[Federal Register Volume 67, Number 32 (Friday, February 15, 2002)]
[Notices]
[Pages 7193-7196]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-3818]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service


Outer Continental Shelf, Central Gulf of Mexico, Oil and Gas 
Lease Sale 182

AGENCY: Minerals Management Service, Interior.

ACTION: Final Notice of Sale 182.

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SUMMARY: On March 20, 2002, the MMS will open and publicly announce 
bids received for blocks offered in Sale 182, Central Gulf of Mexico, 
pursuant to the Outer Continental Shelf (OCS) Lands Act (43 U.S.C. 
1331-1356, as amended) and the regulations issued thereunder (30 CFR 
part 256).
    Bidders can obtain a ``Final Notice of Sale 182 package'' 
containing this Notice of Sale and several supporting and essential 
documents referenced herein, from the MMS Gulf of Mexico Region's 
Public Information Unit, 1201 Elmwood Park Boulevard, New Orleans, 
Louisiana 70123-2394, (504) 736-2519 or (800) 200-GULF, or via the MMS 
Gulf of Mexico Region's Internet site at 
http://www.gomr.mms.gov. Please Note: This site may be temporarily 
unavailable; if so, please use a temporary Homepage until further 
notice: http://www.temporarygomr.com.
    The Final Notice of Sale 182 package contains information essential 
to bidders, and bidders are charged with the knowledge of the documents 
contained in the package.
    Location and Time: Public bid reading will begin at 9 a.m., 
Wednesday, March 20, 2002, in Grand Ballroom C (5th floor) at the 
Sheraton New Orleans Hotel, 500 Canal Street, New Orleans, Louisiana. 
All times referred to in this document are local New Orleans time.
    Filing of Bids: Bidders must submit sealed bids to the Regional 
Director (RD), MMS Gulf of Mexico Region, 1201 Elmwood Park Boulevard, 
New Orleans, Louisiana 70123-2394, between 8 a.m. and 4 p.m. on normal 
working days, prior to the Bid Submission Deadline of 10 a.m., Tuesday, 
March 19, 2002. If the bids are mailed, please mark on the envelope 
containing all the sealed bids the following: Attention: Mr. John Rodi, 
Contains Sealed Bids for Sale 182.
    If the RD receives bids later than the time and date specified 
above, he will return the bids unopened to bidders. Bidders may not 
modify or withdraw their bids unless the RD receives a written 
modification or written withdrawal request prior to 10 a.m., Tuesday, 
March 19, 2002. In the event of an unexpected event significantly 
disruptive to bid submission, such as flooding or travel restrictions, 
the MMS

[[Page 7194]]

Gulf of Mexico regional office may extend the bid submission deadline. 
Bidders may call (504) 736-0557 for information about the possible 
extension of the bid submission deadline due to such an event.
    Areas Offered for Leasing: The MMS is offering for leasing all 
blocks and partial blocks listed in the document ``Blocks Available for 
Leasing in Gulf of Mexico OCS Oil and Gas Lease Sale 182'' included in 
the Final Notice of Sale 182 package. This list of blocks available 
includes certain blocks and partial blocks beyond the United States 
Exclusive Economic Zone in the area formerly referred to as the 
Northern Portion of the Western Gap. All of these blocks are shown on 
the following Leasing Maps and Official Protraction Diagrams (which may 
be purchased from the MMS Gulf of Mexico Region Public Information 
Unit):

Outer Continental Shelf Leasing Maps--Louisiana Map Numbers 1 
through 12 (These 30 maps sell for $2.00 each.)

