ARTICLE 4. Oil and Gas Leases on Tide and Submerged Lands and Beds of Navigable Rivers and Lakes [6870. - 6880.]

Cal. Public Resources Code - PRC 4.

in effect

Cal. Public Resources Code - PRC § 6870. Section 6870.

(a) Notwithstanding any other provision of law to the contrary, no leases shall be let for the extraction of oil and gas from coastal tidelands or submerged lands in state waters within the Santa Barbara Channel unless the commission determines that such a lease will not result in the seepage or spillage of oil (either by finding that the safety and containment devices to be used are sufficient to prevent such seepage or spillage or that no seepage or spillage would result in any event) or in the destruction of scenic or aesthetic values. (b) As used in this section, the Santa Barbara Channel is the area described as follows: Beginning at the point of intersection of the ordinary high-water mark of the Pacific Ocean with the westerly point of Point Conception; thence in a generally easterly and southeasterly direction along said ordinary high-water mark to the westerly point of Point Mugu; thence in a generally southwesterly direction to the southwest tip of Anacapa Island; thence along the inland sides of Anacapa, Santa Cruz, Santa Rosa and San Miguel Islands to the most westerly part of San Miguel Island; thence in a northerly direction to the point of beginning; excluding the area described in subdivision (b) of Section 6871.2.

Cal. Public Resources Code - PRC § 6871. Section 6871.

Tide and submerged lands and beds of navigable rivers and lakes may be leased by the commission for the extraction of oil and gas in accordance with the provisions of this article and of this chapter insofar as not in conflict with the provisions of this article. No political subdivision of the State or any city or county or any official of either or any of them shall grant or issue any lease, license, easement, privilege, or permit vesting authority in any person to take or extract oil or gas from tide or submerged lands whether filled or unfilled of which the State is the owner or from which the State has the right to extract oil or gas, or both.

Cal. Public Resources Code - PRC § 6871.3. Section 6871.3.

Whenever it appears to the commission that it is for the best interests of the State to lease lands subject to the provisions of Section 6871.1 or 6877 of this code for the production of oil or gas therefrom, or whenever a person who possesses the qualifications provided in this chapter makes written request therefor, the commission may, subject to the provisions of Section 6871.4, offer the same for bidding at such times and in such parcels as the commission shall determine to be in the best interests of the State.

Cal. Public Resources Code - PRC § 6871.4. Section 6871.4.

The commission may divide the lands within the area proposed to be leased into parcels of convenient size and shape and shall prepare a form of lease or leases therefor embracing not to exceed 5,760 acres in any one lease.

Cal. Public Resources Code - PRC § 6872. Section 6872.

(a) If an application for oil and gas development in state waters that is determined to be incomplete by the commission continues to remain incomplete one year after the date of the first incomplete notice sent to the applicant by the commission, the application shall be considered withdrawn. (b) If an application has been withdrawn pursuant to subdivision (a), the applicant may submit a new application.

Cal. Public Resources Code - PRC § 6872.1. Section 6872.1.

Whenever it appears to the commission that oil and gas deposits are known or believed to be contained in any such lands as are described in Section 6871.2, subdivision (b), of this code or in tide and submerged lands along the coast of the Pacific Ocean south of the northerly city limits of the City of Newport Beach in Orange County to the southerly boundary of the state, and are being drained by means of wells upon adjacent lands owned by others than the state, the commission shall thereupon be authorized and empowered to lease state-owned tide and submerged lands adjacent to any such wells for the production of oil and gas therefrom, either as a tract or in parcels of such size and shape as the commission shall determine but only within an area and to an extent necessary to offset such drainage of state-owned tide and submerged lands by any such wells upon adjacent lands owned by others.

Cal. Public Resources Code - PRC § 6872.2. Section 6872.2.

If the commission determines that any tide and submerged lands belonging to the state in the area hereinafter referred to should be drilled pursuant to the terms of Section 6872.1 of this code, then, notwithstanding the provisions of Section 6874 of this code, in order to preserve and protect the highly developed recreational and residential area now referred to, the commission shall require that any well or wells drilled pursuant to the terms of any lease issued with respect to any part of the hereinafter described area be slant-drilled from an upland or littoral site to and into the subsurface of the tide or submerged lands covered by the lease. The area to which this section is applicable is the tide and submerged lands along the coast of the Pacific Ocean south of the northerly city limits of the City of Newport Beach in Orange County to the southerly boundary of the state.

Cal. Public Resources Code - PRC § 6872.5. Section 6872.5.

