[Federal Register Volume 66, Number 169 (Thursday, August 30, 2001)]
[Rules and Regulations]
[Pages 45760-45773]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-21638]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service

30 CFR Parts 206, 210, 216, and 218

RIN 1010-AC86


Solid Minerals Reporting Requirements

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Final rule.

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SUMMARY: MMS is updating its solid minerals reporting regulations to 
implement our reengineered royalty compliance strategy. The new 
reporting requirements will provide the necessary information to timely 
verify that mineral revenues due the government are correctly paid in 
compliance with applicable laws, regulations, and lease terms. The new 
reporting requirements replace several existing information collections 
and decrease the reporting burden for solid mineral reporters.

EFFECTIVE DATE: This rule is effective October 1, 2001.

FOR FURTHER INFORMATION CONTACT: Carol P. Shelby, Regulatory 
Specialist, Regulations and FOIA Team, Minerals Revenue Management, 
MMS, telephone (303) 231-3151, fax (303) 231-3385, or email 
[email protected].

SUPPLEMENTARY INFORMATION: The principal authors of this rule are Glenn 
W. Kepler, Sr., Cynthia Stuckey, and Herb Wincentsen, of Solid Minerals 
and Geothermal Compliance and Asset Management, Minerals Revenue 
Management, MMS, and Geoffrey Heath of the Office of the Solicitor, 
Department of the Interior.

I. Background

    Beginning in 1996, MMS embarked on an initiative to reengineer its 
royalty compliance operations and develop a process to assure that 
royalties and other mineral revenues are properly paid in accordance 
with applicable laws, lease terms, and regulations. As a result of this 
initiative, we set a performance goal of assuring royalty compliance in 
the shortest time possible, but not more than 3 years from the due date 
of the payment, in contrast to our current 6-year audit-based 
compliance cycle. This goal led us to adopt a contemporaneous 
compliance strategy. The contemporaneous compliance strategy is 
designed to detect and resolve compliance issues in the early stages of 
the compliance cycle and target audits accordingly, rather than waiting 
for future regularly scheduled or random audits. Early detection and 
resolution of compliance discrepancies not only benefits MMS by 
improving correct payment, but also helps industry by reducing its 
exposure to underpayments and associated interest.
    To accomplish our compliance strategy for solid minerals, we 
determined--with industry participation--the minimum data necessary to 
support our contemporaneous compliance program. Accordingly, on June 5, 
2001, we published a proposed rule in the Federal Register (66 FR 
30121) describing revisions to our solid minerals reporting 
requirements. This final rule adopts the proposed revisions with 
modifications, where appropriate, suggested in the public comments we 
received.
    The new reporting requirements replace eight existing production 
and royalty forms with a single form (Form MMS-4430, Solid Minerals 
Production and Royalty Report) and three supplementary data collections 
(sales contracts, sales summaries, and facility reports). This 
information collection methodology allows us to integrate production 
and royalty information into our contemporaneous compliance and asset 
management activities and validate the correctness of revenue receipts 
in the early stages of the compliance cycle. This data collection 
minimizes industry's reporting burden by (1) collecting the information 
at the beginning of the compliance cycle, thereby eliminating 
industry's requirement to retrieve records from storage at some future 
date in response to audit requests, and (2) collecting the information 
in the same manner and format as prepared by industry during routine 
business processes.

II. Responses to Public Comments

    Eight respondents commented on the proposed regulations during the 
30-day public comment period that closed July 5, 2001. Those comments 
and our responses follow.

Mailing Addresses

    Comment: Two companies and one industry trade association suggested 
that references to specific mailing addresses be deleted, because 
addresses are subject to change and could require a rule revision. They 
recommended that the final rule provide a reference to an Internet web 
site or a telephone number for the current mailing address.
    MMS Response: We disagree with this comment. Lessees must submit 
reports and documents by prescribed filing deadlines. For reports and 
documents submitted in paper, it is important that there be no 
ambiguity regarding where to send them. Failure to provide a mailing or 
delivery address greatly increases the chance of disputes between 
lessees and MMS regarding whether submissions were timely. There is no 
reason or benefit to increasing the risk of such disputes when they are 
easily preventable.
    In response to the comment that MMS's addresses may change, we 
include language in the final rule to the effect that MMS may publish a 
change of address in the Federal Register. This

[[Page 45761]]

avoids the necessity of a later rulemaking procedure if the MMS office 
changes location.

Other Government Bureau Data Collection

    Comment: A field office of a sister Interior bureau questioned 
whether our information collection rules would prevent it from also 
collecting lease and mine data.
    MMS Response: Part of the intent of this rulemaking is to ease 
reporting burdens on industry by requesting the data once and 
consolidating the Government's information needs. MMS will provide 
access to data it collects to other government entities that also need 
the data to perform their verification and compliance duties so that 
other agencies may avoid seeking duplicate information.

Data Submission to Indian Tribes

    Comment: One Indian tribe that participated in the Solid Minerals 
Operational Model expressed concern that under the new reporting 
requirements it will not timely receive mine data from MMS. The tribe 
recommends that the final rule require companies to send duplicate 
information directly to the tribe.
    MMS Response: One purpose of the Operational Model was to test the 
effectiveness of new reporting forms and strategies. Companies 
participating in the model had to continue submitting Form MMS-4059 
(SMOR-A) and Form MMS-2014 (Report of Sales and Royalty Remittance) for 
production information and royalty distribution purposes. During 
testing we became aware that the tribe had a longstanding agreement 
with the producer whereby the producer would also submit copies of the 
Forms MMS-4059 and MMS-2014 directly to the tribe. As part of the 
Operational Model, the participants agreed to test the concept of 
reducing the producer's reporting burden by having a single submission 
to MMS, which we would then copy and forward to the tribe. The tribe's 
delay in receiving timely reports from MMS was caused by our not having 
the necessary software installed on our computers to open the 
producer's reports. This prevented us from timely forwarding the 
submitted reports to the tribe. Our new web-based reporting system is 
designed so that the tribe and other authorized users will have 
immediate access to the reported information. Therefore, we believe the 
tribe will no longer need to receive reports directly from the 
producer.

Confidentiality

    Comment: A field office of a sister Interior bureau commented that 
MMS may increase the risk of releasing confidential information by 
making reported information available to all that bureau's offices, 
rather than just the office of jurisdiction.
    MMS Response: The MMS has extensive requirements for safeguarding 
the confidentiality of proprietary data. For example, effective 
September 6, 1991, MMS, the Bureau of Land Management (BLM), and the 
Bureau of Indian Affairs (BIA) executed a Tripartite Memorandum of 
Understanding (MOU). This MOU sets forth requirements for information 
sharing among the three bureaus. Under the MOU we provide the BLM and 
BIA access to our production and royalty data for their lease 
monitoring and compliance duties. The MOU has extensive requirements 
for safeguarding the confidentiality of proprietary data. These 
requirements are binding on the entire bureau, not just a single office 
within the bureau. Those other offices must operate under the same 
requirements as MMS when handling proprietary information. It is those 
offices' responsibility to maintain the confidentiality of proprietary 
mine information, regardless of the mine's location or a particular 
office's jurisdiction, in accordance with applicable law.
    Comment: One industry association requested that the rule address 
how MMS will maintain the confidentiality of sensitive data submitted 
over the Internet.
    MMS Response: Security controls for data reported on the Form MMS-
4430, Solid Minerals Production and Royalty Report, as well as all data 
reported to MMS's new financial system, are being developed by our 
consulting firm. The consulting firm is creating a security plan 
following the protocols given in the National Institute of Standards 
and Technology (NIST) Special Publication 800-18, ``Guide for 
Developing Security Plans for Information Technology Systems.'' 
Security, authentication, and identification (ID) for the Form MMS-4430 
will be provided by an application known as Brio. Users must first log 
into Brio with a specific user identification and password before 
gaining access to Form MMS-4430. Two firewalls will be in place to 
prevent unauthorized users. Because Form MMS-4430 is web-based, it will 
use two servers to run the application. Both servers will use 128-bit 
Secure Socket Layer (SSL) encryption. By using SSL, not only are the 
passwords that are sent to the servers encrypted for secure 
authentication but all data transmitted to and from the servers is 
encrypted for protection. At the data level, each user logged into Brio 
will be associated with an MMS-assigned user ID. The user ID will 
determine what data an individual user can or cannot see on the Form 
MMS-4430. Lessees will only be able to create or view reports for mines 
and leases associated with their user ID and Brio logon ID combination.
    Most reporters will submit supplementary data (sales summaries, and 
facility reports, and possibly sales contracts) by email to our 
electronic mail box at [email protected]. MMS applies state-of-the-
art anti-virus applications to assure that incoming data do not contain 
harmful virus applications. Access to the mailbox is limited to certain 
MMS employees who will download the information to internal data base 
systems. Only MMS and its authorized agents will have access to these 
systems. Additional safeguards for email transmissions are available, 
such as an encrypted zip file. We will work with individual firms to 
establish additional electronic safeguards as necessary.

Part 206--Product Valuation

Section 206.263  Contract Submission

    Comment: Four commenters--two industry trade associations and two 
company representatives--objected to the removal of the confidentiality 
paragraph found at Sec. 206.263(d). They believe a confidentiality 
section is needed in the final regulation to protect proprietary 
information from potential public release.
    MMS Response: The proposed rule removed both Secs. 206.263 and 
206.462 because they duplicated our proposed reporting requirements. We 
note that most Federal leases contain language prohibiting release of 
proprietary information. For example, coal lease Form 3400-12, approved 
for use beginning in April 1984, provides in Section 6, ``While this 
lease remains in effect, information obtained under this section 
[Documents, Evidence, and Inspection] shall be closed to inspection by 
the public in accordance with the Freedom of Information Act (5 U.S.C. 
552).'' However, we agree that Part 210, Forms and Reports, should 
contain language reinforcing the confidentiality of reported 
information that is legally exempt from disclosure. Accordingly, in the 
final rule, we added a new Sec. 210.206, titled ``How will information 
submissions be kept confidential?'' This new section encompasses the 
provisions of the former Secs. 206.263 and 206.462.

