Sec. 320. PRODUCTION AND USE OF NATURAL GAS AT FORT KNOX, KENTUCKY
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## SEC. 320 PRODUCTION AND USE OF NATURAL GAS AT FORT KNOX, KENTUCKY ###
(a)Authority ####
(1)In general The Secretary of the Army is authorized to continue production, treatment, management, and use of the natural gas from covered wells at Fort Knox, without regard to section 3 of the Mineral Leasing Act for Acquired Lands (30 U.S.C. 352), with the limitation that the Secretary of the Army shall comply with the Mineral Leasing Act, Mineral Leasing Act for Acquired Lands, and the Federal Oil and Gas Royalty Management Act, for additional oil or natural gas drilling operations and production activities beyond the production from the covered wells at Fort Knox. ####
(2)Contract authority The Secretary is authorized to enter into a contract with an appropriate entity to carry out paragraph (1), with the limitation that the authority provided in this section does not affect or authorize any interference with the Muldraugh Gas Storage Facility at Fort Knox. ###
(b)Royalties to the State of Kentucky ####
(1)In general In implementing this section— #####
(A)The Secretary of the Interior shall calculate the value of royalty payments, calculated on a calendar year basis beginning on the date of enactment of this section, that the State of Kentucky would have received under the Mineral Leasing Act for Acquired Lands (30 U.S.C. 352) for future natural gas produced at Fort Knox under the authority of this section as though the natural gas had been produced under the Mineral Leasing Act for Acquired Lands, and provide the calculation to the Secretary of the Army. #####
(B)Upon request of the Secretary of the Interior, the Secretary of the Army or its contractor shall promptly provide all information, documents, or other materials the Secretary of the Interior deems necessary to conduct this calculation. #####
(C)The Secretary of the Army shall pay to the Treasury of the United States the value of royalty calculated under this section upon receipt of the calculation from the Secretary of the Interior. #####
(D)The Secretary of the Interior shall disburse the sums collected from the Secretary of the Army pursuant to this paragraph to the State of Kentucky as though the funds were being disbursed to the State under section 6 of the Mineral Leasing Act for Acquired Lands (30 U.S.C. 355) no later than 6 months after the date of the enactment of this Act. #####
(E)Regardless of the value of the royalty payments calculated under subparagraph (A), in no case may the amount of the sums disbursed under subparagraph
(D)for any calendar year exceed $49,000. ####
(2)Waiver authority The Governor of Kentucky may waive paragraph
(1)by providing written notice to the Secretary of the Interior to that effect. ###
(c)Ownership of Facilities The Secretary of the Army may take ownership of any gas production and treatment equipment and facilities and associated infrastructure from an entity with which the Secretary has entered into a contract under subsection
(a)in accordance with the terms of the contract. The Secretary of the Interior shall have no responsibility for the plugging and abandonment of the covered wells at Fort Knox, the reclamation of the covered wells at Fort Knox, or any environmental damage caused or associated with the production of the covered wells at Fort Knox. ###
(d)Applicability The authority of the Secretary of the Army under this section is effective as of August 2, 2007. ###
(e)Limitation on Uses Any natural gas produced under the authority of this section may be used only to support energy security and energy resilience at Fort Knox. For purposes of this section, energy security and energy resilience include maintaining and continuing to produce natural gas from the covered wells at Fort Knox, and enhancing the Fort Knox energy grid through acquisition and maintenance of battery storage, loop transmission lines and pipelines, sub-stations, and automated circuitry. ###
(f)Safety Standards for Gas Wells The covered wells at Fort Knox shall meet the same technical installation and operating standards that they would have had to meet had they been installed under a lease pursuant to the Mineral Leasing Act for Acquired Lands. Such standards include the gas measurement requirements in the Federal Oil and Gas Royalty Management Act and the operational standards in the Onshore Oil and Gas Operating and Production regulations issued by the Bureau of Land Management. The Bureau of Land Management shall inspect and enforce the Army’s and its contractor’s compliance with the standards of the Mineral Leasing Act for Acquired Lands, the Federal Oil and Gas Royalty Management Act, and the Bureau of Land Management Onshore Oil and Gas Operating and Production regulations. ###
(g)Covered Wells at Fort Knox In this section, the term “covered wells at Fort Knox” means the 26 wells located at Fort Knox, Kentucky, as of the date of the enactment of this Act. ## Subtitle C Logistics and Sustainment
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