S 595 IS

To amend the Internal Revenue Code of 1986 to establish a graduated response to shrinking domestic oil and gas production and surging foreign oil imports, and for other purposes.

March 11, 1999

Mr. DOMENICI (for himself and Mr. INHOFE) introduced the following bill; which was read twice and referred to the Committee on Finance

To amend the Internal Revenue Code of 1986 to establish a graduated response to shrinking domestic oil and gas production and surging foreign oil imports, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.

(a) SHORT TITLE- This Act may be cited as the `Domestic Oil and Gas Crisis Tax Relief and Foreign Oil Reliance Reversal Act of 1999.'

(b) AMENDMENT OF 1986 CODE- Except as otherwise expressly provided, whenever in this Act an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986.

SEC. 2. PURPOSES.

The purposes of this Act are--

(1) to establish a graduated response to shrinking domestic oil and gas production and surging foreign oil imports;

(2) to prevent the abandonment of marginal oil and gas wells responsible for half of the domestic oil and gas production of the United States;

(3) to transform earned tax credits and other tax benefits into working capital for the cash-strapped domestic oil and gas producers and service companies;

(4) to reverse the trend of increased dependence on foreign oil and gas by encouraging exploration and development of oil and gas reserves in the United States to achieve the goal of doubling current domestic oil and gas production; and

(5) to provide an emergency procedure for times when foreign imports exceed 60 percent of the total United States crude and oil product consumption, thereby recognizing that when imports exceed a statutory level a national security threat exists that demands Presidential action.

SEC. 3. FINDINGS.

Congress finds the following:

(1) Foreign oil consumption in the United States is estimated to be equal to 56 percent of total oil consumption and could reach 68 percent by the year 2010 if current prices prevail.

(2) The number of oil and gas rigs operating in the United States is at the lowest count since 1944, when records of this number began to be recorded.

(3) If oil prices do not increase soon, the United States could lose at least half of its marginal wells which, in the aggregate, produce as much oil as the amount of oil the United States imports from Saudi Arabia.

(4) Oil and gas prices are unlikely to increase for the next several years.

(5) Declining production, well abandonment, and the lack of exploration and development are shrinking the domestic oil and gas industry.

(6) It is essential in order for the United States to have a vibrant economy to have a healthy domestic oil and gas industry.

(7) The world's richest oil producing regions in the Middle East are experiencing great political stability.

(8) The policy of the United Nations may make Iraq the swing oil producing nation, thereby granting an enemy of the United States a tremendous amount of power.

(9) Reliance on foreign oil for more than 60 percent of the daily oil and gas consumption in the United States is a national security threat.

(10) The United States is the leader of the free world and has a worldwide responsibility to promote economic and political security.

(11) The exercise of traditional responsibilities in the United States and abroad in foreign policy requires that the United States be free of the risk of energy blackmail in times of gas and oil shortages.

(12) The level of the United States security is directly related to the level of domestic production of oil, natural gas liquids, and natural gas.

(13) A national energy policy should be developed which ensures that adequate supplies of oil are available at all times free of the threat of embargo or other foreign hostile acts.

SEC. 4. TABLE OF CONTENTS.

The table of contents of this Act is as follows:

Sec. 1. Short title; amendment of 1986 Code.

Sec. 2. Purposes.

Sec. 3. Findings.

Sec. 4. Table of contents.

TITLE I--DOMESTIC OIL AND GAS PRODUCTION PRESERVATION PROVISIONS

Sec. 101. Tax credit for marginal domestic oil and natural gas well production.

Sec. 102. Exclusion of certain amounts received from recovered inactive wells.

Sec. 103. Enhanced oil recovery credit extended to certain nontertiary recovery methods.

TITLE II--DOMESTIC OIL AND GAS INDUSTRY CRISIS TAX RELIEF

Sec. 200. Purpose.

Subtitle A--Credits to Cash Provisions

Sec. 201. 10-year carryback for unused minimum tax credit.

Sec. 202. 10-year carryback for percentage depletion for oil and gas property.

Sec. 203. 10-year net operating loss carryback for losses attributable to oil servicing companies and mineral interests of oil and gas producers.

Sec. 204. Waiver of limitations.

Subtitle B--Hard Times Tax Relief

Sec. 211. Phase-out of certain minimum tax preferences relating to energy production.

Sec. 212. Depreciation adjustment not to apply to oil and gas assets.

Sec. 213. Repeal certain adjustments based on adjusted current earnings relating to oil and gas assets.

Sec. 214. Enhanced oil recovery credit and credit for producing fuel from a nonconventional source allowed against minimum tax.

Subtitle C--Oil-for-Food Program Compensating Tax Benefits

Sec. 220. Purpose.

Sec. 221. Increase in percentage depletion for stripper wells.

Sec. 222. Net income limitation on percentage depletion repealed for oil and gas properties.

Sec. 223. Election to expense geological and geophysical expenditures and delay rental payments.

Sec. 224. Extension of Spudding rule.

TITLE III--FOREIGN OIL RELIANCE REVERSAL PROVISIONS

Sec. 300. Purpose.

Sec. 301. Crude oil and natural gas exploration and development credit.

TITLE IV--NATIONAL SECURITY EMERGENCY PROVISIONS

Sec. 400. Purpose.

Sec. 401. Duties of the President.

Sec. 402. Congressional review.

Sec. 403. National security and oil production actions.

TITLE I--DOMESTIC OIL AND GAS PRODUCTION PRESERVATION PROVISIONS

SEC. 101. TAX CREDIT FOR MARGINAL DOMESTIC OIL AND NATURAL GAS WELL PRODUCTION.

(a) PURPOSE- The purpose of this section is to prevent the abandonment of marginal oil and gas wells responsible for half of the domestic production of oil and gas in the United States.

(b) CREDIT FOR PRODUCING OIL AND GAS FROM MARGINAL WELLS- Subpart D of part IV of subchapter A of chapter 1 (relating to business credits) is amended by adding at the end the following new section:

`SEC. 45D. CREDIT FOR PRODUCING OIL AND GAS FROM MARGINAL WELLS.

`(a) GENERAL RULE- For purposes of section 38, the marginal well production credit for any taxable year is an amount equal to the product of--

`(1) the credit amount, and

`(2) the qualified crude oil production and the qualified natural gas production which is attributable to the taxpayer.