[[Page 45762]]

Part 210--Forms and Reports

Section 210.201  How Do I Submit Form MMS-4430, Solid Minerals 
Production and Royalty Report?

    Comment: One industry trade association and two companies observed 
that a literal reading of proposed Sec. 210.201(a)(1) would require a 
lessee to submit its royalty payment on the same day the Form MMS-4430 
is submitted, even if the report is submitted in advance of the due 
date. They noted that this was a departure from current practice and 
questioned the intent of the rule.
    MMS Response: We agree with this observation and did not intend to 
require the simultaneous submission of both Form MMS-4430 and payment 
if the Form MMS-4430 is submitted in advance of the deadline for 
reporting and payment. The payment and the report do not need to be 
submitted on the same day, but both must be submitted by the due date. 
For example, a lessee may choose to submit the Form MMS-4430 one week 
before the due date (the due date typically being the end of the month 
following the month of production and sale), but delay the payment 
until the actual due date. To clarify our intent in this section in the 
final rule, we deleted the phrase from the proposed rule ``accompanied 
by all required royalty and rental payments (except for first year 
rentals).''
    Comment: One company requested a definition of the phrase 
``electronic reporting service'' appearing in Sec. 210.201(c)(3).
    MMS Response: An electronic reporting service is a company that 
provides electronic reporting services to other companies that may not 
have the resources to undertake electronic reporting themselves or that 
may wish to contract for that function.

Section 210.202  How Do I Submit Sales Summaries?

    Comment: An industry trade association objected to the submission 
of purchaser names or identities required under Sec. 210.202(a), 
arguing that such information is highly confidential and is not needed 
to monitor compliance or determine royalties due, except in the rare 
situation where the purchaser identity may be relevant to some issue 
during an audit.
    MMS Response: Valuation of solid minerals production is predicated 
in part on whether the sales contract is arm's-length or non-arm's-
length. MMS, not the lessee, is the final arbiter of whether any 
particular contract is an arm's-length contract. Moreover, MMS may need 
to obtain information directly from the purchaser and asking the lessee 
to identify the purchaser in every case would cause unnecessary delay 
in classifying the contract. Accordingly, purchaser identities are an 
integral component of the contract classification process. 
Identification of affiliate sales early in the compliance cycle enables 
expeditious resolution of valuation issues and improves the lessee's 
certainty that its royalties are properly paid under its lease terms, 
statutes, and regulations.
    We believe the contemporaneous submission of purchaser names with 
the lessee's sales summary data, as opposed to collecting the same data 
years later during audit, is an improved process. The information is 
necessary for the reengineered contemporaneous compliance process to 
work. That process works to the lessee's benefit and may indicate that 
a later audit is not necessary.
    Moreover, submission of purchaser names does not appear to give 
rise to confidentiality concerns separate from the submission of the 
sales summary data itself--which will be broken out by sales 
arrangement regardless of whether the purchasers' names are included in 
the document. MMS therefore respectfully disagrees with this comment.
    Comment: One company and one industry trade association objected to 
the submission of separate sales summaries for each remote storage site 
when a lessee has five or fewer sites (Sec. 210.202(a)), arguing that 
such a requirement is needlessly burdensome.
    MMS Response: Our new compliance and asset management process 
associates lease sales reported on the Form MMS-4430 with purchaser 
sales reported on the sales summary. For example, the Form MMS-4430 for 
a particular remote sales site will show total sales from that site 
allocated to the source leases, but will not show the prices and 
quantities sold to particular purchasers. The sales summary will show 
the individual sales to each purchaser, including price and quantity 
and other information. The contemporaneous compliance process, among 
other things, will compare and correlate the information shown on both 
reports.
    For the contemporaneous compliance process to function efficiently, 
the sales summary must cover the same transactions as the Form MMS-
4430. Thus, if an MMS-4430 is submitted for a remote sales site, the 
sales summary needs to be for that same site. If Forms MMS-4430 were 
separated by site but sales summaries were combined for all sites, the 
process of correlating the information becomes much more costly and 
time-consuming, undercutting the goal of the contemporaneous compliance 
approach.
    MMS does not object if lessees submit their sales summaries for 
separate remote sites in one document rather than as separate 
documents. However, the single document must contain the same 
information, identified separately for each sales site, as the sales 
summaries submitted for separate sites; that is, purchaser name, 
quantity sold, quality data, price/proceeds received, allowances, etc. 
(see the table in Sec. 210.202(a)(3)).
    Comment: Two companies and one industry trade association found 
ambiguous the requirement to submit processing or washing costs and 
transportation costs on the monthly sales summary (Sec. 210.202(a)). 
They noted that the proposed rule provided no guidance regarding what 
cost information must be submitted and interpreted the rule to require 
calculation and submission of costs on a monthly basis pursuant to 
Secs. 206.259 and 206.262. They believe this requirement would 
significantly increase industry's cost of compliance.
    MMS Response: The purpose of capturing processing (including coal 
washing) and transportation allowances on the sales summary is to 
associate allowances with individual sales. The sales summary provides 
information about product sales at the purchaser level. As explained in 
the previous response, we associate certain data reported on Form MMS-
4430 with data reported on the sales summary to run our compliance 
processes. Allowances on the Form MMS-4430 are reported at the lease 
level, while allowances reported on the sales summary are at the 
purchaser level. The sales summary is a company-generated record and 
not a standard form.
    In our experience, companies express processing and transportation 
allowances as costs in their internal documents, either on a unit or 
gross basis. Therefore, we will accept allowance/cost information on 
the sales summary in whatever format the company uses. However, our 
acceptance of the allowance/cost information in the company's format on 
the sales summary does not constitute our approval of the allowance 
claimed on Form MMS-4430.
    Lessees may report allowances on the sales summary using either 
actual costs, if known, or estimated costs. If the lessee reports 
estimated costs on the sales summary, then the lessee must true-up the 
claimed allowances on the Form MMS-4430 when actual costs

[[Page 45763]]

become available. Allowances (cost data) reported on the sales summary 
do not require true-up. In any event, coal allowances claimed on the 
Form MMS-4430 must be calculated in accordance with Secs. 206.259 and 
206.262. Allowances claimed for non-coal solid minerals must reflect 
actual, reasonable costs. All allowances claimed on the Form MMS-4430 
are subject to review, audit, and adjustment.
    Comment: Two companies and one industry trade association objected 
to the submission of coal size data on the sales summary 
(Sec. 210.202(a)). They found the requirement redundant because coal 
size is given in sales contracts.
    MMS Response: We agree with this comment and removed the 
requirement to report coal size in the final rule.
    Comment: Two companies and one industry trade association objected 
to the requirement to submit sales summaries during months when there 
is no Federal or Indian lease production. They contend this requirement 
is unduly burdensome and unnecessary.
    MMS Response: The proposed rule requires sales summaries (1) for 
all months when Federal or Indian production is sold, whether directly 
from a mine or from a stockpile, and (2) when any Federal or Indian 
production is commingled with production from State or fee lands and 
sold. It does not require lessees to submit a sales summary when State 
or fee production is the only production sold. To clarify our intent, 
in the final rule we added language to Sec. 210.202(a) and (b) stating 
that a sales summary is not required when sales do not involve Federal 
or Indian production.

Section 210.203  How Do I Submit Sales Contracts?

    Comment: Two companies and one industry trade association disagreed 
with the requirement to submit sales contracts and amendments on a 
quarterly basis (Sec. 210.203(b)(1)), particularly for multi-period 
contracts. They also argued that the rule was unclear regarding what 
was to be submitted and when the submission is due. They recommended 
changing the quarterly requirement to semi-annual and defining specific 
due dates.
    MMS Response: We agree with the comment and changed the submission 
requirement to a semi-annual basis in the final rule (at the end of 
March and end of September of each year). We also added due dates for 
the submissions.
    Comment: A trade association for the potash industry objected to 
the submission of sales contracts, stating that such submission will 
require disclosure of confidential information and is being imposed 
without a demonstrated need for the data at any point prior to audit.
    MMS Response: Sales contracts are one of our fundamental compliance 
tools. They play a critical role in compliance verification by 
providing the necessary information to gauge the value of production on 
which royalties are due. MMS's performance goal is to complete our 
compliance work in 3 years or less from the due date of the royalty 
payment. Our strategy to accomplish this goal rests on our ability to 
acquire meaningful information to show that reported royalty payments 
are in compliance with statutes, lease terms, and regulations.
    If we are unable to obtain timely the critical information 
necessary to support our compliance verification process, then we must 
revert to audit under longer timeframes to verify the correctness of 
royalty payments. Long-term audits increase the lessee's risk of 
underpayments and associated late payment interest.
    Our experience gained in the Operational Model showed that industry 
participants welcomed the shortened compliance cycle and understood and 
accepted the tradeoff between a compressed compliance cycle and up-
front data submissions necessary to accomplish that goal. While our new 
compliance process will not totally supplant audits, the process will 
target audits on a more selective basis. When they do occur, audits 
will be less burdensome on the lessee because we will already have much 
of the fundamental information otherwise requested in an audit.
    Comment: Four coal producers and a potash industry trade 
association objected to changing the submission of sales contracts from 
an ``as requested'' basis to a regular quarterly basis. One coal 
producer and the potash industry trade association would rather make 
the contracts available only at the lessee's mine site or offices and 
only on an as-requested basis. These commenters believe that an 
automatic submission of such materials will raise the risk of 
compromising confidential, proprietary information.
    MMS Response: Submission of sales contracts on a regular basis in 
the coal and metals industries is integral to the contemporaneous 
compliance strategy. Review of sales contracts is necessary to identify 
a number of royalty valuation issues (such as proceeds issues, 
production conditioning issues, affiliation issues, allowance issues, 
etc.) before an audit would bring those issues to light. As noted 
above, the final rule changes the requirement to submit sales contracts 
from quarterly to semi-annually.
    The proposed rule included a requirement for potash, sodium, 
phosphate and other non-coal and non-metal producers to submit sales 
contracts when MMS requests them rather than quarterly. The reason for 
the difference is that the producers have a larger number of smaller 
customers to whom they sell on an invoice or other less formal basis 
without lengthy contract instruments. It appears that the potash trade 
association misunderstood the proposed rule. The proposal for the non-
coal and non-metal producers is continued in the final rule. The MMS 
will require contracts to be submitted on an as-needed basis. 
Submission of contracts in the early stages of the compliance cycle is 
not fundamentally different from MMS requesting copies of the contracts 
at the time of an audit.
    The MMS will not limit examination of those contracts to the 
producer's mine or office locations. The contracts submitted to MMS 
will have the same confidentiality protections provided by applicable 
law regardless of whether they are submitted regularly or only when MMS 
asks for them.
    Comment: Four companies and one industry trade association found 
the requirement to submit ``other documents that affect gross 
proceeds,'' contained in Sec. 210.203(a), overly broad and ambiguous. 
They claim the requirement places an undue burden on the lessee to 
determine what documents must be submitted and increases their 
liability risk should they erroneously omit a document that MMS later 
identifies as necessary. They suggested MMS delete the phrase.
    MMS Response: We agree the phrase ``other documents that affect 
gross proceeds'' is ambiguous. We therefore removed this phrase in the 
final rule. However, additional documentation relevant to gross 
proceeds likely will be needed in some instances. The provisions of 
Sec. 210.205 provide MMS the necessary authority to request such 
information on an as-needed basis. Examples of additional data include, 
but are not limited to, requests for organization charts; contracts, 
letter agreements, or other communications that supplement or affect 
sales contracts or amendments; or any other document that affects gross 
proceeds.
    Our experience from the Operational Model indicated that additional 
data requests were occasionally needed to resolve specific issues. 
Industry participants understood the need for additional information 
but asked that we specify the particular contract or

