[Federal Register Volume 65, Number 140 (Thursday, July 20, 2000)]
[Notices]
[Pages 45101-45104]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-18365]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service


Outer Continental Shelf, Western Gulf of Mexico, Oil and Gas 
Lease Sale 177

AGENCY: Minerals Management Service, Interior.

ACTION: Final notice of Sale 177.

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    On August 23, 2000, the Minerals Management Service (MMS) will open 
and publicly announce bids received for blocks offered in Sale 177, 
Western Gulf of Mexico, pursuant to the Outer Continental Shelf (OCS) 
Lands Act (43 U.S.C. 1331-1356, as amended) and the regulations issued 
thereunder (30 CFR part 256). Bidders can obtain a ``Final Notice of 
Sale 177 Package'' containing this Notice of Sale and several 
supporting and essential documents referenced herein, from the MMS Gulf 
of Mexico Region's Public Information Unit, 1201 Elmwood Park 
Boulevard,

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New Orleans, Louisiana 70123-2394, (504) 736-2519 or (800) 200-GULF, or 
via the MMS Gulf of Mexico Region's Internet site at http://www.gomr.mms.gov. The MMS also maintains a 24-hour Fax-on-Demand 
Service at (202) 219-1703. The ``Final Notice of Sale 177 Package'' 
contains information essential to bidders, and bidders are charged with 
the knowledge of the documents contained in the package.
    Location and Time: Public bid reading will begin at 9 a.m., 
Wednesday, August 23, 2000, in the Grand Ballroom of the Royal Sonesta 
Hotel, 300 Bourbon Street, New Orleans, Louisiana. All times referred 
to in this document are local New Orleans time.
    Filing of Bids: Bidders must submit sealed bids to the Regional 
Director (RD), MMS Gulf of Mexico Region, 1201 Elmwood Park Boulevard, 
New Orleans, Louisiana 70123-2394, between 8 a.m. and 4 p.m., prior to 
the Bid Submission Deadline at 10 a.m., Tuesday, August 22, 2000. If 
the bids are mailed, mark on the envelope containing all the sealed 
bids the following:

Attention: Mr. John Rodi--Contains Sealed Bids for Sale 177

If the RD receives bids later than the time and date specified above, 
he will return the bids unopened to bidders. Bidders may not modify or 
withdraw their bids unless the RD receives a written modification or 
written withdrawal request prior to 10 a.m., Tuesday, August 22, 2000. 
In the event of widespread flooding or other natural disaster, the MMS 
Gulf of Mexico Regional Office may extend the bid submission deadline. 
Bidders may call (504) 736-0557 for information about the possible 
extension of the bid submission deadline due to such an event.
    Areas Offered for Leasing: The MMS is offering for leasing all the 
blocks and partial blocks listed in the document ``List of Blocks 
Available for Leasing, Sale 177'' included in the Sale Notice Package. 
All of these blocks are shown on the following Leasing Maps and 
Official Protraction Diagrams (which may be purchased from the MMS Gulf 
of Mexico Regional Office Public Information Unit).
    Outer Continental Shelf Leasing Maps--Texas, Nos. 1 through 8. 
These 16 maps sell for $2.00 each:

    TX1  South Padre Island Area (revised 09/01/99)
    TX1A  South Padre Island Area, East Addition (revised 09/09/98)
    TX2  North Padre Island Area (revised 09/01/99)
    TX2A  North Padre Island Area, East Addition (revised 09/01/99)
    TX3  Mustang Island Area (revised 09/01/99)
    TX3A  Mustang Island Area, East Addition (revised 09/01/99)
    TX4  Matagorda Island Area (revised 09/01/99)
    TX5  Brazos Area (revised 09/01/99)
    TX5B  Brazos Area, South Addition (revised 09/01/99)
    TX6  Galveston Area (revised 09/01/99)
    TX6A  Galveston Area, South Addition (revised 09/01/99)
    TX7  High Island Area (revised 09/01/99)
    TX7A  High Island Area, East Addition (revised 05/30/97)
    TX7B  High Island Area, South Addition (revised 03/15/99)
    TX7C  High Island Area, East Addition, South Extension (revised 03/
15/99)
    TX8  Sabine Pass Area (revised 05/30/97)

