[Federal Register Volume 64, Number 35 (Tuesday, February 23, 1999)]
[Notices]
[Pages 8844-8852]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-4372]



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DEPARTMENT OF THE INTERIOR

Minerals Management Service


Agency Information Collection Activities: Submitted for Office of 
Management and Budget Review; Comment Request

AGENCY: Minerals Management Service, DOI.

ACTION: Notice of information collection solicitation and public 
meetings.

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SUMMARY: Under the Paperwork Reduction Act (PRA) of 1995, the Minerals 
Management Service (MMS) is soliciting comments on revising an existing 
information collection, Production Accounting and Auditing Reports, the 
Office of Management and Budget (OMB) Control Number 1010-0040, which 
expires on July 31, 2001. MMS is also giving notice of two public 
meetings concerning oil and gas production reporting changes.

FORMS: MMS-3160, MMS-4054, MMS-4055, MMS-4056, MMS-4058.

DATES: Written comments should be received on or before April 26, 1999. 
MMS will hold two public meetings about the proposed production 
reporting changes on March 11, 1999, in Houston, Texas, and on March 
17, 1999, in Lakewood, Colorado.

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 RMP.[email protected]. The 
time and location for each public meeting is:

Houston--March 11, 1999, 1-5 p.m. Central Standard Time, Houston 
Compliance Division Office, 4141 North Sam Houston Parkway East, 
Houston, Texas 77032, Telephone Number (281) 987-6802
Denver March 17, 1999, 1-5 p.m. Mountain Standard Time, Minerals 
Management Service, Denver Federal Center, Building 85, West 6th Avenue 
and Kipling Street, Lakewood, Colorado 80215, Telephone Number (303) 
231-3585

(Access to the Denver Federal Center will require the presentation of a 
picture identification.)

FOR FURTHER INFORMATION CONTACT: Beth Ann Danford, Production 
Accounting Branch, Royalty Management Program (RMP), phone (303) 231-
3522, FAX (303) 231-3700, e-mail Beth.D[email protected].

SUPPLEMENTARY INFORMATION: We are seeking your comments, both positive 
and negative, on our proposed changes for each oil and gas production 
form. Do you have objections to any of our proposed changes? What, if 
any, problems will the elimination of the Monthly Report of Operations, 
Form MMS-3160, for Onshore Federal and Indian oil and gas properties 
cause industry? Is this the best option for MMS to collect accurate and 
timely data for gallons per thousand cubic feet of gas (GPM) and 
Methane Mol percentage? Is it beneficial to industry to combine the Oil 
and Gas Operations Report (OGOR), Parts B and C? If you do have 
objections, what alternative(s) would you suggest? Can we enhance the 
quality, utility, and clarity of the information we collect? Can we 
lessen the information collection burden on the respondents by using 
automated collection techniques or other forms of information 
technology?
    The public meetings will be open to the public to discuss the 
proposed reporting changes. We encourage members of the public to 
attend these meetings. Those wishing to make formal presentations 
should sign up upon arrival. The sign-up sheet will determine the order 
of speakers. For building security measures, each person will be 
required to sign in and may be required to present a picture 
identification.
    Comments, including names and home addresses of respondents, are 
available for public review during regular business hours and placed on 
our web site at http://www.rmp.mms.gov/library/readroom/readrm.htm. 
Individual respondents may request that we withhold their home address 
from the rulemaking record, which we will honor to the extent allowable 
by law. There may be circumstances in which we would withhold from the 
rulemaking record a respondent's identity, as allowable by the law. If 
you wish us to withhold your name and/or address, you must state this 
prominently at the beginning of your comment. However, we will not 
consider anonymous comments. We will make all submissions from 
organizations or businesses, and from individuals identifying 
themselves as representatives or officials of organizations or 
businesses, available for public inspection in their entirety.
    MMS is responsible for ensuring that all revenues from Federal and 
Indian mineral properties are efficiently, effectively, and accurately 
collected, accounted for, verified, and disbursed to appropriate 
recipients in a timely manner. These revenues amount to more than $4.5 
billion annually. In addition to a broad range of financial services, 
we also operate a comprehensive compliance strategy that includes an 
automated compliance verification program to validate the accuracy and 
timeliness of revenues paid and an audit program staffed by MMS, State, 
and Tribal auditors.
    In April 1996, we undertook a compliance reengineering initiative 
to examine the current compliance strategy and determine the best 
approach for accomplishing future goals and objectives. The principal 
reengineering objective was to define and implement a new compliance 
strategy that satisfied, in the most cost-effective manner possible, 
the compliance program's primary purpose of ensuring that Federal and 
Indian mineral property revenues were accurately and timely paid.
    In August 1996, the Federal Oil and Gas Royalty Simplification and 
Fairness Act of 1996 (RSFA) was enacted into law. This law amended the 
Federal Oil and Gas Royalty Management Act of 1982, the Outer 
Continental Shelf Lands Act, and the Mineral Leasing Act. RSFA 
significantly changed many of our historical operating assumptions as 
well as some fundamental Federal oil and gas mineral revenue financial 
activities. We needed to immediately change some of our procedures and 
processes to implement RSFA, but we also needed to reassess our long-
term strategies, our business processes, and improve and modernize our 
ADP systems to become more cost-effective and responsive to our 
customers. Therefore, we decided to conduct an in-depth reengineering 
of all of our core business processes.
    A reengineering design team analyzed current information reporting 
requirements to confirm the presence of data needed to support future 
RMP processes. Building upon a royalty and production reporting study 
completed in May 1996, by the Royalty Policy Committee (RPC), the 
design team identified opportunities for decreasing reporting burden, 
avoiding data duplication, decreasing error rates, and increasing 
processing efficiency. They critically analyzed the information 
collected by each royalty and production report to determine: Is it 
necessary to collect this information, and how will it be used? Will 
this information support reengineered business processes? Can this 
information be obtained or utilized more efficiently?
    The design team recommended incorporating the RPC recommendations 
including eliminating some reports, streamlining the required data 
elements