`(b) CREDIT AMOUNT- For purposes of this section--

`(1) IN GENERAL- The credit amount is--

`(A) $3 per barrel of qualified crude oil production, and

`(B) 50 cents per 1,000 cubic feet of qualified natural gas production.

`(2) REDUCTION AS OIL AND GAS PRICES INCREASE-

`(A) IN GENERAL- The $3 and 50 cents amounts under paragraph (1) shall each be reduced (but not below zero) by an amount which bears the same ratio to such amount (determined without regard to this paragraph) as--

`(i) the excess (if any) of the applicable reference price over $14 ($1.56 for qualified natural gas production), bears to

`(ii) $3 ($0.33 for qualified natural gas production).

The applicable reference price for a taxable year is the reference price for the calendar year preceding the calendar year in which the taxable year begins.

`(B) INFLATION ADJUSTMENT- In the case of any taxable year beginning in a calendar year after 2000, each of the dollar amounts contained in subparagraph (A) shall be increased to an amount equal to such dollar amount multiplied by the inflation adjustment factor for such calendar year (determined under section 43(b)(3)(B) by substituting `1999' for `1990').

`(C) REFERENCE PRICE- For purposes of this paragraph, the term `reference price' means, with respect to any calendar year--

`(i) in the case of qualified crude oil production, the reference price determined under section 29(d)(2)(C), and

`(ii) in the case of qualified natural gas production, the Secretary's estimate of the annual average wellhead price per 1,000 cubic feet for all domestic natural gas.

`(c) QUALIFIED CRUDE OIL AND NATURAL GAS PRODUCTION- For purposes of this section--

`(1) IN GENERAL- The terms `qualified crude oil production' and `qualified natural gas production' mean domestic crude oil or natural gas which is produced from a marginal well.

`(2) LIMITATION ON AMOUNT OF PRODUCTION WHICH MAY QUALIFY-

`(A) IN GENERAL- Crude oil or natural gas produced during any taxable year from any well shall not be treated as qualified crude oil production or qualified natural gas production to the extent production from the well during the taxable year exceeds 1,095 barrels or barrel equivalents.

`(B) PROPORTIONATE REDUCTIONS-

`(i) SHORT TAXABLE YEARS- In the case of a short taxable year, the limitations under this paragraph shall be proportionately reduced to reflect the ratio which the number of days in such taxable year bears to 365.

`(ii) WELLS NOT IN PRODUCTION ENTIRE YEAR- In the case of a well which is not capable of production during each day of a taxable year, the limitations under this paragraph applicable to the well shall be proportionately reduced to reflect the ratio which the number of days of production bears to the total number of days in the taxable year.

`(3) DEFINITIONS-

`(A) MARGINAL WELL- The term `marginal well' means a domestic well--

`(i) the production from which during the taxable year is treated as marginal production under section 613A(c)(6), or

`(ii) which, during the taxable year--

`(I) has average daily production of not more than 25 barrel equivalents, and

`(II) produces water at a rate not less than 95 percent of total well effluent.

`(B) CRUDE OIL, ETC- The terms `crude oil', `natural gas', `domestic', and `barrel' have the meanings given such terms by section 613A(e).

`(C) BARREL EQUIVALENT- The term `barrel equivalent' means, with respect to natural gas, a conversion ratio of 6,000 cubic feet of natural gas to 1 barrel of crude oil.

`(d) OTHER RULES-

`(1) PRODUCTION ATTRIBUTABLE TO THE TAXPAYER- In the case of a marginal well in which there is more than one owner of operating interests in the well and the crude oil or natural gas production exceeds the limitation under subsection (c)(2), qualifying crude oil production or qualifying natural gas production attributable to the taxpayer shall be determined on the basis of the ratio which taxpayer's revenue interest in the production bears to the aggregate of the revenue interests of all operating interest owners in the production.

`(2) OPERATING INTEREST REQUIRED- Any credit under this section may be claimed only on production which is attributable to the holder of an operating interest.

`(3) PRODUCTION FROM NONCONVENTIONAL SOURCES EXCLUDED- In the case of production from a marginal well which is eligible for the credit allowed under section 29 for the taxable year, no credit shall be allowable under this section unless the taxpayer elects not to claim the credit under section 29 with respect to the well.'.

`(c) CREDIT TREATED AS BUSINESS CREDIT- Section 38(b) is amended by striking `plus' at the end of paragraph (11), by striking the period at the end of paragraph (12) and inserting `, plus', and by adding at the end the following new paragraph:

`(13) the marginal oil and gas well production credit determined under section 45D(a).'.

(d) CREDIT ALLOWED AGAINST REGULAR AND MINIMUM TAX-

(1) IN GENERAL- Subsection (c) of section 38 (relating to limitation based on amount of tax) is amended by redesignating paragraph (3) as paragraph (4) and by inserting after paragraph (2) the following new paragraph:

`(3) SPECIAL RULES FOR MARGINAL OIL AND GAS WELL PRODUCTION CREDIT-

`(A) IN GENERAL- In the case of the marginal oil and gas well production credit--

`(i) this section and section 39 shall be applied separately with respect to the credit, and

`(ii) in applying paragraph (1) to the credit--

`(I) subparagraphs (A) and (B) thereof shall not apply, and

`(II) the limitation under paragraph (1) (as modified by subclause (I)) shall be reduced by the credit allowed under subsection (a) for the taxable year (other than the marginal oil and gas well production credit).

`(B) MARGINAL OIL AND GAS WELL PRODUCTION CREDIT- For purposes of this subsection, the term `marginal oil and gas well production credit' means the credit allowable under subsection (a) by reason of section 45D(a).'.

(2) CONFORMING AMENDMENT- Subclause (II) of section 38(c)(2)(A)(ii) is amended by inserting `or the marginal oil and gas well production credit' after `employment credit'.

(e) CARRYBACK- Subsection (a) of section 39 (relating to carryback and carryforward of unused credits generally) is amended by adding at the end the following new paragraph:

`(3) 10-YEAR CARRYBACK FOR MARGINAL OIL AND GAS WELL PRODUCTION CREDIT- In the case of the marginal oil and gas well production credit--

`(A) this section shall be applied separately from the business credit (other than the marginal oil and gas well production credit),

`(B) paragraph (1) shall be applied by substituting `10 taxable years' for `1 taxable years' in subparagraph (A) thereof, and

`(C) paragraph (2) shall be applied--

`(i) by substituting `31 taxable years' for `21 taxable years' in subparagraph (A) thereof, and

`(ii) by substituting `30 taxable years' for `20 taxable years' in subparagraph (B) thereof.'

