HB 695

1	A bill to be entitled
2	An act relating to the development of oil and gas
3	resources; authorizing a land management agency to
4	enter into a public-private partnership with a
5	business entity to develop oil and gas resources on
6	onshore state lands if the development yields near-
7	term revenues for the state; providing that the
8	financial, technical, and operational risk for the
9	exploration, development, and production of oil and
10	gas resources is the responsibility of the private
11	business entity; requiring that a business entity
12	seeking a public-private partnership contract submit a
13	business proposal to the agency for review; specifying
14	the information to be included in the business
15	proposal; requiring that the geophysical data and the
16	subsequent interpretation be made available to the
17	agency for review but remain in the possession of the
18	business entity; providing criteria for the agency to
19	use in selecting the exploration proposal by a
20	business entity; providing criteria for the public-
21	private partnership contract; requiring a proposed
22	public-private partnership contract to be approved by
23	the Cabinet sitting as the Board of Trustees of the
24	Internal Improvement Trust Fund; providing an
25	effective date.
26
27	WHEREAS, the detection and development of oil and gas
28	deposits on onshore lands owned by a board, department, or
29	agency of the state may provide the opportunity to produce
30	higher, near-term revenues to the state, and
31	WHEREAS, the monetary reward for discovering new reserves
32	of oil and gas deposits may be significant, and
33	WHEREAS, the exploration for oil and gas deposits by three-
34	dimensional, geophysical seismic methods and production, with
35	its related infrastructure, involving directional drilling and
36	horizontal drilling, although costly, is more thorough and
37	provides more data than older methods of exploration and
38	production in use over the past 50 years, NOW, THEREFORE,
39
40	Be It Enacted by the Legislature of the State of Florida:
41
42	Section 1.  (1)  DUTIES; AUTHORITY.-Notwithstanding the
43	provisions in chapter 253, Florida Statutes, if a land
44	management agency determines that there is an opportunity to
45	develop oil and gas resources on onshore lands owned by a board,
46	department, or agency of this state to yield greater, near-term
47	revenue returns for the state, the land management agency may
48	participate with a business entity authorized to conduct
49	business in the state in a public-private partnership contract.
50	(2)  PRIVATE-PARTNER RESPONSIBILITIES.-The financial,
51	technical, and operational risk for the exploration,
52	development, and production of oil and gas resources is the
53	responsibility of the private business entity.
54	(3)  PROPOSAL SELECTION.-
55	(a)  A business entity seeking a public-private partnership
56	contract shall submit a business proposal that describes the
57	exploration for oil or gas resources and the development of
58	state lands for those purposes. The business entity may nominate
59	state land that is to be explored and developed under the
60	public-private partnership contract. The proposal shall provide
61	an estimate of the revenues that the project is expected to
62	generate for the state.
63	(b)  The land management agency shall review the business
64	proposal in a timely manner and in a manner that is consistent
65	with contemporary industry practices. The geophysical seismic
66	exploration shall be of a duration consistent with industry
67	practices. The geophysical data acquired and the subsequent
68	interpretation shall be made available to the land management
69	agency or its representatives for review during the period
70	provided for in paragraph (4)(a), but shall remain in the sole
71	possession of the business entity until the business entity has
72	selected the lease areas.
73	(c)  The land management agency shall select a private
74	partner based on the business proposal. The land management
75	agency's consideration must include, but need not be limited to,
76	the technical quality of the exploration program proposed and
77	the proposed timetable of geophysical and drilling activities
78	which expedites the potential for generating revenues. If more
79	than one entity submits a proposal for a public-private
80	partnership for substantially the same area, the land management
81	agency shall evaluate and select the single proposal that will
82	provide the best value for the state.
83	(4)  PUBLIC-PRIVATE PARTNERSHIP CONTRACT.-The public-
84	private partnership contract shall provide for:
85	(a)  A period of 3 years or longer during which the private
86	partner may explore specified state lands by geophysical seismic
87	methods for the feasibility of oil and gas resource development
88	and production;
89	(b)  A selection process in which the private partner may
90	select prospective parcels of state land for exploration and
91	lease after the geophysical seismic testing;
92	(c)  A first right of refusal to lease a parcel of state
93	land identified as a result of the geophysical seismic
94	exploration for the development and production of oil or gas
95	resources for a term of at least 5 years;
96	(d)  Negotiated royalty rates and a lease bonus; and
97	(e)  Confidentiality for a period of at least 10 years for
98	the geophysical information, seismic interpretation, or
99	geological information developed as a result of the geophysical
100	seismic exploration by the business entity before the selection
101	of lease areas.
102	(5)  APPROVAL OF CONTRACT.-The proposed public-private
103	partnership contract must be approved by the Cabinet sitting as
104	the Board of Trustees of the Internal Improvement Trust Fund in
105	order to be legally binding on the State of Florida.
106	Section 2.  This act shall take effect July 1, 2012.

CODING: Words stricken are deletions; words underlined are additions.