States that a Bureau of Land Management (BLM) drilling permit shall not be required under either the Federal Oil and Gas Royalty Management Act of 1982 or the Code of Federal Regulations for an action occurring within an oil and gas drilling or spacing unit, if: (1) less than 50% of the minerals within the oil and gas drilling or spacing unit are federally owned, and (2) the federal government neither owns nor leases the surface estate within the unit's boundaries.
Retains the right of the federal government to receive royalties from the production of federal minerals within the unit.