[Federal Register Volume 65, Number 43 (Friday, March 3, 2000)]
[Notices]
[Pages 11601-11602]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-5179]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service


Agency Information Collection Activities: Proposed Collection; 
Comment Request

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Notice.

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SUMMARY: To comply with the Paperwork Reduction Act (PRA) (44 U.S.C. 
3501 et seq.), we are notifying you that we have submitted an 
information collection request (ICR) to the Office of Management and 
Budget (OMB) for review and approval. We are also soliciting your 
comments on this ICR which describes the information collection, its 
expected costs and burden, and how the data will be collected.

DATES: Written comments should be received on or before April 3, 2000.

ADDRESSES: You may submit comments directly to the Office of 
Information and Regulatory Affairs, OMB, Attention: Desk Officer for 
the Department of the Interior (OMB Control Number 1010-0130), 725 17th 
Street, NW, Washington, DC 20503. Copies of these comments should also 
be sent to us. The U.S. Postal Service address is Minerals Management 
Service, Royalty Management Program, Rules and Publications Staff, P.O. 
Box 25165, MS 3021, Denver, CO 80225-0165; the courier address is 
Building 85, Room A-613, Denver Federal Center, Denver, CO 80225; and 
the email address is [email protected]. Our practice is to make 
comments, including names and home addresses of respondents, available 
for public review during regular business hours. Individual respondents 
may request that we withhold their home address from the record, which 
we will honor to the extent allowable by law. There may be 
circumstances in which we would withhold from the 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.

FOR FURTHER INFORMATION CONTACT: For questions concerning this 
collection of information, please contact Anne Ewell, RIK Study Team, 
telephone (703) 787-1584, FAX (703) 787-1093, email [email protected]. 
You may also obtain copies of this collection of information at no cost 
by contacting Jo Ann Lauterbach, MMS's Information Collection Clearance 
Officer, at (202) 208-7744.

SUPPLEMENTARY INFORMATION:   
    Title: Directed Communications Between Operators of Federal Royalty 
in Kind (RIK) Leases and Deliverers of Equivalent Crude Oil Production 
to the Strategic Petroleum Reserve (SPR).
    OMB Control Number: 1010-0130.
    Abstract: The Secretary of the Interior, under the Outer 
Continental Shelf Lands Act (43 U.S.C. 1353), is responsible for the 
management of royalty revenues on minerals produced from leased Federal 
offshore lands. MMS carries out these responsibilities for the 
Secretary. Most royalties are now paid in value--when a company or 
individual enters into a contract to develop, produce, and dispose of 
minerals from Federal lands, that company or individual agrees to pay 
the United States a share (royalty) of the value received for the 
minerals taken from leased lands.
    On February 11, 1999, the Department of the Interior announced that 
it would assist in an Administration initiative to collect royalty in 
the form of crude oil production (RIK) from Federal lessees in the Gulf 
of Mexico and transfer the royalty oil (or equivalent oil) to the 
Department of Energy (DOE). DOE will use 28 million barrels of RIK oil 
to refill the Strategic Petroleum Reserve (SPR). DOE published a 
Request for Offers

[[Page 11602]]

