Bill Text: CA AB2257 | 2021-2022 | Regular Session | Amended
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: State lands: oil and gas leases: cost study.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Passed) 2022-09-28 - Chaptered by Secretary of State - Chapter 692, Statutes of 2022. [AB2257 Detail]
Download: California-2021-AB2257-Amended.html
measures evaluates the fiscal impact of a voluntary buy-out relinquishment of any lease interests in actively producing state offshore oil and gas leases in state waters.
Bill Title: State lands: oil and gas leases: cost study.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Passed) 2022-09-28 - Chaptered by Secretary of State - Chapter 692, Statutes of 2022. [AB2257 Detail]
Download: California-2021-AB2257-Amended.html
|
Amended
IN
Senate
June 15, 2022 |
|
Amended
IN
Assembly
May 19, 2022 |
|
Amended
IN
Assembly
March 21, 2022 |
CALIFORNIA LEGISLATURE—
2021–2022 REGULAR SESSION
Assembly Bill
No. 2257
| Introduced by Assembly |
February 16, 2022 |
An act to add Section 6880 to the Public Resources Code, relating to state lands.
LEGISLATIVE COUNSEL'S DIGEST
AB 2257, as amended, Boerner Horvath.
State lands: oil and gas leases: cost study.
Existing law establishes the State Lands Commission in the Natural Resources Agency. Existing law authorizes the commission to lease tide and submerged lands and beds of navigable rivers and lakes for purposes of the extraction of oil and gas, as provided. Existing law, notwithstanding this provision of law, prohibits a state agency or state officer from entering into any new lease for the extraction of oil or gas from the California Coastal Sanctuary, except as provided.
This bill would, contingent upon an appropriation of funds by the Legislature for this purpose, require the commission to develop, on or before December 31, 2024, a cost study that measures evaluates
the fiscal impact of a voluntary buy-out relinquishment of any lease interests in actively producing state offshore oil and gas leases in state waters, as provided. The bill would require the commission, on or before December 31, 2024, to submit the cost study to the Governor and the Legislature. The bill would require the commission to make the cost study available on its internet website.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NOBill Text
The people of the State of California do enact as follows:
SECTION 1.
The Legislature finds and declares all of the following:(a) Climate change The climate crisis is an existential threat that and the need to reduce greenhouse gas emissions grows more urgent each passing day.
(b)Average global temperatures are on track to rise by nearly two and a half degrees Celsius this century.
(c)The State of California, the fifth largest economy in the world, is aggressively pursuing various options to reduce greenhouse gas emissions and deaccelerate the impacts of climate change.
(b) The global temperature for January 2022 was the sixth highest for January in the 143-year National Oceanic and Atmospheric Administration record, which dates back to 1880. According to the National Centers for Environmental Information’s Global Annual Temperature Rankings Outlook, there is a greater then 99 percent chance that the year 2022 will rank among the 10 warmest years on record.
(c) The amount of future warming the Earth will experience depends on how much carbon dioxide and other greenhouse gases are emitted in coming decades. Today, burning fossil fuels and clearing forests add about 11 billion metric tons of carbon to the atmosphere each year.
(d) The United Nations’ Intergovernmental Panel on Climate Change has found that emissions
from fossil fuels are the dominant cause of global warming.
climate change. In 2018, 89 percent of global carbon dioxide emissions came from fossil fuels and industry. Oil, a fossil fuel that releases an enormous amount of carbon dioxide and other greenhouse gas emissions when burned, exacerbates the impacts of climate change. change and releases pollutants that lead to early death, heart attacks, respiratory disorders, stroke, asthma, and absenteeism at school and work.
(e) The State of California, the fifth largest economy in the world, is aggressively pursuing various options to reduce greenhouse gas emissions and deaccelerate the impacts of climate change by building on and accelerating successful approaches to carbon reduction by transitioning to a clean energy economy, drastically reducing the use of fossil fuels, achieving carbon neutrality by 2045 or sooner, and significantly cleaning the state’s air, especially in disadvantaged communities disproportionately burdened by persistent pollution.
(e)The advances
(f) While advances in clean energy development enable are enabling California to transition from fossil fuels to clean energy, a transition that will reduce the impacts of climate change. California will require much deeper greenhouse gas emissions reductions to reach its 2030 target of 40 percent below 1990 levels, and carbon neutrality no later than 2045, or sooner.
(f)
(g) Although California banned new offshore oil and gas leases through the California Coastal Sanctuary Act of 1994 (Chapter 3.4 (commencing with Section 6240) of Part 1 of Division 6 of the Public Resources Code), the remaining offshore oil
and gas leases continue as long as the lessee either produces or is capable of producing oil from the lease; that is, the leases lack an end date and may continue into perpetuity. there are 11 actively producing offshore oil and gas leases in state waters. These leases lack end dates and can continue to operate into perpetuity as long as it is economically feasible to continue to produce oil and gas.
(g)
(h) In October 2021, an underwater pipeline operated by Amplify Energy Corp. ruptured, spilling
nearly 25,000 gallons of oil into the Pacific Ocean and causing beach and fisheries closures, oiling wildlife, damaging the environment, and harming the regional and state coastal economies.
(h)
(i) California’s coastal economy annually employs 12.3 million people annually,
people, earning a total of almost $883.5 billion and equating to over $2 trillion in gross domestic product.
(i)
(j) The risk of an oil spill, and the economic and environmental catastrophe that could follow, coupled with the fact that fossil fuels exacerbate climate change, call for California to seek out ways to quicken the end of offshore oil and gas development.
(j)
(k) A cost study that assesses the potential fiscal impact of buying out a voluntary relinquishment of the remaining lease interests in the state’s last actively producing offshore oil and gas leases will provide the knowledge necessary for informed decisionmaking and practical solutions to end offshore oil and gas development,
which, from a climate and environmental
climate change, environmental, and public health perspective, is momentous. vital.
(k)
(l) A cost study that assesses the potential fiscal impact of buying out
a voluntary relinquishment of the remaining offshore oil and gas lease interests in the state’s actively producing offshore oil and gas leases is consistent with California’s role as a global leader in climate protection.
SEC. 2.
Section 6880 is added to the Public Resources Code, immediately following Section 6879, to read:6880.
(a) Contingent upon an appropriation of funds by the Legislature for this purpose, the commission shall develop, on or before December 31, 2024, a cost study that(b) The cost study shall consider, including, but not limited to, all of the following factors:
(1)Unrealized state revenues.
(2)Reasonably anticipated lost profits.
(3)Life of the reservoir based on proven reserves.
(4)Decommissioning costs.
(1) Expected duration of oil production at the time of leasing.
(2) State revenues received to date.
(3) Expected remaining life of the reservoir based on proven reserves.
(4) Reasonably anticipated unrealized lessee revenues and profits.
(5) Reasonably anticipated unrealized state revenues.
(6) Lessees’ decommissioning and restoration costs.
(c) (1) On or before December 31, 2024, the commission shall submit the cost study prepared pursuant to this section to the Governor and the Legislature.
(2) The commission shall make the cost study available on its internet website.
(d) (1) The cost study submitted to the Legislature pursuant to subdivision (c) shall be submitted in compliance with Section 9795 of the Government Code.
(2) Pursuant to Section 10231.5 of the Government Code, the requirement to submit a report imposed pursuant to paragraph (1) of subdivision (c) shall become inoperative on December 31, 2028.