(f) COORDINATION WITH SECTION 29- Section 29(a) is amended by striking `There' and inserting `At the election of the taxpayer, there'.

(g) CLERICAL AMENDMENT- The table of sections for subpart D of part IV of subchapter A of chapter 1 is amended by adding at the end the following item:

`45D. Credit for producing oil and gas from marginal wells.'

(h) EFFECTIVE DATE- The amendments made by this section shall apply to production after the date of the enactment of this Act.

SEC. 102. EXCLUSION OF CERTAIN AMOUNTS RECEIVED FROM RECOVERED INACTIVE WELLS.

(a) PURPOSE- The purpose of this section is to encourage producers to reopen wells that have not been producing oil and gas because the wells have been plugged or abandoned.

(b) IN GENERAL- Part III of subchapter B of chapter 1 (relating to items specifically excluded from gross income) is amended by redesignating section 139 as section 140 and by inserting after section 138 the following new section:

`SEC. 139. OIL OR GAS PRODUCED FROM A RECOVERED INACTIVE WELL.

`(a) IN GENERAL- Gross income does not include income attributable to independent producer oil from a recovered inactive well.

`(b) DEFINITIONS- For purposes of this section--

`(1) INDEPENDENT PRODUCER OIL- The term `independent producer oil' means crude oil or natural gas in which the economic interest of the independent producer is attributable to an operating mineral interest (within the meaning of section 614(d)), overriding royalty interest, production payment, net profits interest, or similar interest.

`(2) CRUDE OIL AND NATURAL GAS- The terms `crude oil' and `natural gas' have the meanings given such terms by section 613A(e).

`(3) RECOVERED INACTIVE WELL- The term `recovered inactive well' means a well if--

`(A) throughout the time period beginning any time prior to January 15, 1999, and ending on such date, such well is inactive or has been plugged and abandoned, as determined by the agency of the State in which such well is located that is responsible for regulating such wells, and

`(B) during the 5-year period beginning on the date of the enactment of this section, such well resumes producing crude oil or natural gas.

`(4) INDEPENDENT PRODUCER- The term `independent producer' means a producer of crude oil or natural gas whose allowance for depletion is determined under section 613A(c).

`(c) DEDUCTIONS- No deductions directly connected with amounts excluded from gross income by subsection (a) shall be allowed.

`(d) ELECTION-

`(1) IN GENERAL- This section shall apply for any taxable year only at the election of the taxpayer.

`(2) MANNER- Such election shall be made, in accordance with regulations prescribed by the Secretary, not later than the time prescribed for filing the return (including extensions thereof) and shall be made annually on a property-by-property basis.'

(c) MINIMUM TAX- Section 56(g)(4)(B) is amended by adding at the end the following new clause:

`(iii) INACTIVE WELLS- In the case of income attributable to independent producers of oil recovered from an inactive well, clause (i) shall not apply to any amount allowable as an exclusion under section 139.'

(d) CLERICAL AMENDMENT- The table of sections for part III of subchapter B of chapter 1 is amended by striking the item relating to section 139 and inserting the following:

`Sec. 139. Oil or gas produced from a recovered inactive well.

`Sec. 140. Cross references to other Acts.'

(e) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years ending after the date of the enactment of this Act.

SEC. 103. ENHANCED OIL RECOVERY CREDIT EXTENDED TO CERTAIN NONTERTIARY RECOVERY METHODS.

(a) PURPOSE- The purpose of this section is to extend the productive lives of existing domestic oil and gas wells in order to recover the 75 percent of the oil and gas that is not recoverable using primary oil and gas recovery techniques.

(b) IN GENERAL- Clause (i) of section 43(c)(2)(A) (defining qualified enhanced oil recovery project) is amended to read as follows:

`(i) which involves the application (in accordance with sound engineering principles) of--

`(I) one or more tertiary recovery methods (as defined in section 193(b)(3)) which can reasonably be expected to result in more than an insignificant increase in the amount of crude oil which will ultimately be recovered, or

`(II) one or more qualified nontertiary recovery methods which are required to recover oil with traditionally immobile characteristics or from formations which have proven to be uneconomical or noncommercial under conventional recovery methods,'

(c) QUALIFIED NONTERTIARY RECOVERY METHODS- Section 43(c)(2) is amended by adding at the end the following new subparagraphs:

`(C) QUALIFIED NONTERTIARY RECOVERY METHOD- For purposes of this paragraph--

`(i) IN GENERAL- The term `qualified nontertiary recovery method' means any recovery method described in clause (ii), (iii), or (iv), or any combination thereof.

`(ii) ENHANCED GRAVITY DRAINAGE (EGD) METHODS- The methods described in this clause are as follows:

`(I) HORIZONTAL DRILLING- The drilling of horizontal, rather than vertical, wells to penetrate any hydrocarbon-bearing formation which has an average in situ calculated permeability to fluid flow of less than or equal to 12 or less millidarcies and which has been demonstrated by use of a vertical wellbore to be uneconomical unless drilled with lateral horizontal lengths in excess of 1,000 feet.

`(II) GRAVITY DRAINAGE- The production of oil by gravity flow from drainholes that are drilled from a shaft or tunnel dug within or below the oil-bearing zone.

`(iii) MARGINALLY ECONOMIC RESERVOIR REPRESSURIZATION (MERR) METHODS- The methods described in this clause are as follows, except that this clause shall only apply to the first 1,000,000 barrels produced in any project:

`(I) CYCLIC GAS INJECTION- The increase or maintenance of pressure by injection of hydrocarbon gas into the reservoir from which it was originally produced.

`(II) FLOODING- The injection of water into an oil reservoir to displace oil from the reservoir rock and into the bore of a producing well.

`(iv) OTHER METHODS- Any method used to recover oil having an average laboratory measured air permeability less than or equal to 100 millidarcies when averaged over the productive interval being completed, or an in situ calculated permeability to fluid flow less than or equal to 12 millidarcies or oil defined by the Department of Energy as being immobile.

