CHAPTER 869 - NAVAL PETROLEUM RESERVES

Title 10 > CHAPTER 869

Sections (34)

§ 8720 Definitions

In this chapter: The term “national defense” includes the needs of, and the planning and preparedness to meet, essential defense, industrial, and military emergency energy requirements relative to the national safety, welfare, and economy, particularly resulting from foreign military or economic actions. The term “naval petroleum reserves” means the naval petroleum and oil shale reserves established by this chapter, including Naval Petroleum Reserve Numbered 1 (Elk Hills), located in Kern County, California, established by Executive order of the President, dated September 2, 1912 ; Naval Petroleum Reserve Numbered 2 (Buena Vista), located in Kern County, California, established by Executive order of the President, dated December 13, 1912 ; Naval Petroleum Reserve Numbered 3 (Teapot Dome), located in Wyoming, established by Executive order of the President, dated April 30, 1915 ; Oil Shale Reserve Numbered 1, located in Colorado, established by Executive order of the President, dated December 6, 1916 , as amended by Executive order dated June 12, 1919 ; Oil Shale Reserve Numbered 2, located in Utah, established by Executive order of the President, dated December 6, 1916 ; and Oil Shale Reserve Numbered 3, located in Colorado, established by Executive order of the President, dated September 27, 1924 . The term “petroleum” includes crude oil, gases (including natural gas), natural gasoline, and other related hydrocarbons, oil shale, and the products of any of such resources. The term “Secretary” means the Secretary of Energy. The term “small refiner” means an owner of a refinery or refineries (including refineries not in operation) who qualifies as a small business refiner under the rules and regulations of the Small Business Administration. The term “maximum efficient rate” means the maximum sustainable daily oil or gas rate from a reservoir which will permit economic development and depletion of that reservoir without detriment to the ultimate recovery. (Added Pub. L. 94–258, title II, § 201(1) , Apr. 5, 1976 , 90 Stat. 307 , § 7420; amended Pub. L. 96–513, title V, § 513(30) , Dec. 12, 1980 , 94 Stat. 2933 ; Pub. L. 100–26, § 7(k)(5) , Apr. 21, 1987 , 101 Stat. 284 ; renumbered § 8720, Pub. L. 115–232, div. A, title VIII, § 807(d)(5) , Aug. 13, 2018 , 132 Stat. 1836 .)

“SEC. 331 TRANSFER OF ADMINISTRATIVE JURISDICTION AND ENVIRONMENTAL REMEDIATION, NAVAL PETROLEUM RESERVE NUMBERED 2, KERN COUNTY, CALIFORNIA.

(“(a) Administration Jurisdiction Transfer to Secretary of the Interior.— Effective on the date of the enactment of this Act [ Aug. 8, 2005 ], administrative jurisdiction and control over all public domain lands included within Naval Petroleum Reserve Numbered 2 located in Kern County, California (other than the lands specified in subsection (b)), are transferred from the Secretary to the Secretary of the Interior for management, subject to subsection (c), in accordance with the laws governing management of the public lands, and the regulations promulgated under such laws, including the Mineral Leasing Act ( 30 U.S.C. 181 et seq.) and the Federal Land Policy and Management Act of 1976 ( 43 U.S.C. 1701 et seq.).

(“(b) Exclusion of Certain Reserve Lands.— The transfer of administrative jurisdiction made by subsection (a) does not include the following lands: That portion of Naval Petroleum Reserve Numbered 2 authorized for disposal under section 3403(a) of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 ( Public Law 105–261 ; 10 U.S.C. 7420 note [now 10 U.S.C. 8720 note]). That portion of the surface estate of Naval Petroleum Reserve Numbered 2 conveyed to the City of Taft, California, by section 333.

(“(c) Purpose of Transfer.— Notwithstanding any other provision of law, the principal purpose of the lands subject to transfer under subsection (a) is the production of hydrocarbon resources, and the Secretary of the Interior shall manage the lands in a fashion consistent with this purpose. In managing the lands, the Secretary of the Interior shall regulate operations to prevent unnecessary degradation and to provide for ultimate economic recovery of the resources. The Secretary of the Interior may make disposals of lands subject to transfer under subsection (a), or allow commercial or non-profit surface use of such lands, not to exceed 10 acres each, so long as the disposals or surface uses do not materially interfere with the ultimate economic recovery of the hydrocarbon resources of such lands. All revenues received from the disposal of lands under this paragraph or from allowing the surface use of such lands shall be deposited in the Naval Petroleum Reserve Numbered 2 Lease Revenue Account established by section 332.

(“(d) Conforming Amendment.—

“SEC. 332 NAVAL PETROLEUM RESERVE NUMBERED 2 LEASE REVENUE ACCOUNT.

(“(a) Establishment.— There is established in the Treasury a special deposit account to be known as the ‘Naval Petroleum Reserve Numbered 2 Lease Revenue Account’ (in this section referred to as the ‘lease revenue account’). The lease revenue account is a revolving account, and amounts in the lease revenue account shall be available to the Secretary of the Interior, without further appropriation, for the purposes specified in subsection (b).

(“(b) Purposes of Account.— The lease revenue account shall be the sole and exclusive source of funds to pay for any and all costs and expenses incurred by the United States for— environmental investigations (other than any environmental investigations that were conducted by the Secretary before the transfer of the Naval Petroleum Reserve Numbered 2 lands under section 331), remediation, compliance actions, response, waste management, impediments, fines or penalties, or any other costs or expenses of any kind arising from, or relating to, conditions existing on or below the Naval Petroleum Reserve Numbered 2 lands, or activities occurring or having occurred on such lands, on or before the date of the transfer of such lands; and any future remediation necessitated as a result of pre-transfer and leasing activities on such lands. The lease revenue account shall also be available for use by the Secretary of the Interior to pay for transition costs incurred by the Department of the Interior associated with the transfer and leasing of the Naval Petroleum Reserve Numbered 2 lands.

(“(c) Funding.— The lease revenue account shall consist of the following: Notwithstanding any other provision of law, for a period of three years after the date of the transfer of the Naval Petroleum Reserve Numbered 2 lands under section 331, the sum of $500,000 per year of revenue from leases entered into before that date, including bonuses, rents, royalties, and interest charges collected pursuant to the Federal Oil and Gas Royalty Management Act of 1982 ( 30 U.S.C. 1701 et. seq.), derived from the Naval Petroleum Reserve Numbered 2 lands, shall be deposited into the lease revenue account. Subject to subsection (d), all revenues derived from leases on Naval Petroleum Reserve Numbered 2 lands issued on or after the date of the transfer of such lands, including bonuses, rents, royalties, and interest charges collected pursuant to the Federal Oil and Gas Royalty Management Act of 1982 ( 30 U.S.C. 1701 et seq.), shall be deposited into the lease revenue account.

(“(d) Limitation.— Funds in the lease revenue account shall not exceed $3,000,000atanyonetime.Wheneverfundsintheleaserevenueaccountareobligatedorexpendedsothatthebalanceintheaccountfallsbelowthatamount,leaserevenuesreferredtoinsubsection(c)(2)shallbedepositedintheaccounttomaintainabalanceof$3,000,000.

(“(e) Termination of Account.— At such time as the Secretary of the Interior certifies that remediation of all environmental contamination of Naval Petroleum Reserve Numbered 2 lands in existence as of the date of the transfer of such lands under section 331 has been successfully completed, that all costs and expenses of investigation, remediation, compliance actions, response, waste management, impediments, fines, or penalties associated with environmental contamination of such lands in existence as of the date of the transfer have been paid in full, and that the transition costs of the Department of the Interior referred to in subsection (b)(2) have been paid in full, the lease revenue account shall be terminated and any remaining funds shall be distributed in accordance with subsection (f).

(“(f) Distribution of Remaining Funds.— Section 35 of the Mineral Leasing Act ( 30 U.S.C. 191 ) shall apply to the payment and distribution of all funds remaining in the lease revenue account upon its termination under subsection (e).

“SEC. 333 LAND CONVEYANCE, PORTION OF NAVAL PETROLEUM RESERVE NUMBERED 2, TO CITY OF TAFT, CALIFORNIA.

