer Continental Shelf Planning Area that would conflict with 
        any military operation, as determined in accordance with the 
        Memorandum of Agreement between the Department of Defense and 
        the Department of the Interior on Mutual Concerns on the Outer 
        Continental Shelf signed July 20, 1983, and any revision or 
        replacement for that agreement that is agreed to by the 
        Secretary of Defense and the Secretary of the Interior after 
        that date but before the date of issuance of the lease under 
        which such exploration, development, or production is 
        conducted.

SEC. 303. AREAS ADDED TO CENTRAL GULF OF MEXICO PLANNING AREA.

  The Secretary shall conduct an offshore oil and gas lease sale under 
section 8 of the Outer Continental Shelf Lands Act (43 U.S.C. 1337) for 
the areas added to the Central Gulf of Mexico Outer Continental Shelf 
Planning Area as a result of the enactment of section 302(a) as soon as 
practicable, but not later than the first lease sale under such section 
after the date of the enactment of this Act in which any area in such 
planning area is made available for leasing.

SEC. 304. APPLICATION OF OUTER CONTINENTAL SHELF LANDS ACT WITH RESPECT 
                    TO TERRITORIES OF THE UNITED STATES.

  Section 2 of the Outer Continental Shelf Lands Act (43 U.S.C. 1331) 
is amended--
          (1) in paragraph (a), by inserting after ``control'' the 
        following: ``or lying within the United States' exclusive 
        economic zone and the Continental Shelf adjacent to any 
        territory of the United States''; and
          (2) in paragraph (p), by striking ``and'' after the semicolon 
        at the end;
          (3) in paragraph (q), by striking the period at the end and 
        inserting ``; and''; and
          (4) by adding at the end the following:
  ``(r) The term `State' includes each territory of the United 
States.''.

           TITLE IV--OUTER CONTINENTAL SHELF REVENUE SHARING

SEC. 401. DISPOSITION OF OUTER CONTINENTAL SHELF REVENUES TO COASTAL 
                    STATES.

  (a) In General.--Section 9 of the Outer Continental Shelf Lands Act 
(43 U.S.C. 1338) is amended--
          (1) in the existing text--
                  (A) in the first sentence, by striking ``All 
                rentals,'' and inserting the following:
  ``(c) Disposition of Revenue Under Old Leases.--All rentals,''; and
                  (B) in subsection (c) (as designated by the amendment 
                made by subparagraph (A) of this paragraph), by 
                striking ``for the period from June 5, 1950, to date, 
                and thereafter'' and inserting ``in the period 
                beginning June 5, 1950, and ending on the date of 
                enactment of the Energy Security and Transportation 
                Jobs Act'';
          (2) by adding after subsection (c) (as so designated) the 
        following:
  ``(d)  Definitions.--In this section:
          ``(1) Coastal state.--The term `coastal State' includes a 
        territory of the United States.
          ``(2) New leasing revenues.--The term `new leasing 
        revenues'--
                  ``(A) means amounts received by the United States as 
                bonuses, rents, and royalties under leases for oil and 
                gas, wind, tidal, or other energy exploration, 
                development, and production on areas of the outer 
                Continental Shelf that are authorized to be made 
                available for leasing as a result of enactment of the 
                Energy Security and Transportation Jobs Act; and
                  ``(B) does not include amounts received by the United 
                States under any lease of an area located in the 
                boundaries of the Central Gulf of Mexico and Western 
                Gulf of Mexico Outer Continental Shelf Planning Areas 
                on the date of the enactment of the Energy Security and 
                Transportation Jobs Act, including a lease issued 
                before, on, or after such date of enactment.''; and
          (3) by inserting before subsection (c) (as so designated) the 
        following:
  ``(a) Payment of New Leasing Revenues to Coastal States.--
          ``(1) In general.--Except as provided in paragraph (2), of 
        the amount of new leasing revenues received by the United 
        States each fiscal year, 37.5 percent shall be allocated and 
        paid in accordance with subsection (b) to coastal States that 
        are affected States with respect to the leases under which 
        those revenues are received by the United States.
          ``(2) Phase-in.--Paragraph (1) shall be applied--
                  ``(A) with respect to new leasing revenues under 
                leases awarded under the first leasing program under 
                section 18(a) that takes effect after the date of 
                enactment of the Energy Security and Transportation 
                Jobs Act, by substituting `12.5 percent' for `37.5 
                percent'; and
                  ``(B) with respect to new leasing revenues under 
                leases awarded under the second leasing program under 
                section 18(a) that takes effect after the date of 
                enactment of the Energy Security and Transportation 
                Jobs Act, by substituting `25 percent' for `37.5 
                percent'.
  ``(b) Allocation of Payments.--
          ``(1) In general.--The amount of new leasing revenues 
        received by the United States with respect to a leased tract 
        that are required to be paid to coastal States in accordance 
        with this subsection each fiscal year shall be allocated among 
        and paid to coastal States that are within 200 miles of the 
        leased tract, in amounts that are inversely proportional to the 
        respective distances between the point on the coastline of each 
        such State that is closest to the geographic center of the 
        lease tract, as determined by the Secretary.
          ``(2) Minimum and maximum allocation.--The amount allocated 
        to a coastal State under paragraph (1) each fiscal year with 
        respect to a leased tract shall be--
                  ``(A) in the case of a coastal State that is the 
                nearest State to the geographic center of the leased 
                tract, not less than 25 percent of the total amounts 
                allocated with respect to the leased tract;
                  ``(B) in the case of any other coastal State, not 
                less than 10 percent, and not more than 15 percent, of 
                the total amounts allocated with respect to the leased 
                tract; and
                  ``(C) in the case of a coastal State that is the only 
                coastal State within 200 miles of a least tract, 100 
                percent of the total amounts allocated with respect to 
                the leased tract.
          ``(3) Administration.--Amounts allocated to a coastal State 
        under this subsection--
                  ``(A) shall be available to the coastal State without 
                further appropriation;
                  ``(B) shall remain available until expended; and
                  ``(C) shall be in addition to any other amounts 
                available to the coastal State under this Act.
          ``(4) Use of funds.--
                  ``(A) In general.--Except as provided in subparagraph 
                (B), a coastal State may use funds allocated and paid 
                to it under this subsection for any purpose as 
                determined by the laws of that State.
                  ``(B) Restriction on use for matching.--Funds 
                allocated and paid to a coastal State under this 
                subsection may not be used as matching funds for any 
                other Federal program.''.
  (b) Limitation on Application.--This section and the amendment made 
by this section shall not affect the application of section 105 of the 
Gulf of Mexico Energy Security Act of 2006 (title I of division C of 
Public Law 109-432; (43 U.S.C. 1331 note)), as in effect before the 
enactment of this Act, with respect to revenues received by the United 
States under oil and gas leases issued for tracts located in the 
Western and Central Gulf of Mexico Outer Continental Shelf Planning 
Areas, including such leases issued on or after the date of the 
enactment of this Act.

                   TITLE V--MISCELLANEOUS PROVISIONS

SEC. 501. 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 and renewable energy resource development on the Outer 
Continental Shelf under this Act.

SEC. 502. REGULATIONS.

  Section 30(a) of the Outer Continental Shelf Lands Act (43 U.S.C. 
1356(a)) is amended by striking ``shall issue regulations which'' and 
inserting ``shall issue regulations that shall be supplemental to, 
complementary with, and under no circumstances a substitution for the 
provisions of the Constitution and laws of the United States extended 
to the subsoil and seabed of the outer Continental Shelf by section 
4(a)(1), except insofar as such laws would otherwise apply to 
individuals who have extraordinary ability in the sciences, arts, 
education, or business, which has been demonstrated by sustained 
national or international acclaim, and that''.