`(D) AUTHORITY TO ADD OTHER NONTERTIARY RECOVERY METHODS- The Secretary shall provide procedures under which--

`(i) the Secretary may treat methods not described in clause (ii), (iii), or (iv) of subparagraph (C) as qualified nontertiary recovery methods, and

`(ii) a taxpayer may request the Secretary to treat any method not so described as a qualified nontertiary recovery method.

The Secretary may only specify methods as qualified nontertiary recovery methods under this subparagraph if the Secretary determines that such specification is consistent with the purposes of subparagraph (C) and will result in greater production of oil and natural gas.'

(d) CONFORMING AMENDMENT- Clause (iii) of section 43(c)(2)(A) is amended to read as follows:

`(iii) with respect to which--

`(I) in the case of a tertiary recovery method, the first injection of liquids, gases, or other matter commences after December 31, 1990, and

`(II) in the case of a qualified nontertiary recovery method, the implementation of the method begins after December 31, 1998.'

(e) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years ending after December 31, 1998.

TITLE II--DOMESTIC OIL AND GAS INDUSTRY CRISIS TAX RELIEF

SEC. 200. PURPOSE.

The purpose of this title is to transform earned tax credits and other accumulated tax benefits into working capital for the cash-strapped domestic oil and gas producers and service companies.

Subtitle A--Credits to Cash Provisions

SEC. 201. 10-YEAR CARRYBACK FOR UNUSED MINIMUM TAX CREDIT.

(a) IN GENERAL- Section 53(c) of the Internal Revenue Code of 1986 (relating to limitation) is amended by adding at the end the following new paragraph:

`(2) SPECIAL RULE FOR TAXPAYERS WITH UNUSED ENERGY MINIMUM TAX CREDITS-

`(A) IN GENERAL- If, during the 10-taxable year period ending with the current taxable year, a taxpayer has an unused energy minimum tax credit for any taxable year in such period (determined without regard to the application of this paragraph to the current taxable year)--

`(i) paragraph (1) shall not apply to each of the taxable years in such period for which the taxpayer has an unused energy minimum tax credit (as so determined), and

`(ii) the credit allowable under subsection (a) for each of such taxable years shall be equal to the excess (if any) of--

`(I) the sum of the regular tax liability and the net minimum tax for such taxable year, over

`(II) the sum of the credits allowable under subparts A, B, D, E, and F of this part.

`(B) ENERGY MINIMUM TAX CREDIT- For purposes of this paragraph, the term `energy minimum tax credit' means the minimum tax credit which would be computed with respect to any taxable year if the adjusted net minimum tax were computed by only taking into account items attributable to--

`(i) the taxpayer's mineral interests in oil and gas property, and

`(ii) the taxpayer's active conduct of a trade or business of providing tools, products, personnel, and technical solutions on a contractural basis to persons engaged in oil and gas exploration and production.'

(b) CONFORMING AMENDMENTS- Section 53(c) of such Code (as in effect before the amendment made by subsection (a)) is amended--

(1) by striking `The' and inserting:

`(1) IN GENERAL- Except as provided in paragraph (2), the ', and

(2) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B).

(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 1998, and to any taxable year beginning on or before such date to the extent necessary to apply section 53(c)(2) of the Internal Revenue Code of 1986 (as added by subsection (a)).

SEC. 202. 10-YEAR CARRYBACK FOR PERCENTAGE DEPLETION FOR OIL AND GAS PROPERTY.

(a) IN GENERAL- Subsection (d)(1) of section 613A (relating to limitations on percentage depletion in case of oil and gas wells) is amended to read as follows:

`(1) LIMITATION BASED ON TAXABLE INCOME-

`(A) IN GENERAL- The deduction for the taxable year attributable to the application of subsection (c) shall not exceed the taxpayer's taxable income for the year computed without regard to--

`(i) any depletion on production from an oil or gas property which is subject to the provisions of subsection (c),

`(ii) any net operating loss carryback to the taxable year under section 172,

`(iii) any capital loss carryback to the taxable year under section 1212, and

`(iv) in the case of a trust, any distributions to its beneficiary, except in the case of any trust where any beneficiary of such trust is a member of the family (as defined in section 267(c)(4)) of a settlor who created inter vivos and testamentary trusts for members of the family and such settlor died within the last six days of the fifth month in 1970, and the law in the jurisdiction in which such trust was created requires all or a portion of the gross or net proceeds of any royalty or other interest in oil, gas, or other mineral representing any percentage depletion allowance to be allocated to the principal of the trust.

`(B) Carrybacks and carryforwards-

`(i) IN GENERAL- If any amount is disallowed as a deduction for the taxable year (in this subparagraph referred to as the `unused depletion year') by reason of application of subparagraph (A), the disallowed amount shall be treated as an amount allowable as a deduction under subsection (c) for--

`(I) each of the 10 taxable years preceding the unused depletion year, and

`(II) the taxable year following the unused depletion year,

subject to the application of subparagraph (A) to such taxable year.

`(ii) APPLICABLE RULES- Rules similar to the rules of section 39 shall apply for purposes of this subparagraph.

`(C) ALLOCATION OF DISALLOWED AMOUNTS- For purposes of basis adjustments and determining whether cost depletion exceeds

percentage depletion with respect to the production from a property, any amount disallowed as a deduction on the application of this paragraph shall be allocated to the respective properties from which the oil or gas was produced in proportion to the percentage depletion otherwise allowable to such properties under subsection (c).'

(b) EFFECTIVE DATE- The amendment made by this section shall apply to taxable years beginning after December 31, 1998, and to any taxable year beginning on or before such date to the extent necessary to apply section 613A(d)(1)(B) of the Internal Revenue Code of 1986 (as added by subsection (a)).

SEC. 203. 10-YEAR NET OPERATING LOSS CARRYBACK FOR LOSSES ATTRIBUTABLE TO OIL SERVICING COMPANIES AND MINERAL INTERESTS OF OIL AND GAS PRODUCERS.

(a) IN GENERAL- Paragraph (1) of section 172(b) (relating to years to which loss may be carried) is amended by adding at the end the following new subparagraph:

`(H) LOSSES ON OPERATING MINERAL INTERESTS OF OIL AND GAS PRODUCERS AND OILFIELD SERVICING COMPANIES- In the case of a taxpayer which has an eligible oil and gas loss (as defined in subsection (j)) for a taxable year, such eligible oil and gas loss shall be a net operating loss carryback to each of the 10 taxable years preceding the taxable year of such loss.'

