[Federal Register Volume 62, Number 142 (Thursday, July 24, 1997)]
[Rules and Regulations]
[Pages 39773-39775]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-19383]
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DEPARTMENT OF THE INTERIOR
Minerals Management Service
30 CFR Parts 250 and 256
RIN 1010-AC04
Pipeline Right-of-Way Applications and Assignment Fees;
Requirements for Filing of Lease Transfers
AGENCY: Minerals Management Service, Interior.
ACTION: Final rule.
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SUMMARY: The Minerals Management Service (MMS) amends its regulations
governing the filing fees charged for processing pipeline right-of-way
applications and assignments, and applications for approval of
instruments of transfer of a lease or interest. This amendment
increases the filing fees for these documents, which will allow MMS to
recover the full processing costs.
EFFECTIVE DATE: September 22, 1997.
FOR FURTHER INFORMATION CONTACT: John Mirabella, Engineering and
Operations Division, at (703) 787-1607.
SUPPLEMENTARY INFORMATION: MMS last increased the filing fees for
pipeline right-of-way applications and assignments on April 1, 1988. At
that time, the fee for a pipeline right-of-way application was
increased to $1,400, and the fee for a pipeline right-of-way assignment
was increased to $50. MMS has not changed the $25 filing fee for
instruments of transfer of a lease or interest since the administration
of regulations concerning Outer Continental Shelf (OCS) minerals and
rights-of-way was transferred to MMS from the Bureau of Land Management
in 1982.
During the years since MMS last adjusted these filing fees, the
costs to process these documents have increased. MMS conducted in-house
cost analyses based on the costs of salaries and benefits, computer
time, and overhead in each of the regional offices to determine the
average processing cost for each of these documents. The results showed
that MMS is undercharging for these services, and, therefore, MMS is
increasing the fees.
This rule increases the filing fee for a pipeline right-of-way
application from $1,400 to $2,350; the filing fee for a pipeline right-
of-way assignment from $50 to $60; and the filing fee for instruments
of transfer of a lease or an interest from $25 to $185.
MMS published a notice of proposed rulemaking (NPRM) on August 11,
1995 (60 FR 41034). We received eight comment letters responding to the
proposed rule. The comments all opposed the increase in fees. The
principal comments and MMS's responses are as follows:
Comment: Commenters opposed the large increase in the fee for
transfer of leases. They pointed out that the MMS had proposed an
increase of 640 percent. Comments suggested a lesser increase based on
the increase in the Consumer Price Index (CPI) or the increase in the
Council of Petroleum Accountants Society's (COPAS) Wage Index. Others
suggested a specific amount.
Response: Under the Independent Offices Appropriation Act of 1952
(IOAA), 31 U.S.C. 9701, and Department of the Interior (DOI)
implementing policy, MMS is required to charge the full cost for
services which provide special benefits or privileges to an
identifiable non-Federal recipient above and beyond those which accrue
to the public at large. We do not have the option of choosing to charge
less.
Comment: The bonus, royalty, and rental payments lessees make are
more than sufficient to cover any fee increases that might be needed.
Response: Bonus, royalty, and rental payments are compensation for
the right to explore for, develop, and produce oil and gas on the
lease. Fees covering pipeline rights-of-way applications or transfers
and fees covering transfers of leases provide additional benefits not
covered by bonus, royalty, and rental payments.
Comment: MMS should improve its business practices and look to
reduce costs internally before passing on costs to lessees.
Response: MMS is continuously looking for ways to improve
efficiency and lower costs. This increase reflects both the effects of
inflation and the effects of added complexity of reviewing lease
transfers. These added complexities result from necessary bond reviews.
Comment: Establish a fee schedule for ``multiples'' of interests
transferred when one lessee transfers a number of interests to another
party (i.e., $X per 10 transfers). Also, establish a ceiling on the
total cost for these types of ``bulk'' transfers.
