[Federal Register Volume 60, Number 228 (Tuesday, November 28, 1995)]
[Proposed Rules]
[Pages 58590-58593]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-28965]



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DEPARTMENT OF THE INTERIOR

Bureau of Land Management

43 CFR Part 3160

[WO-310-4191-02-24 1A]
RIN 1004-AC09


Onshore Oil and Gas Operations

AGENCY: Bureau of Land Management, Interior.

ACTION: Proposed rule.

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SUMMARY: The Department of the Interior, through the Bureau of Land 
Management (BLM), proposes to amend the provisions of 43 CFR Part 3160 
that address BLM's responsibility for managing oil and gas operations 
on lands administered by the United States Forest Service (Forest 
Service). This action is being taken to clarify the regulations 
implementing the Federal Onshore Oil and Gas Leasing Reform Act of 1987 
(Reform Act), to establish clearly that BLM's responsibility on 
National Forest System (NFS) lands is limited to the approval of 
applications for permit to drill (APD), the approval of other 
development or operational proposals involving subsurface activity, 
related impacts, and any appeals regarding the same. On NFS lands the 
approval of an APD does not, in itself, constitute approval of the 
surface use plan of operations (SUPO). Surface use plans of operations 
on NFS lands require separate approval by the Forest Service, and all 
appeals related to the SUPO are appeals from the decision of the Forest 
Service. Agency responsibilities under this rule and the Reform Act are 
determined on the basis of subsurface (BLM) and surface (Forest 
Service) authority for oil and gas operations on NFS lands.

DATES: Comments should be submitted by January 29, 1996. Comments 
received or postmarked after this date may not be considered in the 
decision making on the final rule.

ADDRESSES: Comments should be sent to: Director (420), Bureau of Land 
Management, Room 401 LS, 1849 C Street, NW., Washington, DC 20240. 
Comments can also be sent to internet!WO[email protected]. Please include 
``attn: AC09'' and your name and return address in your internet 
message. Comments will be available for public review at the above 
address during regular business hours (7:45 a.m. to 4:15 p.m.), Monday 
through Friday.

FOR FURTHER INFORMATION CONTACT: Erick Kaarlela, (202) 452-0340, or 
Howard Lemm, (406) 255-2842.

SUPPLEMENTARY INFORMATION: The Federal Onshore Oil and Gas Reform Act 
of 1987 (30 U.S.C. 226) vests the Secretary of the Interior and the 
Secretary of Agriculture with the authority to take actions on NFS 
lands for APD and SUPO approvals, respectively. The purpose of this 
proposed rule is to clarify in the regulations the statutory division 
of authority between the Department of the Interior, acting through the 
BLM, and the Department of Agriculture, acting through the Forest 
Service, for managing oil and gas operations on NFS lands. The 
responsibility for review of actions on NFS lands by the BLM for APDs 
and the Forest Service for SUPOs is clearly divisible. Each agency is 
responsible for predecisional reviews under such statutes as the 
National Environmental Policy Act of 1969 (42 U.S.C. 4332 et seq.) and 
the Endangered Species Act of 1973 (16 U.S.C. 1531 et seq.) to the 
extent that such reviews are performed for decisions proposed to be 
made pursuant to its decisional authority.
    The Reform Act authorizes the Secretary of Agriculture to regulate 
all surface-disturbing activities carried out in conjunction with oil 
and gas development and operation on NFS lands. The Act states: ``The 
Secretary of the Interior, or for National Forest lands, the Secretary 
of Agriculture, shall regulate all surface-disturbing activities 
conducted pursuant to any lease issued under this Act, and shall 
determine 

