§ 1353. — Federal purchase and disposition of oil and gas.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 43USC1353]
TITLE 43--PUBLIC LANDS
CHAPTER 29--SUBMERGED LANDS
SUBCHAPTER III--OUTER CONTINENTAL SHELF LANDS
Sec. 1353. Federal purchase and disposition of oil and gas
(a) Payment of royalties or net profit shares in oil and gas; purchase
of oil and gas by United States; transfer of title to Federal
agencies
(1) Except as may be necessary to comply with the provisions of
sections 1335 and 1336 of this title, all royalties or net profit
shares, or both, accruing to the United States under any oil and gas
lease issued or maintained in accordance with this subchapter, shall, on
demand of the Secretary, be paid in oil or gas.
(2) The United States shall have the right to purchase not to exceed
16\2/3\ per centum by volume of the oil and gas produced pursuant to a
lease issued or maintained in accordance with this subchapter, at the
regulated price, or, if no regulated price applies, at the fair market
value at the well head of the oil and gas saved, removed, or sold,
except that any oil or gas obtained by the United States as royalty or
net profit share shall be credited against the amount that may be
purchased under this subsection.
(3) Title to any royalty, net profit share, or purchased oil or gas
may be transferred, upon request, by the Secretary to the Secretary of
Defense, to the Administrator of the General Services Administration, or
to the Secretary of Energy, for disposal within the Federal Government.
(b) Sale of oil by United States to public; disposition of oil to small
refiners; application of other laws
(1) The Secretary, except as provided in this subsection, may offer
to the public and sell by competitive bidding for not more than its
regulated price, or, if no regulated price applies, not less than its
fair market value, any part of the oil (A) obtained by the United States
pursuant to any lease as royalty or net profit share, or (B) purchased
by the United States pursuant to subsection (a)(2) of this section.
(2) Whenever, after consultation with the Secretary of Energy, the
Secretary determines that small refiners do not have access to adequate
supplies of oil at equitable prices, the Secretary may dispose of any
oil which is taken as a royalty or net profit share accruing or reserved
to the United States pursuant to any lease issued or maintained under
this subchapter, or purchased by the United States pursuant to
subsection (a)(2) of this section, by conducting a lottery for the sale
of such oil, or may equitably allocate such oil among the competitors
for the purchase of such oil, at the regulated price, or if no regulated
price applies, at its fair market value. The Secretary shall limit
participation in any allocation or lottery sale to assure such access
and shall publish notice of such allocation or sale, and the terms
thereof, at least thirty days in advance. Such notice shall include
qualifications for participation, the amount of oil to be sold, and any
limitation in the amount of oil which any participant may be entitled to
purchase.
(3) The Secretary may only sell or otherwise dispose of oil
described in paragraph (1) of this subsection in accordance with any
provision of law, or regulations issued in accordance with such
provisions, which provide for the Secretary of Energy to allocate,
transfer, exchange, or sell oil in amounts or at prices determined by
such provision of law or regulations.
(c) Sale of gas by United States to public
(1) Except as provided in paragraph (2) of this subsection, the
Secretary, pursuant to such terms as he determines, many \1\ offer to
the public and sell by competitive bidding for not more than its
regulated price, or, if no regulated price applies, not less than its
fair market value any part of the gas (A) obtained by the United States
pursuant to a lease as royalty or net profit share, or (B) purchased by
the United States pursuant to subsection (a)(2) of this section.
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\1\ So in original. Probably should be ``may''.
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(2) Whenever, after consultation with and advice from the Secretary
of Energy, the Federal Energy Regulatory Commission determines that an
emergency shortage of natural gas is threatening to cause severe
economic or social dislocation in any region of the United States and
that such region can be serviced in a practical, feasible, and efficient
manner by royalty, net profit share, or purchased gas obtained pursuant
to the provisions of this section, the Secretary of the Interior may
allocate or conduct a lottery for the sale of such gas, and shall limit
participation in any allocation or lottery sale of such gas to any
person servicing such region, but he shall not sell any such gas for
more than its regulated price, or, if no regulated price applies, less
than its fair market value. Prior to selling or allocating any gas
pursuant to this subsection, the Secretary shall consult with the
Federal Energy Regulatory Commission.
(d) Purchase by lessee of Federal oil or gas for which no bids received
The lessee shall take any Federal oil or gas for which no acceptable
bids are received, as determined by the Secretary, and which is not
transferred pursuant to subsection (a)(3) of this section, and shall pay
to the United States a cash amount equal to the regulated price, or, if
no regulated price applies, the fair market value of the oil or gas so
obtained.
(e) Definitions
As used in this section--
(1) the term ``regulated price'' means the highest price--
(A) at which oil many \2\ be sold pursuant to the Emergency
Petroleum Allocation Act of 1973 \3\ [15 U.S.C. 751 et seq.] and
any rule or order issued under such Act;
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\2\ So in original. Probably should be ``may''.
\3\ See References in Text note below.
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(B) at which natural gas may be sold to natural-gas
companies pursuant to the Natural Gas Act [15 U.S.C. 717 et
seq.], any other Act, regulations governing natural gas pricing,
or any rule or order issued under any such Act or any such
regulations; or
(C) at which either Federal oil or gas may be sold under any
other provision of law or rule or order thereunder which sets a
price (or manner for determining a price) for oil or gas; and
(2) the term ``small refiner'' has the meaning given such term
by Small Business Administration Standards 128.3-8(d) and (g), as in
effect on September 18, 1978, or as there-after revised or amended.
(f) Purchase of oil and gas in time of war
Nothing in this section shall prohibit the right of the United
States to purchase any oil or gas produced on the outer Continental
Shelf as provided by section 1341(b) of this title.
(Aug. 7, 1953, ch. 345, Sec. 27, as added Pub. L. 95-372, title II,
Sec. 208, Sept. 18, 1978, 92 Stat. 666.)
References in Text
The Emergency Petroleum Allocation Act of 1973, referred to in
subsec. (e)(1)(A), is Pub. L. 93-159, Nov. 27, 1973, 87 Stat. 628, as
amended, which was classified generally to chapter 16A (Sec. 751 et
seq.) of Title 15, Commerce and Trade, and was omitted from the Code
pursuant to section 760g of Title 15, which provided for the expiration
of the President's authority under that chapter on Sept. 30, 1981.
The Natural Gas Act, referred to in subsec. (e)(1)(B), is act June
21, 1938, ch. 556, 52 Stat. 821, as amended, which is classified
generally to chapter 15B (Sec. 717 et seq.) of Title 15. For complete
classification of that Act to the Code, see section 717w of Title 15 and
Tables.
Transfer of Functions
Functions vested in Secretary of Energy and Department of Energy
under or with respect to subsec. (b)(2), (3) of this section,
transferred to, and vested in, Secretary of the Interior, by section 100
of Pub. L. 97-257, 96 Stat. 841, set out as a note under section 7152 of
Title 42, The Public Health and Welfare.