(b) ELIGIBLE OIL AND GAS LOSS- Section 172 is amended by redesignating subsection (j) as subsection (k) and by inserting after subsection (i) the following new subsection:

`(j) ELIGIBLE OIL AND GAS LOSS- For purposes of this section--

`(1) IN GENERAL- The term `eligible oil and gas loss' means the lesser of--

`(A) the amount which would be the net operating loss for the taxable year if only income and deductions attributable to--

`(i) mineral interests in oil and gas wells, and

`(ii) the active conduct of a trade or business of providing tools, products, personnel, and technical solutions on a contractual basis to persons engaged in oil and gas exploration and production,

are taken into account, and

`(B) the amount of the net operating loss for such taxable year.

`(2) COORDINATION WITH SUBSECTION (b)(2)- For purposes of applying subsection (b)(2), an eligible oil and gas loss for any taxable year shall be treated in a manner similar to the manner in which a specified liability loss is treated.

`(3) ELECTION- Any taxpayer entitled to a 10-year carryback under subsection (b)(1)(H) from any loss year may elect to have the carryback period with respect to such loss year determined without regard to subsection (b)(1)(H). Such election shall be made in such manner as may be prescribed by the Secretary and shall be made by the due date (including extensions of time) for filing the taxpayer's return for the taxable year of the net operating loss. Such election, once made for any taxable year, shall be irrevocable for such taxable year.'

(c) EFFECTIVE DATE- The amendments made by this section shall apply to net operating losses for taxable years beginning after December 31, 1998, and to any taxable year beginning on or before such date to the extent necessary to apply section 172(b)(1)(H) of the Internal Revenue Code of 1986 (as added by subsection (a)).

SEC. 204. WAIVER OF LIMITATIONS.

If refund or credit of any overpayment of tax resulting from the application of the amendments made by this subtitle is prevented at any time before the close of the 1-year period beginning on the date of the enactment of this Act by the operation of any law or rule of law (including res judicata), such refund or credit may nevertheless be made or allowed if claim therefor is filed before the close of such period.

Subtitle B--Hard Times Tax Relief

SEC. 211. PHASE-OUT OF CERTAIN MINIMUM TAX PREFERENCES RELATING TO ENERGY PRODUCTION.

(a) ENERGY PREFERENCES FOR INTEGRATED OIL COMPANIES- Section 56 (relating to alternative minimum taxable income) is amended by adding at the end the following new subsection:

`(h) Adjustment Based on Energy Preference-

`(1) IN GENERAL- In computing the alternative minimum taxable income of any taxpayer which is an integrated oil company (as defined in section 291(b)(4)) for any taxable year beginning after 1998, there shall be allowed as a deduction an amount equal to the alternative tax energy preference deduction.

`(2) PHASE-OUT OF DEDUCTION AS OIL PRICES INCREASES- The amount of the deduction under paragraph (1) (determined without regard to this paragraph) shall be reduced (but not below zero) by the amount which bears the same ratio to such amount as--

`(A) the amount by which the reference price for the calendar year preceding the calendar year in which the taxable year begins exceeds $14, bears to

`(B) $3.

For purposes of this paragraph, the reference price for any calendar year shall be determined under section 29(d)(2)(C) and the $14 amount under subparagraph (A) shall be adjusted at the same time and in the same manner as under section 43(b)(3).

`(3) ALTERNATIVE TAX ENERGY PREFERENCE DEDUCTION- For purposes of paragraph (1), the term `alternative tax energy preference deduction' means an amount equal to the sum of--

`(A) the intangible drilling cost preference, and

`(B) the depletion preference.

`(4) INTANGIBLE DRILLING COST PREFERENCE- For purposes of this subsection, the term `intangible drilling cost preference' means the amount by which alternative minimum taxable income would be reduced if it were computed without regard to section 57(a)(2).

`(5) DEPLETION PREFERENCE- For purposes of this subsection, the term `depletion preference' means the amount by which alternative minimum taxable income would be reduced if it were computed without regard to section 57(a)(1).

`(6) ALTERNATIVE MINIMUM TAXABLE INCOME- For purposes of paragraphs (1), (4), and (5), alternative minimum taxable income shall be determined without regard to the deduction allowable under this subsection and the alternative tax net operating loss deduction under subsection (a)(4).

`(7) REGULATIONS- The Secretary may by regulation provide for appropriate adjustments in computing alternative minimum taxable income or adjusted current earnings for any taxable year following a taxable year for which a deduction was allowed under this subsection to ensure that no double benefit is allowed by reason of such deduction.'

(b) REPEAL OF LIMIT ON REDUCTION FOR INDEPENDENT PRODUCERS- Subparagraphs (E) of section 57(a)(2) (relating to exception for independent producers) is amended to read as follows:

`(E) EXCEPTION FOR INDEPENDENT PRODUCERS- In the case of any oil or gas well, this paragraph shall not apply to any taxpayer which is not an integrated oil company (as defined in section 291(b)(4)).'

(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after, and amounts paid or incurred in taxable years after, December 31, 1998.

SEC. 212. DEPRECIATION ADJUSTMENT NOT TO APPLY TO OIL AND GAS ASSETS.

(a) IN GENERAL- Subparagraph (B) of section 56(a)(1) (relating to depreciation adjustments) is amended to read as follows:

`(B) EXCEPTIONS- This paragraph shall not apply to--

`(i) property described in paragraph (1), (2), (3), or (4) of section 168(f), or

`(ii) property used in the active conduct of the trade or business of exploring for, extracting, developing, or gathering crude oil or natural gas.'

(b) CONFORMING AMENDMENT- Paragraph (4)(A) of section 56(g) (relating to adjustments based on adjusted current earnings) is amended by adding at the end the following new clause:

`(vi) OIL AND GAS PROPERTY- In the case of property used in the active conduct of the trade or business of exploring for, extracting, developing, or gathering crude oil or natural gas, the amount allowable as depreciation or amortization with respect to such property shall be determined in the same manner as for purposes of computing the regular tax.'