[[Page 58591]]
reclamation and other actions as required in the interest of 
conservation of surface resources. No permit to drill on an oil and gas 
lease issued under this Act may be granted without the analysis and 
approval by the Secretary concerned of a plan of operations covering 
proposed surface-disturbing activities within the lease area.'' As 
applied to SUPOs and APDS, the Reform Act makes an approved SUPO a 
condition precedent to the granting of an APD. Although the Forest 
Service is responsible for the SUPO approval prior to the APD, the 
Reform Act does not make the SUPO a part of the APD. The analysis and 
subsequent decisions for SUPOs and APDs are separate functions for 
Forest Service and BLM, respectively.
    Although Section 5102(g) of the Reform Act delineates the authority 
given to each agency, clarification of this division in part 3160 of 
Title 43 of the Code of Federal regulations is needed to bring the 
existing regulations into greater conformance with the Reform Act. The 
intent of this proposed rule is to accurately describe the authority of 
the BLM for managing oil and gas operations on NFS lands. The proposed 
rule would abolish the existing regulatory provision making the SUPO a 
part of an APD on NFS lands, thus making it clearer that a SUPO 
approved by the Forest Service is instead a precondition to the 
approval of an APD on NFS lands. The proposed rule would also clarify 
BLM's exclusive responsibility for APD approval and any subsequent 
appeals related to actions taken on APDs for NFS lands pursuant to 43 
CFR 3162.3-1(h). Concurrently, the Forest Service is preparing a 
technical amendment to 36 CFR 228 subpart E to clarify the exclusive 
responsibility of that agency to approve any SUPO for oil and gas 
operations on NFS lands and to hear any appeals of related actions. It 
is the intention of both agencies to coordinate these rulemaking 
activities.
    The BLM's environmental review responsibilities for oil and gas 
development on NFS lands would be for decisions related to those 
actions described in a new section 3161.3 subtitled Responsibility of 
the authorized officer on National Forest System lands. Section 3161.3 
would reiterate that BLM's authority to make decisions relating to 
drilling and suspension of operations or production will be 
appropriately coordinated with Forest Service decisions on the 
corresponding SUPO.
    It is intended under this proposed rule that environmental review 
responsibilities for oil and gas development on NFS lands would be 
fully met through the coordinated efforts of the BLM and Forest 
Service. These coordinated efforts could include the development of 
environmental documents as cooperating agencies pursuant to the 
regulations located at 40 CFR 1501.6 implementing the National 
Environmental Policy Act of 1969 (NEPA, 42 U.S.C. 4332 et seq.). 
Although this proposed rule would not affect the working relationships 
between the two agencies in terms of NEPA compliance, the rule would 
make clear the limits of authority of the two agencies for the ultimate 
decisions on APDs and SUPOs involving NFS lands.
    The existing national level Memorandum of Understanding (MOU) 
between the BLM and the Forest Service dated November 11, 1991, would 
be updated, as needed, to ensure coordination between the agencies with 
respect to oil and gas development on NFS lands in a manner consistent 
with the rule. It is anticipated that items to be considered in future 
amendment of the MOU would include, but would not be limited to, public 
posting requirements, review timeframes, operator notification 
requirements, SUPO and APD information sharing, and the distribution of 
environmental review findings and decision documents.
    The principal authors of this proposed rule are Howard Lemm and 
Chun Wong of the Montana State Office and Erick Kaarlela of the 
Washington Office (WO) Compliance Team, assisted by the Regulatory 
Management Team, WO BLM, and the Forest Service.
    It is hereby determined that this proposed rule does not constitute 
a major Federal action significantly affecting the quality of the human 
environment, and that no detailed statement pursuant to Section 
102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 
4332(2)(C)) is required. The Bureau of Land Management has determined 
that this rule is categorically excluded from further environmental 
review pursuant to Departmental Manual (DM), Chapter 2, Appendix 1, 
Item 1.10, being a regulation of an administrative, financial, legal, 
technical, or procedural nature, and that the rule will not 
significantly affect the 10 criteria for exceptions listed in 516 DM 2, 
Appendix 2. Pursuant to the Council on Environmental Quality 
regulations (40 CFR 1508.4) and environmental policies and procedures 
of the Department of the Interior, ``categorical exclusions'' means a 
category of actions which do not individually or cumulatively have a 
significant effect on the human environment and which have been found 
to have no such effect in procedures adopted by a Federal agency and 
for which neither an environmental assessment nor an environmental 
impact statement is required.
    This rule was not subject to review by the Office of Management and 
Budget under Executive Order 12866. This rule will not have a 
significant effect on the oil and gas industry. The rule will not 
adversely affect in a material way, the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local or tribal communities. The rule would 
have a positive impact in that it would eliminate duplicative 
responsibilities and appeal processes, thereby streamlining the process 
for all involved without compromising the stewardship of the resource.
    The Department has further determined that this rulemaking would 
not have a significant economic impact on a substantial number of small 
entities under the Regulatory Flexibility Act (5 U.S.C. 605 et seq.). 
No small entities are likely to be affected by this rule and there are 
no particularly affected industries or sectors.
    The Department certifies that this proposed rule does not represent 
a governmental action capable of interference with constitutionally 
protected property rights. Therefore, as required by Executive Order 
12630, the Department of the Interior has determined that the rule 
would not cause a taking of private property.
    The Department has certified to the Office of Management and Budget 
that these regulations meet the applicable standards provided in 
Sections 2(a) and 2(b)(2) of Executive Order 12778.
    This rule does not contain information collection requirements that 
require approval by the Office of Management and Budget under 44 U.S.C. 
3501 et seq.

