CCLME.ORG - PRC Article 4 (commencing with PRC 6870) Ch. 3 Pt. 2 Div. 6
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State
California
PRC Sec 6870-6879 Oil and Gas Leases on Tide and Submerged Lands and Beds of Navigable Rivers and Lakes OIL AND GAS AND MINERAL LEASES (PUBLIC LANDS)


PUBLIC RESOURCES CODE
SECTION 6870-6879





6870. (a) Notwithstanding any other provision of law to the
contrary, no leases shall be let for the extraction of oil and gas
from coastal tidelands or submerged lands in state waters within the
Santa Barbara Channel unless the commission determines that such a
lease will not result in the seepage or spillage of oil (either by
finding that the safety and containment devices to be used are
sufficient to prevent such seepage or spillage or that no seepage or
spillage would result in any event) or in the destruction of scenic
or aesthetic values.
(b) As used in this section, the Santa Barbara Channel is the area
described as follows:
Beginning at the point of intersection of the ordinary high-water
mark of the Pacific Ocean with the westerly point of Point
Conception; thence in a generally easterly and southeasterly
direction along said ordinary high-water mark to the westerly point
of Point Mugu; thence in a generally southwesterly direction to the
southwest tip of Anacapa Island; thence along the inland sides of
Anacapa, Santa Cruz, Santa Rosa and San Miguel Islands to the most
westerly part of San Miguel Island; thence in a northerly direction
to the point of beginning; excluding the area described in
subdivision (b) of Section 6871.2.


6871. Tide and submerged lands and beds of navigable rivers and
lakes may be leased by the commission for the extraction of oil and
gas in accordance with the provisions of this article and of this
chapter insofar as not in conflict with the provisions of this
article. No political subdivision of the State or any city or county
or any official of either or any of them shall grant or issue any
lease, license, easement, privilege, or permit vesting authority in
any person to take or extract oil or gas from tide or submerged lands
whether filled or unfilled of which the State is the owner or from
which the State has the right to extract oil or gas, or both.



6871.3. Whenever it appears to the commission that it is for the
best interests of the State to lease lands subject to the provisions
of Section 6871.1 or 6877 of this code for the production of oil or
gas therefrom, or whenever a person who possesses the qualifications
provided in this chapter makes written request therefor, the
commission may, subject to the provisions of Section 6871.4, offer
the same for bidding at such times and in such parcels as the
commission shall determine to be in the best interests of the State.



6871.4. The commission may divide the lands within the area
proposed to be leased into parcels of convenient size and shape and
shall prepare a form of lease or leases therefor embracing not to
exceed 5,760 acres in any one lease.


6872.1. Whenever it appears to the commission that oil and gas
deposits are known or believed to be contained in any such lands as
are described in Section 6871.2, subdivision (b), of this code or in
tide and submerged lands along the coast of the Pacific Ocean south
of the northerly city limits of the City of Newport Beach in Orange
County to the southerly boundary of the state, and are being drained
by means of wells upon adjacent lands owned by others than the state,
the commission shall thereupon be authorized and empowered to lease
state-owned tide and submerged lands adjacent to any such wells for
the production of oil and gas therefrom, either as a tract or in
parcels of such size and shape as the commission shall determine but
only within an area and to an extent necessary to offset such
drainage of state-owned tide and submerged lands by any such wells
upon adjacent lands owned by others.



6872.2. If the commission determines that any tide and submerged
lands belonging to the state in the area hereinafter referred to
should be drilled pursuant to the terms of Section 6872.1 of this
code, then, notwithstanding the provisions of Section 6874 of this
code, in order to preserve and protect the highly developed
recreational and residential area now referred to, the commission
shall require that any well or wells drilled pursuant to the terms of
any lease issued with respect to any part of the hereinafter
described area be slant-drilled from an upland or littoral site to
and into the subsurface of the tide or submerged lands covered by the
lease. The area to which this section is applicable is the tide and
submerged lands along the coast of the Pacific Ocean south of the
northerly city limits of the City of Newport Beach in Orange County
to the southerly boundary of the state.



