10 December 2014

Oil and Gas Leases


[T]he only entities entitled to conduct oil and gas exploration, development, and production on the Outer Continental Shelf are lessees of the federal government. Century Exploration New Orleans, LLC v. US, (Fed. Cir. 2014).

Congress enacted OCSLA [The Outer Continental Shelf Lands Act] to ensure that a "vital national resource reserve held by the Federal Government for the public" would be "made available for expeditious and orderly development, subject to environmental safeguards, in a manner which is consistent with the maintenance of competition and other national needs." 43 U.S.C. § 1332(3). In furtherance of this objective, the Department of Interior enters into mineral leases with private parties. These mineral leases authorize private parties, such as oil companies, to explore the Outer Continental Shelf for oil and natural gas and extract any reserves that are discovered. Century Exploration New Orleans, LLC, ibid.

OCSLA vests the Secretary of the Interior with the authority to regulate exploration under the oil and gas leases, as well as the resulting development and production activities. Id. § 1334. Century Exploration New Orleans, LLC, ibid.


The Oil Pollution Act, 33 U.S.C. § 2701 et seq., is simultaneously narrower and broader in scope than OCSLA. In 1990, Congress enacted OPA in response to "rising public concern following the Exxon Valdez oil spill." [U]nlike OCSLA, which covers all mineral activity on the Outer Continental Shelf pursuant to leases from the United States, 43 U.S.C. §§ 1331-1356, OPA is specifically designed to govern oil spill prevention, clean up, and compensation in all United States navigable waters whatever the source of the exploration, development, and production rights. [Citations omitted.]Century Exploration New Orleans, LLC, ibid.

Oil and gas companies leasing land on the Outer Continental Shelf must comply with both OCSLA and OPA. These statutes contain some overlapping provisions, in particular those relating to the remediation of oils spills. For example,[ . . .] both OCSLA and OPA regulations require[ ] oil companies to submit Oil Spill Response Plans. Century Exploration New Orleans, LLC, ibid.

THIS CASEBOOK contains a selection of 38 U. S. Court of Appeals decisions that discuss and analyze issues stemming from oil and gas leases. The selection of decisions spans from January 2012 to the date of publication.