    Outer Continental Shelf Official Protraction Diagrams. These 
diagrams sell for $2.00 each:

    NG14-03  Corpus Christi (revised 09/01/99)
    NG14-06  Port Isabel (revised 09/09/98)
    NG15-01  East Breaks (revised 09/01/99)
    NG15-02  Garden Banks (revised 03/15/99)
    NG15-04  Alaminos Canyon (revised 09/09/99)
    NG15-05  Keathley Canyon (revised 04/27/89)
    NG15-08  (Unnamed) (revised 04/27/89)

    Note: A CD-ROM (in ARC/INFO format) containing all of the Gulf 
of Mexico Leasing Maps and Official Protraction Diagrams, except for 
those not yet revised to digital format, is available from the MMS 
Gulf of Mexico Regional Office Public Information Unit for a price 
of $15.00. Only NG15-05 and NG15-08 in the Western Gulf are not 
available on the CD-ROM. The Leasing Maps and Official Protraction 
Diagrams are also available on our Internet site. See also 65 FR 
2191, published on January 13, 2000, for the current status of all 
Gulf of Mexico Leasing Maps and Official Protraction Diagrams.

Acreage of all blocks is shown on these Leasing Maps and Official 
Protraction Diagrams. The available Federal acreage of all whole and 
partial blocks in this sale is shown in the document ``List of Blocks 
Available for Leasing, Sale 177'' included in the Sale Notice Package. 
Some of these blocks may be partially leased, or transected by 
administrative lines such as the Federal/State jurisdictional line, or 
partially included in the Flower Garden Banks National Marine Sanctuary 
(in accordance with the President's June 1998 withdrawal directive, 
portions of blocks lying within National Marine Sanctuaries are no 
longer available for leasing). Information on the unleased portions of 
such blocks, including the exact acreage, is found in the document 
titled ``Western Gulf of Mexico Lease Sale 177--Unleased Split Blocks 
and Unleased Acreage of Blocks with Aliquots and Irregular Portions 
Under Lease,'' included in the Sale Notice Package.
    Areas Not Available for Leasing: The following blocks in the 
Western Gulf of Mexico Planning Area are not available for leasing:
    Blocks currently under lease; and
    The following unleased block: High Island Area Block 170 (which is 
currently under appeal); and
    High Island Area, East Addition, South Extension, Blocks A-375 and 
A-398 (at the Flower Garden Banks), and the portions of other blocks 
within the boundary of the Flower Garden Banks National Marine 
Sanctuary; portions of High Island Area, East Addition, South 
Extension, Block A-401; High Island Area, South Addition, Blocks A-502 
and A-513; and Garden Banks Area Block 135; and
    Mustang Island Area Blocks 793, 799, and 816 (blocks located off 
Corpus Christi which have been identified by the Navy as needed for 
testing equipment and training mine warfare personnel); and
    The following blocks which are beyond the United States Exclusive 
Economic Zone and have been temporarily deferred from leasing by the 
Department of the Interior. These blocks are contained in an area 
subject to a treaty only recently negotiated and signed by the United 
States and Mexico (but not yet ratified). These blocks were deferred 
from this sale in the proposed Notice of Sale for Sale 177:

Keathley Canyon (Area NG 15-05)

Blocks

722 through 724
764 through 770
807 through 816
849 through 861
892 through 907
934 through 953
978 through 999

Area NG 15-08

Blocks

11 through 34
56 through 81
102 through 128
148 through 173
194 through 217
239 through 261

[[Page 45103]]