(“(a) Conveyance.— Effective on the date of the enactment of this Act [ Aug. 8, 2005 ], there is conveyed to the City of Taft, California (in this section referred to as the ‘City’), all surface right, title, and interest of the United States in and to a parcel of real property consisting of approximately 220 acres located in the NE¼, the NE¼ of the NW¼, and the N½ of the SE¼ of the NW¼ of section 18, township 32 south, range 24 east, Mount Diablo meridian, Kern County, California.

(“(b) Consideration.— The conveyance under subsection (a) is made without the payment of consideration by the City.

(“(c) Treatment of Existing Rights.— The conveyance under subsection (a) is subject to valid existing rights, including Federal oil and gas lease SAC–019577.

(“(d) Treatment of Minerals.— All coal, oil, gas, and other minerals within the lands conveyed under subsection (a) are reserved to the United States, except that the United States and its lessees, licensees, permittees, or assignees shall have no right of surface use or occupancy of the lands. Nothing in this subsection shall be construed to require the United States or its lessees, licensees, permittees, or assignees to support the surface of the conveyed lands.

(“(e) Indemnify and Hold Harmless.— The City shall indemnify, defend, and hold harmless the United States for, from, and against, and the City shall assume all responsibility for, any and all liability of any kind or nature, including all loss, cost, expense, or damage, arising from the City’s use or occupancy of, or operations on, the land conveyed under subsection (a), whether such use or occupancy of, or operations on, occurred before or occur after the date of the enactment of this Act.

(“(f) Instrument of Conveyance.— Not later than 1 year after the date of the enactment of this Act, the Secretary shall execute, file, and cause to be recorded in the appropriate office a deed or other appropriate instrument documenting the conveyance made by this section.

“SEC. 334 REVOCATION OF LAND WITHDRAWAL.

“Effective on the date of the enactment of this Act [ Aug. 8, 2005 ], the Executive Order of December 13, 1912 , which created Naval Petroleum Reserve Numbered 2, is revoked in its entirety.”

“SEC. 3401 DEFINITIONS.

“In this title: The term ‘naval petroleum reserves’ has the meaning given the term in section 7420(2) [now 8720(2)] of title 10, United States Code. The term ‘Naval Petroleum Reserve Numbered 2’ means the naval petroleum reserve, commonly referred to as the Buena Vista unit, that is located in Kern County, California, and was established by Executive order of the President, dated December 13, 1912 . The term ‘Naval Petroleum Reserve Numbered 3’ means the naval petroleum reserve, commonly referred to as the Teapot Dome unit, that is located in the State of Wyoming and was established by Executive order of the President, dated April 30, 1915 . The term ‘Oil Shale Reserve Numbered 2’ means the naval petroleum reserve that is located in the State of Utah and was established by Executive order of the President, dated December 6, 1916 . The term ‘antitrust laws’ has the meaning given the term in section 1(a) of the Clayton Act ( 15 U.S.C. 12(a) ), except that the term also includes— the Act of June 19, 1936 ( 15 U.S.C. 13 et seq.; commonly known as the Robinson-Patman Act); and section 5 of the Federal Trade Commission Act ( 15 U.S.C. 45 ), to the extent that such section applies to unfair methods of competition. The term ‘petroleum’ has the meaning given the term in section 7420(3) [now 8720(3)] of title 10, United States Code.

“SEC. 3402 AUTHORIZATION OF APPROPRIATIONS.

(“(a) Amount.— There are hereby authorized to be appropriated to the Secretary of Energy $22,500,000 for fiscal year 1999 for the purpose of carrying out— activities under chapter 641 [now 869] of title 10, United States Code, relating to the naval petroleum reserves; closeout activities at Naval Petroleum Reserve Numbered 1 upon the sale of that reserve under subtitle B of title XXXIV of the National Defense Authorization Act for Fiscal Year 1996 ( Public Law 104–106 ; 10 U.S.C. 7420 note [now 10 U.S.C. 8720 note]); and activities under this title relating to the disposition of Naval Petroleum Reserve Numbered 2, Naval Petroleum Reserve Numbered 3, and Oil Shale Reserve Numbered 2.

(“(b) Period of Availability.— Funds appropriated pursuant to the authorization of appropriations in subsection (a) shall remain available until expended.

“SEC. 3403 DISPOSAL OF NAVAL PETROLEUM RESERVE NUMBERED 2.

(“(a) Disposal of Ford City Lots Authorized.— Subject to section 3406, the Secretary of Energy may dispose of the portion of Naval Petroleum Reserve Numbered 2 that is located within the town lots in Ford City, California, which are identified as ‘Drill Sites Numbered 3A, 4, 6, 9A, 20, 22, 24, and 26’ and described in the document entitled ‘Ford City Drill Site Locations—NPR–2,’ and accompanying maps on file in the office of the Deputy Assistant Secretary for Naval Petroleum and Oil Shale Reserves of the Department of Energy. The Secretary of Energy shall carry out the disposal authorized by paragraph (1) by competitive sale or lease consistent with commercial practices, by transfer to another Federal agency or a public or private entity, or by such other means as the Secretary considers appropriate. Any competitive sale or lease under this subsection shall provide for the disposal of all right, title, and interest of the United States in the property to be conveyed. The Secretary of Energy may use the authority provided by the Act of June 14, 1926 ( 43 U.S.C. 869 et seq.; commonly known as the Recreation and Public Purposes Act), in the same manner and to the same extent as the Secretary of the Interior, to dispose of the portion of Naval Petroleum Reserve Numbered 2 described in paragraph (1). Section 2696(a) of title 10 , United States Code, regarding the screening of real property for further Federal use before disposal, shall apply to the disposal authorized by paragraph (1).

(“[(b) Repealed. Pub. L. 109–58, title III, § 331(d) , Aug. 8, 2005 , 119 Stat. 695 .]

(“(c) Relationship to Antitrust Laws.— This section does not modify, impair, or supersede the operation of the antitrust laws.

“SEC. 3404 DISPOSAL OF NAVAL PETROLEUM RESERVE NUMBERED 3.

(“(a) Administration Pending Termination of Operations.— The Secretary of Energy shall continue to administer Naval Petroleum Reserve Numbered 3 in accordance with chapter 641 [now 869] of title 10, United States Code, until such time as the Secretary makes a determination to abandon oil and gas operations in Naval Petroleum Reserve Numbered 3 in accordance with commercial operating practices.

(“(b) Disposal Authorized.— After oil and gas operations are abandoned in Naval Petroleum Reserve Numbered 3, the Secretary of Energy may dispose of the reserve as provided in this subsection. Subject to section 3406, the Secretary shall carry out any such disposal of the reserve by sale or lease or by transfer to another Federal agency. Any sale or lease shall provide for the disposal of all right, title, and interest of the United States in the property to be conveyed and shall be conducted in accordance with competitive procedures consistent with commercial practices, as established by the Secretary.

(“(c) Relationship to Antitrust Laws.— This section does not modify, impair, or supersede the operation of the antitrust laws.

“SEC. 3405 DISPOSAL OF OIL SHALE RESERVE NUMBERED 2.

(“(a) Definitions.— In this section: The term ‘NOSR–2’ means Oil Shale Reserve Numbered 2, as identified on a map on file in the Office of the Secretary of the Interior. The term ‘Moab site’ means the Moab uranium milling site located approximately three miles northwest of Moab, Utah, and identified in the Final Environmental Impact Statement issued by the Nuclear Regulatory Commission in March 1996 in conjunction with Source Materials License No. SUA–917. The term ‘map’ means the map depicting the boundaries of NOSR–2, to be kept on file and available for public inspection in the offices of the Department of the Interior. The term ‘Tribe’ means the Ute Indian Tribe of the Uintah and Ouray Indian Reservation. The term ‘Trustee’ means the Trustee of the Moab Mill Reclamation Trust.

(“(b) Conveyance.— Except as provided in paragraph (2) and subsection (e), all right, title, and interest of the United States in and to all Federal lands within the exterior boundaries of NOSR–2 (including surface and mineral rights) are hereby conveyed to the Tribe in fee simple. The Secretary of Energy shall execute and file in the appropriate office a deed or other instrument effectuating the conveyance made by this section. The conveyance under paragraph (1) does not include the following: The portion of the bed of Green River contained entirely within NOSR–2, as depicted on the map. The land (including surface and mineral rights) to the west of the Green River within NOSR–2, as depicted on the map. A ¼ mile scenic easement on the east side of the Green River within NOSR–2.