The commission may adjust the boundaries of existing leases to encompass all of a field partially contained within the existing lease subject to both of the following conditions: (a) The commission makes all of the following findings: (1) The adjustment will permit more efficient utilization of state resources. (2) The number and size of existing offshore platforms will not be increased, except that modifications to a platform within the existing boundaries of a lease shall be permitted where the modifications are reasonably necessary for development of all of the resources within the reconfigured lease. (3) The boundary adjustment will not require the construction or major modification of a refinery in this state to permit development of any increased production resulting from the boundary adjustment, unless that construction or major modification is to a field production facility servicing the lease. (4) The boundary adjustment represents the environmentally least damaging feasible alternative for the extraction and production of affected resources. (b) Those parts of the field within areas added to the existing lease may not be developed except from upland sites or from existing offshore facilities within the original lease boundaries.

Cal. Public Resources Code - PRC § 6873. Section 6873.

When leasing tide or submerged lands or beds of navigable rivers or lakes, the commission shall prepare a form of lease which shall contain, in addition to other provisions deemed desirable and necessary by the commission, appropriate provisions contained in this chapter and the following: (a) Each well drilled pursuant to the terms of the lease may be drilled or slant-drilled to and into the subsurface of the tide or submerged lands or beds of navigable rivers or lakes, covered by the lease from upland, riparian or littoral drill sites owned or controlled by the state or owned by or available, at any time, to the lessee, or from drill sites located upon any filled lands heretofore or hereafter filled, whether contiguous or noncontiguous to the riparian or littoral lands or uplands, or from any pier heretofore or hereafter constructed owned by or available to the lessee and available for such purpose, or from platforms or other fixed or floating structure in, on or over the tide or submerged lands or beds of navigable rivers or lakes, covered by the lease or otherwise available to the lessee. (b) Such lease shall prohibit the pollution or contamination of the ocean, tidelands, or navigable rivers or lakes, and shall prohibit the impairment of and interference with bathing, fishing, or navigation in the waters of the ocean, any bay or inlet thereof, or any navigable river or lake, and shall prohibit the impairment of and interference with developed shoreline recreational or residential areas. In addition, no oil, tar, residuary product of oil, or any refuse of any kind from any well or works shall be permitted to be deposited on or pass into the waters of the ocean, any bay or inlet thereof, or any navigable river or lake. This subdivision does not apply to the deposit on or passage into such waters of water not containing any hydrocarbons or vegetable or animal matter. This subdivision does not prohibit the deposit on or passage into the waters of the ocean or any bay or inlet thereof of drill cuttings or drilling mud which are free of oil and materials that are deleterious to marine life if such activities are under authorization of a regional water quality control board. (c) If the lessee, as disclosed by information submitted with his bid, proposes to drill one or more wells from filled lands, whether contiguous or noncontiguous to the riparian or littoral lands or uplands, or from any pier or from platforms or other fixed or floating structures to be constructed for such purpose, and if permission from any federal or state agency is legally required in order to construct any such filled land or structures, the lessee shall be allowed a reasonable time following the execution of the lease within which to secure the necessary permission from such federal and state agencies as shall be legally required, and, upon the securing of such permission, a further reasonable time, determined with regard to the nature of the filled lands or structure or structures to be constructed, within which to commence operations for the drilling of such well or wells. The drilling term of the lease shall be extended by the commission by a period equal to such reasonable time to secure such permission, and, if necessary, to the date to which the time to commence operations for the drilling of such well or wells has been extended. (d) Any offshore filled lands or structure or structures constructed for the purpose of drilling pursuant to this section shall conform to the rules and regulations of the commission in effect at the time of invitation for bids in pursuance of which the lease is awarded. Drilling, whether from upland, riparian, littoral or offshore locations, shall be conducted in conformance with such rules and regulations in effect at the time of invitation for bids in pursuance of which the lease is awarded. In the case of any existing lease of tide or submerged lands, the commission may, with the consent of the other party thereto, amend the same so as to contain or conform with subdivisions (a), (b), (c) and (d) hereof, or any of them, except that the provisions of said subdivision (d) when incorporated into such a lease by such an amendment shall refer to the rules and regulations in effect at the time such amendment is made rather than to those in effect at the time of invitation for bids in pursuance of which the lease is awarded and said subdivision (a) may not be incorporated into such a lease without also incorporating said subdivision (d) therein.

Cal. Public Resources Code - PRC § 6873.1. Section 6873.1.

Filled lands shall include, but not be limited to, tide or submerged lands or beds of navigable rivers or lakes, reclaimed artificially through raising such lands above the highest probable elevation of the tides, or high water line on the river banks or shore, to form dry land, by placement of a fill or deposit of earth, rock, sand or other solid imperishable material. Such fill may be retained in place or protected by bulkheads, seawalls, revetments or similar enclosures and may be placed at any location approved by the commission under a lease heretofore or hereafter issued pursuant to this article.