(c) EFFECTIVE DATE- The amendment made by this section shall apply to property placed in service in taxable years beginning after December 31, 1998.

SEC. 213. REPEAL CERTAIN ADJUSTMENTS BASED ON ADJUSTED CURRENT EARNINGS RELATING TO OIL AND GAS ASSETS.

(a) DEPRECIATION- Clause (vi) of section 56(g)(4)(A), as added by section 212(b), is amended to read as follows:

`(vi) OIL AND GAS PROPERTY- This subparagraph shall not apply to property used in the active conduct of the trade or business of exploring for, extracting, developing, or gathering crude oil or natural gas.'

(b) INTANGIBLE DRILLING COSTS- Clause (i) of section 56(g)(4)(D) is amended by striking the second sentence and inserting `In the case of any oil or gas well, this clause shall not apply in the case of amounts paid or incurred in taxable years beginning after December 31, 1998.'.

(c) DEPLETION- Clause (ii) of section 56(g)(4)(F) is amended to read as follows:

`(ii) EXCEPTION FOR OIL AND GAS WELLS- In the case of any taxable year beginning after December 31, 1998, clause (i) (and subparagraph (C)(i)) shall not apply to any deduction for depletion computed in accordance with section 613A.'

(d) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 1998.

SEC. 214. ENHANCED OIL RECOVERY CREDIT AND CREDIT FOR PRODUCING FUEL FROM A NONCONVENTIONAL SOURCE ALLOWED AGAINST MINIMUM TAX.

(a) Enhanced Oil Recovery Credit Allowed Against Regular and Minimum Tax-

(1) ALLOWING CREDIT AGAINST MINIMUM TAX- Subsection (c) of section 38 (relating to limitation based on amount of tax), as amended by section 101(d), is amended by redesignating paragraph (4) as paragraph (5) and by inserting after paragraph (3) the following new paragraph:

`(4) Special rules for enhanced oil recovery credit-

`(A) IN GENERAL- In the case of the enhanced oil recovery credit--

`(i) this section and section 39 shall be applied separately with respect to the credit, and

`(ii) in applying paragraph (1) to the credit--

`(I) subparagraphs (A) and (B) thereof shall not apply, and

`(II) the limitation under paragraph (1) (as modified by subclause (I)) shall be reduced by the credit allowed under subsection (a) for the taxable year (other than the enhanced oil recovery credit).

`(B) ENHANCED OIL RECOVERY CREDIT- For purposes of this subsection, the term `enhanced oil recovery credit' means the credit allowable under subsection (a) by reason of section 43(a).'.

(2) Conforming amendments-

(A) Subclause (II) of section 38(c)(2)(A)(ii), as amended by section 101(d), is amended by striking `or the marginal oil and gas well production credit' and inserting `, the marginal oil and gas well production credit, or the enhanced oil recovery credit'.

(B) Subclause (II) of section 38(c)(3)(A)(ii), as added by section 101(d), is amended by inserting `or the enhanced oil recovery credit' after `recovery credit'.

(b) Credit for Producing Fuel From a Non-conventional Source-

(1) ALLOWING CREDIT AGAINST MINIMUM TAX- Section 29(b)(6) is amended to read as follows:

`(6) APPLICATION WITH OTHER CREDITS- The credit allowed by subsection (a) for any taxable year shall not exceed--

`(A) the regular tax for the taxable year and the tax imposed by section 55, reduced by

`(B) the sum of the credits allowable under subpart A and section 27.'

(2) Conforming amendments-

(A) Section 53(d)(1)(B)(iii) is amended by inserting `as in effect on the date of the enactment of the Domestic Oil and Gas Crisis Tax Reliance Reversal Act of 1999,' after `29(b)(6)(B),'.

(B) Section 55(c)(2) is amended by striking `29(b)(6),'.

(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 1998.

Subtitle C--Oil-for-Food Program Compensating Tax Benefits

SEC. 220. PURPOSE.

The purpose of this subtitle is to provide compensation to the domestic oil and gas industry in the form of tax benefits to offset the depressing impact that the Oil-for-Food Program is having on the world market.

SEC. 221. INCREASE IN PERCENTAGE DEPLETION FOR STRIPPER WELLS.

(a) IN GENERAL- Subparagraph (C) of section 613A(c)(6) (relating to oil and natural gas produced from marginal properties) is amended--

(1) by striking `25 percent' and inserting `27.5 percent' in the matter preceding clause (i); and

(2) by striking `$20' and inserting `$28' in clause (ii).

(b) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 1998.

SEC. 222. NET INCOME LIMITATION ON PERCENTAGE DEPLETION REPEALED FOR OIL AND GAS PROPERTIES.

(a) IN GENERAL- Section 613(a) (relating to percentage depletion) is amended by striking the second sentence and inserting: `Except in the case of oil and gas properties, such allowance shall not exceed 50 percent of the taxpayer's taxable income from the property (computed without allowances for depletion).'

(b) Conforming Amendments-

(1) Section 613A(c)(7) (relating to special rules) is amended by striking subparagraph (C) and redesignating subparagraph (D) as subparagraph (C).

(2) Section 613A(c)(6) (relating to oil and natural gas produced from marginal properties) is amended by striking subparagraph (H).

(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 1998.

SEC. 223. ELECTION TO EXPENSE GEOLOGICAL AND GEOPHYSICAL EXPENDITURES AND DELAY RENTAL PAYMENTS.

(a) PURPOSE- The purpose of this section is to recognize that geological and geophysical expenditures and delay rentals are ordinary and necessary business expenses that should be deducted in the year the expense is incurred.

(b) Election To Expense Geological and Geophysical Expenditures-

(1) IN GENERAL- Section 263 (relating to capital expenditures) is amended by adding at the end the following new subsection:

`(j) GEOLOGICAL AND GEOPHYSICAL EXPENDITURES FOR DOMESTIC OIL AND GAS WELLS- Notwithstanding subsection (a), a taxpayer may elect to treat geological and geophysical expenses incurred in connection with the exploration for, or development of, oil or gas within the United States (as defined in section 638) as expenses which are not chargeable to capital account. Any expenses so treated shall be allowed as a deduction in the taxable year in which paid or incurred.'

(2) CONFORMING AMENDMENT- Section 263A(c)(3) is amended by inserting `263(j),' after `263(i),'.