(“(c) Conditions on Conveyance.— The conveyance under subsection (b) is subject to valid existing rights in effect on the day before the date of the enactment of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 [ Oct. 30, 2000 ]. On completion of the conveyance under subsection (b), the United States relinquishes all management authority over the conveyed land, including tribal activities conducted on the land. With respect to the land conveyed to the Tribe under subsection (b)— the land shall not be subject to any Federal restriction on alienation; and notwithstanding any provision to the contrary in the constitution, bylaws, or charter of the Tribe, the Act of May 11, 1938 (commonly known as the ‘Indian Mineral Leasing Act of 1938’) ( 25 U.S.C. 396a et seq.), the Indian Mineral Development Act of 1982 ( 25 U.S.C. 2101 et seq.), section 2103 of the Revised Statutes ( 25 U.S.C. 81 ), or section 2116 of the Revised Statutes ( 25 U.S.C. 177 ), or any other law, no purchase, grant, lease, or other conveyance of the land (or any interest in the land), and no exploration, development, or other agreement relating to the land that is authorized by resolution by the governing body of the Tribe, shall require approval by the Secretary of the Interior or any other Federal official. The reservation of the easement under subsection (b)(2)(C) shall not affect the right of the Tribe to use and maintain access to the Green River through the use of the road within the easement, as depicted on the map. Each withdrawal that applies to NOSR–2 and that is in effect on the date of the enactment of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 [ Oct. 30, 2000 ] is revoked to the extent that the withdrawal applies to NOSR–2. Notwithstanding that the land conveyed to the Tribe under subsection (b) shall not be part of the reservation of the Tribe, such land shall be deemed to be part of the reservation of the Tribe for the purposes of criminal and civil jurisdiction.

(“(d) Administration of Unconveyed Land and Interests in Land.— The land and interests in land excluded by subparagraphs (A) and (B) of subsection (b)(2) from conveyance under subsection (b) shall be administered by the Secretary of the Interior in accordance with the Federal Land Policy and Management Act of 1976 ( 43 U.S.C. 1701 et seq.). Not later than three years after the date of the enactment of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 [ Oct. 30, 2000 ], the Secretary of the Interior shall submit to Congress a land use plan for the management of the land and interests in land referred to in paragraph (1). There are authorized to be appropriated to the Secretary of the Interior such sums as are necessary to carry out this subsection.

(“(e) Royalty.— Notwithstanding the conveyance under subsection (b), the United States retains a nine percent royalty interest in the value of any oil, gas, other hydrocarbons, and all other minerals that are produced, saved, and sold from the conveyed land during the period beginning on the date of the conveyance and ending on the date the Secretary of Energy releases the royalty interest under subsection (i). The royalty payments shall be made by the Tribe or its designee to the Secretary of Energy during the period that the oil, gas, hydrocarbons, or minerals are being produced, saved, sold, or extracted. The Secretary of Energy shall retain and use the payments in the manner provided in subsection (i)(3). The royalty interest retained by the United States under this subsection does not include any development, production, marketing, and operating expenses. The Tribe shall submit to the Secretary of Energy and to Congress an annual report on resource development and other activities of the Tribe concerning the conveyance under subsection (b). Not later than five years after the date of the enactment of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 [ Oct. 30, 2000 ], and every five years thereafter, the Tribe shall obtain an audit of all resource development activities of the Tribe concerning the conveyance under subsection (b), as provided under chapter 75 of title 31, United States Code. The results of each audit under this paragraph shall be included in the next annual report submitted under paragraph (4).

(“(f) River Management.— The Tribe shall manage, under Tribal jurisdiction and in accordance with ordinances adopted by the Tribe, land of the Tribe that is adjacent to, and within ¼ mile of, the Green River in a manner that— maintains the protected status of the land; and is consistent with the government-to-government agreement and in the memorandum of understanding dated February 11, 2000 , as agreed to by the Tribe and the Secretary of the Interior. An ordinance referred to in paragraph (1) shall not impair, limit, or otherwise restrict the management and use of any land that is not owned, controlled, or subject to the jurisdiction of the Tribe. An ordinance adopted by the Tribe and referenced in the government-to-government agreement may not be repealed or amended without the written approval of both the Tribe and the Secretary of the Interior.

(“(g) Plant Species.— In accordance with a government-to-government agreement between the Tribe and the Secretary of the Interior, in a manner consistent with levels of legal protection in effect on the date of the enactment of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 [ Oct. 30, 2000 ], the Tribe shall protect, under ordinances adopted by the Tribe, any plant species that is— listed as an endangered species or threatened species under section 4 of the Endangered Species Act of 1973 ( 16 U.S.C. 1533 ); and located or found on the NOSR–2 land conveyed to the Tribe. The protection described in paragraph (1) shall be performed solely under tribal jurisdiction.

(“(h) Horses.— The Tribe shall manage, protect, and assert control over any horse not owned by the Tribe or tribal members that is located or found on the NOSR–2 land conveyed to the Tribe in a manner that is consistent with Federal law governing the management, protection, and control of horses in effect on the date of the enactment of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 [ Oct. 30, 2000 ]. The management, control, and protection of horses described in paragraph (1) shall be performed solely— under tribal jurisdiction; and in accordance with a government-to-government agreement between the Tribe and the Secretary of the Interior.

(“(i) Remedial Action at Moab Site.— The Secretary of Energy shall prepare a plan for remediation, including ground water restoration, of the Moab site in accordance with title I of the Uranium Mill Tailings Radiation Control Act of 1978 ( 42 U.S.C. 7911 et seq.). The Secretary of Energy shall enter into arrangements with the National Academy of Sciences to obtain the technical advice, assistance, and recommendations of the National Academy of Sciences in objectively evaluating the costs, benefits, and risks associated with various remediation alternatives, including removal or treatment of radioactive or other hazardous materials at the site, ground water restoration, and long-term management of residual contaminants. If the Secretary prepares a remediation plan that is not consistent with the recommendations of the National Academy of Sciences, the Secretary shall submit to Congress a report explaining the reasons for deviation from the National Academy of Sciences’ recommendations. The remediation plan required by subparagraph (A) shall be completed not later than one year after the date of the enactment of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 [ Oct. 30, 2000 ], and the Secretary of Energy shall commence remedial action at the Moab site as soon as practicable after the completion of the plan. The license for the materials at the Moab site issued by the Nuclear Regulatory Commission shall terminate one year after the date of the enactment of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001, unless the Secretary of Energy determines that the license may be terminated earlier. Until the license is terminated, the Trustee, subject to the availability of funds appropriated specifically for a purpose described in clauses (i) through (iii) or made available by the Trustee from the Moab Mill Reclamation Trust, may carry out— interim measures to reduce or eliminate localized high ammonia concentrations in the Colorado River, identified by the United States Geological Survey in a report dated March 27, 2000 ; activities to dewater the mill tailings at the Moab site; and other activities related to the Moab site, subject to the authority of the Nuclear Regulatory Commission and in consultation with the Secretary of Energy. As part of the remediation plan for the Moab site required by subparagraph (A), the Secretary of Energy shall develop, in consultation with the Trustee, the Nuclear Regulatory Commission, and the State of Utah, an efficient and legal means for transferring all responsibilities and title to the Moab site and all the materials therein from the Trustee to the Department of Energy. The Secretary of Energy shall limit the amounts expended in carrying out the remedial action under paragraph (1) to— amounts specifically appropriated for the remedial action in an appropriation Act; and other amounts made available for the remedial action under this subsection. The royalty payments received by the Secretary of Energy under subsection (e) shall be available to the Secretary, without further appropriation, to carry out the remedial action under paragraph (1) until such time as the Secretary determines that all costs incurred by the United States to carry out the remedial action (other than costs associated with long-term monitoring) have been paid. Upon making the determination referred to in subparagraph (A), the Secretary of Energy shall transfer all remaining royalty amounts to the general fund of the Treasury and release to the Tribe the royalty interest retained by the United States under subsection (e). Funds made available to the Department of Energy for national security activities shall not be used to carry out the remedial action under paragraph (1), except that the Secretary of Energy may use such funds for program direction directly related to the remedial action. There are authorized to be appropriated to the Secretary of Energy to carry out the remedial action under paragraph (1) such sums as are necessary. If the Moab site is sold after the date on which the Secretary of Energy completes the remedial action under paragraph (1), the seller shall pay to the Secretary of Energy, for deposit in the general fund of the Treasury, the portion of the sale price that the Secretary determines resulted from the enhancement of the value of the Moab site as a result of the remedial action. The enhanced value of the Moab site shall be equal to the difference between— the fair market value of the Moab site on the date of the enactment of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 [ Oct. 30, 2000 ], based on information available on that date; and the fair market value of the Moab site, as appraised on completion of the remedial action. Not later than October 1, 2019 , the Secretary of Energy shall complete remediation at the Moab site and removal of the tailings to the Crescent Junction site in Utah. In the event the Secretary of Energy is unable to complete remediation at the Moab Site by October 1, 2019 , the Secretary shall submit to Congress a plan setting forth the projected completion date and the estimated funding to meet the revised date. The Secretary shall submit the plan, if required, to Congress not later than October 2, 2019 .

