PRINTER'S NO. 302
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.347
Session of
2025
INTRODUCED BY OWLETT, PICKETT, ROWE, STENDER, HAMM, OLSOMMER,
KAUFFMAN, BANTA, GROVE, SMITH, BARGER AND ZIMMERMAN,
JANUARY 27, 2025
REFERRED TO COMMITTEE ON ENVIRONMENTAL AND NATURAL RESOURCE
PROTECTION, JANUARY 27, 2025
AN ACT
Providing for the leasing of subsurface rights on State forest
and park property for oil and natural gas development;
establishing a restricted account within the Oil and Gas
Lease Fund; making an appropriation; and abrogating an
executive order and other orders and administrative policies.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Short title.
This act shall be known and may be cited as the Subsurface
Oil and Gas Lease Act.
Section 2. Definitions.
The following words and phrases when used in this act shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Company." An entity doing business within this Commonwealth
and subject to tax under Article III, IV or VI of the act of
March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
1971.
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18 "Department." The Department of Conservation and Natural
Resources of the Commonwealth.
"Secretary." The Secretary of Conservation and Natural
Resources of the Commonwealth.
"Upfront payments." All payments received by the
Commonwealth which are paid at the time that a lease is entered
into under this act.
Section 3. Subsurface drilling under Commonwealth lands.
(a) Program established.--The department shall establish a
program to review submissions or nominations by companies for
the leasing of subsurface rights under State forest and park
property for oil and gas development from subsurface drilling
originating from well sites outside State forest or park
property.
(b) Lease approval.--The secretary may approve or disapprove
a submission or nomination for a lease under this act. The
department shall provide in writing to a company which has sent
a submission or nomination to the department notice of the
department's decision to approve or disapprove a lease within 60
days of receipt from the company. The department shall list all
reasons for disapproval in the notification.
(c) Resubmission upon disapproval.--A company receiving
notice of disapproval may resend a submission or nomination to
the department with or without changes and may include a
response addressing the department's reasons within 60 calendar
days of receipt of the department's disapproval. The department
shall provide in writing to a company which has sent a
resubmission to the department notice of the department's
decision to approve or disapprove a submission or nomination
within 60 days of receipt from the company. The department shall
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30 list all reasons for disapproval in the notification.
(d) Reasons for disapproval.--The department may disapprove
a submission or nomination for the following reasons:
(1) The company has environmental compliance violations
within this Commonwealth which have not been satisfactorily
addressed and which have caused a significant negative
environmental impact.
(2) Development of the tract would lead to the need for
related infrastructure development elsewhere on State forest
land which would, in the department's determination, lead to
significant negative environmental impacts.
(e) Appeal.--A company receiving notice of disapproval of a
resubmission under subsection (c) may appeal the disapproval to
Commonwealth Court. Commonwealth Court shall consider the
factors in subsection (d) when considering an appeal.
(f) Implementation and posting.--Within 90 days of the
effective date of this subsection, the department shall
implement the program under subsection (a) and post information
relating to the program and instructions regarding the manner in
which submissions or nominations should be sent for review on
the department's publicly accessible Internet website.
(g) Submissions and nominations.--Companies may begin
sending submissions or nominations for review under this act to
the department 90 days after the effective date of this
subsection.
(h) Competitive bidding process.--If the department approves
a submission or nomination under this act, the department shall
hold a competitive bidding process for the rights in question
under the already-approved submission or nomination as follows:
(1) The department shall notify the company that
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30 submitted the approved submission or nomination of the time
and manner by which the bidding process will take place. The
bidding process shall be open to any company.
(2) When the department approves a submission or
nomination under this act, the department shall post
information regarding the time and manner by which the
bidding process will take place, along with a description of
the rights which will be bid.
(3) The department shall complete the bidding process
and select the winning bidder within 45 days of approving a
submission or nomination under this act.
(4) The winning bidder shall be awarded a lease for the
rights in question previously approved by the department.
Section 4. Deposit of lease revenue and grant program.
(a) Oil and Gas Lease Fund.--All revenue generated from
leases under this act shall be deposited into the Oil and Gas
Lease Fund.
(b) Restricted account and continuing appropriation.--Money
deposited into the Oil and Gas Lease Fund under subsection (a)
that is attributable to upfront payments made in consideration
for a lease under this act shall be transferred to a restricted
account within the fund. The money of the restricted account is
appropriated on a continuing basis to the department for the
grant program under subsection (c).
(c) Grant program.--
(1) The department shall establish a grant program under
this act to fund stream maintenance and clearing projects.
The department shall prioritize awarding the money under the
grant program to all of the following:
(i) Projects designed to mitigate the risk of
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30 flooding.
(ii) Projects that have the potential to preserve
farmland or residential property from flooding.
(iii) Projects from areas of this Commonwealth that
have been under Federal or State disaster emergency
related to flooding within the last five years.
(2) The department shall award, in consultation with
county conservation districts, the money under the grant
program to projects in different areas of this Commonwealth.
A proposed project within a single county or municipality
shall not receive more than 10% of the money under the grant
program distributed by the department in a given year.
Section 5. Construction.
Nothing in this act shall be construed to prohibit oil and
gas drilling on State forest and park property in accordance
with the laws of this Commonwealth.
Section 6. Abrogation of executive order and other orders and
administrative policies.
This act shall abrogate Executive Order 2015-03 and any other
order or administrative policy in conflict with this act.
Section 7. Effective date.
This act shall take effect immediately.
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