SB 559: Offshore oil drilling: leases.

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 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.

Existing law requires, contingent upon an appropriation of funds by the Legislature for this purpose, the commission to develop, on or before December 31, 2024, a cost study that evaluates the fiscal impact of a voluntary relinquishment of any lease interests in actively producing state offshore oil and gas leases in state waters.

This bill would require, before or upon the publication of the cost study, the commission to seek to initiate negotiations with the lessees for the active oil and gas leases in state waters, with the goal of reaching an agreement for the voluntary relinquishment of the leases and termination of all oil and gas production associated with these leases. The bill would require, if the commission is unable to reach an agreement with the lessees that results in voluntary relinquishments of the leases on or before December 31, 2025, 2026, the commission to terminate the leases and provide fair compensation, as determined through the cost study, if warranted, to the lessees. The bill would describe fair compensation for these purposes. The bill would also require the lessees to plug and abandon all oil and gas wells, decommission pipelines, offshore platforms, and attendant production facilities, and restore the tidelands and submerged lands in compliance with the requirements of the applicable law. The bill would include legislative findings and declarations.