“SEC. 3406 ADMINISTRATION.

(“(a) Protection of Existing Rights.— At the discretion of the Secretary of Energy, the disposal of property under this title shall be subject to any contract related to the United States ownership interest in the property in effect at the time of disposal, including any lease agreement pertaining to the United States interest in Naval Petroleum Reserve Numbered 2.

(“(b) Deposit of Receipts.— Notwithstanding any other law, all monies received by the United States from the disposal of property under this title, including any monies received from a lease entered into under this title, shall be deposited in the general fund of the Treasury.

(“(c) Treatment of Royalties.— Any petroleum accruing to the United States as royalty from any lease of lands transferred under this title shall be delivered to the United States, or shall be paid for in money, as the Secretary of the Interior may elect.

(“(d) Elements of Lease.— A lease under this title may provide for the exploration for, and development and production of, petroleum, other than petroleum in the form of oil shale.

(“(e) Waiver of Requirements Regarding Consultation and Approval.— Section 7431 [now 8731] of title 10, United States Code, shall not apply to the disposal of property under this title.

(“(f) Oil Shale Reserve Numbered 2.— This section does not apply to the transfer of Oil Shale Reserve Numbered 2 under section 3405.”

“SEC. 3411 DEFINITIONS.

“For purposes of this subtitle: The terms ‘Naval Petroleum Reserve Numbered 1’ and ‘reserve’ mean Naval Petroleum Reserve Numbered 1, commonly referred to as the Elk Hills Unit, located in Kern County, California, and established by Executive order of the President, dated September 2, 1912 . The term ‘naval petroleum reserves’ has the meaning given that term in section 7420(2) [now 8720(2)] of title 10, United States Code, except that the term does not include Naval Petroleum Reserve Numbered 1. The term ‘unit plan contract’ means the unit plan contract between equity owners of the lands within the boundaries of Naval Petroleum Reserve Numbered 1 entered into on June 19, 1944 . The term ‘effective date’ means the date of the enactment of this Act [ Feb. 10, 1996 ]. The term ‘Secretary’ means the Secretary of Energy. The term ‘appropriate congressional committees’ means the Committee on Armed Services of the Senate and the Committee on Armed Services and the Committee on Commerce [now Committee on Energy and Commerce] of the House of Representatives.

“SEC. 3412 SALE OF NAVAL PETROLEUM RESERVE NUMBERED 1.

(“(a) Sale of Reserve Required.— Subject to section 3414, not later than two years after the effective date, the Secretary of Energy shall enter into one or more contracts for the sale of all right, title, and interest of the United States in and to all lands owned or controlled by the United States inside Naval Petroleum Reserve Numbered 1. Chapter 641 [now 869] of title 10, United States Code, shall not apply to the sale of the reserve.

(“(b) Equity Finalization.— Not later than eight months after the effective date, the Secretary shall finalize equity interests of the known oil and gas zones in Naval Petroleum Reserve Numbered 1 in the manner provided by this subsection. The Secretary shall retain the services of an independent petroleum engineer, mutually acceptable to the equity owners, who shall prepare a recommendation on final equity figures. The Secretary may accept the recommendation of the independent petroleum engineer for final equity in each known oil and gas zone and establish final equity interest in Naval Petroleum Reserve Numbered 1 in accordance with the recommendation, or the Secretary may use such other method to establish final equity interest in the reserve as the Secretary considers appropriate. If, on the effective date, there is an ongoing equity redetermination dispute between the equity owners under section 9(b) of the unit plan contract, the dispute shall be resolved in the manner provided in the unit plan contract within eight months after the effective date. The resolution shall be considered final for all purposes under this section.

(“(c) Notice of Sale.— Not later than two months after the effective date, the Secretary shall publish a notice of intent to sell Naval Petroleum Reserve Numbered 1. The Secretary shall make all technical, geological, and financial information relevant to the sale of the reserve available to all interested and qualified buyers upon request. The Secretary, in consultation with the Administrator of General Services, shall ensure that the sale process is fair and open to all interested and qualified parties.

(“(d) Establishment of Minimum Sale Price.— Not later than seven months after the effective date, the Secretary shall retain the services of five independent experts in the valuation of oil and gas fields to conduct separate assessments, in a manner consistent with commercial practices, of the value of the interest of the United States in Naval Petroleum Reserve Numbered 1. The independent experts shall complete their assessments within 11 months after the effective date. In making their assessments, the independent experts shall consider (among other factors)— all equipment and facilities to be included in the sale; the estimated quantity of petroleum and natural gas in the reserve; and the net present value of the anticipated revenue stream that the Secretary and the Director of the Office of Management and Budget jointly determine the Treasury would receive from the reserve if the reserve were not sold, adjusted for any anticipated increases in tax revenues that would result if the reserve were sold. The independent experts retained under paragraph (1) shall also determine and submit to the Secretary the estimated total amount of the cost of any environmental restoration and remediation necessary at the reserve. The Secretary shall report the estimate to the Director of the Office of Management and Budget, the Secretary of the Treasury, and Congress. The Secretary, in consultation with the Director of the Office of Management and Budget, shall set the minimum acceptable price for the reserve. The Secretary may not set the minimum acceptable price below the higher of— the average of the five assessments prepared under paragraph (1); and the average of three assessments after excluding the high and low assessments.

(“(e) Administration of Sale; Draft Contract.— Not later than two months after the effective date, the Secretary shall retain the services of an investment banker or an appropriate equivalent financial adviser to independently administer, in a manner consistent with commercial practices and in a manner that maximizes sale proceeds to the Government, the sale of Naval Petroleum Reserve Numbered 1 under this section. Costs and fees of retaining the investment banker or financial adviser may be paid out of the proceeds of the sale of the reserve. Not later than 11 months after the effective date, the investment banker or financial adviser retained under paragraph (1) shall complete a draft contract or contracts for the sale of Naval Petroleum Reserve Numbered 1, which shall accompany the solicitation of offers and describe the terms and provisions of the sale of the interest of the United States in the reserve. The draft contract or contracts shall identify— all equipment and facilities to be included in the sale; and any potential claim or liability (including liability for environmental restoration and remediation), and the extent of any such claim or liability, for which the United States is responsible under subsection (g). The draft contract or contracts, including the terms and provisions of the sale of the interest of the United States in the reserve, shall be subject to review and approval by the Secretary, the Secretary of the Treasury, and the Director of the Office of Management and Budget. Each of those officials shall complete the review of, and approve or disapprove, the draft contract or contracts not later than 12 months after the effective date.

(“(f) Solicitation of Offers.— Not later than 13 months after the effective date, the Secretary shall publish the solicitation of offers for Naval Petroleum Reserve Numbered 1. Not later than 18 months after the effective date, the Secretary shall identify the highest responsible offer or offers for purchase of the interest of the United States in Naval Petroleum Reserve Numbered 1 that, in total, meet or exceed the minimum acceptable price determined under subsection (d)(3). The Secretary shall take such action immediately after the effective date as is necessary to obtain from an independent petroleum engineer within 10 months after that date a reserve report prepared in a manner consistent with commercial practices. The Secretary shall use the reserve report in support of the preparation of the solicitation of offers for the reserve.

(“(g) Future Liabilities.— To effectuate the sale of the interest of the United States in Naval Petroleum Reserve Numbered 1, the Secretary may extend such indemnities and warranties as the Secretary considers reasonable and necessary to protect the purchaser from claims arising from the ownership in the reserve by the United States.