List of Subjects in 43 CFR Part 3160

    Government contracts, Indian lands--mineral resources, Mineral 
royalties, Oil and gas exploration, Oil and gas production, Public 
lands--mineral resources, Reporting and recordkeeping requirements.

    For the reasons stated in the preamble, part 3160, of title 43 of 
the Code of Federal Regulations is proposed to be amended as follows.

PART 3160--ONSHORE OIL AND GAS OPERATIONS

    1. The authority citation for Part 3160 is revised to read as 
follows:


[[Page 58592]]

    Authority: 30 U.S.C. 181 et seq.; 30 U.S.C. 359; 30 U.S.C. 306; 
25 U.S.C. 396; 25 U.S.C. 396d; 25 U.S.C. 398e; 25 U.S.C. 399; and 30 
U.S.C. 1701, 1751(a).


Sec. 3160.0-2  [Removed]

    2. Section 3160.0-2 is removed.
    3. Section 3160.0-5 is amended by redesignating paragraphs (m) 
through (w) as paragraphs (n) through (x), respectively, and by adding 
a new paragraph (m) to read as follows:


Sec. 3160.0-5  Definitions.

* * * * *
    (m) National Forest System lands means all National Forest lands 
reserved or withdrawn from the public domain of the United States, all 
National Forest lands acquired through purchase, exchange, donation, or 
other means, the National Grasslands and land utilization projects 
administered by the Forest Service under title III of the Bankhead-
Jones Farm Tenant Act (7 U.S.C. 1010 et seq.), and other lands, waters 
or interests therein which are administered by the Forest Service or 
are designated for administration through the Forest Service as a part 
of the System (16 U.S.C. 1609).
* * * * *
    4. In Sec. 3161.1 paragraph (a) is revised to read as follows:


Sec. 3161.1  Jurisdiction.

    (a) All operations conducted on a Federal or Indian oil and gas 
lease by the operator are subject to the regulations in this part 
except as provided in Sec. 3161.3.
* * * * *
    5. Section 3161.2 is revised to read as follows:


Sec. 3161.2  Responsibility of the authorized officer.

    Except as provided in Sec. 3161.3 of this title, the authorized 
officer is authorized and directed to approve unitization, 
communitization, gas storage and other contractual agreements for 
Federal lands; to assess compensatory royalty; to approve suspensions 
of operations or production, or both; to issue NTLs; to approve and 
monitor other operator proposals for drilling, development or 
production of oil and gas; to perform administrative reviews; to impose 
monetary assessments or penalties; to provide technical information and 
advice relative to oil and gas development and operations on Federal 
and Indian lands; to enter into cooperative agreements with States, 
Federal agencies and Indian tribes relative to oil and gas development 
and operations; to approve, inspect and regulate the operations that 
are subject to the regulations in this part; to require compliance with 
lease terms, with the regulations in this title and all other 
applicable regulations promulgated under the cited laws; and to require 
that all operations be conducted in a manner which protects other 
natural resources and environmental quality, protects life and property 
and results in the maximum ultimate recovery of oil and gas with 
minimum waste and with minimum adverse effect on the ultimate recovery 
of other mineral resources. The authorized officer may issue written or 
oral orders to govern specific lease operations. Any such oral orders 
shall be confirmed in writing by the authorized officer within 10 
working days from issuance thereof. Before approving operations on 
leasehold, the authorized officer shall determine that the lease is in 
effect, that acceptable bond coverage has been provided and that except 
as provided in Sec. 3161.3 of this title the proposed plan of 
operations is sound both from a technical and environmental standpoint.