Response: The new fees are based on the total cost of reviewing and
approving many applications and requests for transfers. The fee charged
for each transaction is an average. If MMS were to set up a system
allowing a lesser fee for simple transfers or ``bulk'' transfers, then
the fee for others would need to be higher. MMS chose to charge the
same fee for all transactions rather than a higher fee for some
transactions and a lower fee for others. A variable fee structure would
be difficult to administer and would add unnecessary administrative
costs.
Comment: MMS should not index the fees to the CPI. The commenter
believed that with automatic increases in costs, MMS would not strive
to control expenses or improve work efficiency, and lessees would be
precluded from any future comment on fee increases. Others suggested
the COPAS Wage Index as the appropriate choice of an index.
Response: We kept the proposed provision to allow future automatic
adjustments in the amount of the fee based on the CPI ``U''. We believe
that a broader inflation index such as the CPI ``U'' is a better
indicator of changes in MMS costs than the suggested COPAS Wage Index
which specifically reflects costs in the petroleum industry. (Note: the
CPI ``U'' refers to the CPI for all urban consumers.)
However, in response to the comment, we revised the rule to allow
MMS to increase the fee by a percentage equal to the percentage
increase in MMS costs to process applications. MMS will attempt to
minimize cost increases. The rule provides that if the percentage
increase in MMS costs is greater than the percentage increase in the
CPI ``U'', MMS will provide notice and opportunity for comment before
changing the fee. Author: This document was prepared by John V.
Mirabella, Engineering and Operations Division.
Executive Order (E.O.) 12866
This rule is a significant rule under E.O. 12866 and has been
reviewed by the Office of Management and Budget (OMB). MMS estimates
that the rule will cost industry approximately $670,000 per year. This
is based on the average number of applications, assignments, and
transfers handled by the Regions in the past.
E.O. 12988
DOI certified to OMB that this rule meets the applicable civil
justice reform standards provided in sections 3(a) and 3(b)(2) of E.O.
12988.
[[Page 39774]]
Unfunded Mandates Reform Act of 1995
DOI determined and certifies according to the Unfunded Mandates
Reform Act, 2 U.S.C. 1502 et seq., that this rule will not impose a
cost of $100 million or more in any given year on State, local, and
tribal governments, or the private sector.
Regulatory Flexibility Act
DOI determined that this rule will not have a significant effect on
a substantial number of small entities. The increase in fees charged by
MMS is small relative to the cost of operating on the OCS. We expect
that the increase in the fees will not affect the number of leases or
pipelines that are transferred each year or the number of pipeline
right-of-way applications requested each year.
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.)
provides that an agency may not conduct or sponsor, and a person is not
required to respond to, a collection of information unless it displays
a currently valid OMB control number. Although OMB previously approved
the collections of information required by these regulations prior to
this revision, the amount of the filing fees was not subject to OMB
review at the time the NPRM was published. Therefore, we did not submit
the collections in the NPRM to OMB for review. However, under the new
Paperwork Reduction Act, MMS is now required to obtain OMB approval as
part of the final rulemaking process. The collections of information in
this final rule remain unchanged from the proposed rule. Comments
received on the NPRM are discussed earlier in the preamble. The
applicable OMB control numbers for the information collections in this
final rule are 1010-0050 (30 CFR 250.160 and 250.163) and 1010-0006 (30
CFR 256.64). The information collection aspects of this final rule will
not take effect until approved by OMB.
MMS has submitted to OMB information collection packages for 30 CFR
part 250, Subpart J, Pipelines and Pipeline Rights-of-Way, which
includes the revised requirements in Secs. 250.160 and 250.163 (OMB
control number 1010-0050); and 30 CFR part 256, Leasing of Sulphur or
Oil and Gas in the Outer Continental Shelf, which includes the revised
requirements in Sec. 256.64 (OMB control number 1010-0006). MMS invites
the public and other Federal agencies to comment on the collections of
information as discussed below. Send comments regarding any aspect of
these collections to the Office of Information and Regulatory Affairs,
OMB, Attention: Desk Officer for the Interior Department (1010-0050 or
1010-0006), 725 17th Street NW., Washington, D.C. 20503. Send a copy of
your comments to the Information Collection Clearance Officer, Minerals
Management Service, 1849 C Street NW., MS 4230, Washington, D.C. 20240.