(“(h) Maintaining Production.— Until the sale of Naval Petroleum Reserve Numbered 1 is completed under this section, the Secretary shall continue to produce the reserve at the maximum daily oil or gas rate from a reservoir, which will permit maximum economic development of the reservoir consistent with sound oil field engineering practices in accordance with section 3 of the unit plan contract.

(“(i) Noncompliance With Deadlines.— At any time during the two-year period beginning on the effective date, if the Secretary determines that the actions necessary to complete the sale of the reserve within that period are not being taken or timely completed, the Secretary shall transmit to the appropriate congressional committees a written notification of that determination together with a plan setting forth the actions that will be taken to ensure that the sale of the reserve will be completed within that period. The Secretary shall consult with the Director of the Office of Management and Budget in preparing the plan for submission to the committees.

(“(j) Oversight.— The Comptroller General shall monitor the actions of the Secretary relating to the sale of the reserve and report to the appropriate congressional committees any findings on such actions that the Comptroller General considers appropriate to report to the committees.

(“(k) Acquisition of Services.— The Secretary may enter into contracts for the acquisition of services required under this section under the authority of paragraph (7) of section 3304(a) of title 41 , United States Code, except that the notification required under subparagraph (B) of such paragraph for each contract shall be submitted to Congress not less than 7 days before the award of the contract.

“SEC. 3413 EFFECT OF SALE OF RESERVE.

(“(a) Effect on Existing Contracts.— In the case of any contract, in effect on the effective date, for the purchase of production from any part of the United States’ share of Naval Petroleum Reserve Numbered 1, the sale of the interest of the United States in the reserve shall be subject to the contract for a period of three months after the closing date of the sale or until termination of the contract, whichever occurs first. The term of any contract entered into after the effective date for the purchase of the production shall not exceed the anticipated closing date for the sale of the reserve. The Secretary shall exercise the termination procedures provided in the contract between the United States and Bechtel Petroleum Operation, Inc., Contract Number DE–ACO1–85FE60520 so that the contract terminates not later than the date of closing of the sale of Naval Petroleum Reserve Numbered 1 under section 3412. The Secretary shall exercise the termination procedures provided in the unit plan contract so that the unit plan contract terminates not later than the date of closing of the sale of reserve.

(“(b) Effect on Antitrust Laws.— Nothing in this subtitle shall be construed to alter the application of the antitrust laws of the United States to the purchaser or purchasers (as the case may be) of Naval Petroleum Reserve Numbered 1 or to the lands in the reserve subject to sale under section 3412 upon the completion of the sale.

(“(c) Preservation of Private Right, Title, and Interest.— Nothing in this subtitle shall be construed to adversely affect the ownership interest of any other entity having any right, title, and interest in and to lands within the boundaries of Naval Petroleum Reserve Numbered 1 and which are subject to the unit plan contract.

(“(d) Transfer of Otherwise Nontransferable Permit.— The Secretary may transfer to the purchaser or purchasers (as the case may be) of Naval Petroleum Reserve Numbered 1 the incidental take permit regarding the reserve issued to the Secretary by the United States Fish and Wildlife Service and in effect on the effective date if the Secretary determines that transfer of the permit is necessary to expedite the sale of the reserve in a manner that maximizes the value of the sale to the United States. The transferred permit shall cover the identical activities, and shall be subject to the same terms and conditions, as apply to the permit at the time of the transfer.

“SEC. 3414 CONDITIONS ON SALE PROCESS.

(“(a) Notice Regarding Sale Conditions.— The Secretary may not enter into any contract for the sale of Naval Petroleum Reserve Numbered 1 under section 3412 until the end of the 31-day period beginning on the date on which the Secretary submits to the appropriate congressional committees a written notification— describing the conditions of the proposed sale; and containing an assessment by the Secretary of whether it is in the best interests of the United States to sell the reserve under such conditions.

(“(b) Authority to Suspend Sale.— The Secretary may suspend the sale of Naval Petroleum Reserve Numbered 1 under section 3412 if the Secretary and the Director of the Office of Management and Budget jointly determine that— the sale is proceeding in a manner inconsistent with achievement of a sale price that reflects the full value of the reserve; or a course of action other than the immediate sale of the reserve is in the best interests of the United States. Immediately after making a determination under paragraph (1) to suspend the sale of Naval Petroleum Reserve Numbered 1, the Secretary shall submit to the appropriate congressional committees a written notification describing the basis for the determination and requesting a reconsideration of the merits of the sale of the reserve.

(“(c) Effect of Reconsideration Notice.— After the Secretary submits a notification under subsection (b), the Secretary may not complete the sale of Naval Petroleum Reserve Numbered 1 under section 3412 or any other provision of law unless the sale of the reserve is authorized in an Act of Congress enacted after the date of the submission of the notification.

“SEC. 3415 TREATMENT OF STATE OF CALIFORNIA CLAIM REGARDING RESERVE.

(“(a) Reservation of Funds.— After the costs incurred in the conduct of the sale of Naval Petroleum Reserve Numbered 1 under section 3412 are deducted, nine percent of the remaining proceeds from the sale of the reserve shall be reserved in a contingent fund in the Treasury for payment to the State of California for the Teachers’ Retirement Fund of the State in the event that, and to the extent that, the claims of the State against the United States regarding production and proceeds of sale from Naval Petroleum Reserve Numbered 1 are— settled by agreement with the United States under subsection (c); or finally resolved in favor of the State by a court of competent jurisdiction, if a settlement agreement is not reached.

(“(b) Disposition of Funds.— In such amounts as may be provided in appropriation Acts, amounts in the contingent fund shall be available for paying a claim described in subsection (a). After final disposition of the claims, any unobligated balance in the contingent fund shall be credited to the general fund of the Treasury. If no payment is made from the contingent fund within 10 years after the effective date, amounts in the contingent fund shall be credited to the general fund of the Treasury.

(“(c) Settlement Offer.— Not later than 30 days after the date of the sale of Naval Petroleum Reserve Numbered 1 under section 3412, the Secretary shall offer to settle all claims of the State of California against the United States with respect to lands in the reserve located in sections 16 and 36 of township 30 south, range 23 east, Mount Diablo Principal Meridian, California, and production or proceeds of sale from the reserve, in order to provide proper compensation for the State’s claims. The Secretary shall base the amount of the offered settlement payment from the contingent fund on the fair value for the State’s claims, including the mineral estate, not to exceed the amount reserved in the contingent fund.

(“(d) Release of Claims.— Acceptance of the settlement offer made under subsection (c) shall be subject to the condition that all claims against the United States by the State of California for the Teachers’ Retirement Fund of the State be released with respect to lands in Naval Petroleum Reserve Numbered 1, including sections 16 and 36 of township 30 south, range 23 east, Mount Diablo Principal Meridian, California, or production or proceeds of sale from the reserve.

“SEC. 3416 STUDY OF FUTURE OF OTHER NAVAL PETROLEUM RESERVES.

(“(a) Study Required.— The Secretary of Energy shall conduct a study to determine which of the following options, or combinations of options, regarding the naval petroleum reserves (other than Naval Petroleum Reserve Numbered 1) would maximize the value of the reserves to the United States: Retention and operation of the naval petroleum reserves by the Secretary under chapter 641 [now 869] of title 10, United States Code. Transfer of all or a part of the naval petroleum reserves to the jurisdiction of another Federal agency for administration under chapter 641 [now 869] of title 10, United States Code. Transfer of all or a part of the naval petroleum reserves to the Department of the Interior for leasing in accordance with the Mineral Leasing Act ( 30 U.S.C. 181 et seq.) and surface management in accordance with the Federal Land Policy and Management Act [of 1976] ( 43 U.S.C. 1701 et seq.). Sale of the interest of the United States in the naval petroleum reserves.

(“(b) Conduct of Study.— The Secretary shall retain an independent petroleum consultant to conduct the study.

(“(c) Considerations Under Study.— An examination of the value to be derived by the United States from the transfer or sale of the naval petroleum reserves shall include an assessment and estimate of the fair market value of the interest of the United States in the naval petroleum reserves. The assessment and estimate shall be made in a manner consistent with customary property valuation practices in the oil and gas industry.

(“(d) Report and Recommendations Regarding Study.— Not later than June 1, 1996 , the Secretary shall submit to Congress a report describing the results of the study and containing such recommendations (including proposed legislation) as the Secretary considers necessary to implement the option, or combination of options, identified in the study that would maximize the value of the naval petroleum reserves to the United States.”

