Federal Register: September 9, 2009 (Volume 74, Number 173)
DOCID: fr09se09-76 FR Doc E9-21708
DEPARTMENT OF THE INTERIOR
Minerals Management Service
Docket ID: [Docket No. MMS-2009-OMM-0004]
NOTICE: NOTICES
DOCID: fr09se09-76
DOCUMENT ACTION: Notice of extension of an information collection (1010-0071).
SUBJECT CATEGORY:
MMS Information Collection Activity: 1010-0071, Relief or Reduction in Royalty Rates, Extension of a Collection; Submitted for Office of Management and Budget (OMB) Review; Comment Request
DOCUMENT SUMMARY:
To comply with the Paperwork Reduction Act of 1995 (PRA), we are notifying the public that we have submitted to OMB an information collection request (ICR) to renew approval of the paperwork requirements in the regulations under 30 CFR 203, Relief or Reduction in Royalty Rates, and related documents. This notice also provides the public a second opportunity to comment on the paperwork burden of these regulatory requirements.
SUMMARY:
Agency Information Collection Activities; Proposals, Submissions, and Approvals
SUPPLEMENTAL INFORMATION
Title: 30 CFR 203, Relief or Reduction in Royalty Rates.
OMB Control Number: 10100071.
Abstract: The Outer Continental Shelf (OCS) Lands Act, as amended by Public Law 10458, Deep Water Royalty Relief Act (DWRRA), gives the Secretary of the Interior (Secretary) the authority to reduce or eliminate royalty or any net profit share specified in OCS oil and gas leases to promote increased production. The DWRRA also authorized the Secretary to suspend royalties when necessary to promote development or recovery of marginal resources on producing or nonproducing leases in the Gulf of Mexico (GOM) west of 87 degrees, 30 minutes West longitude.
Section 302 of the DWRRA provides that new production from a lease in existence on November 28, 1995, in a water depth of at least 200 meters, and in the GOM west of 87 degrees, 30 minutes West longitude qualifies for royalty suspension in certain situations. To grant a royalty suspension, the Secretary must determine that the new production or development would not be economic in the absence of royalty relief. The Secretary must then determine the volume of production on which no royalty would be due in order to make the new production from the lease economically viable. This determination is done on a casebycase basis. Production from leases in the same water depth and area issued after November 28, 2000, also can qualify for royalty suspension in addition to any that may be included in their lease terms.
In addition, Federal policy and statute require us to recover the cost of services that confer special benefits to identifiable non Federal recipients. The Independent Offices Appropriation Act (31 U.S.C. 9701), Office of Management and Budget (OMB) Circular A25, and the Omnibus Appropriations Bill (Pub. L. 104133 110 Stat. 1321, April 26, 1996) authorize the Minerals Management Service (MMS) to collect these fees to reimburse us for the cost to process applications or assessments.
Regulations at 30 CFR part 203 implement these statutes and policy and require respondents to pay a fee to request royalty relief. Section 203.3 states that, ``We will specify the necessary fees for each of the types of royaltyrelief applications and possible MMS audits in a Notice to Lessees. We will periodically update the fees to reflect changes in costs as well as provide other information necessary to administer royalty relief.''
The MMS uses the information to make decisions on the economic viability of leases requesting a suspension or elimination of royalty or net profit share. These decisions have enormous monetary impacts to both the lessee and the Federal Government. Royalty relief can lead to increased production of natural gas and oil, creating profits for lessees and royalty and tax revenues for the government that they might not otherwise receive. We could not make an informed decision without the collection of information required by 30 CFR part 203.
Regulations implementing these responsibilities are under 30 CFR
part 203. Responses are mandatory or are required to obtain or retain a
benefit. No questions of a sensitive nature are asked. The MMS protects
information considered proprietary according to 30 CFR parts 203.63 and
250, and the Freedom of Information Act (5 U.S.C. 552) and its implementing regulations (43 CFR part 2).
Frequency: On occasion.
Description of Respondents: Potential respondents comprise Federal
OCS oil and gas lessees and/or operators. It should be noted that not all of the
[[Page 46449]]
potential respondents will submit information in any given year and some may submit multiple times.
Estimated Reporting and Recordkeeping Hour Burden: The estimated
annual hour burden for this information collection is a total of 2,635
hours. The following chart details the individual components and
estimated hour burdens. In calculating the burdens, we assumed that
respondents perform certain requirements in the normal course of their
activities. We consider these to be usual and customary and took that into account in estimating the burden.
