[Federal Register Volume 65, Number 77 (Thursday, April 20, 2000)]
[Notices]
[Pages 21172-21174]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-9912]


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DEPARTMENT OF ENERGY

Energy Information Administration


Agency Information Collection Activities: Proposed Collection, 
Comment Request

AGENCY: Energy Information Administration, DOE.

ACTION: Agency information collection activities: Proposed collection, 
comment request.

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SUMMARY: The Energy Information Administration (EIA) is soliciting 
comments concerning proposed revisions and three-year extensions to the 
Oil and Gas Reserves Survey Forms EIA-23, EIA-23P and EIA-64A. Titles 
of these forms are ``Annual Survey of Domestic Oil and Gas Reserves'' 
(EIA-23), ``Oil and Gas Well Operator List Update Report'' (EIA-23P), 
and ``Annual Report of the Origin of Natural Gas Liquids Production'' 
(EIA-64A), respectively.

DATES: Written comments must be submitted on or before June 19, 2000. 
If you anticipate difficulty in submitting comments within that period, 
contact the person listed below as soon as possible.

ADDRESSES: Send comments to Rafi Zeinalpour, U.S. Department of Energy, 
Energy Information Administration, Reserves and Production Division, 
1999 Bryan Street, Suite 1110, Dallas, Texas 75201-6801. Alternatively, 
Rafi Zeinalpour may be reached by phone at (214) 720-6191, at the e-
mail address of [email protected] or by FAX at (214) 720-6155.

FOR FURTHER INFORMATION CONTACT: Requests for additional information or 
copies of the forms and instructions should be directed to Rafi 
Zeinalpour at the address listed above.

SUPPLEMENTARY INFORMATION:

I. Background
II. Current Actions
III. Request for Comments

I. Background

    The Federal Energy Administration Act of 1974 (Pub. L. No. 93-275, 
15 U.S.C. 761 et seq.) and the Department of Energy Organization Act 
(Pub. L. No. 95-91, 42 U.S.C. 7101 et seq.) require the Energy 
Information Administration (EIA) to carry out a centralized, 
comprehensive and unified energy information program. This program 
collects, evaluates, assembles, analyzes and disseminates information 
on energy resource reserves, production, demand, technology and related 
economic and statistical information. This information is used to 
assess the adequacy of energy resources to meet near and longer-term 
domestic demands.
    The EIA, as part of its effort to comply with the Paperwork 
Reduction Act of 1995 (Pub. L. 104-13, 44 U.S.C. Chapter 35), provides 
the general public and other Federal agencies with opportunities to 
comment on collections of energy information conducted by or in 
conjunction with the EIA. Any comments received help the EIA to prepare 
data requests that maximize the utility of the information collected 
and to assess the impact of collection requirements on the public. 
Also, the EIA will later seek approval by the Office of Management and 
Budget (OMB) of the collections under Section 3507(h) of the Paperwork 
Reduction Act of 1995.
    Operators of crude oil and natural gas wells are the target 
respondents of Forms EIA-23 and EIA-23P. The amount of crude oil, 
associated-dissolved natural gas, non-associated natural gas and lease 
condensate production and reserves by individual field are requested of 
large and intermediate size producers on Form EIA-23. A sample of small 
operators are required to submit less detailed information on a 
different version of the form and the majority of small operators are 
not asked to report annually on Form EIA-23. The selected sample of 
small operators provide production and available reserves information 
for crude oil, natural gas and lease condensate at a State or 
geographic sub-division level on the Form EIA-23. Form EIA-23P is a 
postcard form used to collect information on possible oil and gas well 
operators that may be included in future EIA-23 surveys. Information 
obtained

