[Federal Register Volume 62, Number 241 (Tuesday, December 16, 1997)]
[Notices]
[Pages 65818-65819]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-32718]


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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, Stripper Royalty Rate Reduction Notification (OMB Control 
Number 1010-0090, Form MMS-4377), which expires on May 31, 1998.

FORM: MMS-4377, Stripper Royalty Rate Reduction Notification

DATES: Written comments should be received on or before February 17, 
1998.

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 A613, 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: To encourage continued production, provide 
an incentive for enhanced oil recovery projects, discourage abandonment 
of properties producing less than 15 barrels of oil per well-day, and 
reduce the operator's expenses, the Bureau of Land Management (BLM) 
will grant royalty rate reductions to operators of low-producing, 
stripper oil properties. BLM amended 43 CFR 3103.4-1 to establish the 
conditions under which an operator or owner of a stripper oil property 
can obtain a reduction in the royalty rate for a property producing 
less than 15 barrels of oil per well-day. The amended regulations 
provided instructions for calculation of royalty rates based on the 
property's annual production rate.
    Operators of stripper oil properties use a formula developed by BLM 
[royalty rate (%) = 0.5 + (0.8 x average daily production)] and 
included under 43 CFR 3103.4-1(d)(3)(ii) to determine the reduced 
royalty rate. Operators are then required to notify MMS of the reduced 
royalty rate. The reduced rate will become effective for all oil 
production from qualifying properties the first day of the month after 
MMS receives notification of the rate change. Failure to inform MMS of 
the new royalty rate would result in the generation of exceptions by 
MMS computer systems processing financial and production data. The 
operator would then be held liable for royalty at the old rate and be 
subject to interest charges as well.
    MMS has developed Form MMS-4377, Stripper Royalty Rate Reduction 
Notification, to be used to notify MMS of the reduced royalty rate. The 
form requires identification of the operator, name of the contact 
person, lease and agreement numbers, calculated royalty rate, current 
royalty rate and period covered. Since implementation of the final rule 
on September 10, 1992, MMS has received over 7,000 of these 
notifications. MMS uses the information provided on the form to update 
the database with accepted reduced royalty rates.
    There are approximately 4,500 stripper leases or agreements on 
Federal lands and a total of 900 operators. Royalty rate calculations 
were made for the initial qualifying period, August 1, 1990, through 
July 31, 1991, and are now submitted for each 12-month period. We 
estimate that an operator may require 30 minutes per property to 
research production for one 12-month period, determine average annual 
well production, and calculate and report a new royalty rate or an 
annual burden of 2,250 hours (1/2 hour x 4,500 properties). We estimate 
that an operator may require 15 minutes annually to perform the 
necessary

[[Page 65819]]

recordkeeping responsibilities associated with this information 
collection or an annual burden of 225 hours (1/4 hour x 900 operators).

    Dated: December 10, 1997.
R. Dale Fazio,
Acting Associate Director for Royalty Management.
[FR Doc. 97-32718 Filed 12-15-97; 8:45 am]
BILLING CODE 4310-MR-P