                          Purpose of the Bill

    The purpose of H.R. 3410, as ordered reported, is to 
require the Secretary of the Interior to conduct certain 
offshore oil and gas lease sales, to provide fair and equitable 
revenue sharing for all coastal States, to formulate future 
offshore energy development plans in areas with the most 
potential and to generate revenue for American infrastructure.

                  Background and Need for Legislation

    The Outer Continental Shelf Lands Act (OCSLA, 43 U.S.C. 
1331 et seq.) provides a legal structure for offshore oil and 
natural gas exploration, leasing, and development in federal 
waters. The federal government develops five-year plans to 
determine where and when offshore leasing and energy production 
will occur.
    As currently written in law, OCSLA specifically identifies 
our nation's Outer Continental Shelf (OCS) as a ``vital 
national resource reserve held by the Federal Government for 
the public, which should be made available for expeditious and 
orderly development, subject to environmental safeguards, in a 
manner which is consistent with the maintenance of competition 
and other national needs.'' Unfortunately, management of our 
nation's OCS minerals under the Obama Administration has not 
been conducted in a manner that preserves or enhances our 
Nation's competitive edge, nor has the management been 
conducive to expeditious and orderly development of our 
national mineral resources.
    H.R. 3410, the Energy Security and Transportation Jobs Act, 
will reverse this mismanagement of our national OCS resources 
and require the Secretary of the Interior to adhere to a 
management approach that addresses the needs of U.S. citizens 
in the 21st Century. The bill will require the Secretary to 
move forward on domestic oil and gas production in our OCS in 
accordance with our soaring national need for energy resources 
as well as our desire to remain competitive in a growing global 
economy.
    Section 18 of the OCSLA requires the Secretary to furnish a 
five-year plan for leasing activity in the OCS. The most recent 
five-year plan put forward under the Obama Administration, 
entitled ``Proposed Outer Continental Shelf Oil & Gas Leasing 
Program 2012-2017,'' included no new areas for leasing. In 
fact, the plan as proposed directs more drilling to some of the 
most technologically challenging areas of the OCS and withdraws 
from development areas of the OCS with easily developable 
resources. Additionally, the proposed five-year plan left out 
the previously included Lease Sale 220 off the coast of 
Virginia--a lease sale that is heavily supported by the 
Governor of Virginia, the majority of the Congressional 
delegation, and the legislature of the Commonwealth of 
Virginia. The Obama narrowly focused five-year proposed leasing 
plan does not reflect the growing need for energy resources in 
our Nation. The plan also ignores the skyrocketing gas prices 
that are distressing American families and businesses at a time 
when unemployment rates are hovering above 9 percent.
    H.R. 3410 will require the Secretary to conduct a goal-
oriented leasing program in which the Secretary will aim to 
meet targeted production goals in line with national need. The 
Secretary will also be required to lease a specific amount of 
OCS acreage focusing on multiple planning areas with the 
greatest potential for oil and gas resources. The Act is clear 
that the goal is to open as much of the OCS as is prospective. 
While not setting specific areas as open into the future, the 
bill sets into place a plan that will allow the OCS to begin to 
produce the resources needed for the American consumer. The Act 
will require the Secretary to conduct specific lease sales 
within a certain amount of time--including sales in OCS areas 
off the coasts of Alaska, Virginia, California and Florida.

              RESUMING CANCELED AND POSTPONED LEASE SALES

    The 2007-2012 Offshore Oil and Gas Leasing Program included 
a lease sale off the Virginia coast in 2011 (#220), two Gulf of 
Mexico lease sales (#216 and #218) in 2011, and another Gulf of 
Mexico lease sale (#222) in 2012. All of these sales were 
either canceled or delayed by the Obama Administration. In some 
cases, the Administration has showed renewed interest in 
conducting certain formerly-delayed lease sales in an attempt 
to rebrand them as new offshore energy development. While this 
is far from the case, H.R. 3410 requires the Secretary to 
expediently conduct lease sales 216, 220, and 222. The bill 
also reinstates lease sale 214 in the North Aleutian Basin 
offshore Alaska.
    Additionally, the bill directs a lease sale in the Southern 
California OCS Planning Area. This area is one where there are 
known resources of hydrocarbons that private geologists 
informed the Committee could be developed from production 
platforms that already exist in these federal waters. The 
Committee also noted the State of California's renewed interest 
in pursuing the development of State oil and gas resources from 
existing resources. For these reasons, this bill directs a 
lease sale in Southern California, but requires that the leases 
only be those which can be reached from existing offshore 
infrastructure or from onshore-based directional drilling.
    Offshore drilling is certainly not new to the State of 
California, as there is currently oil and gas production from 
23 platforms located offshore southern California. These 
account for about 24 million barrels of oil and 47 billion 
cubic feet of natural gas annually. Despite these figures, 
California is a net importer of oil. According to the 
California Energy Commission, California produces only about 
37.2 percent of the petroleum the State uses. In 2007, the 
State spent nearly $50 billion for gasoline and $9.7 billion 
for diesel. Additionally, petroleum-based fuels account for 96 
percent of the State's transportation needs. By directing this 
lease sale, California can play a greater role in generating 
the petroleum it sorely needs and consumes largely for 
transportation purposes. Additionally, for the first time, 
California will be entitled to share the revenues from this 
production under title IV of this bill.

                         EASTERN GULF OF MEXICO

    The Gulf of Mexico Energy Security Act of 2006 (GOMESA, 
Public Law 109-432) includes a moratorium on oil and natural 
gas leasing in the Eastern Gulf of Mexico until June 30, 2022. 
Additionally, GOMESA provides no revenue sharing for the State 
of Florida. The Eastern Gulf of Mexico is known to have 
significant hydrocarbon potential. Despite the limited leasing 
activity that has occurred in the Eastern Gulf, the Minerals 
Management Service estimated in 2000 that the Eastern Gulf of 
Mexico contains between 6.95 and 9.22 trillion cubic feet of 
natural gas and 1.57 and 2.78 billion barrels of oil.
    The underlying purpose of H.R. 3410 is to focus new lease 
sales and production into areas of America's OCS where there 
are known resources. The Eastern Gulf of Mexico is one of these 
places. Currently, under GOMESA, most of the region in the 
Eastern Gulf of Mexico is closed to offshore oil and gas 
development until June 30, 2022. H.R. 3410 as introduced 
eliminated the 2022 date and opened the entire Eastern Gulf of 
Mexico immediately for offshore leasing. However, changes made 
to the bill in Committee establish a gradual and responsible 
plan to allow for limited leasing in the Eastern Gulf of Mexico 
and provide for significant protection for military activity.
    Improvements made to the bill by the amendment in the 
nature of a substitute include the permanent establishment of 
the Military Mission line (a North-South line at 86 degrees 41 
minutes) as the new administrative boundary between the Central 
Gulf of Mexico Planning Area and the Eastern Gulf of Mexico 
Planning Area for the purposes of OCS oil, gas and wind 
administration by the Federal Government. Areas east of this 
line are closed to offshore leasing until 2025, an adjustment 
from the current 2022 date, with the exception of three 
discreet lease sales of only 50 lease blocks (450 square miles) 
each, allowing for a total of 1,350 square miles to be leased 
for oil and gas development. According to the Bureau of Ocean 
Energy Management, the area east of the military mission line 
contains 6,079,201.33 offshore acres. Conducting three, 50-
block lease sales in that area represents roughly 1.4 percent 
of total acreage. These lease blocks are to be in areas with 
the most promising oil and gas resources and the Secretary is 
able to conduct these leases with significant stipulations to 
protect ongoing military operations. The Committee directed 
these sales in a careful manner to balance the interest of 
various parties in the region including industry, defense and 
tourism. In contrast to the sudden and complete opening of the 
Eastern Gulf in just a few years, the limited set of 50-block 
sales in this bill begins the cautious steps of opening the 
Eastern Gulf at a measured, deliberate pace.
    Finally, the Committee understands that there are active 
leases in the Eastern Gulf of Mexico Planning area that have 
not been able to be developed as a result of provisions 
included in GOMESA. It is the Committee's intent that should 
these existing leases be in areas chosen by the Secretary to be 
opened for leasing, the existing leases should be allowed to be 
developed in accordance with the stipulations included in H.R. 
3410.