Sec. 3161.3  [Redesignated as Sec. 3161.4]

    6. Section 3161.3 is redesignated as Sec. 3161.4.
    7. A new Sec. 3161.3 is added as follows:


Sec. 3161.3  Responsibility of the authorized officer on National 
Forest System lands.

    (a) The authorized officer is responsible for the approval, 
inspection, and regulation of drilling, development and production 
operations on National Forest System lands to the same extent as 
described in Sec. 3161.2 of this title except that the authorized 
officer has no responsibility for the approval, enforcement, 
modification or revocation of any surface use plan of operations 
covering National Forest System lands. Approval of Applications for 
Permit to Drill, or approval of other proposed actions that would 
involve additional surface disturbance or reclamation, shall not be 
granted for operations to be conducted on National Forest System lands 
until the authorized representative of the Secretary of Agriculture has 
approved a surface use plan of operations covering related surface-
disturbing activities. The authorized officer has the right to 
reexamine Applications for Permit to Drill, and other proposed 
development or production activities on National Forest System lands, 
if a related surface use plan of operations is revoked, modified or 
amended by the authorized representative of the Secretary of 
Agriculture.
    (b) A surface use plan of operations related to the operator's 
proposed oil and gas operations must be furnished to the authorized 
officer for informational purposes at the time the operator submits an 
Application for Permit to Drill or other development or operational 
proposals applying to National Forest System lands.
    8. In Sec. 3162.3-1 paragraph (d)(1) is amended by removing the 
period and adding a semicolon in its place, paragraph (d)(3) is amended 
by removing ``, and'' and adding ``; and'' in its place, and paragraph 
(d)(2) is revised to read as follows:


Sec. 3162.3-1  Drilling applications and plans.

* * * * *
    (d) * * *
    (2) A surface use plan of operations containing information 
required by paragraph (f) of this section and appropriate orders and 
notices, except on National Forest System lands a surface use plan of 
operations is not required as part of an Application for Permit to 
Drill;
* * * * *
    9. Paragraph (a) of Sec. 3162.3-2 is revised to read as follows:


Sec. 3162.3-2  Subsequent well operations.

    (a) A proposal for further well operations shall be submitted by 
the operator on Form 3160-5 and approved by the authorized officer 
prior to commencing operations to redrill, perform casing repairs, 
plug-back, alter casing, perform nonroutine fracturing jobs, recomplete 
in a different interval, perform water shut off, commingle production 
between intervals and/or convert to an injection well. If there will be 
additional surface disturbance, the proposal shall include a surface 
use plan of operations as an integral part of the proposal unless it 
comes within the exception provided in Sec. 3161.3, in which case a 
copy of such surface use plan must be provided in accordance with 
Sec. 3161.3(b). The authorized officer may prescribe that each proposal 
contain all or a portion of the information set forth in Sec. 3162.3-1 
of this part. The operator shall file a subsequent report of these 
operations with the authorized officer using Form 3160-5.
* * * * *
    10. Section 3162.3-3 is revised to read as follows:


Sec. 3162.3-3  Other lease operations.

    Prior to commencing any operation on the leasehold that will result 
in additional surface disturbance, other than those activities 
authorized under Sec. 3162.3-1 or Sec. 3162.3-2 of this title, the 
operator shall submit a proposal on Form 3160-5 and receive approval of 
the authorized officer. The proposal 

[[Page 58593]]
shall include a surface use plan of operations as an integral part of 
the proposal unless it comes within the exception provided in 
Sec. 3161.3 of this title, in which case a copy of such surface use 
plan must be provided in accordance with Sec. 3161.3(b).
    11. Paragraph (c) of Sec. 3162.3-4 is amended by revising the last 
sentence to read as follows:


Sec. 3162.3-4  Well abandonment.

* * * * *
    (c) * * * Upon the removal of drilling or producing equipment from 
the site of a well that is to be permanently abandoned, the surface of 
the lands disturbed in connection with the conduct of operations shall 
be reclaimed in accordance with a plan already approved or prescribed 
by the authorized officer or, where appropriate, where approved by the 
authorized representative of the Secretary of Agriculture as provided 
in Sec. 3161.3 of this title.

    Dated: November 13, 1995.
Bob Armstrong,
Assistant Secretary of the Interior.
[FR Doc. 95-28965 Filed 11-27-95; 8:45 am]
BILLING CODE 4310-84-P