[[Page 45764]]

issue. Industry participants told us that by narrowing our requests to 
a specific issue or contract their likelihood of sending incorrect 
documents or being non-responsive is substantially reduced.
    Comment: Respondents also believe MMS understated the average 
reporting burden associated with contract submission.
    MMS Response: We believe much of the concern regarding contract 
reporting burdens stems from ambiguity in the proposed rule. To clarify 
our intent, we have added language to the final rule (1) explaining 
that a multi-period contract does not need to be submitted more than 
once; (2) requesting ``other documents affecting gross proceeds'' on an 
as-needed basis; and (3) changing the contract submission frequency 
from quarterly to semi-annually. These three changes mitigate the 
lessee's reporting burden. However, we recognize that contract 
submission, even on a semi-annual basis, may take longer than 
originally estimated to account for the lessee's need to index all its 
contracts, and agree with the commenters that we underestimated the 
time that will be necessary for contract submission. Therefore, the 
estimated annual contract submission burden has been increased from 90 
hours to 180 hours.
    We note that the overall reporting burden for contract submission 
would be roughly equivalent regardless of whether the contracts are 
submitted semi-annually or during audit. Because semi-annual submission 
is more contemporaneous, we believe it will require less effort over 
time than searching for and retrieving multiple contracts during audit.

Section 210.204  How Do I Submit Facility Data?

    Comment: Two companies and one industry trade association objected 
to the submission of facility data during months when there is no 
Federal or Indian lease production. They contend this requirement is 
unduly burdensome and unnecessary.
    MMS Response: Producers must submit facility data for any month 
Federal or Indian production is stockpiled awaiting processing or is 
processed. Such production may have occurred at any time before the 
current reporting period. Until all Federal or Indian mine production 
is processed and no longer in stockpile inventory, facility reports 
must continue to show the production quantities in inventory. This does 
not constitute a new reporting burden because the same information was 
required on the old Form MMS-4060, Solid Minerals Facility Report, Part 
B. The difference is that now industry may supply its own internal 
report rather than completing a government form. Lessees do not have to 
submit facility data when they process no Federal or Indian production 
and have no such production stockpiled awaiting processing. We added 
language to Sec. 210.204(a) in the final rule to clarify our intent.

Section 210.205  Will I Need To Submit Additional Documents or Evidence 
To MMS?

    Comment: Three companies and one industry trade association believe 
this provision exceeds the data submission requirements in Federal and 
Indian lease terms. They contend that leases only require the lessee to 
provide access to and copying of those documents reasonably necessary 
to verify the lessee's compliance with lease terms and conditions.
    MMS Response: Almost all Federal leases contain substantially 
identical language generally found under a section entitled 
``Documents, Evidence, and Inspection,'' which authorize MMS to require 
the lessee to produce all relevant information. For example, in lease 
Form 3400-12, this section states:

    At such times and in such form as lessor may prescribe, lessee 
shall furnish detailed statements showing the amounts and quality of 
all products removed and sold from the lease, the proceeds 
therefrom, and the amount used for production purposes or 
unavoidably lost.
    Lessee shall keep open at all reasonable times for the 
inspection of any duly authorized officer of lessor, the leased 
premises and all surface and underground improvements, works, 
machinery, ore stockpiles, equipment, and all books, accounts, maps, 
and records relative to operations, surveys, or investigations on or 
under the leased lands.
    Lessee shall allow lessor access to and copying of documents 
reasonably necessary to verify lessee compliance with lease terms 
and conditions of the lease.
    While this lease remains in effect, information obtained under 
this section shall be closed to inspection by the public in 
accordance with the Freedom of Information Act (5 U.S.C. 552).

    Substantially similar language is contained in virtually all 
Federal and Indian solid mineral leases. We believe this language 
authorizes the submission of data that is necessary to show that the 
lease is in compliance with lease terms, statutes, and regulations.
    Furthermore, our experience gained from the Operational Model shows 
that industry cooperation in providing records expedites the compliance 
process. We believe this is in the mutual best interests of the lessees 
and MMS.

 Part 216--Production Accounting

    There were no comments on the proposed changes to part 216.

Part 218--Collection of Royalties and Rentals, Bonuses and Other 
Monies Due the Federal Government

    There were no comments on the proposed changes to part 218.

III. Other Changes Between Proposed Rule and Final Rule

    In addition to the changes discussed in part II above in response 
to the comments, we have made other changes in the final rule. These 
changes are discussed below:

Section 210.201  How Do I Submit Form MMS-4430, Solid Minerals 
Production and Royalty Report?

    In Sec. 210.201 of the final rule, we have made certain clarifying 
changes to eliminate ambiguities in the proposed rule. The new Form 
MMS-4430 replaces the functions of several existing reports for both 
royalty and production accounting. In paragraph (a), we clarify that 
lessees must submit a completed Form MMS-4430 for any of the following 
events:
    (1) Production of all coal and other solid minerals from any 
Federal or Indian lease;
    (2) Sale of any such mineral;
    (3) Any such mineral held in stockpile or inventory; and
    (4) Payment of rents (other than those for which you receive an MMS 
Courtesy Notice as defined in Sec. 218.51(a)), minimum royalty, 
deferred bonus, advance royalty, minimum royalty payable in advance, 
settlements, recoupments, and other financial obligations.
    Any of these events, standing alone, triggers the obligation to 
file a Form MMS-4430. The proposed rule (at paragraph (b)) referred to 
having to file a Form MMS-4430 upon the occurrence of a ``reportable 
action,'' with a few examples then given. A ``reportable action'' was 
not defined.
    Thus, production without sale triggers the obligation to report, 
even though royalty may not be due until sale or disposition. 
Similarly, sale of minerals produced in an earlier period, without 
current production, triggers the reporting obligation. Likewise, simply 
holding stockpiled inventory without either production or sale triggers 
the reporting obligation; so does payment of rent, minimum royalty, and 
other financial obligations, even though there may be no production or 
sales.
    The final rule does not refer to a ``reportable action,'' because 
the actions or events that trigger the reporting

[[Page 45765]]

obligation are itemized in the text of the rule.
    We made corresponding changes in paragraph (b) regarding the timing 
of reports to cover the same actions and events itemized in paragraph 
(a). The final rule specifies that you must submit your Form MMS-4430 
on or before the end of the month following the month in which you 
produce any solid mineral, sell any solid mineral, or hold any solid 
mineral production in stockpile or inventory, unless your lease terms 
specify a different frequency for royalty payment. (If your lease terms 
specify a different frequency, you must submit your Form MMS-4430 on or 
before the date on which you must pay royalty under the terms of the 
lease.)
    The deadline for submitting reports of production, sales, or 
inventory contrasts with the deadline for reports accompanying payment 
of rents, minimum royalty, deferred bonus, advance royalty, minimum 
royalty payable in advance, settlements, recoupments, and other 
financial obligations. For these payment events, you must submit the 
Form MMS-4430 on or before the date on which you must pay the 
obligation under the terms of the lease.
    Section 210.201(c)(2) of the proposed rule provided an exception to 
the electronic reporting requirement in the event that you are 
reporting only ``rent, minimum royalty, or other annual obligations'' 
on the Form MMS-4430. The stated reason was that those obligations 
``are submitted with a Courtesy Notice as instructed in 
Sec. 218.201(c).'' However, Sec. 218.201(c) of the proposed rule 
provided for a Courtesy Notice only for ``a rental payment that is not 
reported on Form MMS-4430.'' The provision did not define which rental 
payments were to be made with a Form MMS-4430 and which were to be made 
with a Courtesy Notice.
    Under current practice, MMS issues a Courtesy Notice to lessees 
whose leases are in pure rental status, that is, leases that are in a 
non-producing status. That practice may expand to certain other leases 
in the future as systems are changed as part of reengineering. For 
leases for which MMS issues a Courtesy Notice, filing a Form MMS-4430--
whether in paper or electronic form--is not necessary. Consequently, in 
the final rule we have deleted the proposed paragraph (c)(2) and added 
the parenthetical clause ``(other than those for which you receive from 
MMS a Courtesy Notice as defined in Sec. 218.51(a) of this chapter)'' 
after the word ``rents'' in paragraphs (a)(1)(iv) and (b)(3).
    The discussion in the preceding paragraph applies only to rental 
payments, and does not apply to minimum royalty or other financial 
obligations.
    If you must file a Form MMS-4430 with your rental payment--in other 
words, if your lease is not one for which MMS issues a Courtesy 
Notice--then you must report electronically unless you meet the 
exception in paragraph (c)(2) (that is, that you are a small business 
and do not have a computer, have no plans to purchase a computer, and 
do not have a contract with an electronic reporting service).