284 through 305
336 through 349

    Leasing Terms and Conditions: Primary lease terms, minimum bids, 
annual rental rates, royalty rates, and royalty suspension areas are 
shown on the map ``Lease Terms and Economic Conditions, Sale 177, 
Final'' for leases resulting from this sale:
    Primary lease terms: 5 years for blocks in water depths of less 
than 400 meters; 8 years for blocks in water depths of 400 to 799 
meters; and 10 years for blocks in water depths of 800 meters or 
deeper;
    Minimum bids: $25 per acre or fraction thereof for blocks in water 
depths of less than 800 meters and $37.50 per acre or fraction thereof 
for blocks in water depths of 800 meters or deeper;
    Annual rental rates: $5 per acre or fraction thereof for blocks in 
water depths of less than 200 meters and $7.50 per acre or fraction 
thereof for blocks in water depths of 200 meters or deeper, until a 
discovery in paying quantities of oil or gas is made;
    Royalty rates: 16\2/3\ percent royalty rate for blocks in water 
depths of less than 400 meters and a 12\1/2\ percent royalty rate for 
blocks in water depths of 400 meters or deeper, except during periods 
of royalty suspension;
    Minimum royalty: After a discovery in paying quantities of oil or 
gas is made: $5 per acre or fraction thereof per year for blocks in 
water depths of less than 200 meters and $7.50 per acre or fraction 
thereof per year for blocks in water depths of 200 meters or deeper;
    Royalty Suspension Areas: Royalty suspension may apply for blocks 
in water depths of 200 meters or deeper; see the map for specific 
areas. See 30 CFR 260 for the final rule specifying royalty suspension 
terms. Threshold prices will be applied to royalty suspension 
determinations; see paragraph (l) of the document ``Information To 
Lessees, Western Gulf of Mexico Sale 177'' included in the Sale Notice 
Package. The minimum royalty requirement is not applicable during 
periods of royalty suspension.
    The map titled ``Stipulations and Deferred Blocks, Sale 177, 
Final'' depicts the blocks where the Topographic Features, Military 
Areas, and Naval Mine Warfare Area stipulations apply. The texts of the 
lease stipulations are contained in the document ``Lease Stipulations 
for Oil and Gas Lease Sale 177, Final'' included in the Sale Notice 
Package. Also shown on this map are the deferred blocks noted above.
    Rounding: The following procedure must be used to calculate minimum 
bid, rental, and minimum royalty on blocks with fractional acreage: 
Round up to the next whole acre and multiply by the applicable dollar 
amount to determine the correct minimum bid, rental, or minimum 
royalty.

    Note: For the minimum bid only, if the calculation results in a 
decimal figure, round up to the next whole dollar amount (see next 
paragraph). The minimum bid calculation, including all rounding, is 
shown in the document ``List of Blocks Available for Leasing, Sale 
177'' included in the Sale Notice Package.

    Method of Bidding: For each block bid upon, a bidder must submit a 
separate signed bid in a sealed envelope labeled ``Sealed Bid for Oil 
and Gas Lease Sale 177, not to be opened until 9 a.m., Wednesday, 
August 23, 2000.'' The total amount bid must be in a whole dollar 
amount; any cent amount above the whole dollar will be ignored by the 
MMS. Details of the information required on the bid(s) and the bid 
envelope(s) are specified in the document ``Bid Form and Envelope'' 
contained in the Sale Notice Package.
    The MMS published a list of restricted joint bidders, which applies 
to this sale, in the Federal Register at 65 FR 16957, on March 30, 
2000. Bidders must execute all documents in conformance with signatory 
authorizations on file in the MMS Gulf of Mexico Regional Office. 
Partnerships also must submit or have on file a list of signatories 
authorized to bind the partnership. Bidders submitting joint bids must 
state on the bid form the proportionate interest of each participating 
bidder, in percent to a maximum of five decimal places, e.g., 33.33333 
percent. The MMS may require bidders to submit other documents in 
accordance with 30 CFR 256.46. The MMS warns bidders against violation 
of 18 U.S.C. 1860 prohibiting unlawful combination or intimidation of 
bidders. Bidders are advised that the MMS considers the signed bid to 
be a legally binding obligation on the part of the bidder(s) to comply 
with all applicable regulations, including paying the \1/5\ bonus on 
all high bids. A statement to this effect must be included on each bid 
(see the document ``Bid Form and Envelope'' contained in the Sale 
Notice Package).
    Bid Deposit: Submitters of high bids must deposit the \1/5\ bonus 
by using electronic funds transfer (EFT) procedures, following the 
detailed instructions contained in the document ``Instructions for 
Making EFT Bonus Payments'' included in the Sale Notice Package. All 
payments must be electronically deposited into an interest-bearing 
account in the U.S. Treasury (account specified in the EFT 
instructions) during the period the bids are being considered. Such a 
deposit does not constitute and shall not be construed as acceptance of 
any bid on behalf of the United States.

