Offshore Leasing Standards and Accountability Act of 2026

Key Points

• The bill creates a "fitness to operate" certification for offshore oil and gas companies. To get or keep a lease on federal waters, companies must prove they have followed environmental and safety laws for the past 10 years, hold an investment-grade credit rating, and have not filed for bankruptcy in the past decade.
• Oil and gas companies would be required to make payments into government-run escrow accounts to cover the full cost of decommissioning their wells, platforms, and pipelines. These accounts earn interest and the funds can only be used for cleanup purposes.
• Companies must fully fund their decommissioning escrow accounts within five years. Before a lease is even issued, the company must pay at least 25% of the estimated average decommissioning cost upfront.
• If companies fall behind on escrow payments by more than 60 days, the government can raise their royalty rates to recover the money within six months or suspend their lease entirely until they pay up.
• The bill limits how long an oil well can sit unused in "temporary abandonment" to three years, with a possible one-time extension to five years. This aims to prevent companies from leaving unplugged wells sitting idle for decades.
• The bill authorizes $30 million per year from 2027 through 2031 for the Department of the Interior to implement the fitness-to-operate program, including annual compliance checks and enforcement actions.

Votes

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