§ 8721 Jurisdiction and control

(a) The Secretary shall take possession of all properties inside the naval petroleum reserves that are or may become subject to the control of and use by the United States for national defense purposes, except as otherwise provided in this chapter.

(b) The Secretary has exclusive jurisdiction and control over those lands inside Naval Petroleum Reserves Numbered 1 and 2 that are covered by leases granted under sections 181–184, 185–188, 189–194, 201, 202–209, 211–214, 223, 224–226, 226d, 226e, 227–229a, 241, 251, and 261–263 of title 30, and shall administer those leases.

§ 8722 Administration

(a) The Secretary, directly or by contract, lease, or otherwise, shall explore, prospect, conserve, develop, use, and operate the naval petroleum reserves in his discretion, subject to the provisions of subsection (c) and the other provisions of this chapter; except that no petroleum leases shall be granted at Naval Petroleum Reserves Numbered 1 and 3.

(b) Except as otherwise provided in this chapter, particularly subsection (c), the naval petroleum reserves shall be used and operated for— the protection, conservation, maintenance, and testing of those reserves; or the production of petroleum whenever and to the extent that the Secretary, with the approval of the President, finds that such production is needed for national defense purposes and the production is authorized by a joint resolution of Congress.

(c) In administering Naval Petroleum Reserves Numbered 1, 2, and 3, the Secretary is authorized and directed— to further explore, develop, and operate such reserves; to produce, during any extension of a period under paragraph (2), such reserves— at the maximum efficient rate consistent with sound engineering practices; or at a lesser rate consistent with sound engineering practices and the protection, conservation, maintenance, and testing of such reserves if the Secretary determines that the minimum price described in section 8730(b)(2) of this title cannot be attained for the United States share of petroleum (other than natural gas liquids) produced from such Reserves; during such production period or any extension thereof to sell or otherwise dispose of the United States share of such petroleum produced from such reserves as provided in section 8730 of this title ; and to construct, acquire, or contract for the use of storage and shipping facilities on and off the reserves and pipelines and associated facilities on and off the reserves for transporting petroleum from such reserves to the points where the production from such reserves will be refined or shipped. Any pipeline in the vicinity of a naval petroleum reserve not otherwise operated as a common carrier may be acquired by the Secretary by condemnation, if necessary, if the owner thereof refuses to accept, convey, and transport without discrimination and at reasonable rates any petroleum produced at such reserve. With the approval of the Secretary, rights-of-way for new pipelines and associated facilities may be acquired by the exercise of the right of eminent domain in the appropriate United States district court. Such rights-of-way may be acquired in the manner set forth in sections 3114–3116 and 3118 of title 40, and the prospective holder of the right-of-way is “the authority empowered by law to acquire the land” within the meaning of those sections. Such new pipelines shall accept, convey, and transport without discrimination and at reasonable rates any petroleum produced at such reserves as a common carrier. After April 5, 1982 , the President may extend the period of production in the case of any naval petroleum reserve for additional periods of not to exceed three years each— after the President requires an investigation to be made, in the case of each extension, to determine the necessity for continued production from such naval petroleum reserve; after the President submits to the Congress, at least 180 days before the expiration of the current production period prescribed by this section, or any extension thereof, a copy of the report made to him on such investigation together with a certification by him that continued production from such naval petroleum reserve is in the national interest; and if neither House of Congress within ninety days after receipt of such report and certification adopts a resolution disapproving further production from such naval petroleum reserve.

§ 8723 Periodic re-examination of production requirements

The Secretary shall from time to time reexamine the need for the production of petroleum from oil shale for national defense when that production is authorized under section 8722 of this title . If he finds that the authorized quantity is no longer needed, he shall reduce production to the amount currently needed for national defense. ( Aug. 10, 1956, ch. 1041 , 70A Stat. 458 , § 7423; Pub. L. 87–796, § 1(3) , Oct. 11, 1962 , 76 Stat. 904 ; Pub. L. 94–258, title II, § 201(4) , Apr. 5, 1976 , 90 Stat. 309 ; renumbered § 8723 and amended Pub. L. 115–232, div. A, title VIII , §§ 807(d)(5), 809(a), Aug. 13, 2018 , 132 Stat. 1836 , 1840.)

§ 8724 Protection of oil reserves; contracts for conservation

(a) To consolidate and protect the oil lands owned by the United States, the Secretary may— contract with owners and lessees of land inside or adjoining naval petroleum reserves for— conservation of oil and gas; and compensation for estimated drainage in lieu of drilling or operating offset wells; and acquire privately owned lands or leases inside Naval Petroleum Reserve Numbered 1 by exchange of— lands of the United States inside Naval Petroleum Reserve Numbered 1; the right to royalty production from any of the naval petroleum reserves; and the right to any money due the United States as a result of the wrongful extraction of petroleum products from lands inside Naval Petroleum Reserve Numbered 1.

(b) The Secretary shall report annually to Congress all agreements under this section.

§ 8725 Acquisition by condemnation and purchase

(a) Whenever the Secretary is unable to make arrangements he considers satisfactory for exchanges of land or agreements for conservation authorized by section 8724 of this title , the Secretary may acquire, with the approval of the President, such privately owned lands and leases— by purchase, inside the naval petroleum reserves, or outside those reserves on the same geologic structure; and by condemnation, inside Naval Petroleum Reserve Numbered 1, or, if there is substantial drainage, outside that reserve on the same geologic structure.

(b) The Secretary shall report annually to Congress all proceedings for purchase and condemnation under this section.

§ 8727 Cooperative or unit plans in the naval petroleum reserves

The Secretary, with the consent of the President, may make agreements, with respect to lands inside the naval petroleum reserves, of the same type as the Secretary of the Interior may make under section 17(m) of the Act of February 25, 1920 ( 30 U.S.C. 226(m) ). No such agreement made by the Secretary may extend the term of any lease unless the agreement so provides. ( Aug. 10, 1956, ch. 1041 , 70A Stat. 460 , § 7427; Pub. L. 94–258, title II, § 201(8) , Apr. 5, 1976 , 90 Stat. 309 ; Pub. L. 96–513, title V, § 513(33) , Dec. 12, 1980 , 94 Stat. 2934 ; Pub. L. 100–456, div. A, title XII, § 1233(g)(3) , Sept. 29, 1988 , 102 Stat. 2058 ; renumbered § 8727, Pub. L. 115–232, div. A, title VIII, § 807(d)(5) , Aug. 13, 2018 , 132 Stat. 1836 .)

§ 8728 Agreements and leases: provision for change

Every unit or cooperative plan of development and operation and every lease affecting lands owned by the United States within Naval Petroleum Reserve Numbered 2 and the oil shale reserves shall contain a provision authorizing the Secretary, subject to approval by the President and to any limitation in the plan or lease, to change from time to time the rate of prospecting and development on, and the quantity and rate of production from, lands of the United States under the plan or lease, notwithstanding any other provision of law. ( Aug. 10, 1956, ch. 1041 , 70A Stat. 460 , § 7428; Pub. L. 87–796, § 1(5) , Oct. 11, 1962 , 76 Stat. 905 ; Pub. L. 94–258, title II, § 201(9) , Apr. 5, 1976 , 90 Stat. 309 ; Pub. L. 106–398, § 1 [div. C, title XXXIV, § 3402(b)(2)] , Oct. 30, 2000 , 114 Stat. 1654 , 1654A–484; renumbered § 8728, Pub. L. 115–232, div. A, title VIII, § 807(d)(5) , Aug. 13, 2018 , 132 Stat. 1836 .)

§ 8729 Re-lease of certain lands: lessee’s preferential right

The Secretary, on terms prescribed by him, may re-lease lands in the naval petroleum reserves that were covered by leases made before July 1, 1936 , and terminated by law at the expiration of their initial twenty-year periods. If any such land is to be re-leased, the Secretary shall give to the former lessee preferential rights to the new lease. ( Aug. 10, 1956, ch. 1041 , 70A Stat. 460 , § 7429; Pub. L. 94–258, title II, § 201(10) , Apr. 5, 1976 , 90 Stat. 309 ; renumbered § 8729, Pub. L. 115–232, div. A, title VIII, § 807(d)(5) , Aug. 13, 2018 , 132 Stat. 1836 .)