                   PROTECTION FOR DEFENSE OPERATIONS

    Currently, in conducting lease sales in the OCS, the 
Secretary works within a mutually-agreed to framework that was 
developed between the Department of the Interior and the 
Department of Defense under a Memorandum of Agreement (MOA) 
signed in 1983. This Act requires the Secretaries of Interior 
and Defense to continue to work inside that framework, or any 
update of that agreement that follows.
    Public lands of the United States are entrusted to the care 
of the federal government to ensure for their multiple uses by 
a wide variety of interests. In the case of federal OCS waters, 
the MOA allows for a symbiotic relationship between the 
Department of Defense and the Department of the Interior. The 
MOA ensures that the Secretary of the Interior and the 
Secretary of Defense are on equal footing in the leasing 
process, and created the framework that balances those needs 
that is still in use today. While the MOA clearly recognizes 
that the OCS leasing program of the Department of the Interior 
is an ``integral part of the nation's energy security 
program,'' it also recognizes that the military's continued use 
of the OCS is imperative to ensure that our armed forces 
``achieve and maintain an optimum state of readiness.'' The 
Committee believes that the MOA has successfully managed the 
multiple-use of federal offshore lands.
    The Committee recognizes the success of this agreement, 
though it understands that there exists a need to update the 
agreement so it may adapt to new and emerging offshore energy 
technologies, such as wind energy. The Committee requests that 
the Department of the Interior update this MOA to account for 
technological advances and report to the Committee on Natural 
Resources and the Committee on Armed Services and their Senate 
counterparts within 60 days on the progress of the updates.
    Given the success of this MOA, the Committee also 
recognizes that the only way to feasibly ensure that the joint 
goals of preserving access to the OCS for the U.S. Armed Forces 
and for mineral development is to allow the agencies to 
continue their negotiations inside the framework of the MOA. 
The Committee believes that a scenario where one Department is 
given precedence over the other would fundamentally undermine 
the multiple-use mission for public lands. Instead, the MOA is 
recognized as a delicate yet sound means by which both 
Departments may reach mutually acceptable solutions, thereby 
allowing leasing to continue in the OCS while making certain 
that the needs of our Nation's military continue to be met.
    Finally, the Committee felt it important to further 
incorporate provisions that address the needs of the Department 
of Defense when conducting certain lease sales under this Act. 
In the Eastern Gulf of Mexico, provisions are included which 
allow limits on permanent surface occupancy should it conflict 
with military operations. Additionally, the Secretary of the 
Interior is able to include limits on drilling schedules to 
accommodate military operations. Finally, the Secretary may 
limit permanent surface infrastructure on any lease block that 
is within 12 nautical miles of any coastal state, unless that 
infrastructure is approved by the State.
    In the case of lease sale 220, the Virginia lease sale 
planning area administrative boundaries were established in 
such a way as to incorporate recommendations from a Department 
of Defense report dated February 15, 2010, entitled: ``Report 
on the compatibility of Department of Defense activities with 
oil and gas resource development on the Outer Continental Shelf 
(OCS).'' This report specifically outlines areas off the coast 
of Virginia (pg. 36, Mid-Atlantic Summary) where oil and gas 
activity can occur with no permanent oil and gas surface 
structures and areas where oil and gas activity would be 
outside of military operational areas. As a result of the 
planning area defined in this Act, the Department of the 
Interior has the flexibility to mitigate conflicts with the 
military by allowing these new areas for lease under lease sale 
220 in exchange for areas that the Department of Defense 
requests not be offered for lease under the terms of the MOA.

                            REVENUE SHARING

    Aside from requiring the Secretary to conduct lease sales 
in areas with existing drilling as well as new areas in a way 
that reduces military conflicts, H.R. 3410 will also provide 
all coastal States and U.S. Territories with a fair and 
equitable revenue sharing plan. This is done without changing 
the existing revenue sharing plan currently in place for four 
Gulf States (Texas, Louisiana, Alabama and Mississippi) under 
GOMESA. The Committee respected concerns voiced by State and 
local officials and Members of Congress from Gulf states who 
wished to leave the existing revenue formulas in place. As a 
result, the amendment in the nature of a substitute adopted 
during Committee markup specifically leaves GOMESA revenue 
sharing formulas in place for areas where it applied prior to 
the enactment of H.R. 3410.
    For all other OCS areas, the bill extends a 37.5 percent 
share of federal revenues to all coastal States. Areas that 
were under moratorium under Section 104 of GOMESA, which this 
bill repeals, as well as areas that were previously a part of 
the Eastern Gulf of Mexico OCS Planning Area but are considered 
part of the Central Gulf of Mexico OCS Planning Area as a 
result of the boundary change included in Section 302 of this 
bill, are to be considered to be covered by the new revenue 
sharing formula because they are now open as a result of this 
bill's enactment. This will ensure Florida receives a portion 
of revenues from the development of hydrocarbons in proximity 
to its shoreline.
    The new revenue sharing formula grants all coastal States 
within 200 miles of the leased tract a portion of the revenues 
based on their distance from that leased trace. This revenue 
sharing formula is phased in based on a five-year leasing plan, 
eventually resulting in 37.5 percent of revenues derived from 
offshore energy development going to all coastal States, 
including the U.S. Territories. As written, the Committee 
intends the bill to begin the first phase of this revenue 
sharing plan in the upcoming FY2012-FY2017 leasing plan that 
will be finalized by the Administration later this year.