(3) Effective date-

(A) IN GENERAL- The amendments made by this subsection shall apply to expenses paid or incurred after the date of the enactment of this Act.

(B) TRANSITION RULE- In the case of any expenses described in section 263(j) of the Internal Revenue Code of 1986, as added by this subsection, which were paid or incurred on or before the date of the enactment of this Act, the taxpayer may elect, at such time and in such manner as the Secretary of the Treasury may prescribe, to amortize the unamortized portion of such expenses over the 36-month period beginning with the month in which the date of the enactment of this Act occurs. For purposes of this subparagraph, the unamortized portion of any expense is the amount remaining unamortized as of the first day of the 36-month period.

(c) ELECTION TO EXPENSE DELAY RENTAL PAYMENTS-

(1) IN GENERAL- Section 263 (relating to capital expenditures), as amended by subsection (b)(1), is amended by adding at the end the following new subsection:

`(k) DELAY RENTAL PAYMENTS FOR DOMESTIC OIL AND GAS WELLS-

`(1) IN GENERAL- Notwithstanding subsection (a), a taxpayer may elect to treat delay rental payments incurred in connection with the development of oil or gas within the United States (as defined in section 638) as payments which are not chargeable to capital account. Any payments so treated shall be allowed as a deduction in the taxable year in which paid or incurred.

`(2) DELAY RENTAL PAYMENTS- For purposes of paragraph (1), the term `delay rental payment' means an amount paid for the privilege of deferring development of an oil or gas well.'

(2) CONFORMING AMENDMENT- Section 263A(c)(3), as amended by subsection (b)(2), is amended by inserting `263(k),' after `263(j),'.

(3) EFFECTIVE DATE-

(A) IN GENERAL- The amendments made by this subsection shall apply to payments made or incurred after the date of the enactment of this Act.

(B) TRANSITION RULE- In the case of any payments described in section 263(k) of the Internal Revenue Code of 1986, as added by this subsection, which were made or incurred on or before the date of the enactment of this Act, the taxpayer may elect, at such time and in such manner as the Secretary of the Treasury may prescribe, to amortize the unamortized portion of such payments over the 36-month period beginning with the month in which the date of the enactment of this Act occurs. For purposes of this subparagraph, the unamortized portion of any payment is the amount remaining unamortized as of the first day of the 36-month period.

SEC. 224. EXTENSION OF SPUDDING RULE.

(a) IN GENERAL- Section 461(i)(2)(A) (relating to special rule for spudding of oil or gas wells) is amended by striking `90th day' and inserting `180th day'.

(b) EFFECTIVE DATE--The amendment made by this section shall apply to taxable years beginning after December 31, 1998.

TITLE III--FOREIGN OIL RELIANCE REVERSAL PROVISIONS

SEC. 300. PURPOSE.

The purpose of this title is to reverse the trend of increased foreign dependence of oil and gas by encouraging exploration and development of oil and gas reserves in the United States to achieve the goal of doubling current domestic oil and gas production.

`SEC. 301. CRUDE OIL AND NATURAL GAS EXPLORATION AND DEVELOPMENT CREDIT.

(a) CRUDE OIL AND NATURAL GAS EXPLORATION AND DEVELOPMENT CREDIT- Subpart B of part IV of subchapter A of chapter 1 is amended by adding at the end the following new section:

`SEC. 30B. CRUDE OIL AND NATURAL GAS EXPLORATION AND DEVELOPMENT CREDIT.

`(a) GENERAL RULE- The crude oil and natural gas exploration and development credit determined under this section for any applicable taxable year shall be an amount equal to the sum of--

`(1) 20 percent of so much of the taxpayer's qualified investment for the taxable year as does not exceed $1,000,000, plus

`(2) 10 percent of so much of such qualified investment for the taxable year as exceeds $1,000,000.

`(b) APPLICALE TAXABLE YEAR- For purposes of subsection (a)--

`(1) IN GENERAL- The term `applicable taxable year' means any taxable year beginning in a calendar year during which the imports of foreign crude and oil product are determined by the Secretary of Energy to exceed 50 percent of the amount of United States crude and oil product consumption for such year.

`(2) DETERMINATION- A determination under paragraph (1) shall be made not later than March 1 of each year with respect to the preceding calendar year.

`(c) QUALIFIED INVESTMENT- For purposes of this section, the term `qualified investment' means amounts paid or incurred by a taxpayer--

`(1) for the purpose of ascertaining the existence, location, extent, or quality of any crude oil or natural gas deposit, including core testing and drilling test wells located in the United States or in a possession of the United States as defined in section 638, or

`(2) for the purpose of developing a property (located in the United States or in a possession of the United States as defined in section 638) on which there is a reservoir capable of commercial production and such amounts are paid or incurred in connection with activities which are intended to result in the recovery of crude oil or natural gas on such property.

`(d) Limitation Based on Amount of Tax-

`(1) LIABILITY FOR TAX- The credit allowable under subsection (a) for any taxable year shall not exceed the excess (if any) of--

`(A) the sum of--

`(i) the taxpayer's tentative minimum tax liability under section 55(b) for such taxable year determined without regard to this section, plus

`(ii) the taxpayer's regular tax liability for such taxable year (as defined in section 26(b)), over

`(B) the sum of the credits allowable against the taxpayer's regular tax liability under part IV (other than section 43 and this section).

`(2) APPLICATION OF THE CREDIT- Each of the following amounts shall be reduced by the full amount of the credit determined under paragraph (1):

`(A) the taxpayer's tentative minimum tax under section 55(b) for the taxable year, and

`(B) the taxpayer's regular tax liability (as defined in section 26(b)) reduced by the sum of the credits allowable under part IV (other than section 43 of this section).

If the amount of the credit determined under paragraph (1) exceeds the amount described in subparagraph (B) of paragraph (2), then the excess shall be deemed to be the adjusted net minimum tax for such taxable year for purposes of section 53.

`(3) Carryback and carryforward of un-used credit-

`(A) IN GENERAL- If the amount of the credit allowed under subsection (a) for any taxable year exceeds the limitation under paragraph (1) for such taxable year (hereafter in this paragraph referred to as the `unused credit year'), such excess shall be--

`(i) an oil and gas exploration and development credit carryback to each of the 3 taxable years preceding the unused credit year, and

`(ii) an oil and gas exploration and development credit carryforward to each of the 15 taxable years following the unused credit year,

and shall be added to the amount allowable as a credit under subsection (a) for such years, except that no portion of the unused oil and gas exploration and development credit for any taxable year may be carried to a taxable year ending before the date of the enactment of this section.