[[Page 21173]]

from Form EIA-23P is used to confirm and/or update general operator 
information, primarily about small companies with which no contact has 
been made in the last few years.
    Operators of natural gas plants are the target respondents of the 
Form EIA-64A. The amount of natural gas processed, natural gas liquids 
produced, resultant shrinkage of the natural gas and natural gas used 
in processing are requested of all natural gas plant operators.
    In response to Public Law 95-91 Section 657, estimates of U.S. oil 
and gas reserves are to be reported annually. These estimates are 
essential to the development, implementation and evaluation of energy 
policy and legislation. Data are used directly in the EIA annual 
publication, U.S. Crude Oil, Natural Gas and Natural Gas Liquids 
Reserves, and are incorporated in a number of other publications and 
analyses. Secondary publications which use the data include EIA's 
Annual Energy Review, Annual Energy Outlook, Petroleum Supply Annual 
and Natural Gas Annual.

II. Current Actions

    This notice is for a proposed three-year extension of Form EIA-23, 
``Annual Survey of Domestic Oil and Gas Reserves'', Form EIA-23P, ``Oil 
and Gas Well Operator List Update Report'', and Form EIA-64A, ``Annual 
Report of the Origin of Natural Gas Liquids Production'', until 
December 31, 2003. Form EIA-23P will be extended without modification. 
Currently available reliable State sources will be used to confirm and/
or update operator information thereby reducing the number of Form EIA-
23P mail-outs and thus the burden on respondents.
    More efficient utilization of space on Form EIA-64A is proposed by 
reducing the number of available lines for sources of the natural gas 
and increasing the number of available lines for explanatory notes and 
comments. This change should allow for more complete information and a 
reduction in paper attachments.
    Modifications to the Schedule A Form (field level detailed report) 
and the information collected on Form EIA-23 are proposed. First, a 
single page will now contain information on three individual fields 
instead of data on four fields as shown on the current form. This will 
increase the readability and the ease of manually completing this form.
    Second, information on two additional reserves classifications will 
be requested from individual large and intermediate sized operators. 
These additions are the gross operated volumes of reserves sold and/or 
acquired by these companies during the survey year. This information 
should be readily available, since in the majority of cases, for 
companies selling properties this should be the same volume of reserves 
as those reported on the previous year's survey as year-end reserves. 
For companies acquiring properties, these gross reserves volumes would 
be the same as those determined during the evaluation process prior to 
the acquisition. The reserves volumes for sold and acquired properties 
will also provide a more complete understanding of the sources of 
growths and reductions in reserves and an independent evaluation of the 
gross annual volumes of reserves under new operators. These 
modifications to Form EIA-23 are also anticipated to reduce the 
reporting burden time for the large and intermediate operators.
    The format for Form EIA-23, Schedule A, will be revised first to 
include these two new classifications and also to allow the reporting 
of production from wells without available values of reserves in the 
same location on the form as production from wells with available 
values of reserves. Reporting all production information in the same 
location should increase the accuracy of the data and the efficiency of 
completing the form. The form location for reporting proved non-
producing reserves will be moved to the location previously used for 
reporting production associated with wells without available values of 
reserves. As a result of this move, the location of the total values of 
reserves will now be at the end of the rows on the Form EIA-23. These 
changes should increase data accuracy and reduce both confusion and the 
time required to complete the form.
    On the Form EIA-23, Summary Report, which is completed by small 
operators, two changes are proposed. First, the form would not have the 
State and/or geographic sub-divisions preprinted. Instead, the operator 
would identify and enter on the form all areas in which they have 
operated properties. This will eliminate one page of the report and 
increase the accuracy and readability of the information. Additionally, 
the lines for data entry have been expanded to allow for easier manual 
input. The units for reporting crude oil, natural gas and lease 
condensate production and reserves would also be changed from thousands 
of barrels and millions of cubic feet units to barrels and thousands of 
cubic feet, which is more routinely used by small operators. This 
should increase accuracy and eliminate rounding errors for the small 
operators.
    Many U.S. government agencies have an interest in the definitions 
of proved oil and gas reserves and the quality, reliability and 
usefulness of estimates of reserves. Among these are the Energy 
Information Administration (EIA), Department of Energy; Minerals 
Management Service (MMS), Department of Interior; Internal Revenue 
Service (IRS), Department of the Treasury; and the Securities and 
Exchange Commission (SEC). Each of these organizations has specific 
purposes for collecting, using or estimating proved reserves. The EIA 
has a congressional mandate to provide accurate annual estimates of 
U.S. proved crude oil, natural gas and natural gas liquids reserves and 
publishes an annual reserves report to meet this requirement. The MMS 
is second only to the IRS in generating Federal revenue. The MMS 
maintains estimates of proved reserves to carry out their 
responsibilities in leasing, collecting royalty payments and regulating 
the activities of oil and gas companies on Federal lands and water. For 
the IRS, proved reserves and occasionally probable reserves are an 
essential component of calculating taxes for companies owning or 
producing oil and gas. The SEC requires publicly traded petroleum 
companies to annually file a reserves statement as part of their 10-K 
filing. The basic purpose of the 10-K filing is to give the investing 
public a clear and reliable financial basis to assess the relative 
value, as a financial asset, of a company's reserves, especially in 
comparison to other similar oil and gas companies.
    The Society of Petroleum Engineers (SPE) adopted new oil and gas 
reserves definitions in March 1997 for the three categories of proved, 
probable and possible reserves. The SPE is an international 
organization of petroleum engineers with 50,000 members worldwide. The 
World Petroleum Congresses (WPC) ratified the same definitions in 
October 1996 and is a co-sponsor of the definitions. These definitions 
were thoroughly discussed and reviewed for several years prior to 
adoption by the WPC. The EIA, through its observer's position on the 
committee, strongly supported the adoption of the new SPE/WPC 
definitions. Consequently, the EIA has recently adopted the SPE/WPC 
definitions. This action has been somewhat delayed, however, in order 
to allow time for all major U.S. government agencies having a 
significant interest in proved oil and gas reserves to adopt the new 
definitions concurrently. The MMS has