Section 210.202  How Do I Submit Sales Summaries?

    In the table in paragraph (a)(3) prescribing the time frames and 
data elements for submitting sales summaries, the proposed rule 
required sodium and potassium lessees to submit purchaser names ``as 
requested.'' This was an error, and should have read ``monthly.'' We 
have changed that entry in the table to monthly in the final rule. MMS 
needs the specific identity of purchasers for reasons discussed above.

Section 210.204  How Do I Submit Facility Data?

    In paragraph (a) of the proposed rule, we stated that facility data 
had to include the following minimum information: identification of 
your facility, mines served, input quantity, output quantity, and 
output quality or product grade. For solid minerals other than coal, 
input quality (ore grade) is also an important data factor. This was 
inadvertently omitted in the proposed rule. In the final rule, we have 
added wording to this paragraph requiring input quality information if 
requested by MMS.

Part 216--Production Accounting

    The proposed rule contained various amendments to part 216 that 
were intended to be conforming amendments consistent with the proposed 
changes to part 210. As noted above, MMS received no comments on these 
proposed provisions. However, further examination has revealed that the 
proposed amendments were incorrect. In view of the incorporation of all 
production reporting functions within the Form MMS-4430 and the 
consequent coverage of these matters in the new Secs. 210.200 through 
210.206, it was unnecessary and duplicative to include provisions 
regarding production reporting in part 216. The final rule therefore 
includes amendments to the existing part 216 to remove references to 
solid minerals and remove coverage of solid minerals from that part.

IV. Procedural Matters

1. Summary Cost and Benefit Data

    We have summarized below the economic impacts of this rule on the 
groups affected by our regulations: Industry, State and local 
governments, Indian tribes and allottees, and the Federal Government. 
All costs summarized below are associated with reporting changes. As 
stated previously, this rule does not affect the valuation--for royalty 
purposes--of Federal or Indian coal or other solid minerals. The cost 
and benefit information in this Item 1 of Procedural Matters is used as 
the basis for the Departmental certifications in Items 2-12.
A. Industry
    The effect of the information collection changes in this proposed 
rulemaking would be a net savings of $168,400 per year for all solid 
minerals reporters, calculated as follows:
    Cost--New Information Collection. There are about 200 solid mineral 
lessees who are required to report production and royalty information 
to us. Using the annual reporting burden experienced by the 
participants in the operational model, we estimate the annual cost of 
the new information collection proposed in this rulemaking to be 
$72,600, calculated as follows:
    Form MMS-4430. The average reporting burden for completing Form 
MMS-4430 is 20 minutes per month. We estimate that all 200 solid 
minerals lessees will submit Form MMS-4430, and that this annual 
reporting burden will be 800 hours (200 lessees  x  \1/3\ hour per 
month  x  12 months).
    Sales summaries. The average reporting burden for sales summaries 
is 15 minutes per month. We estimate that 120 lessees will submit sales 
summary data and that this annual reporting burden will be 360 hours 
(120 lessees  x  \1/4\ hour per month  x  12 months).
    Facility data. The average reporting burden for facility data is 15 
minutes per month. We estimate that 30 lessees will submit facility 
data and that this annual reporting burden will be 90 hours (30 lessees 
 x  \1/4\ hour per month  x  12 months).
    Contracts and contract amendments. Contracts and contract 
amendments will be copied and sent to MMS. The average annual reporting 
burden for providing contracts and contract amendments to us is 2 hours 
per lessee. We estimate that 90 lessees (predominantly coal companies) 
will submit contracts and contract amendments. Consequently,

[[Page 45766]]

the annual reporting burden is 180 hours (90 lessees  x  2 hours per 
year).
    Additional documents or evidence. Federal and Indian lease terms 
allow us to request detailed statements, documents, or other evidence 
that supports our compliance and asset management responsibilities. We 
will request this additional information as we need it, not as a 
regular submission. We estimate that 10 percent of the 200 solid 
minerals lessees, or 20 lessees, will submit this additional 
information annually, and that each lessee will require 1 hour to 
submit this information for a total annual reporting burden of 20 
hours.
    Method of Payment. Each payment document associated with Form MMS-
4430 (Electronic Funds Transfer or hard copy check) must be annotated 
with the lessee's customer identification and the customer document 
identification numbers. For each rental payment document not reported 
on Form MMS-4430, the lessee must include the MMS Courtesy Notice, when 
provided, or annotate the payment document with the customer 
identification number and Government-assigned lease number. This 
requirement will help MMS link payments with Form MMS-4430 submittals. 
We estimate all payors collectively will require 2 hours annually to 
report this identification information.
    The annual reporting burden for all of these documents is 
summarized below:

------------------------------------------------------------------------
                                     Estimated hours
           Document name              to prepare and      Total cost =
                                          submit        hrs.  x  $50/hr.
------------------------------------------------------------------------
Form MMS-4430.....................                800            $40,000
Sales Summaries...................                360             18,000
Facility Data.....................                 90              4,500
Contracts and Subsequent                          180              9,000
 Amendments.......................
Other Documents...................                 20              1,000
Method of Payments................                  2                100
                                   -------------------------------------
    Total.........................              1,452             72,600
------------------------------------------------------------------------

    Benefit--Eliminating Eight Existing Reports. MMS currently requires 
solid minerals reporters to submit eight separate forms:
    1. Form MMS-4030, Payor Information Form (PIF), OMB Control Number 
1010-0064. This form is used to establish and maintain the payor 
accounts required for processing Form MMS-2014. Estimated annual burden 
hours are 173.
    2. Form MMS-2014, Report of Sales and Royalty Remittance, OMB 
Control Number 1010-0022. This form serves as the monthly report form 
on which payors report all royalty and lease-level transactions. 
Estimated annual burden hours for solid mineral payors are 1,884.
    3. Form MMS-4050, Mine Information Form (MIF), OMB Control Number 
1010-0063. This form is used to establish and maintain mine-level 
production reporting. Estimated annual burden hours for forms in 
paragraph 3 and paragraphs 4 through 8 below are 2,763.
    4. Form MMS-4051, Facility and Measurement Information Form (FMIF), 
OMB Control Number 1010-0063. This form is used to establish and 
maintain facilities in the volume-tracking system including identifying 
key sales/transfer measurement points that are required to track 
production and identify all secondary processing and remote storage 
facilities.
    5. Form MMS-4059-A, Solid Minerals Operations Report, Part A (SMOR-
A), OMB Control Number 1010-0063. This form is used to identify, for a 
mine, the quantity and quality of all raw material produced from each 
Federal or Indian lease, specify the disposition of those raw materials 
including sales, transfers, and adjustments, and track raw material 
inventories.
    6. Form MMS-4059-B, Solid Minerals Operations Report, Part B (SMOR-
B), OMB Control Number 1010-0063. This form is used to allocate sales 
from a secondary processing or remote storage facility back to 
individual Federal or Indian leases within a mine.
    7. Form MMS-4060-A, Solid Minerals Facility Report, Part A (SMFR-
A), OMB Control Number 1010-0063. This form is used to provide detailed 
information on a secondary processing facility's inputs/outputs.
    8. Form MMS-4060-B, Solid Minerals Facility Report, Part B (SMFR-
B), OMB Control Number 1010-0063. This form is used to show a secondary 
processing or remote storage facility's raw material receipts, 
production, inventory, and disposition.
    These eight forms would be replaced by Form MMS-4430 and other data 
submissions described in the cost section above. The combined annual 
burden that will be eliminated if these eight forms are no longer 
submitted by solid mineral reporters is 4,820 hours or a total cost of 
$241,000. The effect of replacing these eight forms with the new 
information collection (costing $72,600) would be an estimated savings 
of $168,400 per year.
    Issues Affecting Small Businesses. Approximately 200 solid mineral 
reporters submit forms and other information to MMS, 91 percent of 
which are small businesses because they have 500 employees or less. As 
noted earlier, the effect of the information collection changes in this 
proposed rulemaking would be a net savings of $168,400 per year for all 
solid minerals reporters. We expect small businesses to benefit 
proportionately from the reduction in reporting burden.
    Using the experience gained through the Operational Model, our 
reengineered initiative ensures that the information requested is the 
minimum necessary and places the least possible burden on industry. We 
have further provided two exceptions to the requirement to submit the 
Form MMS-4430 electronically to avoid placing undue burden on small 
businesses. You would not be required to report electronically if you 
report only annual obligations such as rent or minimum royalty. 
Further, you would not be required to report electronically if you are 
a small business, as defined by the U.S. Small Business Administration, 
and you have no computer and no plans to purchase a computer or 
contract with an electronic reporting service. For other data 
submissions, respondents including small businesses or other small 
entities would have the flexibility to submit information to us via 
hard copy or electronic submissions.
    During late summer and fall of 2001, we plan to hold several 
seminars to explain the revised reporting requirements. We will 
encourage all solid mineral lessees to attend one of these seminars to 
familiarize themselves with the revised reporting requirements and to 
prepare to implement these requirements.