6872.5. The commission may adjust the boundaries of existing leases
to encompass all of a field partially contained within the existing
lease subject to both of the following conditions:
(a) The commission makes all of the following findings:
(1) The adjustment will permit more efficient utilization of state
resources.
(2) The number and size of existing offshore platforms will not be
increased, except that modifications to a platform within the
existing boundaries of a lease shall be permitted where the
modifications are reasonably necessary for development of all of the
resources within the reconfigured lease.
(3) The boundary adjustment will not require the construction or
major modification of a refinery in this state to permit development
of any increased production resulting from the boundary adjustment,
unless that construction or major modification is to a field
production facility servicing the lease.
(4) The boundary adjustment represents the environmentally least
damaging feasible alternative for the extraction and production of
affected resources.
(b) Those parts of the field within areas added to the existing
lease may not be developed except from upland sites or from existing
offshore facilities within the original lease boundaries.




6873. When leasing tide or submerged lands or beds of navigable
rivers or lakes, the commission shall prepare a form of lease which
shall contain, in addition to other provisions deemed desirable and
necessary by the commission, appropriate provisions contained in this
chapter and the following:
(a) Each well drilled pursuant to the terms of the lease may be
drilled or slant-drilled to and into the subsurface of the tide or
submerged lands or beds of navigable rivers or lakes, covered by the
lease from upland, riparian or littoral drill sites owned or
controlled by the state or owned by or available, at any time, to the
lessee, or from drill sites located upon any filled lands heretofore
or hereafter filled, whether contiguous or noncontiguous to the
riparian or littoral lands or uplands, or from any pier heretofore or
hereafter constructed owned by or available to the lessee and
available for such purpose, or from platforms or other fixed or
floating structure in, on or over the tide or submerged lands or beds
of navigable rivers or lakes, covered by the lease or otherwise
available to the lessee.
(b) Such lease shall prohibit the pollution or contamination of
the ocean, tidelands, or navigable rivers or lakes, and shall
prohibit the impairment of and interference with bathing, fishing, or
navigation in the waters of the ocean, any bay or inlet thereof, or
any navigable river or lake, and shall prohibit the impairment of and
interference with developed shoreline recreational or residential
areas. In addition, no oil, tar, residuary product of oil, or any
refuse of any kind from any well or works shall be permitted to be
deposited on or pass into the waters of the ocean, any bay or inlet
thereof, or any navigable river or lake.
This subdivision does not apply to the deposit on or passage into
such waters of water not containing any hydrocarbons or vegetable or
animal matter.
This subdivision does not prohibit the deposit on or passage into
the waters of the ocean or any bay or inlet thereof of drill
cuttings or drilling mud which are free of oil and materials that are
deleterious to marine life if such activities are under
authorization of a regional water quality control board.
(c) If the lessee, as disclosed by information submitted with his
bid, proposes to drill one or more wells from filled lands, whether
contiguous or noncontiguous to the riparian or littoral lands or
uplands, or from any pier or from platforms or other fixed or
floating structures to be constructed for such purpose, and if
permission from any federal or state agency is legally required in
order to construct any such filled land or structures, the lessee
shall be allowed a reasonable time following the execution of the
lease within which to secure the necessary permission from such
federal and state agencies as shall be legally required, and, upon
the securing of such permission, a further reasonable time,
determined with regard to the nature of the filled lands or structure
or structures to be constructed, within which to commence operations
for the drilling of such well or wells. The drilling term of the
lease shall be extended by the commission by a period equal to such
reasonable time to secure such permission, and, if necessary, to the
date to which the time to commence operations for the drilling of
such well or wells has been extended.
(d) Any offshore filled lands or structure or structures
constructed for the purpose of drilling pursuant to this section
shall conform to the rules and regulations of the commission in
effect at the time of invitation for bids in pursuance of which the
lease is awarded. Drilling, whether from upland, riparian, littoral
or offshore locations, shall be conducted in conformance with such
rules and regulations in effect at the time of invitation for bids in
pursuance of which the lease is awarded.
In the case of any existing lease of tide or submerged lands, the
commission may, with the consent of the other party thereto, amend
the same so as to contain or conform with subdivisions (a), (b), (c)
and (d) hereof, or any of them, except that the provisions of said
subdivision (d) when incorporated into such a lease by such an
amendment shall refer to the rules and regulations in effect at the
time such amendment is made rather than to those in effect at the
time of invitation for bids in pursuance of which the lease is
awarded and said subdivision (a) may not be incorporated into such a
lease without also incorporating said subdivision (d) therein.