                    CBO SCORING AND FEDERAL REVENUE

    Through the provisions in this bill directing the 
responsible opening of federal offshore waters containing the 
most significant known resources that (1) are not currently 
leased for energy production, and (2) are part of no existing 
plan for future leasing and production, the resulting revenues 
should be substantial and sustained, generating billions of 
dollars for the coming decades.
    However, in preparing its score of this bill, the 
Congressional Budget Office (CBO) takes what is both a more 
conservative and optimistic approach that results in much lower 
projected revenues. The Committee has communicated to CBO that 
it respectfully disagrees with its scoring approach and that 
the Committee believes current law, current leasing plans, 
Administration policies and proposed new policies, and decades 
of areas being closed for leasing and drilling, all run 
contrary to the assumptions and baselines used to calculate the 
CBO score for this bill. The Committee appreciates that CBO has 
very modestly adjusted its score upward on provisions in this 
bill compared to the analysis done in 2011 on H.R. 1230 and 
H.R. 1231.
    By opening, for the first time in a generation, areas of 
the Pacific and Atlantic Oceans that are closed by the Obama 
Administration and for which there are no plans to open, the 
Committee expects the bill to generate several billion dollars 
above the CBO score within the 10-year window, and tens of 
billions of dollars over the next several decades in new 
revenue.
    It is important to note that CBO's analysis and estimate 
represents, using their own term, a ``middle'' estimate of the 
revenue anticipated to come to the federal Treasury. Again, 
CBO's budget baseline makes assumptions about future revenues 
by assuming areas will open when there has been no plan 
proposed to open those areas.
    In 2006, CBO estimated that opening the areas of the OCS 
under moratoria could generate an additional $4 billion for the 
U.S. Treasury over a ten year period. However, as a result of 
the lifting of both the Presidential and Congressional 
moratoria on the OCS in 2008, CBO now considers those areas to 
be open and includes revenues from those areas in the baseline. 
CBO makes that assumption based on the reading of OCSLA that 
directs the Secretary to consider all open areas. This means 
that CBO assumes that areas of the Pacific and Atlantic will be 
opened by the Administration, despite this Administration using 
every tool at their disposal to close these areas, as well as 
to delay and limit leasing and production in areas that are 
actually open in the Gulf of Mexico.
    The tremendous gas resources of the Eastern Gulf of Mexico 
and Atlantic combined with the tremendous resources in federal 
waters off the State of California make the potential for 
revenue generated by this bill higher than the CBO score. The 
Committee believes that an accurate review of the legislation 
should reflect the generation of closer to $5.1 billion in new 
receipts over the ten-year period, and additional revenue of 
tens of billions for decades into the future.
    One example of why this estimate is too low are the federal 
waters off the State of California. Geologists have estimated 
that from the existing platforms in the OCS there are as much 
as 1.6 billion barrels of oil available for leasing, but are 
unleased and absent from any existing future leasing plan. This 
volume of resource, combined with the low cost of production 
due to the shallow water and shallow drilling depth at which 
the oil is contained, mean that the leases would fetch a 
tremendous premium if offered. In addition, these leases (which 
would be 5-year leases) would mean that most would have several 
years of production of royalties inside the 10-year budget 
window. Generating significant revenue for the Treasury not 
assumed in estimate of this bill. All this is made available 
from the one directed California OCS sale included in the bill. 
Meanwhile, according to the 2006 National Resource Assessment, 
there are billions of other barrels of oil in the Southern 
California planning area available for leasing. Leasing that 
can occur as a result of passage of this Act, not as the result 
of Obama Administration action.

                            Committee Action

    H.R. 3410 was introduced on November 14, 2011, by 
Congressman Steve Stivers (R-OH). 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. 3410. The 
Subcommittee on Energy and Mineral Resources was discharged by 
unanimous consent. Congressman Doc Hastings (R-WA) offered an 
amendment in the nature of a substitute to the bill. 
Congressman John Sarbanes (D-MD) offered amendment designated 
.03 to the amendment in the nature of a substitute; the 
amendment was not adopted by a bipartisan roll call vote of 12 
to 25, as follows:


    Congressman Peter DeFazio (D-OR) offered amendment 
designated .10 to the amendment in the nature of a substitute; 
the amendment was not adopted by a bipartisan roll call vote of 
15 to 25, as follows:


    Congressman John Garamendi (D-CA) offered amendment 
designated .06 to the amendment in the nature of a substitute; 
the amendment was not adopted by a bipartisan roll call vote of 
17 to 25, as follows:


    Congressman John Garamendi (D-CA) offered amendment 
designated .071 to the amendment in the nature of a substitute; 
the amendment was not adopted by a bipartisan roll call vote of 
15 to 27, as follows:


    Congresswoman Niki Tsongas (D-MA) offered amendment 
designated .04 to the amendment in the nature of a substitute; 
the amendment was not adopted by a bipartisan roll call vote of 
15 to 27, as follows:


    Congresswoman Niki Tsongas (D-MA) offered amendment 
designated .12 to the amendment in the nature of a substitute; 
the amendment was not adopted by a bipartisan roll call vote of 
16 to 27, as follows:


    Congressman Edward Markey (D-MA) offered amendment 
designated Grijalva.05 to the amendment in the nature of a 
substitute; the amendment was not adopted by a bipartisan roll 
call vote of 14 to 30, as follows:


    Congressman Rush Holt (D-NJ) offered amendment designated 
.099 to the amendment in the nature of a substitute; the 
amendment was not adopted by a bipartisan roll call vote of 18 
to 27, as follows:


    Congressman Edward Markey (D-MA) offered amendment 
designated .01 to the amendment in the nature of a substitute; 
the amendment was not adopted by a bipartisan roll call vote of 
16 to 28, as follows:


    Congressman Jon Runyan (R-NJ) offered amendment designated 
.025 to the amendment in the nature of a substitute. 
Congressman John Garamendi (D-CA) offered a substitute 
amendment to the Runyan amendment; the Garamendi amendment was 
not adopted by a bipartisan roll call vote of 20 to 24, as 
follows:


    The Runyan amendment to the amendment in the nature of a 
substitute then failed by voice vote. 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 roll call vote of 
25 to 19, as follows:


                      Section-by-Section Analysis


             TITLE I. EXPANDING OFFSHORE ENERGY DEVELOPMENT

Section 101. Outer Continental Shelf Leasing Program.

    This section requires the Secretary of the Interior, when 
preparing the five-year oil and gas leasing program, to make 
available those Outer Continental Shelf (OCS) planning areas 
with the most known resource potential; requires the Secretary 
to consider requests made by Governors who seek development off 
their shores; and requires the Secretary to open all OCS areas 
in the 2012-2017 5-Year Plan that are estimated to contain more 
than 2.5 billion barrels of oil and more than 7.5 TCF of 
natural gas.

Section 102. Domestic Oil and Natural Gas Production Goal.

    This section requires the Secretary to determine strategic 
energy production goals when crafting a 5-year plan that best 
addresses domestic energy demand; and sets the production goal 
for the 2012-2017 5-year plan to increase energy production by 
2027 by no less than 3 million barrels of oil per day and no 
less than 10 billion cubic feet of natural gas per day.

            TITLE II. CONDUCTING PROMPT OFFSHORE LEASE SALES

Section 201. Requirement To Conduct Proposed Oil and Gas Lease Sale 216 
        in the Central Gulf of Mexico.

    This section requires the Secretary to conduct Lease Sale 
216 in the Central Gulf not later than 4 months after enactment 
of the bill.

Section 202. Requirement To Conduct Proposed Oil and Gas Lease Sale 220 
        on the Outer Continental Shelf Offshore Virginia.

    This section requires the Secretary to conduct Lease Sale 
220 off the coast of Virginia not later than one year after 
enactment of the bill while also protecting military operations 
and readiness. The section also provides the Secretary with 
flexibility on lease area.

Section 203. Requirement To Conduct Oil and Gas Lease Sale 222 in the 
        Central Gulf of Mexico.

    This section requires the Secretary to conduct Lease Sale 
222 in the Central Gulf not later than September 1, 2012.

Section 204. Lease Sale Offshore California with No New Offshore 
        Impact.

    This section requires the Secretary to conduct a lease sale 
off the coast of Southern California for selected areas with 
known amounts of hydrocarbons that can be accessed only from 
existing infrastructure. This sale must be conducted not later 
than 18 months after enactment of the bill.