[[Page 45767]]

    We will meet with each company's information technology staff to 
assist in setting up hardware and software configuration. We plan to 
provide the necessary electronic reporting software that will interface 
with our financial and production application systems. We will also 
cover the cost associated with the development and implementation of 
the reporting software. We will provide any initial software formatting 
or other assistance needed to get a company ready to comply with the 
new information collection proposed in this rule by October 1, 2001.
B. State and Local Governments
    This rulemaking would not impose any additional costs on State or 
local governments.
C. Indian Tribes and Allottees
    This rulemaking would not impose any additional costs on Indian 
tribes or allottees.
D. Federal Government
    MMS is reengineering its financial and compliance processes to 
transform its function-based program to a process-centered 
organization. The new reengineered MMS will be highly integrated and 
positioned to provide royalty management services at less cost to the 
nation. Some of the more important goals for the reengineering 
initiative include cutting in half the time necessary to collect and 
verify mineral revenues, distributing revenue to States and Indian 
mineral owners within 1 business day, reducing industry reporting 
requirements, and modernizing our computer and software systems.
    MMS expects significant reduction in annual operating costs of 
administration, accelerated cash flows through reductions in current 
business cycle times, and increased revenue through improved compliance 
coverage.
    Although all benefits of this rulemaking cannot be quantified at 
this time, the Federal Government should see significant savings and 
far greater efficiencies.
    The quantifiable costs and benefits of this proposed rulemaking to 
the Federal Government is a cost of $424,700 in the first two years 
after this rule is effective and a savings of $20,800 each year 
thereafter, as calculated below.
    Benefit--Personnel. We estimate that Solid Minerals and Geothermal 
Compliance and Asset Management's 23 employees will allocate about 10 
percent of their time to collect and analyze contracts, sales 
summaries, and facility data required by this rulemaking for a total 
cost of $239,200 (2.3 employees  x  2,080 hours/year  x  $50/hour) 
annually. However, under current reporting processes, Solid Minerals 
and Geothermal Compliance and Asset Management allocates the equivalent 
of 2.5 employees annually to error correction. Under this rulemaking 
error correction is expected to be negligible. Therefore this 
rulemaking nets no additional personnel cost but rather a minimal 
savings of .2 employees or $20,800 (.2 employees  x  2,080 hours/year 
x  $50/hour) annually.
    These employees will also resolve compliance issues using end-to-
end processes that eliminate handoffs that would otherwise occur 
between functionally aligned units which also improves efficiencies.
    This rule would allow substantial administrative dollar savings to 
MMS. Owing to the elimination of eight separate reporting forms under 
this proposed rule, MMS can utilize its solid minerals personnel more 
efficiently and effectively for verification of mineral revenues. Solid 
minerals personnel would review and process only one reporting form in 
place of eight existing reporting forms, which would result in 
associated reductions in error corrections, document handling issues, 
data entry problems, and time spent correcting those issues with 
industry personnel.
    Cost--Computer software. MMS is also building a computer platform 
and associated database as the host for data collected. This computer 
platform, and associated cost to MMS, will involve data from the 
Onshore, Offshore, and Solid Minerals Operational Models and all 
exception processing and compliance activity. We estimate the cost for 
the solid minerals portion of the new computer system to be about 
$445,500 within the first and second years after implementation of this 
rule or $891,000 over 2 fiscal years ($891,000 divided by 2 = 
$445,500).
    MMS has allocated the cost of its solid minerals portion of the new 
computer system in its reengineering budget requests. Accordingly, MMS 
will not need additional funds for computer systems as a result of the 
provisions proposed in this rulemaking.

2. Regulatory Planning and Review (Executive Order 12866)

    This document is not a significant rule and is not subject to 
review by the Office of Management and Budget under Executive Order 
12866.
    (1) This rule will not have an effect of $100 million or more on 
the economy. It will not adversely affect in a material way the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or tribal governments or 
communities.
    (2) This rule will not create a serious inconsistency or otherwise 
interfere with an action taken or planned by another agency.
    (3) This rule does not alter the budgetary effects of entitlements, 
grants, user fees, or loan programs or the rights or obligations of 
their recipients.
    (4) This rule does not raise novel legal or policy issues.

3. Regulatory Flexibility Act

    The Department of the Interior certifies that this document will 
not have a significant adverse effect on a substantial number of small 
entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). 
For additional information on small business issues, see the cost and 
benefit data in item 1 of these Procedural Matters.
    Your comments are important. The Small Business and Agricultural 
Regulatory Enforcement Ombudsman and 10 Regional Fairness Boards were 
established to receive comments from small businesses about Federal 
agency enforcement actions. The Ombudsman will annually evaluate the 
enforcement activities and rate each agency's responsiveness to small 
business. If you wish to comment on the enforcement actions in this 
rule, call 1-888-734-3247.

4. Small Business Regulatory Enforcement Act (SBREFA)

    This rule is not a major rule under 5 U.S.C. 804(2), the Small 
Business Regulatory Enforcement Fairness Act. This rule:
    a. Does not have an annual effect on the economy of $100 million or 
more.
    b. Will not cause a major increase in costs or prices for 
consumers, individual industries, Federal, State, or local government 
agencies, or geographic regions.
    c. Does not have significant adverse effects on competition, 
employment, investment, productivity, innovation, or the ability of 
U.S.-based enterprises to compete with foreign-based enterprises.

5. Unfunded Mandates Reform Act

    This rule does not impose an unfunded mandate on State, local, or 
tribal governments or the private sector of more than $100 million per 
year. The rule does not have a significant or unique effect on State, 
local, or tribal governments or the private sector. A statement 
containing the information required by the Unfunded Mandates Reform Act 
(2 U.S.C. 1531 et seq.) is not required.

[[Page 45768]]

6. Takings (Executive Order 12630)

    In accordance with Executive Order 12630, this rule does not have 
significant takings implications. This rule does not impose conditions 
or limitations on the use of any private property; consequently, a 
takings implication assessment is not required.

7. Federalism (Executive Order 13132)

    In accordance with Executive Order 13132, this rule does not have 
Federalism implications. This rule does not substantially or directly 
affect the relationship between the Federal and State governments or 
impose costs on States or localities.

8. Civil Justice Reform (Executive Order 12988)

    In accordance with Executive Order 12988, the Office of the 
Solicitor has determined that this rule does not unduly burden the 
judicial system and meets the requirements of sections 3(a) and 3(b)(2) 
of the Order.

9. Paperwork Reduction Act of 1995

    The collections of information associated with this final rule were 
approved by OMB on August 8, 2001 (OMB Control Number 1010-0120, 
expiration date August 31, 2004). We published a proposed rule in the 
Federal Register on June 5, 2001 (66 FR 30121) in which we solicited 
comments on an information collection titled ``Solid Minerals Reporting 
Requirements'' (OMB Control Number 1010-0120). The Paperwork Reduction 
Act of 1995 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.
    Two companies commented on this information collection. We 
responded to those comments in our information collection request to 
OMB on July 31, 2001, as follows:
    Comment: Both companies support the proposed Form MMS-4430 and the 
proposed Internet submission. Both agreed that the replacement of eight 
reporting forms by Form MMS-4430 simplifies reporting.
    Response: We appreciate the support for Form MS-4430. We reiterate 
here that this form is but one integral piece of information we propose 
to collect to perform our contemporaneous compliance and asset 
management process under our reengineered compliance strategy. This 
form alone does not provide the data necessary to achieve our 
compliance performance goal.
    Comment: Both companies expressed concern that the proposed rule 
significantly changes the current rules and goes beyond lease term 
requirements. They note the proposed rule changes submission 
requirements from ``upon request'' to a ``required'' concept. They also 
note lease terms only require submission of information and documents 
that are ``reasonably necessary'' to verify lease compliance with terms 
and conditions of the lease.
    Response: Current reporting requirements require the submission of 
up to eight forms. The proposed new reporting requirements include 
information currently collected on those eight forms. The major 
difference is that instead of submitting the information on a standard 
form, companies can submit the information in the format they prepare 
for their own internal use. Currently, we require contract submission 
during audit. Our reengineered compliance strategy requires collection 
of contracts earlier in our compliance process. The burden of contract 
submission is not a new requirement but merely a change in the timing 
of submissions.
    Our reengineered compliance strategy requires the submission of all 
documents in this proposed information collection. We believe this is 
the minimum information reasonably necessary to support our 
contemporaneous compliance program and verify compliance with lease 
terms and conditions.
    Comment: Both respondents believe the estimated burden for the 
collection of sales summaries is underestimated. One of the respondents 
believes the monthly inclusion of costs related to processing and 
transportation costs, which are currently calculated annually, will 
increase the burden significantly.
    Response: Lessees may report allowances on the sales summary using 
either actual costs, if known, or estimated costs. If the lessee 
reports estimated costs on the sales summary, then he must true-up the 
claimed allowances on Form MMS-4430 when actual costs become available. 
Allowances (cost data) reported on the sales summary do not require 
true-up. In any event, coal allowances claimed on Form MMS 4430 must be 
calculated in accordance with 30 CFR Secs. 206.259 and 206.262. 
Allowances claimed for non-coal solid minerals must reflect actual, 
reasonable costs. All allowances claimed on Form MMS-4430 are subject 
to review, audit, and adjustment.
    We clarified this issue in the preamble to this final rule. We also 
reduced or deleted the requirement to submit coal size, clarified the 
need to submit summaries in months when no Federal or Indian production 
or sales occurs, and clarified when to submit summaries for facilities. 
In view of these changes, we believe our estimated burden is 
reasonable.
    Comment: Both respondents believe the estimated burden for contract 
submissions is underestimated.
    Response: We believe much of the concern regarding contract 
reporting burdens stems from ambiguity in the proposed rule. To clarify 
our intent, we have added language to this final rule (1) explaining 
that a multi-period contract does not need to be submitted more than 
once; (2) requesting ``other documents affecting gross proceeds'' on an 
as-needed basis; and (3) changing the contract submission frequency 
from quarterly to semi-annually. These three changes mitigate the 
lessee's reporting burden. However, we recognize that contract 
submission, even on a semi-annual basis, may take longer than 
originally estimated to account for the lessee's need to index all its 
contracts, and agree with the commenters that we underestimated the 
time that will be necessary for contract submission. Therefore, the 
estimated annual burden associated with contract submission has been 
increased from 90 hours to 180 hours.
    We note that the overall reporting burden for contract submission 
would likely be the same regardless of whether the contracts are 
submitted semi-annually or during audit. Because semi-annual submission 
is more contemporaneous, we believe it will require less effort over 
time than searching for and retrieving multiple contracts during audit.
    The MMS estimates that there are approximately 200 respondents. The 
frequency of response varies by section; however, we estimate the total 
annual burden is 1,452 hours. Based on $50 per hour, the hour burden 
cost to respondents is $72,600.

10. National Environmental Policy Act

    This rule does not constitute a major Federal action significantly 
affecting the quality of the human environment. A detailed statement 
under the National Environmental Policy Act of 1969 is not required.

11. Consultation and Coordination With Indian Tribal Governments

    In accordance with Executive Order 13175, this rule does not have 
tribal implications that impose substantial direct compliance costs on 
Indian tribal governments.