OMB is required to make a decision concerning the collection of
information contained in this final regulation between 30 and 60 days
after publication of this document in the Federal Register. Therefore,
your comments are best assured of being considered by OMB if OMB
receives them by August 25, 1997.
MMS collects the information under regulations implementing the OCS
Lands Act, as amended. MMS uses the information to ensure the
qualification of assignees and that assignees comply with all
requirements for holding a pipeline right-of-way. The information
required is mandatory and/or required to obtain or retain a benefit
under 43 U.S.C. 1331 et seq. MMS will protect information considered
confidential or proprietary under applicable law and under regulations
at 30 CFR 250.18.
The average reporting burden estimates currently approved by OMB
for the individual sections revised by this rulemaking are: 140 hours
per new right-of-way application (Sec. 250.160), 8 hours per assignment
of right-of-way (Sec. 250.163), and 5 hours per application for
approval of any instrument of transfer (Sec. 256.64). The total average
burden estimates currently approved for OMB control number 1010-0050
are 36 reporting hours and 20 recordkeeping hours. The total average
burden estimate currently approved for OMB control number 1010-0006 is
3.5 reporting hours. This includes the time for reviewing instructions,
searching existing data sources, gathering and maintaining the data
needed, and completing and reviewing the information collection. In
addition to the hour burden, the application filing fees represent a
cost burden to the respondents. MMS estimates the annual burdens for
the application fees are: $246,750. (new right-of-way applications,
Sec. 250.160), $4,560 (assignments of right-of-way, Sec. 250.163), and
$420,875 (applications for approval of any instrument of transfer,
Sec. 256.64).
In calculating the burdens, MMS may have assumed that respondents
perform some of the requirements and maintain records in the normal
course of their activities. MMS considers these to be usual and
customary. Commenters are invited to provide information if they
disagree with this assumption and they should tell us what the burden
hours and costs are that are imposed by this collection of information.
(1) MMS specifically solicits comments on the following questions:
(a) Is the proposed collection of information necessary for the
proper performance of MMS's functions, and will it be useful?
(b) Are the burden hours estimates reasonable for the proposed
collection?
(c) Do you have any suggestions that would enhance the quality,
clarity, or usefulness of the information to be collected?
(d) Is there a way to minimize the information collection burden on
those who are to respond, including the use of appropriate automated
electronic, mechanical, or other forms of information technology?
(2) In addition, the Paperwork Reduction Act requires agencies to
estimate the total annual cost burden to respondents or recordkeepers
resulting from the collection of information. The MMS needs your
comments on this item. Your response should split the cost estimate
into two components:
(a) Total capital and startup cost component and
(b) Annual operation, maintenance, and purchase of services
component. Your estimates should consider the costs to generate,
maintain, and disclose or provide the information. You should describe
the methods you use to estimate major cost factors, including system
and technology acquisition, expected useful life of capital equipment,
discount rate(s), and the period over which you incur costs. Capital
and startup costs include, among other items, computers and software
you purchase to prepare for collecting information; monitoring,
sampling, drilling, and testing equipment; and record storage
facilities. Generally, your estimates should not include equipment or
services purchased: (i) Before October 1, 1995; (ii) to comply with
requirements not associated with the information collection; (iii) for
reasons other than to provide information or keep records for the
Government; or (iv) as part of customary and usual business or private
practices.
Takings Implication Assessment
DOI determined that this rule does not represent a governmental
action capable of interfering with constitutionally protected rights.
Thus, DOI does not need to prepare a Takings Implication Assessment
pursuant to E.O. 12630, Governmental Actions and Interference with
Constitutionally Protected Property Rights.