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on other reports, and modifying some reports. The RPC estimated savings 
for the RMP to be in the range of 1 to 1.5 million dollars per year. If 
these proposals are adopted, they will significantly reduce the volume 
of lines reported and processed, minimize errors and related error 
correction workload, simplify reporting, and lower costs for both oil 
and gas reporters and RMP. These reporting changes (for both royalty 
and production) are essential to achieving an end-to-end compliance and 
asset management core business process. We are seeking your comments on 
the proposed changes presented and described below related to 
production reporting for Federal and Indian oil and gas properties. We 
consistently made these changes on the proposed reporting forms which 
are included at the end of this notice. In the report identification 
area, we renamed ``Report Period'' to ``Production Month'' and 
eliminated ``Authorizing Name'' and ``Title'' from the report 
authorization area. Implementation of all proposed reporting changes is 
projected for September 2001.
    We envision that operators will have the option, for all production 
reporting forms, to report via user-friendly templates or Internet 
interfaces with pull down menus. This should be especially beneficial 
to the smaller operators by eliminating reporting complexity and 
reducing reporting time burden or the need to learn codes.

Monthly Report of Operations, Form MMS-3160

    Currently, most operators of onshore properties report their 
production on Form MMS-3160. Some onshore operators and all offshore 
operators report their production on OGOR, Form MMS-4054-A, B and C. 
MMS and those reporters that have production, both offshore and 
onshore, must currently maintain and support two separate production 
reporting systems. We believe it is more efficient for all parties to 
have one system for production reporting. Therefore, we propose that 
the Form MMS-3160 be eliminated and that reporters, whether their 
production is onshore or offshore, use the revised draft OGOR, Form 
MMS-4054 A & B, as further discussed below. We included a revised draft 
of this form at the end of this notice.

Oil and Gas Operations Report (OGOR), Form MMS-4054

    The OGOR may appear to be more complex than the Form MMS-3160; 
however, they are quite similar. Essentially the same data elements are 
being collected on both forms. The proposed OGOR eliminates several 
data fields currently required on the Form MMS-3160. However, under the 
PRA, the following elements are not on the proposed OGOR, since this 
information is obtained through other sources:

--Field Name;
--Unit Name;
--Participating Area;
--County Name;
--State Code;
--Well Location Section Qtr Qtr;
--Well Location Township;
--Well Location Range; and
--Address.