Cal. Public Resources Code - PRC § 6873.2. Section 6873.2.

In carrying out the requirements of subdivision (b) of Section 6873 and the California Environmental Quality Act (Division 13 (commencing with Section 21000)), the commission shall, prior to leasing tide and submerged lands or the beds of navigable rivers or lakes for oil and gas, hold at least one hearing on any draft environmental impact report prepared for the proposed lease. The hearing shall be held within a city or county near the area being considered for leasing. The commission shall give at least 30 days’ written notice regarding the public hearing to each city or county within or adjacent to the proposed lease area and shall publish the notice in the manner prescribed in Section 6834. The authority to hold hearings provided in this section may be delegated by the commission to its officers or employees.

Cal. Public Resources Code - PRC § 6873.5. Section 6873.5.

(a) In carrying out the requirements of subdivision (b) of Section 6873 and the California Environmental Quality Act, the commission shall, prior to the adoption of a form of lease for leasing offshore tide and submerged lands between the mean high tide line and the three-mile jurisdictional limit, consult with the Department of Fish and Game, the National Marine Fisheries Service, and representatives of the oil industry, representatives of fishermen operating within the area being considered for leasing. The commission shall hold at least one hearing on the draft environmental document prepared for the proposed lease in a jurisdiction of a local government within the coastal zone, as defined by Section 30103, near the area being considered for leasing. The commission shall give at least 30 days’ written notice regarding the public hearing to each city or county within or adjacent to the proposed lease area and shall publish the notice in the manner prescribed in Section 6834. The authority to hold hearings provided in this section may be delegated by the commission to its officers or employees. (b) The commission shall consider the potential impacts of the proposed lease on the fisheries and marine habitat within the area being considered for leasing. The commission shall include in its consideration: (1) The environmental document prepared for the proposed lease. (2) Recommendations of the Department of Fish and Game, the National Marine Fisheries Service, the oil industry, and fishermen. (3) The cooperative efforts of the oil industry and fishermen to develop plans to mitigate potential impacts. (c) Fishery areas that should be considered for protection include established fishing grounds or critical spawning or nursery grounds as indicated by records of the Department of Fish and Game. (d) The commission may impose terms, conditions, or operational requirements it deems necessary to protect fisheries, including, but not limited to, the exclusion of specified areas from development activities. (e) This section shall not be construed as a limitation on slant or directional drilling under the excluded area from any location outside an excluded fishery area.

Cal. Public Resources Code - PRC § 6874. Section 6874.

Each bid shall be accompanied by information giving a description of the location or locations, structure or structures, from which the bidder proposes to drill. In awarding a lease, the commission shall not discriminate between bidders by prohibiting drilling from upland, littoral or riparian drill sites, or drilling from sites upon filled lands, whether contiguous or noncontiguous to the riparian or littoral lands or uplands, or upon any pier or platform or other fixed or floating structure in, on or over tide and submerged lands or beds of navigable rivers or lakes, with respect to which the State or other owner thereof has consented, or may thereafter consent, to such use provided, however, that in the event state-owned tide or submerged lands or beds of navigable rivers or lakes are determined by the commission to contain oil or gas deposits which are being drained by wells owned by others upon adjacent lands, and such state-owned tide and submerged lands or beds of navigable rivers or lakes cannot be developed by a particular method of exploration, development or operation without interfering with or impairing developed riverbank or shoreline, recreational or residential areas, then the commission may offer and award an oil and gas lease on such lands with a prohibition against said particular method of exploration, development or operation.

Cal. Public Resources Code - PRC § 6875. Section 6875.

If the Legislature has transferred to any city or county the administration of the trust, whether or not limited, under which tide or submerged lands or beds of navigable rivers and lakes are held by the State, the commission, pursuant to this chapter, may enter into agreements upon behalf of the State to compensate any such city or county for the use of surface drilling and operating sites upon such lands from the royalty or revenue to be derived by the State from oil and gas taken from such lands by lessees of the State. Any such compensation shall include an amount sufficient reasonably to compensate any such city or county for any damage to or interference with the use or uses to which the surface of such lands are being or may be utilized by or upon behalf of such city or county. The consideration to the State in any such agreement shall include the right to a lessee of the State to carry on all operations on any such tidelands or beds of navigable rivers and lakes necessary to accomplish the purposes of this chapter and such terms and conditions as shall be determined by the commission to be in the interests of the State. The consideration to the State in any such agreement shall also include a compromise, settlement and release of any and all claims and rights which such city or county has or may have against the State arising out of or in connection with the extraction and removal of oil and gas from such lands. All money paid to any city or county under this section shall be used by it solely in furtherance of the trust under which the administration of tide and submerged lands and beds of navigable rivers and lakes has been transferred to such city or county and for the purposes expressed in the act so transferring administration of such lands.