Section 205. Requirement To Conduct Oil and Gas Lease Sale 214 in the 
        North Aleutian Basin Offshore Alaska.

    This section requires the Secretary to conduct lease sale 
214 in the North Aleutian Basin not later than one year after 
enactment of the bill.

Section 206. Additional Leases.

    This section provides the Secretary with flexibility to 
issue further lease sales regardless of their inclusion in the 
5-year plan in effect at the time.

Section 207. Definitions.

    This section provides definitions for terms used in the 
bill.

                TITLE III. LEASING IN NEW OFFSHORE AREAS

Section 301. Leasing in the Eastern Gulf of Mexico.

    This section provides a technical amendment to clarify that 
the remainder of this title will serve as the new 
administrative policy on oil and gas leasing in the Eastern 
Gulf of Mexico.

Section 302. Reforming Oil and Gas Leasing in the Eastern Gulf of 
        Mexico.

    This section establishes the administrative boundary line 
between the Central Gulf and Eastern Gulf planning areas as the 
current Military Mission line. The section also provides for 
gradual, careful and limited energy production in the Eastern 
Gulf of Mexico by allowing three small lease sales of 50 lease 
blocks in areas with known quantities of hydrocarbons, subject 
to significant military protections, while also extending the 
2022 opening of the remainder of the Eastern Gulf until 2025.

Section 303. Areas Added to Central Gulf of Mexico Planning Area.

    This section requires the Secretary to conduct a lease sale 
for new areas in the Central Gulf Planning Area as a result of 
the administrative boundary change included in the previous 
section.

Section 304. Application of Outer Continental Shelf Lands Act with 
        Respect to Territories of the United States.

    This section applies the Outer Continental Shelf Lands Act 
to the Territories of the United States.

           TITLE IV. OUTER CONTINENTAL SHELF REVENUE SHARING

Section 401. Disposition of Outer Continental Shelf Revenues to Coastal 
        States.

    This section provides coastal states, including U.S. 
territories, with 37.5 percent of the revenues from offshore 
oil and gas development in new areas, phased in by 5-year plan. 
Central and Western Gulf areas subject to GOMESA revenue 
sharing prior to this Act remain under the pre-existing revenue 
sharing plan.

                   TITLE V. MISCELLANEOUS PROVISIONS

Section 501. Policies Regarding Buying, Building, and Working for 
        America.

    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 502. Regulations.

    This section ensures all individuals working on structures 
such as offshore rigs and offshore wind turbines that are fixed 
permanently or temporarily to the seabed of the OCS obtain work 
visas in accordance with our nation's laws.

            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. 3410--Energy Security and Transportation Jobs Act

    Summary: H.R. 3410 would revise existing laws and policies 
regarding the development of oil and gas resources on the Outer 
Continental Shelf (OCS). It would repeal statutory restrictions 
on leasing in the Eastern Gulf of Mexico and direct the 
Department of the Interior (DOI) to conduct certain lease sales 
in that area. The bill also would reduce the department's 
future administrative discretion to schedule OCS auctions and 
would require that certain auctions be held for leases in the 
Atlantic, Pacific, and Alaska OCS by 2017. Under this bill, 
some of the offsetting receipts from leases issued in those 
areas would be spent, without further appropriation, for 
payments to states.
    CBO estimates that enacting H.R. 3410 would reduce net 
direct spending by $1.8 billion over the 2012-2022 period. In 
addition, CBO estimates that implementing the bill would have 
discretionary costs of $45 million over the 2012-2017 period, 
assuming appropriation of the necessary amounts. Enacting this 
bill would not affect revenues. Pay-as-you-go procedures apply 
because enacting the legislation would reduce direct spending.
    H.R. 3410 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. 3410 is shown in the following table. 
The costs of this legislation fall within budget functions 950 
(undistributed offsetting receipts) and 300 (natural resources 
and the environment).

----------------------------------------------------------------------------------------------------------------
                                                            By fiscal year, in millions of dollars--
                                               -----------------------------------------------------------------
                                                  2012     2013     2014     2015     2016     2017    2012-2017
----------------------------------------------------------------------------------------------------------------
                                           CHANGES IN DIRECT SPENDING

Estimated Budget Authority....................        0        0        0      -50     -500     -360        -910
Estimated Outlays.............................        0        0        0      -50     -500     -360        -910

                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Estimated Authorization Level.................        2       15       15        5        5        3          45
Estimated Outlays.............................        1       14       15        7        5        3         45
----------------------------------------------------------------------------------------------------------------
aOver the 2012-2022 period, CBO estimates enacting H.R. 3410 would reduce direct spending by $1.8 billion.

    Basis of estimate: For this estimate, CBO assumes that H.R. 
3410 will be enacted during 2012. Under the bill, we expect 
that oil and gas leasing activity would increase in the OCS and 
that a specified portion of the income from that activity would 
be paid to affected states. Bonus bids, rental fees, and 
royalty payments for OCS leases are recorded in the budget as 
offsetting receipts, which are an offset to direct spending. 
Because oil and gas production usually occurs several years 
after a lease is issued, CBO expects that most of the increase 
in offsetting receipts over the next 10 years would result from 
bonus bids and rental payments.