6873.1. Filled lands shall include, but not be limited to, tide or
submerged lands or beds of navigable rivers or lakes, reclaimed
artificially through raising such lands above the highest probable
elevation of the tides, or high water line on the river banks or
shore, to form dry land, by placement of a fill or deposit of earth,
rock, sand or other solid imperishable material. Such fill may be
retained in place or protected by bulkheads, seawalls, revetments or
similar enclosures and may be placed at any location approved by the
commission under a lease heretofore or hereafter issued pursuant to
this article.


6873.2. In carrying out the requirements of subdivision (b) of
Section 6873 and the California Environmental Quality Act (Division
13 (commencing with Section 21000)), the commission shall, prior to
leasing tide and submerged lands or the beds of navigable rivers or
lakes for oil and gas, hold at least one hearing on any draft
environmental impact report prepared for the proposed lease. The
hearing shall be held within a city or county near the area being
considered for leasing. The commission shall give at least 30 days'
written notice regarding the public hearing to each city or county
within or adjacent to the proposed lease area and shall publish the
notice in the manner prescribed in Section 6834. The authority to
hold hearings provided in this section may be delegated by the
commission to its officers or employees.



6873.5. (a) In carrying out the requirements of subdivision (b) of
Section 6873 and the California Environmental Quality Act, the
commission shall, prior to the adoption of a form of lease for
leasing offshore tide and submerged lands between the mean high tide
line and the three-mile jurisdictional limit, consult with the
Department of Fish and Game, the National Marine Fisheries Service,
and representatives of the oil industry, representatives of fishermen
operating within the area being considered for leasing. The
commission shall hold at least one hearing on the draft environmental
document prepared for the proposed lease in a jurisdiction of a
local government within the coastal zone, as defined by Section
30103, near the area being considered for leasing. The commission
shall give at least 30 days' written notice regarding the public
hearing to each city or county within or adjacent to the proposed
lease area and shall publish the notice in the manner prescribed in
Section 6834. The authority to hold hearings provided in this
section may be delegated by the commission to its officers or
employees.
(b) The commission shall consider the potential impacts of the
proposed lease on the fisheries and marine habitat within the area
being considered for leasing. The commission shall include in its
consideration:
(1) The environmental document prepared for the proposed lease.
(2) Recommendations of the Department of Fish and Game, the
National Marine Fisheries Service, the oil industry, and fishermen.
(3) The cooperative efforts of the oil industry and fishermen to
develop plans to mitigate potential impacts.
(c) Fishery areas that should be considered for protection include
established fishing grounds or critical spawning or nursery grounds
as indicated by records of the Department of Fish and Game.
(d) The commission may impose terms, conditions, or operational
requirements it deems necessary to protect fisheries, including, but
not limited to, the exclusion of specified areas from development
activities.
(e) This section shall not be construed as a limitation on slant
or directional drilling under the excluded area from any location
outside an excluded fishery area.



6874. Each bid shall be accompanied by information giving a
description of the location or locations, structure or structures,
from which the bidder proposes to drill. In awarding a lease, the
commission shall not discriminate between bidders by prohibiting
drilling from upland, littoral or riparian drill sites, or drilling
from sites upon filled lands, whether contiguous or noncontiguous to
the riparian or littoral lands or uplands, or upon any pier or
platform or other fixed or floating structure in, on or over tide and
submerged lands or beds of navigable rivers or lakes, with respect
to which the State or other owner thereof has consented, or may
thereafter consent, to such use provided, however, that in the event
state-owned tide or submerged lands or beds of navigable rivers or
lakes are determined by the commission to contain oil or gas deposits
which are being drained by wells owned by others upon adjacent
lands, and such state-owned tide and submerged lands or beds of
navigable rivers or lakes cannot be developed by a particular method
of exploration, development or operation without interfering with or
impairing developed riverbank or shoreline, recreational or
residential areas, then the commission may offer and award an oil and
gas lease on such lands with a prohibition against said particular
method of exploration, development or operation.