LA1  West Cameron Area (Revised November 1, 2000)
LA1A  West Cameron Area, West Addition (Revised November 1, 2000)
LA1B  West Cameron Area, South Addition (Revised November 1, 2000)
LA2  East Cameron Area (Revised November 1, 2000)
LA2A  East Cameron Area, South Addition (Revised November 1, 2000)
LA3  Vermilion Area (Revised November 1, 2000)
LA3A  South Marsh Island Area (Revised November 1, 2000)
LA3B  Vermilion Area, South Addition (Revised November 1, 2000)
LA3C  South Marsh Island Area, South Addition (Revised November 1, 
2000)
LA3D  South Marsh Island Area, North Addition (Revised November 1, 
2000)
LA4  Eugene Island Area (Revised November 1, 2000)
LA4A  Eugene Island Area, South Addition (Revised November 1, 2000)
LA5  Ship Shoal Area (Revised November 1, 2000)
LA5A  Ship Shoal Area, South Addition (Revised November 1, 2000)
LA6  South Timbalier Area (Revised November 1, 2000)
LA6A  South Timbalier Area, South Addition (Revised November 1, 2000)
LA6B  South Pelto Area (Revised November 1, 2000)
LA6C  Bay Marchand Area (Revised November 1, 2000)
LA7  Grand Isle Area (Revised November 1, 2000)
LA7A  Grand Isle Area, South Addition (Revised November 1, 2000)
LA8  West Delta Area (Revised November 1, 2000)
LA8A  West Delta Area, South Addition (Revised November 1, 2000)
LA9  South Pass Area (Revised November 1, 2000)
LA9A  South Pass Area, South and East Addition (Revised November 1, 
2000)
LA10  Main Pass Area (Revised November 1, 2000)
LA10A  Main Pass Area, South and East Addition (Revised November 1, 
2000)
LA10B  Breton Sound Area (Revised November 1, 2000)
LA11  Chandeleur Area (Revised November 1, 2000)
LA11A  Chandeleur Area, East Addition (Revised November 1, 2000)
LA12  Sabine Pass Area (Revised November 1, 2000)

Outer Continental Shelf Official Protraction Diagrams (These 10 
diagrams sell for $2.00 each.)

NG15-03  Green Canyon (Revised November 1, 2000)
NG15-06  Walker Ridge (Revised November 1, 2000)
NG15-09  Amery Terrace (Revised October 25, 2000)
NG16-01  Atwater Valley (Revised November 1, 2000)
NG16-04  Lund (Revised November 1, 2000)
NG16-07  Lund South (Revised November 1, 2000)
NH15-12  Ewing Bank (Revised November 1, 2000)
NH16-04  Mobile (Revised November 1, 2000)
NH16-07  Viosca Knoll (Revised November 1, 2000)
NH16-10  Mississippi Canyon (Revised November 1, 2000)

    Please Note: A CD-ROM (in ARC/INFO and Acrobat (.pdf) format) 
containing all of the Gulf of Mexico Leasing Maps and Official 
Protraction Diagrams, except for those not yet revised to digital 
format, is available from the MMS Gulf of Mexico Region's Public 
Information Unit for a price of $15.00. The Leasing Maps and 
Official Protraction Diagrams are also available via the Internet. 
See also 66 FR 28002, published on May 21, 2001, for the current 
status of all Central and Western Gulf of Mexico Leasing Maps and 
Official Protraction Diagrams.


    All blocks are shown on these Leasing Maps and Official Protraction 
Diagrams. The available Federal acreage of all whole and partial blocks 
in this sale is shown in the document ``List of Blocks Available for 
Leasing, Sale 182'' included in the Final Notice of Sale 182 package. 
Some of these blocks may be partially leased or transected by 
administrative lines such as the Federal/State jurisdictional line. 
Information on the unleased portions of such blocks is also found in 
the document titled ``Central Gulf of Mexico Lease Sale 182--Unleased 
Split Blocks and Unleased Acreage of Blocks with Aliquots and Irregular 
Portions Under Lease,'' included in the Final Notice of Sale 182 
package.
    Areas Not Available for Leasing: The following whole and partial 
blocks are not offered for lease in this sale:
     Blocks currently under lease;
     Mississippi Canyon Block 474, which is under consideration 
for use as the host location to develop several existing leases termed 
the ``NaKika Project'';
     Viosca Knoll Block 69 (lease termination currently under 
appeal);
     Blocks which are beyond the United States Exclusive 
Economic Zone in the area known as the Northern portion of the Eastern 
Gap:
Lund South (Area NG16-07)
    Blocks
    172 and 173
    213 through 217
    252 through 261
    296 through 305
    349
     Whole and partial blocks which are beyond the United 
States Exclusive Economic Zone in the area formerly known as the 
Northern portion of the Western Gap and which lie within the 1.4 
nautical mile buffer zone north of the continental shelf boundary 
between the United States and Mexico:
Amery Terrace (Area NG15-09)
    Partial Blocks:
    235 through 238
    273 through 279
    309 through 317