Direct Spending

    CBO estimates that implementing H.R. 3410 would increase 
gross offsetting receipts from OCS leasing activity by $2.3 
billion over the 2012-2022 period and increase direct spending 
for payments to states by $0.5 billion over that same period, 
resulting in a net reduction in direct spending of $1.8 billion 
over the 2012-2022 period and $910 million over the 2012-2017 
period. That estimate is based on information from DOI on the 
oil and gas resources in the affected regions; historical rates 
of leasing in those areas; and recent trends in the amount of 
bonus bids paid for other OCS leases. Although H.R. 3410 would 
direct DOI to hold certain lease sales within a year of 
enactment, CBO anticipates that most of the additional proceeds 
would be collected after 2015 because of the time needed to 
complete geological, environmental, and other assessments for 
each sale and to issue leases to winning bidders.
    Leasing in the Gulf of Mexico. Nearly half of the estimated 
increase in gross offsetting receipts from enacting H.R. 3410--
about $1.1 billion--would result from repealing the temporary 
ban imposed by the Gulf of Mexico Security Act of 2006 (GOMESA) 
on leasing areas within 125 miles of the coast of Florida and 
in the Eastern Gulf of Mexico. According to DOI, H.R. 3410 
would make approximately 4.4 million acres available for 
leasing as part of the department's annual lease sales in the 
Central Gulf of Mexico. The bill also would redraw the 
boundaries of the Eastern Gulf of Mexico planning area for OCS 
leasing and extend the statutory ban on leasing in that area by 
three years--from June 30, 2022 to June 30, 2025--except for a 
specified number of acres that would have to be offered in 
three special auctions.
    Most of the estimated increase in receipts from this region 
would result from leasing acreage that would be added to the 
Central Gulf of Mexico planning area. According to DOI, that 
area contains undiscovered resources estimated to total 2 
billion barrels of oil equivalent (BOE)--that is, either oil or 
an equivalent amount of natural gas with the same energy 
content--as well as additional probable resources that have 
been identified through prior leasing activity. CBO's estimate 
of proceeds from leasing activity in this area reflects the 
fact that most of the resources are natural gas and the 
possibility that some resources may not be leased because of 
potential inconsistencies with state coastal zone management 
plans. Based on the results of lease sales in other newly 
opened areas in the Gulf of Mexico, CBO estimates that the 
proceeds from the three special sales in the Eastern Gulf of 
Mexico would result in receipts totaling about $0.1 billion.\1\
---------------------------------------------------------------------------
    \1\Auctions of leases located in the ``181-south'' area of the Gulf 
of Mexico, which contains an estimated 900 million BOE, have yielded 
federal receipts of only $8 million since lease sales started in 2009.
---------------------------------------------------------------------------
    Finally, CBO estimates that provisions in H.R. 3410 
directing DOI to conduct certain lease sales in the Central 
Gulf of Mexico would have no budgetary effect because the 
proposed schedule is similar to current administrative plans.
    Leasing in Other OCS Regions. Apart from GOMESA, there are 
no statutory restrictions on the location and timing of OCS 
lease sales. Decisions on where and when to offer leases in the 
OCS are made administratively according to various statutory 
criteria and procedures, including consultation with industry 
and affected states. H.R. 3410 would change the plan for lease 
sales over the 2012-2017 period and require DOI to auction at 
least 50 percent of the acreage in all OCS areas in each of the 
subsequent five-year leasing cycles after 2017. CBO estimates 
that those changes to current administrative policy and future 
discretion would increase gross offsetting receipts by $1.2 
billion over the 2012-2022 period relative to amounts we expect 
the government to collect from leasing in those regions under 
current law.
    Leasing in the Atlantic and Pacific OCS. H.R. 3410 would 
primarily affect the schedule for future auctions of leases in 
the Atlantic and Pacific OCS. Estimates of potential proceeds 
from those areas are uncertain for several reasons. Because 
there has been no leasing activity in the Atlantic or Pacific 
OCS for more than 25 years, there are no data on bidders' 
assessments of the value of those resources relative to 
alternative investments in domestic onshore resources, other 
OCS regions, or international prospects. Other factors that 
could affect bidder interest include the absence of pipelines 
and onshore processing facilities in key areas and past 
litigation regarding oil and gas development, which resulted in 
the cancellation of some federal leases in both regions. In 
addition, some resources in these regions may be excluded from 
future auctions because leasing may not be compatible with 
state coastal zone management plans.
    Taking into account such uncertainties and the lead times 
for initiating sales in new areas, CBO estimates that 
auctioning leases in the Atlantic and Pacific OCS would 
generate offsetting receipts of about $1.9 billion over the 
2012-2022 period under the bill.\2\ However, CBO expects a 
portion of that amount will be collected under current law. 
CBO's current baseline projection of future OCS receipts from 
the Atlantic and Pacific OCS is $0.7 billion over the next 10 
years. CBO's baseline estimate is less than the amount we 
estimate from enacting H.R. 3410 for two reasons. First, DOI's 
proposed leasing plan for 2012 through 2017 does not include 
any auctions in the Atlantic and Pacific OCS. Second, the 
probability of such leasing occurring after 2017 under current 
law is uncertain because federal and state administrative 
policies toward leasing change over time.\3\
---------------------------------------------------------------------------
    \2\CBO's estimate of the receipts from leasing in the Atlantic and 
Pacific OCS are roughly proportional to the bonus bids that CBO expects 
will be collected over a comparable period of time for regions in the 
Central and Western Gulf of Mexico and the Beaufort and Chukchi Seas in 
Alaska which are already available to be leased. The estimate also 
assumes that the pace of leasing will be consistent with past trends 
for areas with undiscovered resources that are geologically dispersed 
over large areas. Finally, based on a 2011 report sponsored by the 
American Petroleum Institute, CBO assumes that the amounts paid by 
bidders per BOE for resources in the Atlantic and Pacific would be 
about half the amounts paid for resources in the Alaska National 
Wildlife Refuge or the Eastern Gulf of Mexico.
    \3\For example, a draft OCS leasing plan submitted by the 
administration of President George W. Bush in January, 2009 proposed 
holding lease sales in the Atlantic and Pacific OCS, notwithstanding 
the objections of certain states; by contrast, the November, 2011 draft 
plan submitted by the administration of President Barack Obama cited 
state concerns as the reason for excluding the California and North 
Atlantic OCS from the proposed five-year plan.
---------------------------------------------------------------------------
    By revising the five-year plan for the 2012-2017 period to 
include lease sales in the Atlantic and Pacific OCS and 
increasing the certainty that additional sales will be held 
thereafter, CBO estimates that enacting H.R. 3410 would 
increase offsetting receipts by $1.2 billion over the 2012-2022 
period above the amounts expected under current law. About 40 
percent of that total would be collected over the next five 
years, reflecting directives in the bill for DOI to auction at 
least 50 percent of the acreage in the North Atlantic, Mid-
Atlantic, and Southern California regions and to conduct two 
specific sales: one off the coast of Virginia and another for 
leases in the Santa Barbara and Ventura basins in the 
California OCS that can be developed by using existing offshore 
facilities or from onshore drilling sites.
    Leasing in the Alaska OCS. H.R. 3410 also would revise the 
Administration's 2012-2017 leasing plan by directing DOI to 
auction certain acreage in the North Aleutian Basin in Alaska. 
That OCS region is not included in the proposed leasing plan 
for 2012-2017 because the President withdrew the Bristol Bay 
area from consideration through 2017. Estimates of bidder 
valuations and interest in such leases are uncertain because 
the firms that won leases in this region in the 1980s 
relinquished them as a result of litigation. For this estimate, 
CBO assumes that bonus bids could range from a few million 
dollars to about $100 million, which would be roughly 
proportionate to the prices recently paid for resources in the 
Chukchi Sea. CBO estimates that gross proceeds from enacting 
this provision would fall in the mid-point of this range--or 
about $50 million.
    Receipt Sharing. H.R. 3410 would authorize certain payments 
to states affected by OCS activities in areas that would be 
made available for leasing by this bill and that are outside of 
the current contours of the Central and Western Gulf of Mexico. 
Those states would receive a 12.5 percent share of the gross 
proceeds from eligible leases issued under the five-year plan 
that takes effect after the date of enactment; 25 percent from 
leases issued under the subsequent five-year plan; and 37.5 
percent from leases issued thereafter. CBO estimates that the 
receipt sharing provisions in H.R. 3410 would increase direct 
spending by $0.5 billion over the 2012-2022 period.
    CBO expects that the receipt sharing provision in H.R. 3410 
would apply to leases issued in the Atlantic and Pacific OCS, 
in the North Aleutian basin by 2017, and in areas currently 
subject to GOMESA through June 30, 2022. For this estimate, CBO 
assumes that the initial 12.5 percent rate would apply to 
eligible leases issued over the 2012-2017 period and that funds 
would be disbursed to states the year after receipts are 
collected from lessees. CBO also expects that this spending 
would be recorded in the budget as a reduction in offsetting 
receipts.