6875. If the Legislature has transferred to any city or county the
administration of the trust, whether or not limited, under which tide
or submerged lands or beds of navigable rivers and lakes are held by
the State, the commission, pursuant to this chapter, may enter into
agreements upon behalf of the State to compensate any such city or
county for the use of surface drilling and operating sites upon such
lands from the royalty or revenue to be derived by the State from oil
and gas taken from such lands by lessees of the State.
Any such compensation shall include an amount sufficient
reasonably to compensate any such city or county for any damage to or
interference with the use or uses to which the surface of such lands
are being or may be utilized by or upon behalf of such city or
county. The consideration to the State in any such agreement shall
include the right to a lessee of the State to carry on all operations
on any such tidelands or beds of navigable rivers and lakes
necessary to accomplish the purposes of this chapter and such terms
and conditions as shall be determined by the commission to be in the
interests of the State.
The consideration to the State in any such agreement shall also
include a compromise, settlement and release of any and all claims
and rights which such city or county has or may have against the
State arising out of or in connection with the extraction and removal
of oil and gas from such lands. All money paid to any city or
county under this section shall be used by it solely in furtherance
of the trust under which the administration of tide and submerged
lands and beds of navigable rivers and lakes has been transferred to
such city or county and for the purposes expressed in the act so
transferring administration of such lands.



6876. Should it appear to the commission that any person,
association of persons, or corporation, has drilled, or is making
preparation to drill, wells upon or into tide or submerged lands of
which the State is the owner, or from which the State has the right
to extract oil or gas or both, for the extraction of oil or gas
therefrom, other than pursuant to authority granted in accordance
with this chapter, whether or not such person, association of
persons, or corporation may be acting under purported authority, the
commission shall cause an action to be instituted in the name of and
upon behalf of the State in a court of appropriate jurisdiction, to
enjoin the occupancy and operations upon or in such lands and to
demand compensation for injury and damage, if any, to such lands;
except that, should the drilling operations be conducted upon or in
lands which have been filled and if such operations have been
commenced prior to March 24, 1938, the commission, if it appears to
be in the interests of the State, may, upon behalf of the State,
issue a lease to any such person, association of persons, or
corporation in accordance with the provisions of this chapter insofar
as applicable, and upon a royalty basis, retrospective and
prospective, which appears reasonable and just in the circumstances
to the lessee and the State.


6877. All the beds of navigable rivers and lakes belonging to the
State may be leased pursuant to Section 6871.3 of this code for the
production of oil and gas, subject to the same limitations and
conditions imposed by this article, and in accordance with the
provisions of this chapter insofar as not in conflict with this
article.



6878. Nothing in this chapter limits the effect of any grant of
tide or submerged lands made prior to June 11, 1938, to any city,
county or other political subdivision, nor in any manner to prejudice
whatever claim the state, on the one hand, or such city, county or
political subdivision, on the other, may have in or to the right to
extract or authorize the extraction of oil or gas or other minerals
underlying such lands.
Notwithstanding any provision to the contrary herein, no city,
county or political subdivision to which the state has granted tide
or submerged lands without reserving minerals shall enter into any
lease or agreement for the extraction of oil, gas or other
hydrocarbons from such tide and submerged lands within any area
described in subdivisions (a) though (e), inclusive, of Section
6871.2 of this code, or from tide and submerged lands along the coast
of the Pacific Ocean south of the northerly city limits of the City
of Newport Beach in Orange County to the southerly boundary of the
state until the State Lands Commission has made findings in
accordance with the provisions of Section 6872 of this code regarding
any lands within any area described in subdivisions (a), (c), (d)
and (e) of Section 6871.2 of this code, or has made findings in
accordance with the provisions of Section 6872.1 of this code
regarding any lands within the area described in subdivision (b) of
Section 6871.2 of this code, or has made findings in accordance with
the provisions of Section 6872 of this code regarding any tide or
submerged lands along the coast of the Pacific Ocean south of the
northerly city limits of the City of Newport Beach in Orange County
to the southerly boundary of the state.
Provided further that any lease or agreement for the extraction of
oil and gas or other hydrocarbons from such granted tide or
submerged lands authorized to be entered into by a county, city or
political subdivision after necessary findings are made by the State
Lands Commission as heretofore provided shall be in accordance with
the provisions of Section 6872.1 of this code in respect to any lands
within the area described in subdivision (b) of Section 6871.2 of
this code, and shall be in accordance with the provisions of Section
6872.2 of this code in respect to any tide or submerged lands along
the coast of the Pacific Ocean south of the northerly city limits of
the City of Newport Beach in Orange County to the southerly boundary
of the state.