`(B) LIMITATIONS- The amount of the unused credit which may be taken into account under subparagraph (A) for any succeeding taxable year shall not exceed the amount by which the limitation provided by paragraph (1) for such taxable year exceeds the sum of--

`(i) the credit allowable under subsection (a) for such taxable year, and

`(ii) the amounts which, by reason of this paragraph, are added to the amount allowable for such taxable year and which are attributable to taxable years preceding the unused credit year.

`(e) SPECIAL RULES- For purposes of this section--

`(1) Aggregation of qualified investment expenses-

`(A) CONTROLLED GROUPS; COMMON CONTROL- In determining the amount of the credit under this section, all members of the same controlled group of corporations (within the meaning of section 52(a)) and all persons under common control (within the meaning of section 52(b)) shall be treated as a single taxpayer for purposes of this section.

`(B) APPORTIONMENT OF CREDIT- The credit (if any) allowable by this section to members of any group (or to any person) described in subparagraph (A) shall be such member's or person's proportionate share of the qualified investment expenses giving rise to the credit determined under regulations prescribed by the Secretary.

`(2) PARTNERSHIPS, S CORPORATIONS, ESTATES AND TRUSTS-

`(A) PARTNERSHIPS AND S CORPORATIONS- In the case of a partnership, the credit shall be allocated among partners under regulations prescribed by the Secretary. A similar rule shall apply in the case of an S corporation and its shareholders.

`(B) PASS-THRU IN THE CASE OF ESTATES AND TRUSTS- Under regulations prescribed by the Secretary, rules similar to the rules of subsection (d) of section 52 shall apply.

`(3) ADJUSTMENTS FOR CERTAIN ACQUISITIONS AND DISPOSITIONS- Under regulations prescribed by the Secretary, rules similar to the rules contained in section 41(f)(3) shall apply with respect to the acquisition or disposition of a taxpayer.

`(4) SHORT TAXABLE YEARS- In the case of any short taxable year, qualified investment expenses shall be annualized in such circumstances and under such methods as the Secretary may prescribe by regulation.

`(5) DENIAL OF DOUBLE BENEFIT-

`(A) DISALLOWANCE OF DEDUCTION- Any deduction allowable under this chapter for any costs taken into account in computing the amount of the credit determined under subsection (a) shall be reduced by the amount of such credit attributable to such costs.

`(B) BASIS ADJUSTMENTS- For purposes of this subtitle, if a credit is determined under this section for any expenditure with respect to any property, the increase in the basis of such property which would (but for this subsection) result from such expenditures shall be reduced by the amount of the credit so allowed.'

(b) CLERICAL AMENDMENT- The table of sections for subpart B of part IV of subchapter A of chapter 1 is amended by adding at the end thereof the following new item:

`Sec. 30B. Crude oil and natural gas exploration and development credit.'

(c) EFFECTIVE DATE- The amendments made by this section shall apply to expenses paid or incurred in taxable years beginning after December 31, 1998.

TITLE IV--NATIONAL SECURITY EMERGENCY PROVISIONS

SEC. 400. PURPOSE.

The purpose of this title is to recognize that a national security threat exists when foreign crude oil, oil product, and natural gas imports exceed 60 percent of United States oil and gas consumption and to create an emergency procedure to address that threat.

SEC. 401. DUTIES OF THE PRESIDENT.

(a) ESTABLISHMENT OF CEILING- The President shall establish a National Security Energy Independence Ceiling (Referred to in this title as the `ceiling level') which shall represent a ceiling level beyond which foreign crude oil, oil product, and natural gas imports as a share of United States crude and oil product consumption shall not rise.

(b) LEVEL OF CEILING- The ceiling level established under subsection (a) shall not exceed 60 percent of United States crude oil, oil product, and natural gas consumption for any annual period.

(c) REPORT-

(1) CONTENTS-

(A) IN GENERAL- The President shall prepare and submit an annual report to Congress containing a national security projection for energy independence (in this title referred to as the `projection'), which shall contain a forecast of domestic oil and liquid natural gas (commonly known as `NGL') demand and production, and imports of crude oil, oil product, and natural gas, for the subsequent 3 years.

(B) REQUIRED ADJUSTMENTS- The projection shall contain appropriate adjustments for expected price and production changes.

(2) PRESENTATION- The projection prepared under paragraph (1) shall be presented to Congress with the Budget.

(3) CERTIFICATION- The President shall certify in the report whether foreign crude oil, oil product, and natural gas imports will exceed the ceiling level for any year during the 3 years succeeding the date of the report.

SEC. 402. CONGRESSIONAL REVIEW.

(a) REVIEW- Congress shall have 10 continuous session days after submission of each projection under section 401 to review the projection and make a determination whether the ceiling level will be violated within 3 years.

(b) CERTIFICATION BINDING- Unless disapproved or modified by joint resolution, the Presidential certification shall be binding 10 session days after submitted to Congress.

SEC. 403. NATIONAL SECURITY AND OIL AND GAS PRODUCTION ACTIONS.

(a) NATIONAL SECURITY AND OIL AND GAS PRODUCTION POLICY-

(1) SUBMISSION- Upon certification under section 401(c)(3) that the ceiling level will be exceeded, the President shall, within 90 days, submit a National Security and Oil and Gas Production Policy (in this section referred to as the `policy') to Congress. The policy shall prevent crude oil, oil product, and natural gas imports from exceeding the ceiling level.

(2) APPROVAL- Unless disapproved or modified by joint resolution, the policy shall be effective 90 session days after submitted to Congress.

(b) CONTENTS OF POLICY- The National Security and Oil Production Policy may include--

(1) energy conservation actions, including improved fuel efficiency for automobiles;

(2) expansion of the Strategic Petroleum Reserves to maintain a larger cushion against projected oil import blockages;

(3) additional production incentives for domestic oil and gas, including tax and other incentives for stripper well production, offshore, frontier, and other oil produced with tertiary recovery techniques;

(4) regulatory burden relief; and

(5) other policy initiatives designed to lower foreign import reliance.

END