§ 8730 Disposition of products

(a) In administering the naval petroleum reserves under this chapter, the Secretary shall use, store, or sell the petroleum produced from the naval petroleum reserves and lands covered by joint, unit, or other cooperative plans.

(b) Subject to paragraph (2) and notwithstanding any other provision of law, each sale of the United States share of petroleum shall be made by the Secretary at public sale to the highest qualified bidder, at such time, in such amounts, and after such advertising as the Secretary considers proper and without regard to Federal, State, or local regulations controlling sales or allocation of petroleum products. Each sale of the United States share of petroleum shall be for periods of not more than one year, except that a sale of natural gas may be made for a period of more than one year. The Secretary may not sell any part of the United States share of petroleum produced from Naval Petroleum Reserves Numbered 2 and 3 at a price less than the current sales price, as estimated by the Secretary, of comparable petroleum in the same area. For purposes of paragraph (2), the term “petroleum” does not include natural gas liquids.

(c) In no event shall the Secretary permit the award of any contract which would result in any person obtaining control, directly or indirectly, over more than 20 percent of the estimated annual United States share of petroleum produced from Naval Petroleum Reserve Numbered 1.

(d) Each proposal for sale under this title shall provide that the terms of every sale of the United States share of petroleum from the naval petroleum reserves shall be so structured as to give full and equal opportunity for the acquisition of petroleum by all interested persons, including major and independent oil producers and refiners alike. When the Secretary, in consultation with the Secretary of the Interior, determines that the public interests will be served by the sale of petroleum to small refiners not having their own adequate sources of supply of petroleum, the Secretary is authorized and directed to set aside a portion of the United States share of petroleum produced for sale to such refiners under the provisions of this section for processing or use in such refineries, except that— none of the production sold to small refiners may be resold in kind; production must be sold at a cost of not less than the prevailing local market price of comparable petroleum; the set-aside portion may not exceed 25 percent of the estimated annual United States share of the total production from all producing naval petroleum reserves; and notwithstanding the provisions of subsection (b), the Secretary may, at his discretion if he deems it to be in the public interest, prorate such petroleum among such refiners for sale, without competition, at not less than the prevailing local market price of comparable petroleum.

(e) Any petroleum produced from the naval petroleum reserves, except such petroleum which is either exchanged in similar quantities for convenience or increased efficiency of transportation with persons or the government of an adjacent foreign state, or which is temporarily exported for convenience or increased efficiency of transportation across parts of an adjacent foreign state and reenters the United States, shall be subject to all of the limitations and licensing requirements of the Export Administration Act of 1979 ( 50 U.S.C. 4601 et seq.) and, in addition, before any petroleum subject to this section may be exported under the limitations and licensing requirement and penalty and enforcement provisions of the Export Administration Act of 1979, the President must make and publish an express finding that such exports will not diminish the total quality or quantity of petroleum available to the United States and that such exports are in the national interest and are in accord with the Export Administration Act of 1979.

(f) During the period of production or any extension thereof authorized by section 8722(c) of this title , the consultation and approval requirements of section 8731(a)(3) of this title are waived.

(g) Prior to the promulgation of any rules and regulations, plans of development and amendments thereto, and in the entering and making of contracts and operating agreements relating to the development, production, or sale of petroleum in or from the reserves, the Secretary shall consult with and give due consideration to the views of the Attorney General of the United States with respect to matters which may affect competition. No contract or operating agreement may be made, issued, or executed under this chapter until at least 15 days after the Secretary notifies the Attorney General of the proposed contract or operating agreement. Such notification shall contain such information as the Attorney General may require in order to advise the Secretary as to whether such contract or operating agreement may create or maintain a situation inconsistent with the antitrust laws. If, within such 15-day period, the Attorney General advises the Secretary that a contract or operating agreement may create or maintain a situation inconsistent with the antitrust laws, then the Secretary may not make, issue, or execute that contract or operating agreement.

(h) Nothing in this chapter shall be deemed to confer on any person immunity from civil or criminal liability, or to create defenses to actions, under the antitrust laws.

(i) In this section, the term “antitrust laws” means— the Sherman Act ( 15 U.S.C. 1 et seq.); the Clayton Act ( 15 U.S.C. 12 et seq.); the Federal Trade Commission Act ( 15 U.S.C. 41 et seq.); sections 73 and 74 of the Wilson Tariff Act ( 15 U.S.C. 8 and 9); and sections 2, 3, and 4 of the Act of June 19, 1936 (commonly referred to as the “Robinson-Patman Act”) ( 15 U.S.C. 13a , 13b, and 21a).

(j) Any pipeline which accepts, conveys, or transports any petroleum produced from Naval Petroleum Reserves Numbered 1 or Numbered 3 shall accept, convey, and transport without discrimination and at reasonable rates any such petroleum as a common carrier insofar as petroleum from such reserves is concerned. Every contract entered into by the Secretary for the sale of any petroleum owned by the United States which is produced from such reserves shall contain provisions implementing the requirements of the preceding sentence if the contractor owns a controlling interest in any pipeline or any company operating any pipeline, or is the operator of any pipeline, which carries any petroleum produced from such naval petroleum reserves. The Secretary may promulgate rules and regulations for the purpose of carrying out the provisions of this section and he, or the Secretary of the Interior where the authority extends to him, may declare forfeit any contract, operating agreement, right-of-way, permit, or easement held by any person violating any such rule or regulation. This section shall not apply to any natural gas common carrier pipeline operated by any person subject to regulation under the Natural Gas Act ( 15 U.S.C. 717 et seq.) or any public utility subject to regulation by a State or municipal regulatory agency having jurisdiction to regulate the rates and charges for the sale of natural gas to consumers within the State or municipality.

(k) With respect to all or any part of the United States share of petroleum produced from the naval petroleum reserves, the President may direct that the Secretary— place that petroleum in the Strategic Petroleum Reserve as authorized by sections 151 through 166 of the Energy Policy and Conservation Act ( 42 U.S.C. 6231–624 6); or exchange, directly or indirectly, that petroleum for other petroleum to be placed in the Strategic Petroleum Reserve under such terms and conditions and by such methods as the Secretary determines to be appropriate, without regard to otherwise applicable Federal procurement statutes and regulations. The requirements of section 159 of the Energy Policy and Conservation Act ( 42 U.S.C. 6239 ) do not apply to actions taken under this subsection.

(l) Notwithstanding any other provision of this chapter (but subject to paragraph (2)), during any period in which the production of petroleum is authorized from Naval Petroleum Reserves Numbered 1, 2, or 3, the Secretary, at the request of the Secretary of Defense, may provide any portion of the United States share of petroleum so produced to the Department of Defense for its use, exchange, or sale in order to meet petroleum product requirements of the Department of Defense. Petroleum may be provided to the Department of Defense under paragraph (1) either directly or by such exchange as the Secretary deems appropriate. Appropriate reimbursement reasonably reflecting the fair market value shall be provided by the Secretary of Defense for petroleum provided under this subsection. Any exchange made pursuant to this subsection may be made without regard to otherwise applicable Federal procurement statutes and regulations. Paragraph (1) does not apply to any petroleum set aside for small refiners under subsection (d) or placed in the Strategic Petroleum Reserve under subsection (k).

§ 8731 Requirements as to consultation and approval

(a) The Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives must be consulted and the President’s approval must be obtained before any condemnation proceedings may be started under this chapter and before any of the following transactions authorized by this chapter may be effective: A lease of any part of the naval petroleum reserves. A contract to alienate from the United States the use, control, or possession of any part of the naval petroleum reserves (except that consultation and Presidential approval are not required in connection with the issuance of permits, licenses, easements, grazing and agricultural leases, rights-of-way, and similar contracts pertaining to use of the surface area of the naval petroleum reserves). A contract to sell the petroleum (other than royalty oil and gas) produced from any part of the naval petroleum reserves. A contract for conservation or for compensation for estimated drainage. An agreement to exchange land, the right to royalty production, or the right to any money due the United States.

(b) During the period of production authorized by section 8722(c) of this title , the Secretary shall submit to the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives any new plans or substantial amendments to ongoing plans for the exploration, development, and production of the naval petroleum reserves. All plans or substantial amendments submitted to the Congress pursuant to this section shall contain a report by the Attorney General of the United States with respect to the anticipated effects of such plans or amendments on competition. Such plans or amendments shall not be implemented until sixty days after such plans or amendments have been submitted to such committees.