    Because the proposed OGOR was designed to accommodate both onshore 
and offshore reporting, it contains more data fields than the Form MMS-
3160. However, many of these fields will either be system calculated 
(column totals) or will not be required for onshore reporters (metering 
points and facility numbers).
    The current Form MMS-3160 identifies production disposition for 
only the seven most common situations preprinted on the form. All other 
dispositions are reported in the ``Other'' field, with explanations in 
the ``Comments'' field. This weakness in the form design creates a 
burden on industry to provide supplemental information in response to 
MMS system exception reports.
    We propose to provide onshore reporters with the ability to select 
more disposition codes than currently provided on the Form MMS-3160. To 
keep the reporting simple, we will provide templates or Internet 
interfaces with pull-down menus to allow the small reporters to select 
the narrative response they are accustomed to reporting on the Form 
MMS-3160. RMP's system/software will automatically populate the 
appropriate two-digit disposition code.
    The reporting impact will be almost transparent to the onshore 
reporter, and this change will allow our system to automatically 
resolve exceptions.
    Adjustments to oil reported in inventory are also currently 
reported in the ``Other'' field on the Form MMS-3160. These adjustments 
will also be identified by pull-down menus for simplified reporting on 
the proposed OGOR. More accurate disposition data should also assist 
Bureau of Land and Management, Bureau of Indian Affairs, and the States 
in their production verification efforts.
    One additional element ``Product Code'' will be required on the 
proposed OGOR-B. Due to the space limitations, the separate product 
volume fields that currently exist, had to be reduced to one field. A 
two digit ``Product Code'' was added to identify the product. Values 
will be limited to three options, 01 (Oil/Condensate), 04 (Gas), and 30 
(Water), and will be accessible by a pull-down menu.
    The impact to operators using this revised format to submit 
information will be minimal. MMS will provide operators with a user-
friendly template/Internet interface that will guide them through 
completing all required data elements. Also, the few large operators 
that are not currently reporting on the OGOR will have the option of 
using the RMP template or redesigning their own system.
    The OGOR is currently a three part form (OGOR-A, Well Production; 
OGOR-B, Production Disposition; and OGOR-C, Product Sales from 
Facility). We propose to adopt the RPC recommendation to reduce the 
well status code reported on the OGOR-A from up to 13 digits, down to 4 
digits. We also propose that the data elements captured on the OGOR-C 
be combined with those on the proposed OGOR-B. Common elements on both 
will be eliminated. The resultant proposed OGOR-B will report both 
disposition and inventory data for a property. To make room on the 
proposed OGOR-B, three disposition volume columns (Oil, Gas, and Water) 
are consolidated into one disposition volume column. We added a two-
digit Product Code column to enable RMP to continue to account for 
disposition volumes by product.
    A main premise of the reengineering effort is to analyze all 
reported elements at one time, and thereby reduce the number of 
contacts with industry for exception resolution. To accomplish this 
goal, we must be able to accurately allocate volumes of processed gas 
and related natural gas liquids (NGLs) to the property level. The 
minimum data elements necessary to make these allocation calculations 
are GPM and Methane Mol percentage at the property level. In lieu of 
requesting these data elements on a separate Gas Analysis Report (GAR), 
we feel it is less burdensome to add these two fields to the proposed 
OGOR-B and instruct operators to populate these fields when the data 
last reported has changed. Accurate and timely reporting of these 
fields should eliminate the need for property operators to file a 
modified/amended OGOR-B and/or a GAR, except for specific exception 
resolution situations.
    Currently, modifications to OGOR reports are made by deleting the 
original reported line and adding the new line (Delete/Add Method). 
Some companies expressed concern that their systems are

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not compatible with this process and to file a total replacement report 
which will overlay the original report. We propose that our 
reengineered system be flexible enough to allow a company to choose the 
modification method that best meets each company's system capabilities.