Spending Subject to Appropriation

    Based on spending patterns for similar activities, CBO 
estimates that DOI would spend about $45 million over the 2012-
2017 period to complete pre-auction assessments and conduct 
lease sales in the Atlantic, Pacific, Alaska, and Florida OCS, 
assuming appropriation of the necessary amounts.
    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. 3410, 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   2012-2022
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       NET INCREASE OR DECREASE (-) IN THE DEFICIT

Statutory Pay-As-You-Go Impact..................      0      0      0      -50     -500     -360     -300     -120     -150     -150     -150     -1,780
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Intergovernmental and private-sector impact: H.R. 3410 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would impose no costs on state, local, or 
tribal governments.
    Previous CBO estimate: On May 2, 2011, CBO transmitted a 
cost estimate for H.R. 1231, the Reversing President Obama's 
Offshore Moratorium Act, as ordered reported by the House 
Committee on Natural Resources on April 13, 2011. Differences 
between the estimates largely reflect provisions in H.R. 3410 
regarding the eastern Gulf of Mexico and revenue sharing with 
states, which were not included in H.R. 1231.
    Estimate prepared by: Federal Costs: Kathleen Gramp; Impact 
on State, Local, and Tribal Governments: Melissa Merrill; 
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, credit authority, or an increase or decrease in 
revenues or tax expenditures. CBO estimates that enacting H.R. 
3410 would reduce net direct spending by $1.8 billion over the 
2012-2022 period. In addition, CBO estimates that implementing 
the bill would have discretionary costs of $45 million over the 
2012-2017 period, assuming appropriation of the necessary 
amounts. Enacting this bill would not affect revenues. Pay-as-
you-go procedures apply because enacting the legislation would 
reduce direct spending.
    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 require the 
Secretary of the Interior to conduct certain offshore oil and 
gas lease sales, to provide fair and equitable revenue sharing 
for all coastal States, to formulate future offshore energy 
development plans in areas with the most potential and to 
generate revenue for American infrastructure.

                           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, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

OUTER CONTINENTAL SHELF LANDS ACT

           *       *       *       *       *       *       *


  Sec. 2. Definitions.--When used in this Act--
  (a) The term ``outer Continental Shelf'' means all submerged 
lands lying seaward and outside of the area of lands beneath 
navigable waters as defined in section 2 of the Submerged Lands 
Act (Public Law 31, Eighty-third Congress, first session), and 
of which the subsoil and seabed appertain to the United States 
and are subject to its jurisdiction and control or lying within 
the United States' exclusive economic zone and the Continental 
Shelf adjacent to any territory of the United States;

           *       *       *       *       *       *       *

  (p) The term ``major Federal action'' means any action or 
proposal by the Secretary which is subject to the provisions of 
section 102(2)(C) of the National Environmental Policy Act of 
1969 (42 U.S.C. 4332(2)(C)); [and]
  (q) The term ``minerals'' includes oil, gas, sulphur, 
geopressured-geothermal and associated resources, and all other 
minerals which are authorized by an Act of Congress to be 
produced from ``public lands'' as defined in section 103 of the 
Federal Land Policy and Management Act of 1976[.]; and
  (r) The term ``State'' includes each territory of the United 
States.

           *       *       *       *       *       *       *

  Sec. 9. Disposition of Revenues.--[All rentals,]
  (a) Payment of New Leasing Revenues to Coastal States.--
          (1) In general.--Except as provided in paragraph (2), 
        of the amount of new leasing revenues received by the 
        United States each fiscal year, 37.5 percent shall be 
        allocated and paid in accordance with subsection (b) to 
        coastal States that are affected States with respect to 
        the leases under which those revenues are received by 
        the United States.
          (2) Phase-in.--Paragraph (1) shall be applied--
                  (A) with respect to new leasing revenues 
                under leases awarded under the first leasing 
                program under section 18(a) that takes effect 
                after the date of enactment of the Energy 
                Security and Transportation Jobs Act, by 
                substituting ``12.5 percent'' for ``37.5 
                percent''; and
                  (B) with respect to new leasing revenues 
                under leases awarded under the second leasing 
                program under section 18(a) that takes effect 
                after the date of enactment of the Energy 
                Security and Transportation Jobs Act, by 
                substituting ``25 percent'' for ``37.5 
                percent''.
  (b) Allocation of Payments.--
          (1) In general.--The amount of new leasing revenues 
        received by the United States with respect to a leased 
        tract that are required to be paid to coastal States in 
        accordance with this subsection each fiscal year shall 
        be allocated among and paid to coastal States that are 
        within 200 miles of the leased tract, in amounts that 
        are inversely proportional to the respective distances 
        between the point on the coastline of each such State 
        that is closest to the geographic center of the lease 
        tract, as determined by the Secretary.
          (2) Minimum and maximum allocation.--The amount 
        allocated to a coastal State under paragraph (1) each 
        fiscal year with respect to a leased tract shall be--
                  (A) in the case of a coastal State that is 
                the nearest State to the geographic center of 
                the leased tract, not less than 25 percent of 
                the total amounts allocated with respect to the 
                leased tract; 
                  (B) in the case of any other coastal State, 
                not less than 10 percent, and not more than 15 
                percent, of the total amounts allocated with 
                respect to the leased tract; and
                  (C) in the case of a coastal State that is 
                the only coastal State within 200 miles of a 
                least tract, 100 percent of the total amounts 
                allocated with respect to the leased tract.
          (3) Administration.--Amounts allocated to a coastal 
        State under this subsection--
                  (A) shall be available to the coastal State 
                without further appropriation;
                  (B) shall remain available until expended; 
                and
                  (C) shall be in addition to any other amounts 
                available to the coastal State under this Act.
          (4) Use of funds.--
                  (A) In general.--Except as provided in 
                subparagraph (B), a coastal State may use funds 
                allocated and paid to it under this subsection 
                for any purpose as determined by the laws of 
                that State.
                  (B) Restriction on use for matching.--Funds 
                allocated and paid to a coastal State under 
                this subsection may not be used as matching 
                funds for any other Federal program.
  (c)  Disposition of Revenue Under Old Leases.--All rentals, 
royalties, and other sums paid to the Secretary or the 
Secretary of the Navy under any lease on the outer Continental 
Shelf [for the period from June 5, 1950, to date, and 
thereafter] in the period beginning June 5, 1950, and ending on 
the date of enactment of the Energy Security and Transportation 
Jobs Act shall be deposited in the Treasury of the United 
States and credited to miscellaneous receipts.
  (d) Definitions.--In this section:
          (1) Coastal state.--The term ``coastal State'' 
        includes a territory of the United States.
          (2) New leasing revenues.--The term ``new leasing 
        revenues''--
                  (A) means amounts received by the United 
                States as bonuses, rents, and royalties under 
                leases for oil and gas, wind, tidal, or other 
                energy exploration, development, and production 
                on areas of the outer Continental Shelf that 
                are authorized to be made available for leasing 
                as a result of enactment of the Energy Security 
                and Transportation Jobs Act; and
                  (B) does not include amounts received by the 
                United States under any lease of an area 
                located in the boundaries of the Central Gulf 
                of Mexico and Western Gulf of Mexico Outer 
                Continental Shelf Planning Areas on the date of 
                the enactment of the Energy Security and 
                Transportation Jobs Act, including a lease 
                issued before, on, or after such date of 
                enactment.

           *       *       *       *       *       *       *

  Sec. 18. Outer Continental Shelf Leasing Program.--(a) * * *
          (1) * * *

           *       *       *       *       *       *       *

          (5)(A) In each oil and gas leasing program under this 
        section, the Secretary shall make available for leasing 
        and conduct lease sales including--
                  (i) at least 50 percent of the available 
                unleased acreage within each outer Continental 
                Shelf planning area considered to have the 
                largest undiscovered, technically recoverable 
                oil and gas resources (on a total btu basis) 
                based upon the most recent national geologic 
                assessment of the outer Continental Shelf, with 
                an emphasis on offering the most geologically 
                prospective parts of the planning area; and
                  (ii) any State subdivision of an outer 
                Continental Shelf planning area that the 
                Governor of the State that represents that 
                subdivision requests be made available for 
                leasing.
          (B) In this paragraph the term ``available unleased 
        acreage'' means that portion of the outer Continental 
        Shelf that is not under lease at the time of a proposed 
        lease sale, and that has not otherwise been made 
        unavailable for leasing by law.
          (6)(A) In the 2012-2017 5-year oil and gas leasing 
        program, the Secretary shall make available for leasing 
        any outer Continental Shelf planning areas that--
                  (i) are estimated to contain more than 
                2,500,000,000 barrels of oil; or
                  (ii) are estimated to contain more than 
                7,500,000,000,000 cubic feet of natural gas.
          (B) To determine the planning areas described in 
        subparagraph (A), the Secretary shall use the document 
        entitled ``Minerals Management Service Assessment of 
        Undiscovered Technically Recoverable Oil and Gas 
        Resources of the Nation's Outer Continental Shelf, 
        2006''.