12. Energy Effects

    In accordance with Executive Order 13211, this rule is not a 
significant

[[Page 45769]]

regulatory action under Executive Order 12866 nor is it likely to have 
a significant adverse effect on the supply, distribution, or use of 
energy. As noted in Item 1 above, titled ``Summary Cost and Benefit 
Data,'' we estimate this rule will save the solid minerals industry 
approximately $168,500 annually in reporting costs.

List of Subjects

30 CFR Part 206

    Coal, Continental shelf, Geothermal energy, Government contracts, 
Indian lands, Mineral royalties, Natural gas, Petroleum, Public lands--
mineral resources, Reporting and recordkeeping requirements.

30 CFR Part 210

    Coal, Continental shelf, Geothermal energy, Government contracts, 
Indian lands, Mineral royalties, Natural gas, Petroleum, Public lands--
mineral resources, Reporting and recordkeeping requirements.

30 CFR Part 216

    Coal, Continental shelf, Geothermal energy, Government contracts, 
Indian lands, Mineral royalties, Natural gas, Penalties, Petroleum, 
Public lands--mineral resources, Reporting and recordkeeping 
requirements.

30 CFR Part 218

    Coal, Continental shelf, Electronic funds transfers, Geothermal 
energy, Government contracts, Indian lands, Mineral royalties, Natural 
gas, Penalties, Petroleum, Public lands--mineral resources, Reporting 
and recordkeeping requirements.

    Dated: August 22, 2001.
J. Steven Griles,
Acting Assistant Secretary, Land and Minerals Management.

    For reasons set out in the preamble, 30 CFR parts 206, 210, 216, 
and 218 are amended as follows:

PART 206--PRODUCT VALUATION

    1. The authority citation for part 206 continues to read as 
follows:

    Authority: 5 U.S.C. 301 et seq.; 25 U.S.C. 396 et seq., 396a et 
seq., 2101 et seq.; 30 U.S.C. 181 et seq., 351 et seq., 1001 et 
seq., 1701 et seq.; 31 U.S.C. 9701; 43 U.S.C. 1301 et seq., 1331 et 
seq., and 1801 et seq.


Sec. 206.251  [Amended]

    2. In Sec. 206.251, definition of ``Netting,'' remove the word 
``MMS-2014'' and add in its place the word ``MMS-4430.''


Sec. 206.254  [Amended]

    3. Amend Sec. 206.254 as follows:
    a. Remove paragraph (a).
    b. In paragraph (b), last sentence, remove the words ``Report of 
Sales and Royalty Remittance, Form MMS-2014'' and add in their place 
the words ``Solid Minerals Production and Royalty Report, Form MMS-
4430.''
    c. Remove the paragraph designation for paragraph (b).


Sec. 206.257  [Amended]

    4. Amend Sec. 206.257 as follows:
    a. In paragraph (d)(3), second sentence, remove the title 
``Associate Director for Royalty Management'' and add in its place 
``Associate Director for Minerals Revenue Management.''
    b. In paragraph (d)(3), last sentence, remove the word ``MMS-2014'' 
and add in its place the word ``MMS-4430.''


Sec. 206.259  [Amended]

    5. In Sec. 206.259, paragraphs (a)(1), (b)(1), (c)(1)(i), 
(c)(2)(i), (d)(1), (e)(1) and (e)(2), remove the word ``MMS-2014'' and 
add in its place the word ``MMS-4430.''


Sec. 206.262  [Amended]

    6. In Sec. 206.262, paragraphs (a)(1), (b)(1), (c)(1)(i), 
(c)(2)(i), (d)(1), (e)(1) [occurs twice] and (e)(2), remove the word 
``MMS-2014'' and add in its place the word ``MMS 4430.''


Sec. 206.263  [Removed]

    7. Remove Sec. 206.263.


Sec. 206.453  [Amended]

    8. Amend Sec. 206.453 as follows:
    a. Remove paragraph (a).
    b. In paragraph (b), second sentence, remove the words ``Report of 
Sales and Royalty Remittance, Form MMS-2014'' and add in their place 
the words ``Solid Minerals Production and Royalty Report, Form MMS-
4430.''
    c. Remove the paragraph designation from paragraph (b).


Sec. 206.456  [Amended]

    9. Amend Sec. 206.456 as follows:
    a. In paragraph (d)(3), second sentence, remove the title 
``Associate Director for Royalty Management'' and add in its place the 
title ``Associate Director for Minerals Revenue Management.''
    b. In paragraph (d)(3), last sentence, remove the word ``MMS-2014'' 
and add in its place the word ``MMS-4430.''


Sec. 206.458  [Amended]

    10. Amend Sec. 206.458 as follows:
    a. In paragraphs (c)(1)(i) and (c)(2)(i), remove the words ``Form 
MMS-2014, Report of Sales and Royalty Remittance'' and add in their 
place the words ``Form MMS-4430, Solid Minerals Production and Royalty 
Report'' and remove the word ``MMS-2014'' and add in its place the word 
``MMS-4430.''
    b. In paragraphs (c)(4), (d)(1), (e)(1), and (e)(2), remove the 
word ``MMS-2014'' and add in its place the word ``MMS-4430.''


Sec. 206.461  [Amended]

    11. Amend Sec. 206.461 as follows:
    a. In paragraphs (c)(1)(i) and (c)(2)(i), remove the words ``Form 
MMS-2014, Report of Sales and Royalty Remittance,'' and add in their 
place the words ``Form MMS-4430, Solid Minerals Production and Royalty 
Report.''
    b. In paragraphs (c)(4), (d)(1), (e)(1) and (e)(2), remove the word 
``MMS-2014'' and add in its place the word ``MMS-4430.''


Sec. 206.462  [Removed]

    12. Remove Sec. 206.462.

PART 210--FORMS AND REPORTS

    13. The authority citation for part 210 continues to read as 
follows:

    Authority: 5 U.S.C. 301 et seq.; 25 U.S.C. 396, 2107; 30 U.S.C. 
189, 190, 359, 1023, 1751(a); 31 U.S.C. 3716, 9701; 43 U.S.C. 1334, 
1801 et seq.; and 44 U.S.C. 3506(a).


Sec. 210.10  [Amended]

    14. Section 210.10 is amended as follows:
    a. Wherever they appear in Sec. 210.10, the words ``Royalty 
Management Program'' are removed and the words ``Minerals Revenue 
Management'' are added in their place.
    b. The table in paragraph (a) is revised.
    c. Paragraph (b)(2) is amended by removing the words ``or MMS-
4030'' in the first sentence.
    d. Paragraph (b)(3) is amended by removing the words ``MMS-4059, 
MMS-4060,'' in the first sentence.
    e. Paragraph (b)(6) is removed.
    f. Paragraphs (b)(6) through (b)(8) are added.
    g. Paragraphs (c)(4), (c)(11), and (c)(12) are removed.
    h. Paragraphs (c)(5) through (c)(10) are redesignated as paragraphs 
(c)(4) through (c)(9).
    i. Paragraphs (c)(13) through (c)(20) are redesignated as 
paragraphs (c)(10) through (c)(17).
    j. Paragraphs (c)(18) through (c)(21) are added.
    k. Paragraph (d) is revised.
    The additions and revisions read as follows:


Sec. 210.10  Information collection.

    (a) * * *

[[Page 45770]]



------------------------------------------------------------------------
             Form No., name, and filing date                  OMB No.
------------------------------------------------------------------------
MMS-2014--Report of Sales and Royalty Remittance--Due by       1010-0022
 the end of first month following production month for
 royalty payment and for rentals no later than
 anniversary date of the lease..........................
MMS-3160--Monthly Report of Operations--Due by the 15th        1010-0040
 day of the second month following the production month.
MMS-4025--Oil and Gas Payor Information Form--Due 30           1010-0033
 days after issuance of a new lease or change to an
 existing lease.........................................
MMS-4051--Facility and Measurement Information Form and        1010-0040
 Supplement--Due at the request of MMS during the
 initial conversion of the facility and measurement
 device operators.......................................
MMS-4053--First Purchaser Report--Due at the request of        1010-0040
 MMS....................................................
MMS-4054--Oil and Gas Operations Report--Due by the 15th       1010-0040
 day of the second month following the production month.
MMS-4055--Gas Analysis Report--Due by the 15th day of          1010-0040
 the second month following the production month........
MMS-4056--Gas Plant Operations Report--Due by the 15th         1010-0040
 day of the second month following the production month.
MMS-4058--Production Allocation Schedule Report--Due by        1010-0040
 the 15th day of the second month following the
 production month.......................................
MMS-4070--Application of the Purchase of Royalty Oil--         1010-0042
 Due prior to the date of sale in accordance with the
 instructions in the Notice of Availability of Royalty
 Oil....................................................
MMS-4109--Gas Processing Allowance Summary Report--            1010-0075
 Initial report due within 3 months following the last
 day of the month for which an allowance is first
 claimed, unless a longer period is approved by MMS.....
MMS-4110--Oil Transportation Allowance Report--Initial         1010-0061
 report due within 3 months following the last day of
 the month for which an allowance is first claimed,
 unless a longer period is approved by MMS..............
MMS-4280--Application for Reward for Original                  1010-0076
 Information--Due when a reward is claimed for
 information provided which may lead to the recovery of
 royalty or other payments owed to the United States....
MMS-4292--Coal Washing Allowance Report--Due prior to or       1010-0074
 at the same time that the allowance is first reported
 on Form MMS-4430 and annually thereafter if the
 allowance does not change..............................
MMS-4293--Coal Transportation Allowance Report--Due            1010-0074
 prior to or at the same time that the allowance is
 first reported on Form MMS-4430 and annually thereafter
 if the allowance does not change.......................
MMS-4295--Gas Transportation Allowance Report--Initial         1010-0075
 report due within 3 months following the last day of
 month for which an allowance is first claimed unless a
 longer period is approved by MMS.......................
MMS-4377--Stripper Royalty Rate Reduction Notification--       1010-0090
 Due for each 12-month qualifying period that a reduced
 royalty rate is granted by the Bureau of Land
 Management.............................................
MMS-4430--Solid Minerals Production and Royalty Report--       1010-0120
 Due by the end of the month following the month of
 production or sale and for other lease financial
 obligations no later than the payment date specified in
 your lease.............................................
Facility Data--Due monthly or as requested for specific        1010-0120
 solid mineral products and lease types; see Sec.
 210.204................................................
Sales Contracts--Due semi-annually or as requested on          1010-0120
 certain solid mineral products and lease types; see
 Sec.  210.203..........................................
Sales Summaries--Due monthly or as requested for               1010-0120
 specific solid mineral products and lease types; see
 Sec.  210.202..........................................
------------------------------------------------------------------------