[[Page 21174]]

adopted and currently uses the new SPE/WPC definitions and these 
definitions are fundamentally consistent with IRS usage. The SEC has 
had extensive dialogue starting in 1997 with the EIA, petroleum 
industry and investment community on the new SPE/WPC definitions. The 
SEC has yet to reach a decision to modify their definitions or to adopt 
the SEC definitions to be more consistent with the SPE/WPC definitions. 
The dialogue will continue. The EIA, SPE, WPC and the SEC all recognize 
that definitions of proved reserves are not static and will continue to 
evolve over time.
    These new definitions contain at least two major changes from the 
previous SPE definitions adopted in 1987. First, probabilistic 
calculation techniques (i.e., a range of reserves estimates with 
uncertainties associated with each level of reserve estimates) were 
accepted as valid methods of estimating proved reserves along with the 
traditional deterministic techniques (i.e., a discrete reserve estimate 
with an associated level of certainty). Second, the use of an oil or 
gas price averaged over a longer historical period of time, typically 
one year, rather than the price listed on a single day was recommended 
in the SPE/WPC definitions to be consistent with the purpose of 
economic estimation of reserves.
    The EIA believes that allowing and accepting probabilistic 
estimates of reserves is both state-of-the-art and a means for 
improving the understanding of proved reserves The EIA expects that 
most filers will continue to utilize the deterministic methodology to 
determine reserves but will accept probabilistic estimates when 
appropriate. Reserves calculated using any type of evaluation 
methodology rely upon the skill, integrity and judgment of the 
evaluator and require an ample amount of reliable data.
    The EIA also believes that using an average annual price for oil 
and gas rather than a so called ``market price'' on December 31 of the 
reporting year as the SEC currently requires, will lead to more 
reliable proved reserves estimates, as well as more meaningful 
estimates of those reserves' economic value. Estimating reserves 
requires consideration of both technical and economic components. In 
1998, U.S. proved reserves of crude oil registered the largest 
percentage decline in 53 years. The annualized oil price decline from 
$17.40 per barrel in 1997 to $10.88 per barrel in 1998 had a 
significant impact on proved reserves. Moreover, using end of year 
prices [$15.04 per barrel in December 1997 to $8.03 in December 1998], 
further exacerbated the reduction in proved reserves for most producers 
and for the nation. As the oil price falls, each additional dollar 
decline has a proportionally larger negative impact on the reported 
volume of proved reserves.
    The adoption of these new definitions of proved reserves by the EIA 
will not require respondents to change the way they report information 
on Form EIA-23.
    Respondents should use the same methods when estimating reserves 
for the EIA as they do for the SEC. If there is an apparent conflict in 
requirements and assumptions, give precedence to the methods used for 
the SEC.
    Operators should note in the footnotes whether end of year or 
annual average prices were used and whether probabilistic or 
deterministic methods were utilized at the field level.