Gas Analysis Report (GAR), Form MMS-4055

    The GAR is currently used to report gas analysis data regarding the 
composition of OCS Federal lease gas production at the facility 
measurement point (FMP). It is used by lessees and gas plant operators 
to allocate residue gas and gas plant products to contributing 
properties. We propose that GPM and Methane Mol percentage be reported 
on the proposed OGOR-B at the property/FMP level when new samples are 
taken and/or the data last reported has changed. This eliminates 
collecting monthly GARs from the OCS property operators and removes the 
burden of reporting some 30-plus data elements. The GAR, in its current 
approved format, will only be requested on an as-needed basis when the 
reasonableness of residue gas and NGL allocations is in question.

Gas Plant Operations Report (GPOR), Form MMS-4056

    The GPOR is currently required from a few onshore gas plants 
operators and from operators that process natural gas produced from OCS 
Federal oil and gas properties. It is used to verify that property 
level volume allocations are reasonable. We propose to simplify the 
form in several aspects. A draft revised Form MMS-4056 is included at 
the end of this notice. We have eliminated the analysis section of the 
current report (30-plus data elements). In lieu of the analysis data, 
we will require two additional data elements relative to field volumes. 
We added an element called ``Field Btu'' and will clarify that the 
existing Btu field is for residue gas. We also added an element called 
``Field Methane Mol %.'' Component product volumes will still be 
required but only for the most common components as identified on the 
form. That is, scrubber condensate (reported in gallons instead of 
barrels), natural gas liquids (Gallons), carbon dioxide (MCF), nitrogen 
(MCF), helium (MCF), and sulfur (Long Tons). The pressure base for all 
elements reported on the GPOR will be defined as 14.73 psia. We propose 
that the simplified GPOR be required monthly from each operator of a 
gas plant that processes gas produced on OCS properties. In specific 
instances, the GPOR may be required from onshore gas plants.

Production Allocation Schedule Report (PASR), Form MMS-4058

    The PASR is currently required only for OCS Federal properties. We 
propose to simplify it by removing the ``Product Code'' field from the 
Report Identification Area, by removing the ``Delivered Production 
Volumes'' column, and by removing the ``Beginning and Ending 
Inventory'' fields from the body of the current report. A draft revised 
Form MMS-4058 is included at the end of this notice. Three optional 
fields were added at the request of industry representatives. A one-
character field to identify injector type, ``Operator Facility Name/
Location,'' and ``Operator/Area/Block'' will each be optional. The 
number of detail lines available for reporting was also increased at 
the request of industry.

Reporting Burden

    The reporting burden for the Form MMS-3160 is currently estimated 
at 7 minutes per report when electronically completed and 15 minutes 
when manually completed. The estimate for the GAR is currently 15 
minutes per report. If the Form MMS-3160 and GAR are eliminated and all 
onshore properties are reported on the proposed OGOR A & B, we 
anticipate that the reporting burden will be approximately the same as 
for the Form MMS-3160. As explained in this Notice, many of the data 
elements on the proposed OGOR are optional for onshore reporters. 
Additionally, static information, such as well location and reporter 
address which is required on the Form MMS-3160, is not required on the 
proposed OGOR.
    The reporting burden for the current OGOR is 15 minutes when 
electronically completed and 30 minutes when manually completed. We 
believe this burden will remain unchanged if the proposed OGOR is 
implemented. However, allowing reporters the option to ``modify'' or 
``amend'' their reports may help ease the reporting burden for some 
parties.
    The current reporting burden for the GPOR is estimated at 30 
minutes per report. We estimate that the proposed GPOR will require 3 
minutes per report when electronically completed and 5 minutes when 
manually completed.
    The current reporting burden estimate for the PASR is 15 minutes 
per report. We estimate that the proposed PASR will require 7 minutes 
per report when electronically completed and 15 minutes per report when 
manually completed.

    Dated: February 12, 1999.
Lucy Querques Denett,
Associate Director for Royalty Management.

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[FR Doc. 99-4372 Filed 2-22-99; 8:45 am]
BILLING CODE 4310-MR-C