* * * * *
    (b) * * *
    (6) If you are not reporting Form MMS-4430 electronically, you may 
request blank copies of the form by calling 1-888-201-6416. You must 
submit completed Forms MMS-4430 to the address given in 
Sec. 210.201(c).
    (7) If you are not reporting solid minerals sales contracts, sales 
summaries, and facility data electronically, you must submit paper 
copies to the address given in Sec. 210.202(c).
    (8) Reports for oil, gas, and geothermal leases sent by special 
courier or overnight mail (excluding U.S. Postal Service Express Mail) 
should be addressed to: Minerals Management Service, Minerals Revenue 
Management, Building 85, Room A-614, Denver Federal Center, Denver, 
Colorado 80225.
    (c) * * *
    (18) MMS-4430--Submitted monthly to report production from and 
royalty due on all Federal and Indian solid minerals leases (see 
Sec. 210.201). MMS uses the data to distribute payments to appropriate 
recipients and to determine if lessees properly paid lease obligations. 
Public reporting burden is estimated to be 20 minutes per month per 
reporter. Comments relating to this information collection should 
reference OMB Control Number 1010-0120.
    (19) Facility Data--Submitted monthly by operators of wash plant, 
refining, ore concentration, or other processing facilities for 
specific solid minerals produced from specific Federal and Indian lease 
types or when otherwise requested by MMS (see Sec. 210.204). MMS uses 
the data to assure that Federal or Indian lease processed production 
(the output of process plants) is consistent with the input of raw 
production. Public reporting burden is estimated to be approximately 15 
minutes per reporter per month to compile in-house formatted 
information and submit that information electronically. Comments 
relating to this information collection should reference OMB Control 
Number 1010-0120.
    (20) Sales Contracts--Submitted semi-annually by producers of 
specific solid mineral products on specific Federal and Indian lease 
types or when otherwise requested by MMS (see Sec. 210.203). MMS uses 
contracts, agreements and contract amendments for compliance purposes 
including, but not limited to, identifying valuation issues and 
establishing selling arrangement relationships. Public reporting burden 
is estimated to be 2 hours per reporter per year to compile and submit 
contracts and contract amendments. Comments relating to this 
information collection should reference OMB Control Number 1010-0120.
    (21) Sales Summaries--Submitted monthly by producers of specific 
solid minerals from specific Federal and Indian lease types or when 
otherwise requested by MMS (see Sec. 210.202). The MMS uses these data 
for compliance purposes including, but not limited to, assuring that 
sales volumes and values are properly attributed or allocated to 
Federal or Indian leases. Public reporting burden is estimated to be 15 
minutes per month for each reporter to compile in-house formatted sales 
information and submit that information electronically. Comments 
relating to this information collection should reference OMB Control 
Number 1010-0120.
    (d) Comments on burden estimates. Send comments on the accuracy of 
this burden estimate or suggestions on reducing this burden to the 
Minerals Management Service, Attention: Information Collection 
Clearance Officer, (OMB Control Number 1010-0120 (insert appropriate 
OMB Control Number), Mail Stop 4230, 1849 C Street, NW, Washington, 
D.C. 20240. 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.

[[Page 45771]]

Secs. 210.200-210.204  [Removed]

    15. Remove Secs. 210.200 through 210.204.


Secs. 210.200-210.206  [Added]

    16. Add Secs. 210.200 through 210.206 to read as follows:

Subpart E--Solid Minerals, General

Sec.
210.200   What is the purpose of this subpart?
210.201   How do I submit Form MMS-4430, Solid Minerals Production 
and Royalty Report?
210.202   How do I submit sales summaries?
210.203   How do I submit sales contracts?
210.204   How do I submit facility data?
210.205   Will I need to submit additional documents or evidence to 
MMS?
210.206   How will information submissions be kept confidential?


Sec. 210.200  What is the purpose of this subpart?

    This subpart explains your reporting requirements if you produce 
coal or other solid minerals from Federal or Indian leases. Included 
are your requirements for reporting production, sales, and royalties.


Sec. 210.201  How do I submit Form MMS-4430, Solid Minerals Production 
and Royalty Report?

    (a) What to submit. (1) You must submit a completed Form MMS-4430 
for--
    (i) Production of all coal and other solid minerals from any 
Federal or Indian lease;
    (ii) Sale of any such mineral;
    (iii) Any such mineral held in stockpile or inventory; and
    (iv) Payment of rents (other than those for which you receive from 
MMS a Courtesy Notice as defined in Sec. 218.51(a) of this chapter), 
minimum royalty, deferred bonus, advance royalty, minimum royalty 
payable in advance, settlements, recoupments, and other financial 
obligations.
    (2) You must submit a completed Form MMS-4430 for any product you 
sell from a remote storage site. If you sell from five or fewer remote 
storage sites, you must report sales from each site on separate Forms 
MMS-4430. If you sell from more than five remote storage sites, you 
must total the data from all sites and report the summarized data on 
one Form MMS-4430.
    (3) Instructions for completing and submitting Form MMS-4430 are 
available on our Internet reporting web site or you may contact us toll 
free at 1-888-201-6416.
    (b) When to submit. (1) Unless your lease terms specify a different 
frequency for royalty payments, you must submit your Form MMS-4430 on 
or before the end of the month following the month in which you produce 
any solid mineral, sell any solid mineral, or hold any solid mineral 
production in stockpile or inventory. However, if the last day of the 
month falls on a weekend or holiday, your Form MMS-4430 is due on the 
next business day.
    (2) If your lease terms specify a different frequency for royalty 
payment, then you must submit your Form MMS-4430 on or before the date 
on which you must pay royalty under the terms of the lease.
    (3) You must submit your Form MMS-4430 for payment of rents (other 
than those for which you receive from MMS a Courtesy Notice as defined 
in Sec. 218.51(a) of this chapter), minimum royalty, deferred bonus, 
advance royalty, minimum royalty payable in advance, settlements, 
recoupments, and other financial obligations on or before the date on 
which you must pay those obligations under the terms of the lease.
    (4) If the information on a previously reported Form MMS-4430 is no 
longer correct, you must submit a revised Form MMS-4430 by the last day 
of the month in which you learn that the previously reported 
information is no longer correct, except when the last day of the month 
falls on a weekend or holiday. If the last day of the month falls on a 
weekend or holiday, your revised Form MMS-4430 is due on the first 
business day of the following month.
    (c) How to submit. (1) You must submit Form MMS-4430 electronically 
using our Internet reporting web site unless you meet the conditions in 
paragraph (c)(2). We will provide written instructions and a valid 
login and password before you begin reporting.
    (2) You are not required to report electronically if you are a 
small business as defined by the U.S. Small Business Administration (13 
CFR 121.201) and you have no computer, no plans to purchase a computer, 
and no contract with an electronic reporting service.
    (3) If you do not report electronically, you must submit the 
completed Form MMS-4430 to us at one of the following addresses, unless 
MMS publishes notice in the Federal Register giving a different 
address:
    (i) For U.S. Postal Service regular mail or Express Mail: Minerals 
Management Service, Minerals Revenue Management, P.O. Box 5760, Denver, 
Colorado 80217-5760; or
    (ii) For courier service or overnight mail (excluding Express 
Mail): Minerals Management Service, Minerals Revenue Management, 
Building 85, Denver Federal Center, Room A-614, Denver, Colorado 80225.


Sec. 210.202  How do I submit sales summaries?

    (a) What to submit. (1) You must submit sales summaries for all 
coal and other solid minerals produced from Federal and Indian leases 
and for any remote storage site from which you sell Federal or Indian 
solid minerals. You do not have to submit a sales summary for those 
months in which you do not sell any Federal or Indian production.
    (2) If you sell from five or fewer remote storage sites, you must 
submit a sales summary for each site. If you sell from more than five 
remote storage sites, you may total the data from all sites and submit 
the summarized data as one sales summary. The details you report on the 
sales summary are for the same sales reported on Form MMS-4430.
    (3) Use the following table to determine the time frames for 
submitting sales summaries and the data elements you must include. Your 
submitted sales summaries must include the following data but may be 
internally generated documents from your own records. You do not need 
to re-format them before submitting them to us:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                All other leases   All other leases with
          Data element                  Coal          Sodium/potassium        Western             Metals        with ad valorem    no ad valorem royalty
                                                                             phosphate                           royalty terms             terms
--------------------------------------------------------------------------------------------------------------------------------------------------------
(i) Purchaser Name or Unique     Monthly...........  Monthly...........  Monthly..........  Monthly..........  Monthly..........  As Requested.
 Identification.
(ii) Sales Units...............  Monthly...........  Monthly...........  Monthly..........  Monthly..........  Monthly..........  Monthly.
(iii) Gross Proceeds...........  Monthly...........  Monthly...........  Not Required.....  Monthly..........  Monthly..........  Not Required.
(iv) Processing or washing       Monthly...........  Monthly...........  Not Required.....  Monthly..........  Monthly..........  Not Required.
 costs.