(RFO) in April 1999 for the exchange of Federal RIK crude oil for crude 
oil to be delivered to the SPR. This initiative is separate from MMS's 
RIK program for eligible refiners of crude oil. It is also separate 
from MMS's RIK pilot projects and investigation of direct Federal 
consumption which are being conducted to examine the feasibility and 
efficacy of RIK for the Federal Government.
    Communication between the operators of an MMS lease and DOE's 
contractor is necessary to assure that both have information necessary 
to arrange to timely pick up the correct volumes and qualities of MMS's 
share of royalty oil from that lease and make any needed adjustments. 
On June 25, 1999, OMB granted emergency approval for MMS to instruct 
lessees (or their operators), through a ``Dear Operator'' letter which 
contains reporting and recordkeeping requirements, to conduct those 
communications with DOE's contractors.
    The three kinds of directed communication between operators and 
exchange contractors of RIK are: (1) 8 to 10 days before the beginning 
of a month, report any changes in the delivery schedule, volumes, and 
qualities of the RIK crude oil to be made available for that month; (2) 
information on changes during the month, at the end of a month, and the 
end of the contract term to correct (balance) any errors discovered in 
prior months' deliveries; and (3) occasionally, information about 
transportation of the RIK. Experience with the SPR initiative and MMS's 
RIK Pilots demonstrates that the directed communication requirements 
differ according to the needs of each situation. For example, when RIK 
is delivered to MMS or its designee (e.g., DOE's contractor) at the 
lease, the direction to make arrangements to transport production away 
from the lease is not necessary in letters issued to those lease 
operators. Therefore, we are not requesting approval of a specific 
``Dear Operator'' letter to operators delivering to SPR, but, instead, 
approval for the three kinds of reporting requirements concerning 
communications between operators and MMS's designated taker of its 
RIK--DOE's exchange contractor. By obtaining approval for these three 
kinds of reporting requirements, MMS will be able to select only the 
types of directed communications and other unique matters needed for 
each situation and include only those in a letter appropriate to the 
operation of that lease or property.
    The types of communication and supporting data MMS will require 
operators to use in setting up the monthly delivery of RIK to the 
exchange contractor are standard business practices in the oil and gas 
industry. The information in the directed communication is essential to 
the delivery and acceptance of verifiable quantities and qualities of 
oil and is exchanged as a normal part of the conduct of those business 
activities, even when operators are not directed to do so. Failure of 
lessees/operators to timely communicate with DOE's contractor 
designated by MMS concerning the volumetric, delivery, and 
transportation information concerning MMS's RIK volumes will result in 
storage costs being incurred due to DOE's contractor not knowing the 
production is available for pick up. Monetary penalties could also 
accrue to MMS's designee (the DOE contractor) if the contractor cannot 
meet delivery due dates when exchanging MMS's oil for oil closer to the 
SPR delivery point. Additionally, failure to communicate data from 
balancing accounts would severely impair MMS's ability to verify that 
its designee is receiving the full and accurate volume of MMS's royalty 
share of production. Operators will not be required to communicate with 
more than one exchange contractor per property.
    No proprietary information will be submitted to MMS under this 
collection. No items of a sensitive nature are collected. The 
requirement to respond is mandatory.
    The PRA 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. A 60-day 
Federal Register Notice soliciting comments on this collection of 
information was published on August 13, 1999 (64 FR 44236). No comments 
were received. However, MMS increased the estimated hour burden based 
on comments received on a related collection, OMB Control No. 1010-
0126, and feedback from MMS operators of leases delivering RIK to 
exchange contractors under the SPR initiative.
    Estimated Number and Type of Respondents/Affected Entities: 
Approximately 30 lessees or operators of Federal leases participating 
in delivery of Federal RIK oil production to DOE's contractor for 
refilling of the SPR.
    Frequency of Response: Monthly cycle, with intra-month 
communications, on monthly nominations, scheduling, transportation and 
balancing; on occasion, (about once-yearly) communications on end-of-
contract balancing.
    Burden Statement and Estimated Annual Reporting and Recordkeeping 
``Hour'' Burden: We estimate the respondent burden for intra-month 
communications during FY 2000 to average 10 minutes per property per 
month and the burden for communications on end-of-contract balancing 
for short-term contracts terminating during FY 2000 to be 15 minutes 
per property. The total annual burden hour estimate for this collection 
is about 201 hours annually, including recordkeeping.
    Estimated Annual Reporting and Recordkeeping ``Non-Hour Cost'' 
Burden: We have identified no paperwork cost burdens for this 
collection over those included in hour burden.
    Comments: Section 3506(c)(2)(A) of the PRA requires each agency ``* 
* * to provide notice * * * and otherwise consult with members of the 
public and affected agencies concerning each proposed collection of 
information. * * *'' Agencies must specifically solicit comments to: 
(a) Evaluate whether the proposed collection of information is 
necessary for the agency to perform its duties, including whether the 
information is useful; (b) evaluate the accuracy of the agency's 
estimate of the burden of the proposed collection of information; (c) 
enhance the quality, usefulness, and clarity of the information to be 
collected; and (d) minimize the burden on the respondents, including 
the use of automated collection techniques or other forms of 
information technology.
    Send your comments directly to the offices listed under the 
addresses section of this notice. OMB has up to 60 days to approve or 
disapprove the information collection but may respond after 30 days. 
Therefore, to ensure maximum consideration, OMB should receive public 
comments by April 3, 2000.
    MMS Information Collection Clearance Officer: Jo Ann Lauterbach 
(202) 208-7744.

    Dated: February 28, 2000.
Lucy Querques Denett,
Associate Director for Royalty Management.
[FR Doc. 00-5179 Filed 3-2-00; 8:45 am]
BILLING CODE 4310-MR-P