Cal. Public Resources Code - PRC § 6876. Section 6876.

Should it appear to the commission that any person, association of persons, or corporation, has drilled, or is making preparation to drill, wells upon or into tide or submerged lands of which the State is the owner, or from which the State has the right to extract oil or gas or both, for the extraction of oil or gas therefrom, other than pursuant to authority granted in accordance with this chapter, whether or not such person, association of persons, or corporation may be acting under purported authority, the commission shall cause an action to be instituted in the name of and upon behalf of the State in a court of appropriate jurisdiction, to enjoin the occupancy and operations upon or in such lands and to demand compensation for injury and damage, if any, to such lands; except that, should the drilling operations be conducted upon or in lands which have been filled and if such operations have been commenced prior to March 24, 1938, the commission, if it appears to be in the interests of the State, may, upon behalf of the State, issue a lease to any such person, association of persons, or corporation in accordance with the provisions of this chapter insofar as applicable, and upon a royalty basis, retrospective and prospective, which appears reasonable and just in the circumstances to the lessee and the State.

Cal. Public Resources Code - PRC § 6877. Section 6877.

All the beds of navigable rivers and lakes belonging to the State may be leased pursuant to Section 6871.3 of this code for the production of oil and gas, subject to the same limitations and conditions imposed by this article, and in accordance with the provisions of this chapter insofar as not in conflict with this article.

Cal. Public Resources Code - PRC § 6878. Section 6878.

Nothing in this chapter limits the effect of any grant of tide or submerged lands made prior to June 11, 1938, to any city, county or other political subdivision, nor in any manner to prejudice whatever claim the state, on the one hand, or such city, county or political subdivision, on the other, may have in or to the right to extract or authorize the extraction of oil or gas or other minerals underlying such lands. Notwithstanding any provision to the contrary herein, no city, county or political subdivision to which the state has granted tide or submerged lands without reserving minerals shall enter into any lease or agreement for the extraction of oil, gas or other hydrocarbons from such tide and submerged lands within any area described in subdivisions (a) though (e), inclusive, of Section 6871.2 of this code, or from tide and submerged lands along the coast of the Pacific Ocean south of the northerly city limits of the City of Newport Beach in Orange County to the southerly boundary of the state until the State Lands Commission has made findings in accordance with the provisions of Section 6872 of this code regarding any lands within any area described in subdivisions (a), (c), (d) and (e) of Section 6871.2 of this code, or has made findings in accordance with the provisions of Section 6872.1 of this code regarding any lands within the area described in subdivision (b) of Section 6871.2 of this code, or has made findings in accordance with the provisions of Section 6872 of this code regarding any tide or submerged lands along the coast of the Pacific Ocean south of the northerly city limits of the City of Newport Beach in Orange County to the southerly boundary of the state. Provided further that any lease or agreement for the extraction of oil and gas or other hydrocarbons from such granted tide or submerged lands authorized to be entered into by a county, city or political subdivision after necessary findings are made by the State Lands Commission as heretofore provided shall be in accordance with the provisions of Section 6872.1 of this code in respect to any lands within the area described in subdivision (b) of Section 6871.2 of this code, and shall be in accordance with the provisions of Section 6872.2 of this code in respect to any tide or submerged lands along the coast of the Pacific Ocean south of the northerly city limits of the City of Newport Beach in Orange County to the southerly boundary of the state.

Cal. Public Resources Code - PRC § 6879. Section 6879.