[[Page 45772]]

 
(v) Transportation costs.......  Monthly...........  Monthly...........  Not Required.....  Monthly..........  Monthly..........  Not Required.
(vi) Name of product type sold.  Not Required......  Monthly...........  Not Required.....  Monthly..........  Monthly..........  As Requested.
(vii) Btu/lb...................  Monthly...........  Not Required......  Not Required.....  Not Required.....  Not Required.....  Not Required.
(viii) Ash %...................  Monthly...........  Not Required......  Not Required.....  Not Required.....  Not Required.....  Not Required.
(ix) Sulfur %..................  Monthly...........  Not Required......  Not Required.....  Not Required.....  Not Required.....  Not Required.
(x) lbs SO2....................  Monthly...........  Not Required......  Not Required.....  Not Required.....  Not Required.....  Not Required.
(xi) Moisture %................  Monthly...........  Not Required......  Monthly..........  Not Required.....  Not Required.....  Not Required.
(xii) By-product Units.........  Not Required......  As Requested......  Monthly..........  As Requested.....  As Requested.....  Not Required.
(xiii) P2O5 %..................  Not Required......  Not Required......  Monthly..........  Not Required.....  Not Required.....  Not Required.
(xiv) Size.....................  Not Required......  Not Required......  Not Required.....  Not Required.....  As Requested.....  Not Required.
(xv) Net Smelter Return data...  Not Required......  Not Required......  Not Required.....  Monthly..........  Not Required.....  Not Required.
(xvi) Other Data e.g., Royalty   As Requested......  Monthly...........  As Requested.....  As Requested.....  As Requested.....  As Requested.
 Calculation Worksheet.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    (b) When to submit. (1) For leases with ad valorem royalty terms 
(that is, leases for which royalty is a percentage of the value of 
production), you must submit your sales summaries monthly at the same 
time you submit Form MMS-4430. You do not have to submit a sales 
summary for any month in which you did not sell Federal or Indian 
production.
    (2) For leases with no ad valorem royalty terms (that is, leases in 
which the royalty due is not a function of the value of production, 
such as cents-per-ton or dollars-per-unit), you must submit monthly 
sales summaries only if we specifically request you to do so.
    (c) How to submit. (1) You should provide the sales summary data 
via electronic mail where possible. We will provide instructions and 
the proper email address for these submissions.
    (2) If you submit sales summaries by paper copy, mail them to one 
of the following addresses, unless MMS publishes notice in the Federal 
Register giving a different address:
    (i) For U.S. Postal Service regular mail or Express Mail: Minerals 
Management Service, Minerals Revenue Management, Solid Minerals and 
Geothermal Compliance and Asset Management, P.O. Box 25165, MS 390G1, 
Denver, Colorado 80225-0165.
    (ii) For courier service or overnight mail (excluding Express 
Mail): Minerals Management Service, Solid Minerals and Geothermal 
Compliance and Asset Management, 12600 West Colfax Avenue, Suite C-100, 
Lakewood, Colorado 80215.


Sec. 210.203  How do I submit sales contracts?

    (a) What to submit. You must submit sales contracts, agreements, 
and contract amendments for the sale of all coal and other solid 
minerals produced from Federal and Indian leases with ad valorem 
royalty terms.
    (b) When to submit. (1) For coal and metal production, you must 
submit the required documents semi-annually, no later than March 30 and 
September 30 of each year.
    (2) For sodium, potassium, and phosphate production, and production 
from any other lease with ad valorem royalty terms, you must submit the 
required documents only if you are specifically requested to do so.
    (c) How to submit. You must submit complete copies of the sales 
contracts and amendments to us at the applicable address given in 
Sec. 210.202(c)(2), unless MMS publishes notice in the Federal Register 
giving a different address.


Sec. 210.204  How do I submit facility data?

    (a) What to submit. (1) You must submit facility data if you 
operate a wash plant, refining, ore concentration, or other processing 
facility for any coal, sodium, potassium, metals, or other solid 
minerals produced from Federal or Indian leases with ad valorem royalty 
terms, regardless of whether the facility is located on or off the 
lease.
    (2) You do not have to submit facility data for those months in 
which you do not process solid minerals produced from Federal or Indian 
leases and do not have any such minerals in stockpile inventory.
    (3) You must include in your facility data all production processed 
in the facility from all properties, not just production from Federal 
and Indian leases.
    (4) Facility data submissions must include the following minimum 
information:
    (i) Identification of your facility;
    (ii) Mines served;
    (iii) Input quantity;
    (iv) Input quality or ore grade (except for coal);
    (v) Output quantity; and
    (vi) Output quality or product grades.
    (5) Your submitted facility data may be internally generated 
documents from your own records. You do not need to re-format them 
before submitting them to us.
    (b) When to submit. You must submit your facility data monthly at 
the same time you submit your Form MMS-4430.
    (c) How to submit. (1) You should provide the facility data via 
electronic mail where possible. We will provide instructions and the 
proper email address for these submissions before you begin reporting.
    (2) If you submit facility data by paper copy, send it to the 
applicable address given in Sec. 210.202(c)(2).


Sec. 210.205  Will I need to submit additional documents or evidence to 
MMS?

    (a) Federal and Indian lease terms allow us to request detailed 
statements, documents, or other evidence necessary to verify compliance 
with lease terms and conditions and applicable rules.
    (b) We will request this additional information as we need it, not 
as a regular submission.


Sec. 210.206  How will information submissions be kept confidential?

    Information submitted under this part that constitutes trade 
secrets or commercial and financial information that is identified as 
privileged or confidential, or that is exempt from disclosure under the 
Freedom of Information Act, 5 U.S.C. 552, shall not be available for 
public inspection or made public or disclosed without the consent of 
the lessee, except as

[[Page 45773]]

otherwise provided by law or regulation.

PART 216--PRODUCTION ACCOUNTING

    17. The authority citation for part 216 continues to read as 
follows:

    Authority: 5 U.S.C. 301 et seq.; 25 U.S.C. 396, 2107; 30 U.S.C. 
189, 190, 359, 1023, 1751(a); 31 U.S.C. 3716, 9701; 43 U.S.C. 1334, 
1801 et seq.; and 44 U.S.C. 3506(a).


Sec. 216.2  [Amended]

    18. In 216.2, first sentence, remove the phrase ``oil, gas, or 
solid minerals'' and add in its place ``oil or gas.''


Sec. 216.6  [Amended]

    19. Amend Sec. 216.6 as follows:
    a. Remove the definition of ``approved mining plan.''
    b. In the definition of ``lease,'' remove the phrase ``oil, gas, or 
solid minerals'' and add in its place ``oil or gas.''
    c. In the definition of ``measurement device,'' remove the phrase 
``oil, gas, or solid minerals'' and add in its place ``oil or gas.''
    d. Remove the definition of ``mine.''
    e. In the definition of ``mineral leasing law,'' remove the phrase 
``oil, gas, or solid minerals'' and add in its place ``oil or gas.''
    f. In the definition of ``operator,'' first sentence, remove the 
phrase ``or solid minerals.'' In the second sentence, remove the phrase 
``oil, gas, or solid minerals'' and add in its place ``oil or gas.''
    g. In the definition of ``Production Accounting and Auditing 
System,'' second sentence, remove the phrase ``oil, gas, or solid 
minerals'' and add in its place ``oil and gas.''
    h. Remove the definition of ``solid minerals.''


Sec. 216.20  [Amended]

    20. In Sec. 216.20, remove the phrase ``oil, gas, or solid 
minerals'' and add in its place ``oil and gas.''


Sec. 216.40  [Amended]

    21. In Sec. 216.40, remove paragraph (d), and redesignate 
paragraphs (e) through (g) as paragraphs (d) through (f).

Subpart E--Solid Minerals, General [Reserved]


Secs. 216.200-216.204  [Removed]

    22. Remove Secs. 216.200 through 216.204.

PART 218--COLLECTION OF ROYALTIES, RENTALS, BONUSES AND OTHER 
MONIES DUE THE FEDERAL GOVERNMENT

    23. The authority citation for part 218 is revised to read as 
follows:

    Authority: 25 U.S.C. 396 et seq., 396a et seq., 2101 et seq.; 30 
U.S.C. 181 et seq., 351 et seq., 1001 et seq., 1701 et seq.; 31 
U.S.C. 3335; 43 U.S.C. 1301 et seq., 1331 et seq., and 1801 et seq.


Sec. 218.40  [Amended]

    24. In Sec. 218.40, revise paragraph (c) to read as follows:


Sec. 218.40  Assessments for incorrect or late reports and failure to 
report.

* * * * *
    (c) For purposes of assessments discussed in this section, a report 
is defined as follows:
    (1) For coal and other solid mineral leases, a report is each line 
on the Solid Minerals Production and Royalty Report, Form MMS-4430.
    (2) For oil and gas and geothermal leases, a report is each line on 
the Report of Sales and Royalty Remittance, Form MMS-2014.
* * * * *


Sec. 218.51  [Amended]

    25. Amend Sec. 218.51 as follows:
    a. In paragraphs (d)(2) and (d)(3), remove the name ``Royalty 
Management Program'' and add in its place the name ``Minerals Revenue 
Management.''
    b. In paragraph (e), remove the name ``Royalty Management Program'' 
and add in its place the name ``Minerals Revenue Management'' and 
remove the room number ``A-212'' and add in its place ``A-614.''


Sec. 218.201  [Amended]

    26. Revise Sec. 218.201 to read as follows:


Sec. 218.201  Method of payment.

    You must tender all payments in accordance with Sec. 218.51, except 
as follows:
    (a) For purposes of this section, report means the Solid Minerals 
Production and Royalty Report, Form MMS-4430, rather than the Form MMS-
2014.
    (b) For Form MMS-4430 payments, include both your customer 
identification and your customer document identification numbers on 
your payment document, rather than the information required under 
Sec. 218.51(f)(1).
    (c) For a rental payment that is not reported on Form MMS-4430, 
include the MMS Courtesy Notice when provided or write your customer 
identification number and Government-assigned lease number on the 
payment document, rather than the information required under 
Sec. 218.51(f)(4)(iii).


Sec. 218.203  [Amended]

    27. Amend Sec. 218.203 as follows:
    a. In paragraph (a), first sentence, remove the word ``MMS-2014'' 
and add in its place ``MMS-4430.''
    b. In paragraph (b), second sentence, remove the words ``pursuant 
to instructions in the ``AFS Payor Handbook--Solid Minerals'.''
    c. In paragraph (b), remove the third sentence, ``See 30 CFR 
210.204.'' and add in its place the sentence ``Call 1-888-201-6416 for 
instructions.''

[FR Doc. 01-21638 Filed 8-29-01; 8:45 am]
BILLING CODE 4310-MR-P