BILL ANALYSIS
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UNFINISHED BUSINESS
Bill No: SB 23XXXX
Author: Ducheny (D)
Amended: 7/24/09
Vote: 21
SENATE FLOOR : Not relevant
ASSEMBLY FLOOR : Not available
SUBJECT : Budget Act of 2009: oil extraction lease in
state waters
SOURCE : Author
DIGEST : Assembly Amendments delete the prior version of
the bill expressing the intent of the Legislature to enact
statutory changes relating to the 2009 Budget Act.
This bill now allows an Interim Resources Management Board
to reconsider an oil extraction lease at Tranquillon Ridge.
This bill sunsets January 1, 2011.
ANALYSIS :
Specifics of the bill
1.Establishes an Interim Resources Management Board (IRMB)
of three members. The IRMB would sunset January 1, 2011.
2.The IRMB would have the authority to reconsider an oil
CONTINUED
SB 23XXXX
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and gas lease project in state waters that was rejected
by the State Lands Commission in January, 2009. If a new
lease is approved by the Board, the lease would be
administered by the Commission.
3.The IRMB would have the authority to enter into a lease
for oil and gas extraction. Such a lease would extend no
longer than 14 years in duration; the lessee would be
required to make a single pre-payment of royalties in the
amount of $100 million to the state treasury; the lease
requires the avoidance, reduction, and offset of the
project's greenhouse gas emissions; upon termination of
the lease the lessee commits to terminate all its
offshore oil production in California, remove all
on-shore oil processing facilities owned by the lessee,
donate 3,900 acres of land for public use and
conservation, and to use all feasible efforts to remove
four oil drilling platforms in federal waters.
4.The lessee would have to deposit into a special fund an
amount determined by the Board to be sufficient to
mitigate adverse environmental effects of offshore oil
drilling if the four platforms are not removed due to
circumstances beyond the control of the lessee.
5.Ancillary agreements related to the lease that was
rejected by the Commission would be directly incorporated
into the new lease and would become public documents.
6.The Attorney General would enforce the terms of the
lease.
7.Challenges to the lease brought by any person, except for
those brought by the Attorney General, must be brought
within 60 days.
8.This bill contains a sunset date of January 1, 2011.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
DLW:nl 7/24/09 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
SB 23XXXX
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