[Federal Register Volume 62, Number 135 (Tuesday, July 15, 1997)]
[Notices]
[Pages 37930-37931]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-18540]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service


Agency Information Collection Activities: Proposed Collection; 
Comment Request

AGENCY: Minerals Management Service, DOI.

ACTION: Notice of information collection solicitation.

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SUMMARY: Under the Paperwork Reduction Act of 1995, the Minerals 
Management Service (MMS) is soliciting comments on an information 
collection, Gas Transportation and Processing Allowances (OMB Control 
Number 1010-0075); this information collection pertains to Indian 
leases only.

FORMS: MMS-4109, Gas Processing Allowance Summary Report; MMS-4295, Gas 
Transportation Allowance Report.

DATES: Written comments should be received on or before September 15, 
1997.

ADDRESSES: Comments sent via the U.S. Postal Service should be sent to 
Minerals Management Service, Royalty Management Program, Rules and 
Publications Staff, P.O. Box 25165, MS 3021, Denver, Colorado 80225-
0165; courier address is Building 85, Room A-212, Denver Federal 
Center, Denver, Colorado 80225; e:Mail address is 
David__G[email protected].

FOR FURTHER INFORMATION CONTACT: Dennis C. Jones, Rules and 
Publications Staff, phone (303) 231-3046, FAX (303) 231-3385, e-Mail 
Dennis__C__J[email protected].

SUPPLEMENTARY INFORMATION: In compliance with the Paperwork Reduction 
Act of 1995, Section 3506(c)(2)(A), we are notifying you, members of 
the public and affected agencies, of this collection of information, 
and are inviting your comments. Is this information collection 
necessary for us to properly do our job? Have we accurately estimated 
the industry burden for responding to this collection? Can we enhance 
the quality, utility, and clarity of the information we collect? Can we 
lessen the burden of this information collection on the respondents by 
using automated collection techniques or other forms of information 
technology?
    The Secretary of the Interior is responsible for collecting 
royalties from lessees who produce minerals from leased Indian lands. 
The Secretary is required by various laws to manage mineral production 
on Indian lands, to collect the royalties due, and to distribute 
royalty funds in accordance with those laws. The product valuation and 
allowance determination process is essential to assure that the Indian 
community receives payment on the proper value of the minerals being 
removed. The value of the gas and gas plant products being sold, or 
otherwise disposed of, as well as the costs associated with the 
allowable deductions from the value of the products must be established 
to determine whether the royalty amount tendered represents the proper 
royalty due.
    Processing allowances may be taken as a deduction from royalty 
payments. We normally accept the cost as stated in the lessee's arm's-
length processing contract as being the processing allowance cost. In 
those instances where

[[Page 37931]]

gas is processed through a lessee-owned plant, the processing costs 
shall be based upon the actual plant operating and maintenance 
expenses, depreciation, and a reasonable return on investment. The 
allowance is expressed as a cost per unit of individual plant products.
    Under certain circumstances lessees are authorized to deduct from 
royalty payments reasonable actual costs of transporting the royalty 
portion of produced minerals from the lease to a processing or sales 
point not in the immediate lease area. Transportation allowances are a 
part of the product valuation process which MMS uses to determine if 
the lessee is reporting and paying the proper royalty amount.
    Lessees of Indian leases submitting allowance forms may take 
deductions from royalties due. Regulations at 30 CFR 212 require 
revenue payors to make and retain accurate and complete records 
necessary to demonstrate the accuracy of royalty payments. Failure to 
collect this information could result in undervaluing leased minerals 
and render it impossible for us to fulfill our trust responsibilities 
to Indians for their leases. Without such information, we cannot 
evaluate the correctness of values or allowances reported and claimed.
    Small organizations are among the potential respondents. We have 
carefully analyzed requirements to ensure that the information 
requested is the minimum necessary and places the least possible burden 
on industry. There are no special reporting provisions for small 
organizations. We provide toll-free telephone assistance upon request 
and annually schedule product valuation training in addition to other 
RMP training sessions offered throughout the year.
    The Federal government spends about 16 hours reviewing all 
categories of allowance proposals. The categories involve whether or 
not a contract is arm's-length or non-arm's-length and involve a 
request for a transportation or processing allowance or both. Using a 
cost estimate of $35 per hour, our annual cost is $560.
    Sixty-five Indian lease lessees submit about 3,000 allowance data 
lines annually. Lessees may be involved in more than one type of 
allowance proposal and can complete an allowance data line in about 1/4 
hour. The annual industry burden estimate is 750 burden hours (3,000 
allowance data lines  x  1/4 hour per line). Using an estimate of $35 
per hour, the annual cost burden to industry is $26,250.
    The burden currently associated with this information collection is 
16,153 hours. However, we now estimate the burden at 750 hours. The 
decrease in burden hours is due to our amending valuation regulations 
on transportation, processing, and washing allowance deductions used to 
calculate royalties due on Federal oil and gas, and coal leases (61 FR 
5448, Feb. 12, 1996). The amended valuation regulations eliminate 
allowance forms-filing requirements and associated sanctions for 
lessees of Federal leases only.

    Dated: June 3, 1997.
Lucy Querques Denett,
Associate Director for Royalty Management.
[FR Doc. 97-18540 Filed 7-14-97; 8:45 am]
BILLING CODE 4310-MR-M