Whenever tide and submerged lands of the State have been granted to a city, county or city and county by a grant which does not reserve to the State the right to produce oil and gas therefrom, and such grantee shall determine that it is in the interest of increasing the ultimate recovery of oil or gas from such lands, or of the protection of oil or gas in said lands from unreasonable waste, or that the subsidence or sinking of such lands and abutting lands may possibly be arrested or ameliorated thereby, such grantee may enter into agreements for the purpose of bringing about the cooperative development and operation of all or a part or parts of the oil and gas field in which such lands are located, or for the purpose of bringing about the development or operation of all or a part or parts of such field as a unit, or for the purpose of fixing the time, location, and manner of drilling and operating of wells for the production of oil or gas, or providing for the return or injection of gas, water or other substances into the subsurface of the earth for the purpose of storage or the repressuring of such oil or gas field. Each such agreement shall provide that any impairment of the public trust for commerce, navigation or fisheries to which said granted lands are subject is prohibited, and shall be submitted to the State Lands Commission for approval. If the State Lands Commission shall find that said agreement so provides and that the entering into and the performance of such agreement is in the public interest, then the State Lands Commission may approve such agreement on behalf of the State. The Legislature hereby finds and declares that the entering into and the performance of any such agreement which has been approved by the State Lands Commission will not impair the public trust for commerce, navigation and fisheries to which said granted lands are subject, and that any acts or things done pursuant to the terms thereof or resulting therefrom are consistent with and not in violation of the terms or conditions of any such grant or of any trust, restrictions and conditions appertaining thereto. No such agreement so approved by the State Lands Commission shall effect or result in, or be so construed as to effect or result in a revocation of or change in any trust pertaining to said lands, or in any grant, conveyance, alienation or transfer of said lands, or any part thereof, to any other individual, firm, or corporation, even though such agreement provides for the pooling of oil, gas or other hydrocarbon substances produced from said lands with oil, gas or other hydrocarbon substances produced from other lands, or results in the migration of any oil, gas or other hydrocarbon substances between said lands and other lands. Any trusts, restrictions or conditions pertaining to any production from said granted lands included in any such agreement, or to any proceeds from such production, shall apply only to that part of the production or that part of the proceeds therefrom which is allocated to such city, county or city and county on account of said lands under any such agreement, and shall not apply to any other production or the proceeds therefrom, whether or not the same may have been produced from said lands or other lands. If approved by the State Lands Commission, any such agreement shall bind the State, and shall bind any of the following who execute the same: (a) Such city, county or city and county; and (b) Any operator of such tide and submerged lands under contract with such city, county or city and county, and such operators’ successors and assigns; and (c) Any other party, and the successors and assigns of such other party. Any such agreement shall be enforceable in an action for specific performance against the parties bound thereby. No agreement executed pursuant to this section shall affect or determine the boundaries of the tide and submerged lands granted, in trust, to the City of Long Beach by Chapter 676, Statutes of 1911, Chapter 102, Statutes of 1925, Chapter 158, Statutes of 1955, as modified by Chapter 915, Statutes of 1951 and Chapter 29, Statutes of 1956, First Extraordinary Session.

Cal. Public Resources Code - PRC § 6880. Section 6880.

(a) Contingent upon an appropriation of funds by the Legislature for this purpose, the commission shall develop, on or before December 31, 2024, a cost study that evaluates the fiscal impact of a voluntary relinquishment of any lease interests in actively producing state offshore oil and gas leases in state waters. (b) The cost study shall consider at least all of the following factors: (1) Expected duration of oil production at the time of leasing. (2) State revenues received to date. (3) Expected remaining life of the reservoir based on proven reserves. (4) Reasonably anticipated unrealized lessee revenues and profits. (5) Reasonably anticipated unrealized state revenues. (6) Lessees’ decommissioning and restoration costs. (c) (1) On or before December 31, 2023, the commission shall hold at least one public hearing at a properly noticed public commission meeting to discuss the cost study described in this section. (2) After the hearing described in paragraph (1), on or before December 31, 2023, the commission shall provide a status update on the cost study to the Governor and the Legislature. The status update shall include, but not be limited to, all of the following: (A) A proposed outline of the cost study elements. (B) Identified data gaps. (C) Preliminary analysis, conclusions, and recommendations. (D) Any public comments received by the commission. (d) (1) On or before December 31, 2024, the commission shall submit the cost study prepared pursuant to this section, including recommendations to advance the end of offshore oil and gas development consistent with the legislative findings and declarations of Section 1 of Assembly Bill 2257 of the 2021–22 Regular Session, to the Governor and the Legislature. (2) The commission shall make the cost study available on its internet website. (e) (1) The cost study submitted to the Legislature pursuant to paragraph (1) of subdivision (d) and the status update submitted to the Legislature pursuant to paragraph (2) of subdivision (c) shall be submitted in compliance with Section 9795 of the Government Code. (2) (A) Pursuant to Section 10231.5 of the Government Code, the requirement to submit a report imposed pursuant to paragraph (1) of subdivision (d) shall become inoperative on December 31, 2028. (B) Pursuant to Section 10231.5 of the Government Code, the requirement to submit a report imposed pursuant to paragraph (2) of subdivision (c) shall become inoperative on December 31, 2027.

Source: CA Legislative Counsel Bulk DataURL: https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zipFetched: 6/27/2026