[[Page 39775]]
National Environmental Policy Act
DOI determined that this rule does not constitute a major Federal
action significantly affecting the quality of the human environment;
therefore, an Environmental Impact Statement is not required.
List of Subjects in 30 CFR Part 250
Continental shelf, Environmental impact statements, Environmental
protection, Government contracts, Incorporation by reference,
Investigations, Mineral royalties, Oil and gas development and
production, Oil and gas exploration, Oil and gas reserves, Penalties,
Pipelines, Public lands--mineral resources, Public lands--rights-of-
way, Reporting and recordkeeping requirements, Sulphur development and
production, Sulphur exploration, Surety bonds.
List of Subjects for 30 CFR Part 256
Administrative practice and procedure, Continental shelf,
Government contracts, Incorporation by reference, Oil and gas
exploration, Public lands--mineral resources, Reporting and
recordkeeping requirements, Surety bonds.
Dated: May 9, 1997.
Bob Armstrong,
Assistant Secretary, Land and Minerals Management.
For the reasons stated in the preamble, the Minerals Management
Service (MMS) amends 30 CFR parts 250 and 256 as follows:
PART 250--OIL AND GAS AND SULPHUR OPERATIONS IN THE OUTER
CONTINENTAL SHELF
1. The authority citation for part 250 continues to read as
follows:
Authority: 43 U.S.C. 1331 et seq.
2. Section 250.160 is amended by revising the fifth sentence in
paragraph (a) and adding three new sentences following the fifth
sentence to read as follows:
Sec. 250.160 Applications for a pipeline right-of-way grant.
(a) * * * A nonrefundable filing fee of $2,350 and the rental
required under Sec. 250.159(c)(2) of this part must accompany a new
right-of-way application. MMS periodically will amend the filing fee
based on its experience with the costs for administering pipeline
right-of-way applications. If the costs change by a percentage of not
more than the percentage change in the CPI ``U'' since the last change
to the filing fee, MMS will amend the application fee by the percentage
of the change in costs without notice and opportunity for comment. If
costs increase by a percentage more than the percentage change in the
CPI ``U'' since the last change to the filing fee, MMS will provide
notice and an opportunity to comment before it changes the filing fee.
* * *
* * * * *
3. Section 250.163 is amended by revising the last sentence in
paragraph (b) and adding three new sentences following the last
sentence to read as follows:
Sec. 250.163 Assignment of a right-of-way grant.
* * * * *
(b) * * * A nonrefundable filing fee of $60 must accompany the
application for the approval of an assignment. MMS periodically will
amend the filing fee based on its experience with the costs for
administering pipeline right-of-way assignment applications. If the
costs increase by more than the CPI ``U,'' MMS will provide notice and
opportunity for comment before changing the filing fee. For lesser cost
increases or cost reductions MMS will change the fee without such
procedures.
PART 256--LEASING OF SULPHUR OR OIL AND GAS IN THE OUTER
CONTINENTAL SHELF
4. The authority citation for part 256 continues to read as
follows:
Authority: 43 U.S.C. 1331 et seq.
5. Section 256.64 is amended by revising the first sentence in
paragraph (a) (8) as redesignated at 62 FR 27959, May 22, 1997,
effective August 20, 1997, and adding three new sentences following the
first sentence to read as follows:
Sec. 256.64 Requirements for filing of transfers.
(a) * * *
(8) A nonrefundable filing fee of $185 must accompany an
application for approval of any instrument of transfer required to be
filed. MMS periodically will amend the filing fee based on its
experience with the costs for administering lease transfer
applications. If the costs increase by more than the CPI ``U,'' MMS
will provide notice and opportunity for comment before changing the
filing fee. For lesser cost increases or cost reductions MMS will
change the fee without such procedures. * * *
* * * * *
[FR Doc. 97-19383 Filed 7-23-97; 8:45 am]
BILLING CODE 4310-MR-P