Reporting or
recordkeeping Average No. of Annual burden
Citation 30 CFR 203 requirement 30 CFR Hour burden annual responses hours part 203
Application/Audit Fees
2(b); 3; 4; 70............... These sections contain general references to submitting 0
reports, applications, requests, copies, demonstrating
qualifications, for MMS approvalburdens covered under
specific requirements.
Royalty Relief for UltraDeep Gas Wells and Deep Gas Wells on Shallow Water Leases
31(c)........................ Request a refund of 1................ 1 request............ 1 or recoup royalties
from qualified ultra
deep wells.
35(d); 44(e)................. Request to extend the 4................ 2 requests........... 8 deadline for
beginning production
with required
supporting
documentation.
41(d)........................ Request a refund of 1................ 1 request............ 1 or recoup royalties
from qualified wells
>200 meters but <400
meters.
35(a); 44(a); 47(a).......... Notify MMS of intent 1................ 27 notifications..... 27 to begin drilling.
35(c), (d); 44(b), (d), (e).. Notify MMS that 2................ 24 notifications..... 48 production has
begun, request
confirmation of the
size of RSV, provide
supporting
documentation.
46........................... Provide data from 8................ 4 responses.......... 32 well to confirm and
attest well drilled
was an unsuccessful
certified well with
supporting
documentation and
request supplement.
49(b)........................ Notify MMS or The MMS SOL requires that this reg text 0
decision to exercise stay for legacy purposes only. Last
option to replace time any respondent could use was 2004;
one set of deep gas hence, no burden. royalty suspension
terms for another
set of such terms.
Subtotal........................................................... 59................... 117
End of Life and Special Royalty Relief*
51; 83; 84 NTL............... Applicationleases 100.............. 1 application every 3 34 (rounded)
that generate years. earnings that cannot
sustain continued
production (endof
life lease);
required supporting
documentation.
application \1/3\ x $8,000 = $2,667 (rounded)* audit \1/3\
x $12,500 = $4,167 (rounded)
52........................... Demonstrate ability 1................ 1 response........... 1 to qualify for
royalty relief or to
requalify.
55........................... Renounce relief 1................ 1 letter every 3 1 (rounded)
arrangement (endof years. life) (seldom, if
ever will be used;
minimal burden to
prepare letter).
80 NTL....................... Applicationapart 250.............. 1 application every 2 125
from formal programs years. for royalty relief
for marginal
producing lease
(Special Case
Relief); required
supporting
documentation.
application \1/2\ x $8,000** = $4,000 audit \1/4\ x
$12,500 = $3,125
80 NTL....................... Applicationapart 1,000............ 1 application every 2 500
from formal programs years. for royalty relief
for marginal
expansion project or
marginal non
producing lease
(Special Case
Relief); required
supporting
documentation.
application \1/2\ x $19,500** = $9,750 audit \1/4\ x
$18,750 = $4,688
3 (rounded).......... 661
Subtotal.................................$28,397 fees.............. [[Page 46450]]
CPA Report
81; 8390.................... Required reports; Burden included with 0
extension applications justification.
1 CPA report x $45,000 each = $45,000
Subtotal........................................................... 1.................... $45,000
Deep Water Royalty Relief Act (DWRAA)
61; 62; 64; 65; 71; 83; 85 Applicationpreview 900.............. 1 application every 3 300
89; NTL. assessment (seldom years. if ever will be used
as applicants
generally opt for
binding
determination by MMS
instead) and
required supporting
documentation.
application \1/3\ x $28,500 = $9,500
62; 64; 65; 71; 83; 8589.... Applicationleases 2,000............ 1 application every 3 667 (rounded)
in designated areas years. of GOM deep water
acquired in lease
sale before 11/28/95
or after 11/28/00
and are producing
(deep water
expansion project);
required supporting
documentation.
application \1/3\ x $19,500 = $6,500
62; 64; 65; 203.71; 81; 83; Applicationleases 2,000............ 1 application every 3 667 (rounded)
8589; NTL. in designated areas years. of deep water GOM,
acquired in lease
sale before 11/28/95
or after 11/28/00
that have not
produced (preact or
post2000 deep water
leases); required
supporting
documentation.
application \1/3\ x $34,000 = $11,334 (rounded)* audit \1/
3\ x $37,500 = $12,500
70; 81; 90; 91............... Submit fabricator's 20............... 1 report every 3 7 (rounded)
confirmation report; years. extension
justification.
