[Federal Register Volume 65, Number 75 (Tuesday, April 18, 2000)]
[Notices]
[Pages 20829-20830]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-9690]


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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 (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 May 18, 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 1010-0129), 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, PO 
Box 25165, MS 3021, Denver, Colorado 80225-0165; the courier address is 
Building 85, Room A-613, Denver Federal Center, Denver, Colorado 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 comments. 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. 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: Bids and Financial Statements for Sale of Royalty Oil and 
Gas (RIK Pilots).
    OMB Control Number: 1010-0129.
    Bureau Form Number: Form MMS-4440, Summary of Receipt and Delivery 
Volumes.
    Abstract: The Secretary of the Interior, under the Mineral Leasing 
Act (30 U.S.C. 192) and the Outer Continental Shelf Lands Act (43 
U.S.C. 1353), is responsible for the management of royalties on 
minerals produced from leased Federal 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 
full value received for the minerals taken from leased lands. MMS has 
undertaken several pilot programs to study the feasibility of taking 
the Government's royalty in the form of production, that is, as RIK. 
The collections of information addressed in this information collection 
request (ICR) are necessary because the Secretary of the Interior must 
hold competition when selling to the public; protect actual RIK 
production before, during, and after any sale; and obtain a fair return 
on royalty production sold. MMS must fulfill those obligations for the 
Secretary. The reporting requirements are as follows:
    a. The actual bids potential purchasers will submit when MMS offers 
production for competitive sale;
    b. Bidders' statements of financial qualification;
    c. Form MMS-4440, Summary of Receipt and Delivery Volumes;
    d. Report of Gas Analysis (RGA); and
    e. Letters of Credit (LOC).
    On May 24, 1999, OMB granted emergency approval for MMS to collect, 
from potential purchasers, their financial statements and their bids on 
Federal RIK oil or gas offered for sale by MMS. On August 4, 1999, MMS 
published a 60-day Federal Register Notice (64 FR 42410) soliciting 
public comments on MMS's request to renew OMB's approval to collect 
those two items of information. No comments were received.
    As the pilots progressed, MMS recognized the need to collect three 
additional items-Form MMS-4440, RGA, and LOCs.
    MMS will evaluate the bids to determine which competitive offer to 
purchase RIK is most advantageous to the Government. The financial 
statements will be used to evaluate the risk of a bidder not following 
through on all aspects of its offer, including timely taking of RIK and 
payment for it. At the request of some small businesses, MMS will 
accept LOCs to help offset that risk. A small number of purchasers will 
pay for RIK production by delivering like quality and quantities to a 
location designated by MMS. They will report monthly to MMS on Form 
MMS-4440, for each pipeline, the specific daily volumes and qualities 
(usually expressed as MMBtu's) of MMS's RIK natural gas volumes that 
the respondent has been nominated to receive/actually has received and 
similar information on volumes the respondent has been nominated to 
deliver and actually has delivered to MMS or its agent. MMS may 
occasionally ask for an RGA to verify the reported quality of such 
production at the delivery point.
    If a company does not submit a timely competitive bid, MMS may not 
sell Federal RIK to them. Failure of MMS to evaluate a bidder's 
financial qualifications would increase the risk that a purchaser might 
fail to take the production, fail to reserve pipeline transportation to 
move it, fail to pay for it, or fail to deliver it to a delivery point 
designated by MMS. Such failures would likely incur storage costs, 
monetary penalties for failure to meet delivery due dates, or loss of 
the

[[Page 20830]]

production. Administrative costs could be incurred to recover those 
costs as well. MMS would be unable to identify late delivery or under-
delivery by contractors paying for RIK they have taken by delivering 
like value production to an MMS-designated delivery point if the 
contractors did not file Form MMS-4440. Failure to submit an RGA could 
impair MMS's ability to assure a full return on the sale of Federal 
royalty natural gas. If MMS could not accept LOCs, some small 
businesses might be disqualified from purchasing Federal royalty 
production.
    No proprietary information will be submitted to MMS under this 
collection. No items of a sensitive nature are collected. Responses are 
required to obtain or retain benefits.
    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.
    Estimated Number and Type of Respondents/Affected Entities: 
Approximately 37 companies who will submit one or multiple bids on 
Federal royalty oil or gas; 25 of them will also submit a financial 
statement and 5 may also submit an LOC. Of those who submit winning 
bids, a subset six will also submit Form MMS-4440 and an RGA.
    Frequency of Response: Depending on the contract terms of MMS's 
offer, bids are accepted monthly, twice annually, or annually; bidders 
have the option to submit one or multiple bids. Form MMS-4440 is 
required monthly from a small subset of successful bidders who might 
also be asked to submit an RGA about once a year. Financial statements 
and LOCs are required about once a year.
    Burden Statement and Estimated Annual Reporting and Recordkeeping 
``Hour''
    Burden: We estimate the respondent burden to average 1 hour for 
each bid, financial statement, or LOC. Hard copies must be submitted 
for these three items. We estimate the respondent burden to average .5 
hour per pipeline for Form MMS-4440 and .5 hour delivery point for each 
RGA, both of which may be submitted electronically. The total hour 
burden for these five requirements is 1,324 hours annually, including 
recordkeeping. Refer to the following chart:

                                                Burden Breakdown
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                                                                            Estimated
     Reporting/recordkeeping        Estimated                               number of    Burden per     Annual
           requirements             number of       Annual  frequency       responses   requirement     burden
                                   respondents                                Per Yr      in hours      hours
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Bids.............................           37  On Occasion..............          747            1          747
Financial Statements.............           25  On Occasion..............           25            1           25
Summary of Receipt and Delivery             06  Monthly..................        1,080           .5          540
 Volumes (Form MMS-4440.
Report of Gas Analysis...........           06  On Occasion..............           10           .5           05
Letters of Credit................           05  On Occasion..............           07            1           07
    Total Reporting..............          *79   ........................        1,869                     1,324
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*Note: A respondent is counted each time a different form is submitted. Unsuccessful bidders will submit only 2
  forms.

    Estimated Annual Reporting and Recordkeeping ``Non-Hour Cost'' 
Burden: This collection of information will require total capital 
start-up costs of $1,500 ($250 x 6 respondents) to adjust their 
automated production reporting systems to provide information to MMS in 
Form MMS-4440 format.
    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 May 18, 2000.
    MMS Information Collection Clearance Officer: Jo Ann Lauterbach 
(202) 208-7744.

    Dated: April 12, 2000.
R. Dale Fazio,
Acting Associate Director for Royalty Management.
[FR Doc. 00-9690 Filed 4-17-00; 8:45 am]
BILLING CODE 4310-MR-P