           *       *       *       *       *       *       *

  [(b) The leasing program shall include estimates of the 
appropriations and staff required to--
          [(1) obtain resource information and any other 
        information needed to prepare the leasing program 
        required by this section;
          [(2) analyze and interpret the exploratory data and 
        any other information which may be compiled under the 
        authority of this Act;
          [(3) conduct environmental studies and prepare any 
        environmental impact statement required in accordance 
        with this Act and with section 102(2)(C) of the 
        National Environmental Policy Act of 1969 (42 U.S.C. 
        4332(2)(C)); and
          [(4) supervise operations conducted pursuant to each 
        lease in the manner necessary to assure due diligence 
        in the exploration and development of the lease area 
        and compliance with the requirement of applicable laws 
        and regulations, and with the terms of the lease.]
  (b) Domestic Oil and Natural Gas Production Goal.---
          (1) In general.--In developing a 5-year oil and gas 
        leasing program, and subject to paragraph (2), the 
        Secretary shall determine a domestic strategic 
        production goal for the development of oil and natural 
        gas as a result of that program. Such goal shall be--
                  (A) the best estimate of the possible 
                increase in domestic production of oil and 
                natural gas from the outer Continental Shelf;
                  (B) focused on meeting domestic demand for 
                oil and natural gas and reducing the dependence 
                of the United States on foreign energy; and
                  (C) focused on the production increases 
                achieved by the leasing program at the end of 
                the 15-year period beginning on the effective 
                date of the program.
          (2) 2012-2017 program goal.--For purposes of the 
        2012-2017 5-year oil and gas leasing program, the 
        production goal referred to in paragraph (1) shall be 
        an increase by 2027, from the levels of oil and gas 
        produced as of the date of enactment of this paragraph, 
        of--
                  (A) no less than 3,000,000 barrels in the 
                amount of oil produced per day; and
                  (B) no less than 10,000,000,000 cubic feet in 
                the amount of natural gas produced per day.
          (3) Reporting.--The Secretary shall report annually, 
        beginning at the end of the 5-year period for which the 
        program applies, to the Committee on Natural Resources 
        of the House of Representatives and the Committee on 
        Energy and Natural Resources of the Senate on the 
        progress of the program in meeting the production goal. 
        The Secretary shall identify in the report projections 
        for production and any problems with leasing, 
        permitting, or production that will prevent meeting the 
        goal.

           *       *       *       *       *       *       *

  (i) Additional Lease Sales.--In addition to lease sales in 
accordance with a leasing program in effect under this section, 
the Secretary may hold lease sales for areas identified by the 
Secretary to have the greatest potential for new oil and gas 
development as a result of local support, new seismic findings, 
or nomination by interested persons.

           *       *       *       *       *       *       *

  Sec. 30. Documentation, Registry, and Manning Requirements.--
(a) Within six months after the date of enactment of this 
section, the Secretary of the Department in which the Coast 
Guard is operating [shall issue regulations which] shall issue 
regulations that shall be supplemental to, complementary with, 
and under no circumstances a substitution for the provisions of 
the Constitution and laws of the United States extended to the 
subsoil and seabed of the outer Continental Shelf by section 
4(a)(1), except insofar as such laws would otherwise apply to 
individuals who have extraordinary ability in the sciences, 
arts, education, or business, which has been demonstrated by 
sustained national or international acclaim, and that require 
that any vessel, rig, platform, or other vehicle or structure--
          (1) * * *

           *       *       *       *       *       *       *

                              ----------                              


TAX RELIEF AND HEALTH CARE ACT OF 2006

           *       *       *       *       *       *       *


DIVISION C--OTHER PROVISIONS

           *       *       *       *       *       *       *


TITLE I--GULF OF MEXICO ENERGY SECURITY

           *       *       *       *       *       *       *


[SEC. 104. MORATORIUM ON OIL AND GAS LEASING IN CERTAIN AREAS OF GULF 
                    OF MEXICO.

  [(a) In General.--Effective during the period beginning on 
the date of enactment of this Act and ending on June 30, 2022, 
the Secretary shall not offer for leasing, preleasing, or any 
related activity--
          [(1) any area east of the Military Mission Line in 
        the Gulf of Mexico;
          [(2) any area in the Eastern Planning Area that is 
        within 125 miles of the coastline of the State of 
        Florida; or
          [(3) any area in the Central Planning Area that is--
                  [(A) within--
                          [(i) the 181 Area; and
                          [(ii) 100 miles of the coastline of 
                        the State of Florida; or
                  [(B)(i) outside the 181 Area;
                          [(ii) east of the western edge of the 
                        Pensacola Official Protraction Diagram 
                        (UTM X coordinate 1,393,920 (NAD 27 
                        feet)); and
                          [(iii) within 100 miles of the 
                        coastline of the State of Florida.
  [(b) Military Mission Line.--Notwithstanding subsection (a), 
the United States reserves the right to designate by and 
through the Secretary of Defense, with the approval of the 
President, national defense areas on the outer Continental 
Shelf pursuant to section 12(d) of the Outer Continental Shelf 
Lands Act (43 U.S.C. 1341(d)).
  [(c) Exchange of Certain Leases.--
          [(1) In general.--The Secretary shall permit any 
        person that, as of the date of enactment of this Act, 
        has entered into an oil or gas lease with the Secretary 
        in any area described in paragraph (2) or (3) of 
        subsection (a) to exchange the lease for a bonus or 
        royalty credit that may only be used in the Gulf of 
        Mexico.
          [(2) Valuation of existing lease.--The amount of the 
        bonus or royalty credit for a lease to be exchanged 
        shall be equal to--
                  [(A) the amount of the bonus bid; and
                  [(B) any rental paid for the lease as of the 
                date the lessee notifies the Secretary of the 
                decision to exchange the lease.
          [(3) Revenue distribution.--No bonus or royalty 
        credit may be used under this subsection in lieu of any 
        payment due under, or to acquire any interest in, a 
        lease subject to the revenue distribution provisions of 
        section 8(g) of the Outer Continental Shelf Lands Act 
        (43 U.S.C. 1337(g)).
          [(4) Regulations.--Not later than 1 year after the 
        date of enactment of this Act, the Secretary shall 
        promulgate regulations that shall provide a process 
        for--
                  [(A) notification to the Secretary of a 
                decision to exchange an eligible lease;
                  [(B) issuance of bonus or royalty credits in 
                exchange for relinquishment of the existing 
                lease;
                  [(C) transfer of the bonus or royalty credit 
                to any other person; and
                  [(D) determining the proper allocation of 
                bonus or royalty credits to each lease interest 
                owner.]

           *       *       *       *       *       *       *