§ 8732 Authorizations of appropriations

(a) Funds for the following purposes may not be appropriated unless such appropriations have been specifically authorized by law: Exploration, prospecting, conservation, development, use, operations, and production of the naval petroleum reserves as authorized by this chapter. Production (including preparation for production) as authorized by this chapter or as may be authorized after April 5, 1976 . The construction and operation of facilities both within and outside the naval petroleum reserves incident to the production and the delivery of petroleum, including pipelines and shipping terminals. Sums appropriated for such purposes shall remain available until expended.

(b) Contracts under this chapter providing for the obligation of funds may be entered into for a period of five years, renewable for an additional five-year period; however, such contracts may obligate funds only to the extent that such funds are made available in appropriation Acts.

§ 8733 Disposition of royalties

(a) Any oil, gas, gasoline or other substance accruing to the United States as royalty from any lease under this chapter shall be delivered to the United States, or shall be paid for in money, as the Secretary elects.

(b) All money accruing to the United States from lands in the naval petroleum reserves shall be covered into the Treasury.

§ 8735 Foreign interest

(a) If the laws, customs, or regulations of any foreign country deny the privilege of leasing public lands to citizens or corporations of the United States, citizens of that foreign country, or corporations controlled by citizens of that country, may not, by contract made after July 1, 1937 , or by stock ownership, holding, or control, acquire or own any interest in, or right to any benefit from, any lease of land in the naval petroleum, naval oil shale, or other naval fuel reserves made under sections 181–184, 185–188, 189–194, 201, 202–209, 211–214, 223, 224–226, 226d, 226e, 227–229a, 241, 251, and 261–263 of title 30, or under this chapter.

(b) The Secretary may cancel any lease for any violation of this section.

§ 8736 Regulations

(a) The Secretary may prescribe regulations and take any proper action to accomplish the purposes of this chapter.

(b) All statements, reports, and representations required by the regulations shall be under oath, unless otherwise specified, and in such form as the Secretary requires.

§ 8737 Violations by lessee

(a) If a lessee fails to comply with any provision of this chapter, of his lease, or of regulations issued under section 8736 of this title that are in force on the date of his lease, the lease may be forfeited and cancelled by an appropriate proceeding in the United States district court for the district in which any part of the property is located.

(b) The lease may provide appropriate methods for the settlement of disputes and remedies for breach of specified conditions.

§ 8738 Rifle, Colorado, plant; possession, use, and transfer of

(a) The Secretary shall take possession of the experimental demonstration facility near Rifle, Colorado, which was constructed and operated by the Department of the Interior on lands on or near the naval oil shale reserves under the Act of April 5, 1944 ( 30 U.S.C. 321 et seq.).

(b) The Secretary, subject to the approval of the President, shall by contract, lease, or otherwise encourage the use of the facility described in subsection (a) in research, development, test, evaluation, and demonstration work. For such purposes the Secretary may use or lease for use by institutions, organizations, or individuals, public or private, the facility described in subsection (a) and may construct, install, and operate, or lease for operation additional experimental facilities on such lands. The Secretary may, after consultation with the Committee on Armed Services of the Senate and the Committee on Armed Services of the House of Representatives, mine and remove, or authorize the mining and removal, of any oil shale or products therefrom from lands in the naval oil shale reserves that may be needed for such experimentation.

(c) Nothing in this chapter shall be construed— to authorize the commercial development and operation of the naval oil shale reserves by the Government in competition with private industry; or in diminution of the responsibility of the Secretary in providing oil shale and products therefrom for needs of national defense.

§ 8739 Certain oil shale reserves: transfer of jurisdiction and petroleum exploration, development, and production

(a) Transfer Required.— Upon the enactment of this section, the Secretary of Energy shall transfer to the Secretary of the Interior administrative jurisdiction over all public domain lands included within Oil Shale Reserve Numbered 1 and those public domain lands included within the undeveloped tracts of Oil Shale Reserve Numbered 3. Not later than November 18, 1998 , the Secretary of Energy shall transfer to the Secretary of the Interior administrative jurisdiction over those public domain lands included within the developed tract of Oil Shale Reserve Numbered 3, which consists of approximately 6,000 acres and 24 natural gas wells, together with pipelines and associated facilities. Notwithstanding the transfer of jurisdiction, the Secretary of Energy shall continue to be responsible for all environmental restoration, waste management, and environmental compliance activities that are required under Federal and State laws with respect to conditions existing on the lands at the time of the transfer. Upon the transfer to the Secretary of the Interior of jurisdiction over public domain lands under this subsection, the other provisions of this chapter shall cease to apply with respect to the transferred lands.

(b) Authority To Lease.— Beginning on November 18, 1997 , or as soon thereafter as practicable, the Secretary of the Interior shall enter into leases with one or more private entities for the purpose of exploration for, and development and production of, petroleum (other than in the form of oil shale) located on or in public domain lands in Oil Shale Reserves Numbered 1 and 3 (including the developed tract of Oil Shale Reserve Numbered 3). Any such lease shall be made in accordance with the requirements of the Mineral Leasing Act ( 30 U.S.C. 181 et seq.) regarding the lease of oil and gas lands and shall be subject to valid existing rights. Notwithstanding the delayed transfer of the developed tract of Oil Shale Reserve Numbered 3 under subsection (a)(2), the Secretary of the Interior shall enter into a lease under paragraph (1) with respect to the developed tract before November 18, 1998 .

(c) Management.— The Secretary of the Interior, acting through the Director of the Bureau of Land Management, shall manage the lands transferred under subsection (a) in accordance with the Federal Land Policy and Management Act of 1976 ( 43 U.S.C. 1701 et seq.) and other laws applicable to the public lands.

(d) Transfer of Existing Equipment.— The lease of lands by the Secretary of the Interior under this section may include the transfer, at fair market value, of any well, gathering line, or related equipment owned by the United States on the lands transferred under subsection (a) and suitable for use in the exploration, development, or production of petroleum on the lands.

(e) Cost Minimization.— The cost of any environmental assessment required pursuant to the National Environmental Policy Act of 1969 ( 42 U.S.C. 4321 et seq.) in connection with a proposed lease under this section shall be paid out of unobligated amounts available for administrative expenses of the Bureau of Land Management.

(f) Treatment of Receipts.— Notwithstanding section 35 of the Mineral Leasing Act ( 30 U.S.C. 191 ), all moneys received during the period specified in paragraph (2) from a lease under this section (including moneys in the form of sales, bonuses, royalties (including interest charges collected under the Federal Oil and Gas Royalty Management Act of 1982 ( 30 U.S.C. 1701 et seq.)), and rentals) shall be covered into the Treasury of the United States and shall not be subject to distribution to the States pursuant to subsection (a) of such section 35. The period referred to in this subsection is the period beginning on November 18, 1997 , and ending on the date on which the Secretary of Energy and the Secretary of the Interior jointly certify to Congress that the sum of the moneys deposited in the Treasury under paragraph (1) is equal to the total of the following: The cost of all environmental restoration, waste management, and environmental compliance activities incurred by the United States with respect to the lands transferred under subsection (a). The cost to the United States to originally install wells, gathering lines, and related equipment on the transferred lands and any other cost incurred by the United States with respect to the lands.

(g) Use of Receipts.— The Secretary of the Interior may use, without further appropriation, not more than $1,500,000 of the moneys covered into the Treasury under subsection (f)(1) to cover the cost of any additional analysis, site characterization, and geotechnical studies deemed necessary by the Secretary to support environmental restoration, waste management, or environmental compliance with respect to Oil Shale Reserve Numbered 3. Upon the completion of such studies, the Secretary of the Interior shall submit to Congress a report containing— the results and conclusions of such studies; and an estimate of the total cost of the Secretary’s preferred alternative to address environmental restoration, waste management, and environmental compliance needs at Oil Shale Reserve Numbered 3. If the cost estimate required by paragraph (1)(B) does not exceed the total of the moneys covered into the Treasury under subsection (f)(1) and remaining available for obligation as of the date of submission of the report under paragraph (1), the Secretary of the Interior may access such moneys, beginning 60 days after submission of the report and without further appropriation, to cover the costs of implementing the preferred alternative to address environmental restoration, waste management, and environmental compliance needs at Oil Shale Reserve Numbered 3. If the cost estimate exceeds such available moneys, the Secretary of the Interior may only access such moneys as authorized by subsequent Act of Congress.