[Federal Register Volume 62, Number 51 (Monday, March 17, 1997)]
[Notices]
[Pages 12662-12663]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-6569]


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DEPARTMENT OF THE INTERIOR
[MT-921-07-1320-01]


Qualification for Category 5 Royalty Rate Reduction in Designated 
Areas of Fort Union Federal Coal Production Region

AGENCY: Bureau of Land Management, Montana State Office, Interior.

ACTION: Notice of Qualification for Category 5 Royalty Rate Reduction 
Region; Establishment of Competitive Royalty Rate; and Acceptance of 
Applications for Consideration for Royalty Relief: McLean, Mercer, and 
Oliver Counties, North Dakota, and Richland County, Montana.

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SUMMARY: This notice is issued for the purpose of announcing: (1) The 
determination that the Counties of McLean, Mercer, and Oliver, North 
Dakota, and Richland County, Montana, within the Fort Union Federal 
Coal Production Region, continue to meet the criteria to qualify for 
royalty rate differentials under Category 5 of the Royalty Rate 
Reduction guidelines published February 27, 1990 (55 FR 6841), and 
clarified May 2, 1990 (55 FR 18401); (2) Establishment of the Category 
5 royalty rate at 2.6 percent for the Counties of McLean, Mercer, and 
Oliver, North Dakota, and Richland

[[Page 12663]]

County, Montana; and (3) That applications will be accepted by the 
Bureau of Land Management, Montana State Office, for consideration for 
royalty relief for these areas effective upon publication of this 
Notice.

FOR FURTHER INFORMATION CONTACT: Randy D. Heuscher, Chief, Branch of 
Solid Minerals, telephone 406-255-2816, Montana State Office, Bureau of 
Land Management, P.O. Box 36800, Billings, Montana 59107-6800.

SUPPLEMENTARY INFORMATION: The ``Fort Union Region Category 5 Royalty 
Reduction Study'' requested by the State Director, Montana State 
Office, Bureau of Land Management, was completed by the Northwest 
Regional Evaluation Team of the Bureau of Land Management of the 
Department of the Interior in 1991. The geographic area qualification 
and the establishment of the competitive royalty rate under Category 5 
of the ``Royalty Rate Reduction Guidelines for the Solid Leasable 
Minerals'' have been reviewed, and are the basis for the following 
determinations:

A. Geographic Area Qualification

    The Counties of McLean, Mercer, and Oliver, North Dakota, and 
Richland County, Montana, continue to meet the established five 
criteria to qualify under Category 5 for royalty rate differentials as 
follows: (1) The Federal Government is not market dominant in this 
area; (2) Federal royalty rates are above the current market royalty 
rate for non-Federal rates in the area; (3) Based on a mine-by-mine 
examination, it is apparent that there are instances where Federal coal 
can be expected to be bypassed in the near future due to the royalty 
rate differential between Federal and non-Federal coal; (4) All three 
previous criteria considerations have been found to exist throughout 
the region; and (5) A plant-by-plant analysis, based on actual 
shipments, indicates that Powder River Basin coal is competitive in the 
area. However, it has also been shown that a reduction in the Federal 
royalty rate would not have a significant impact on this 
competitiveness.

B. Establishment of Competitive Royalty Rates

    The competitive royalty rate of 2.6 percent is established to 
promote development of Federal coal reserves situated in the Counties 
of McLean, Mercer, and Oliver, North Dakota, and Richland County, 
Montana, that may otherwise be bypassed in favor of non-Federal coal 
having a lower royalty rate.

C. Category 5 Reduction in Royalty Applications

    Federal lease-specific applications for Category 5 Reduction in 
Royalty for coal deposits within the Counties in North Dakota and 
Montana named above will be accepted by the Montana State Office, 
Bureau of Land Management, P.O. Box 36800, Billings, Montana 59107-6800 
effective upon publication of this Notice. Applications will be 
processed pursuant to the regulations at 43 CFR part 3485 as 
established by the ``Royalty Rate Reduction Guidelines for the Solid 
Leasable Minerals.''
    The geographic area qualification and the establishment of the 
competitive royalty rate under Category 5 of the ``Royalty Rate 
Reduction Guidelines for the Solid Leasable Minerals'' will be reviewed 
again and updated 2 years from the effective date hereof.

    Dated: March 6, 1997.
John E. Moorhouse,
Acting State Director.
[FR Doc. 97-6569 Filed 3-14-97; 8:45 am]
BILLING CODE 4310-DN-P