6879. Whenever tide and submerged lands of the State have been
granted to a city, county or city and county by a grant which does
not reserve to the State the right to produce oil and gas therefrom,
and such grantee shall determine that it is in the interest of
increasing the ultimate recovery of oil or gas from such lands, or of
the protection of oil or gas in said lands from unreasonable waste,
or that the subsidence or sinking of such lands and abutting lands
may possibly be arrested or ameliorated thereby, such grantee may
enter into agreements for the purpose of bringing about the
cooperative development and operation of all or a part or parts of
the oil and gas field in which such lands are located, or for the
purpose of bringing about the development or operation of all or a
part or parts of such field as a unit, or for the purpose of fixing
the time, location, and manner of drilling and operating of wells for
the production of oil or gas, or providing for the return or
injection of gas, water or other substances into the subsurface of
the earth for the purpose of storage or the repressuring of such oil
or gas field.
Each such agreement shall provide that any impairment of the
public trust for commerce, navigation or fisheries to which said
granted lands are subject is prohibited, and shall be submitted to
the State Lands Commission for approval. If the State Lands
Commission shall find that said agreement so provides and that the
entering into and the performance of such agreement is in the public
interest, then the State Lands Commission may approve such agreement
on behalf of the State.
The Legislature hereby finds and declares that the entering into
and the performance of any such agreement which has been approved by
the State Lands Commission will not impair the public trust for
commerce, navigation and fisheries to which said granted lands are
subject, and that any acts or things done pursuant to the terms
thereof or resulting therefrom are consistent with and not in
violation of the terms or conditions of any such grant or of any
trust, restrictions and conditions appertaining thereto. No such
agreement so approved by the State Lands Commission shall effect or
result in, or be so construed as to effect or result in a revocation
of or change in any trust pertaining to said lands, or in any grant,
conveyance, alienation or transfer of said lands, or any part
thereof, to any other individual, firm, or corporation, even though
such agreement provides for the pooling of oil, gas or other
hydrocarbon substances produced from said lands with oil, gas or
other hydrocarbon substances produced from other lands, or results in
the migration of any oil, gas or other hydrocarbon substances
between said lands and other lands. Any trusts, restrictions or
conditions pertaining to any production from said granted lands
included in any such agreement, or to any proceeds from such
production, shall apply only to that part of the production or that
part of the proceeds therefrom which is allocated to such city,
county or city and county on account of said lands under any such
agreement, and shall not apply to any other production or the
proceeds therefrom, whether or not the same may have been produced
from said lands or other lands.
If approved by the State Lands Commission, any such agreement
shall bind the State, and shall bind any of the following who execute
the same:
(a) Such city, county or city and county; and
(b) Any operator of such tide and submerged lands under contract
with such city, county or city and county, and such operators'
successors and assigns; and
(c) Any other party, and the successors and assigns of such other
party.
Any such agreement shall be enforceable in an action for specific
performance against the parties bound thereby.
No agreement executed pursuant to this section shall affect or
determine the boundaries of the tide and submerged lands granted, in
trust, to the City of Long Beach by Chapter 676, Statutes of 1911,
Chapter 102, Statutes of 1925, Chapter 158, Statutes of 1955, as
modified by Chapter 915, Statutes of 1951 and Chapter 29, Statutes of
1956, First Extraordinary Session.