III. Request for Comments

    Prospective respondents and other interested parties should comment 
on the actions discussed in Item II. The following guidelines are 
provided to assist in the preparation of comments. Please indicate to 
which form(s) your comments apply.

General Issues

    A. Is the proposed collection of information necessary for the 
proper performance of the functions of the agency and does the 
information have practical utility? Practical utility is defined as the 
actual usefulness of information to or for an agency, taking into 
account its accuracy, adequacy, reliability, timeliness and the 
agency's ability to process the information it collects.
    B. What enhancements can be made to the quality, utility and 
clarity of the information to be collected?

As a Potential Respondent

    A. Are the instructions and definitions clear and sufficient? If 
not, which instructions need clarification?
    B. Can the information be submitted by the due date?
    C. Public reporting burden for this collection is estimated to 
average 4 hours for small operators, 32 hours for intermediate 
operators, and 160 hours for large operators on Form EIA-23. In 
addition, proposed Form EIA-23 modifications are anticipated to reduce 
these reporting burden estimates for intermediate operators by 4 hours 
and for large operators by 16 hours. For operators reporting on Form 
EIA-23P, reporting burden is estimated at 15 minutes. For natural gas 
plant operators reporting on Form EIA-64A, the reporting burden is 
estimated at 6 hours. The estimated burden includes the total time, 
effort or financial resources expended to generate, maintain, retain, 
disclose and provide the information. Please comment on the accuracy of 
the burden estimates.
    D. The agency estimates that the only costs to the respondents are 
for the time it will take them to complete the collection. Please 
comment if respondents will incur start-up costs for reporting or any 
recurring annual costs for operation, maintenance and purchase of 
services associated with the information collection.
    E. What additional actions could be taken to minimize the burden of 
this collection of information? Such actions may involve the use of 
automated, electronic, mechanical or other technological collection 
techniques or other forms of information technology.
    F. Does any other Federal, State or local agency collect similar 
information? If so, specify the agency, the data element(s) and the 
methods of collection.

As a Potential User

    A. Is the information useful at the levels of detail indicated on 
the form?
    B. For what purpose(s) would the information be used? Be specific.
    C. Are there alternate sources for the information and are they 
useful? If so, what are their weaknesses and/or strengths?
    Comments submitted in response to this notice will be summarized 
and/or included in the request for OMB approval of the form. These 
comments will also become a matter of public record.

    Statutory Authority: Section 3506 (c)(2)(A) of the Paperwork 
Reduction Act of 1995 (Pub. L. No. 104-13, 44 U.S.C. Chapter 35).

    Issued in Washington, DC, April 14, 2000.
Jay H. Casselberry,
Agency Clearance Officer, Statistics and Methods Group, Energy 
Information Administration.
[FR Doc. 00-9912 Filed 4-19-00; 8:45 am]
BILLING CODE 6450-01-P