70; 81; 90; 92; NTL.......... Submit post 50............... 1 report* every 3 17 (rounded)
production years. development report;
extension
justification.
right to audit (1
audit every 6 years)
after production
starts to confirm
cost estimates of
the application.
application \1/3\ x $16,000 = $5,334 (rounded)*
77........................... Renounce relief 1................ 1 letter every 3 1 (rounded)
arrangement (deep years. water) (seldom, if
ever will be used;
minimal burden to
prepare letter).
79(a)........................ Request This was a regulatory requirement for 0
reconsideration of leases issued prior to 1995 MMS field
designation.
79(c)........................ Request extension of 2................ 1 request every 3 1 (rounded)
deadline to start years. construction.
81; 8390.................... Required reports; Burden included with 0
extension applications justification.
83; NTL...................... Applicationshort 40............... 1 application every 3 14 (rounded)
form to add or years. assign preAct lease
and required
supporting
documentation.
application \1/3\ x $1,000 = $334 (rounded)
3 (rounded).......... 1,841
Subtotal....................................$48,627................ [[Page 46451]]
Recordkeeping
81(d)........................ Retain supporting 8................ 2 recordkeepers...... 16 cost records for
postproduction
development/
fabrication reports
(records retained as
usual/customary
business practice;
minimal burden to
make available at
MMS request).
Subtotal........................................................... 2 recordkeepers...... 16 68................... 2,635
Total Annual Burden......................$122,024 Fees............. * CPA certification expense burden also imposed on applicant. ** These applications currently do not have a set fee since they are done on a casebycase basis. Note: Applications include numerous items such as: Transmittal letters, letters of request, modifications to applications, reapplications, etc.
Estimated Reporting and Recordkeeping NonHour Cost Burden: There
are two nonhour costs associated with this information collection. The
estimated nonhour cost burden is $122,024. This estimate is based on:
(a) Application and audit fees. The total annual estimated cost burden for these fees is $77,024 (refer to burden chart).
(b) Cost of reports prepared by independent certified public
accountants. Under Sec. 203.81, a report prepared by an independent
certified public accountant must accompany the application and post
production report (expansion project, short form, and preview
assessment applications are excluded). The OCS Lands Act applications
will require this report only once; the DWRRA applications will require
this report at two stageswith the application and postproduction
development report for successful applicants. MMS estimates
approximately one submission each year at an average cost of $45,000
per report, for a total estimated annual cost burden of $45,000.
The total of the two burdens is estimated at $122,024.
Public Disclosure Statement: The PRA (44 U.S.C. 3501, et seq.) provides that an agency may not conduct or sponsor a collection of information unless it displays a currently valid OMB control number. Until OMB approves a collection of information, you are not obligated to respond.
Comments: Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3501, et seq.) requires each agency ``* * * to provide notice * * * and otherwise consult with members of the public and affected agencies concerning each proposed collection of information * * *.'' Agencies must specifically solicit comments to: (a) Evaluate whether the proposed collection of information is necessary for the agency to perform its duties, including whether the information is useful; (b) evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information; (c) enhance the quality, usefulness, and clarity of the information to be collected; and (d) minimize the burden on the respondents, including the use of automated collection techniques or other forms of information technology.
To comply with the public consultation process, on April 22, 2009, we published a Federal Register notice (74 FR 18393) announcing that we would submit this ICR to OMB for approval. The notice provided the required 60day comment period. In addition, Sec. 203.82 provides the OMB control number for the information collection requirements imposed by the 30 CFR part 203 regulations. The regulation also informs the public that they may comment at any time on the collections of information and provides the address to which they should send comments. We have received no comments in response to these efforts.
If you wish to comment in response to this notice, you may send your comments to the offices listed under the ADDRESSES section of this notice. The OMB has up to 60 days to approve or disapprove the information collection but may respond after 30 days. Therefore, to ensure maximum consideration, OMB should receive public comments by October 9, 2009.
Public Availability of Comments: Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment including your personal identifying informationmay be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
MMS Information Collection Clearance Officer: Arlene Bajusz, (202) 2087744.
Dated: June 23, 2009.
E.P. Danenberger,
Chief, Office of Offshore Regulatory Programs.
[FR Doc. E921708 Filed 9809; 8:45 am]
BILLING CODE 4310MRP
FOR FURTHER INFORMATION CONTACT
Cheryl Blundon, Regulations and Standards Branch, (703) 7871607. You may also contact Cheryl Blundon to obtain a copy, at no cost, of the regulation that requires the subject collection of information.