    Note: Certain bid submitters (i.e., those that do not currently 
own or operate an OCS mineral lease OR those that have ever 
defaulted on a \1/5\ bonus payment (EFT or otherwise)) are required 
to guarantee (secure) their \1/5\ bonus payment. For those who must 
secure the EFT \1/5\ bonus payment, one of the following options may 
be used: 1. Provide a third-party guaranty; 2. Amend Development 
Bond Coverage; 3. Provide a Letter of Credit; or 4. Provide a lump-
sum check. The EFT instructions specify the requirements for each 
option.

    Withdrawal of Blocks: The United States reserves the right to 
withdraw any block from this sale prior to issuance of a written 
acceptance of a bid for the block.
    Acceptance, Rejection, or Return of Bids: The United States 
reserves the right to reject any and all bids. In any case, no bid will 
be accepted, and no lease for any block will be awarded to any bidder, 
unless the bidder has complied with all requirements of this Notice, 
including the documents contained in the associated Sale Notice Package 
and applicable regulations; the bid is the highest valid bid; and the 
amount of the bid has been determined to be adequate by the authorized 
officer. Any bid submitted which does not conform to the requirements 
of this Notice, the OCS Lands Act, as amended, and other applicable 
regulations may be returned to the person submitting that bid by the RD 
and not considered for acceptance. To ensure that the Government 
receives a fair return for the conveyance of lease rights for this 
sale, high bids will be evaluated in accordance with MMS bid adequacy 
procedures. A copy of the current procedures, ``Modifications to the 
Bid Adequacy Procedures'' (64 FR 37560 of July 12, 1999), is available 
from the MMS Gulf of Mexico Regional Office Public Information Unit.
    Successful Bidders: As required by MMS, each company that has been 
awarded a lease must execute all copies of the lease (Form MMS-2005 
(March 1986) as amended), pay the balance of the cash bonus bid along 
with the first year's annual rental for each lease issued by EFT in 
accordance with the requirements of 30 CFR 218.155, and satisfy the 
bonding requirements of 30 CFR 256, Subpart I, as amended. Each bidder 
in a successful high bid must have on file, in the MMS Gulf of Mexico 
Regional Office Adjudication Unit, a currently valid certification 
(Debarment Certification Form) certifying that the

[[Page 45104]]

bidder is not excluded from participation in primary covered 
transactions under Federal nonprocurement programs and activities. A 
certification previously provided to that office remains currently 
valid until new or revised information applicable to that certification 
becomes available. In the event of new or revised applicable 
information, the MMS will require a subsequent certification before 
lease issuance can occur. Persons submitting such certifications should 
review the requirements of 43 CFR, Part 12, Subpart D. A copy of the 
Debarment Certification Form is contained in the Sale Notice Package.
    Affirmative Action: The MMS requests that the certification 
required by 41 CFR 60-1.7(b) and Executive Order No. 11246 of September 
24, 1965, as amended by Executive Order No. 11375 of October 13, 1967, 
on the Compliance Report Certification Form, Form MMS-2033 (June 1985), 
and the Affirmative Action Representation Form, Form MMS-2032 (June 
1985) be on file in the MMS Gulf of Mexico Regional Office Adjudication 
Unit prior to bidding. In any event, these forms are required to be on 
file in the MMS Gulf of Mexico Regional Office Adjudication Unit prior 
to execution of any lease contract. Bidders must also comply with the 
requirements of 41 CFR 60.
    Information to Lessees: The Sale Notice Package contains a document 
titled ``Information to Lessees.'' These Information to Lessees items 
provide information on various matters of interest to potential 
bidders.

Thomas R. Kitsos,
Acting Director, Minerals Management Service.
    Approved: July 14, 2000.
Sylvia V. Baca,
Assistant Secretary, Land and Minerals Management.
[FR Doc. 00-18365 Filed 7-19-00; 8:45 am]
BILLING CODE 4310-MR-P