    Whole Blocks:
    280 and 281
    318 through 320
    355 through 359
    Lease Terms and Conditions: Primary lease terms, primary lease term 
extensions, minimum bids, annual rental rates, royalty rates, and 
royalty suspension areas are shown on the map titled ``Lease Terms and 
Economic Conditions, Sale 182, Final'' for leases resulting from this 
sale:
    Primary Lease Terms: 5 years for blocks in water depths of less 
than 400 meters; 8 years for blocks in water depths of 400 to 799 
meters; and 10 years for blocks in water depths of 800 meters or 
deeper;
    Primary Lease Term Extensions: Extensions may be granted for 
eligible blocks in water depths less than 400 meters as specified in 
Notice To Lessees and Operators (NTL) 2000-G22, effective December 22, 
2000;
    Minimum Bids: $25 per acre or fraction thereof for blocks in water 
depths of less than 800 meters and

[[Page 7195]]

$37.50 per acre or fraction thereof for blocks in water depths of 800 
meters or deeper;
    Annual Rental Rates: $5 per acre or fraction thereof for blocks in 
water depths of less than 200 meters and $7.50 per acre or fraction 
thereof for blocks in water depths of 200 meters or deeper, to be paid 
on or before the first day of each lease year until a discovery in 
paying quantities of oil or gas is made, then at the expiration of each 
lease year until the start of royalty-bearing production;
    Royalty Rates: 16\2/3\ percent royalty rate for blocks in water 
depths of less than 400 meters and a 12\1/2\ percent royalty rate for 
blocks in water depths of 400 meters or deeper, except during periods 
of royalty suspension, to be paid monthly on the last day of the month 
following the month in which the production is obtained;
    Minimum Royalty: After the start of royalty-bearing production: $5 
per acre or fraction thereof per year for blocks in water depths of 
less than 200 meters and $7.50 per acre or fraction thereof per year 
for blocks in water depths of 200 meters or deeper, to be paid at the 
expiration of each lease year;
    Royalty Suspension Areas: Leases resulting from this sale are 
subject to royalty relief regulations in 30 CFR part 260, published in 
the Federal Register at 66 FR 11512 on February 23, 2001, and 30 CFR 
part 203, published at 67 FR 1862 on January 15, 2002. Royalty 
suspension will apply for blocks in water depths less than 200 meters 
where new deep gas (15,000 feet or greater subsea) is drilled and 
commences production within the initial primary 5-year lease term, and 
in water depths of 400 meters or deeper (for oil and gas); see the map 
titled ``Lease Terms and Economic Conditions, Sale 182, Final'' for 
specific areas. See the document contained within the Final Notice of 
Sale 182 package titled ``Royalty Suspension Provisions, Sale 182'' for 
the specific details regarding royalty suspension eligibility and 
implementation.
    Stipulations: The map titled ``Stipulations and Deferred Blocks, 
Sale 182, Final'' depicts the blocks where six lease stipulations 
apply: (1) Topographic features; (2) live bottoms; (3) military areas; 
(4) blocks south of Baldwin County, Alabama; (5) Law of the Sea 
Convention Royalty Payment; and (6) marine protected species. Also 
shown on this map are the deferred blocks noted above. The texts of the 
stipulations are contained in the document ``Lease Stipulations for Oil 
and Gas Lease Sale 182, Final'' included in the Final Notice of Sale 
182 package.
    Rounding: The following procedure must be used to calculate minimum 
bid, rental, and minimum royalty on blocks with fractional acreage. 
Round up to the next whole acre and multiply by the applicable dollar 
amount to determine the correct minimum bid, rental, or minimum 
royalty.


    Please Note: For the minimum bid only, if the calculation 
results in a decimal figure, round up to the next whole dollar 
amount (see next paragraph). The minimum bid calculation, including 
all rounding, is shown in the document ``List of Blocks Available 
for Leasing in Central Gulf of Mexico OCS Oil and Gas Sale 182'' 
included in the Final Notice of Sale 182 package.


    Method of Bidding: For each block bid upon, a bidder must submit a 
separate signed bid in a sealed envelope labeled ``Sealed Bid for Oil 
and Gas Lease Sale 182, not to be opened until 9 a.m., Wednesday, March 
20, 2002.'' The total amount bid must be in a whole dollar amount; any 
cent amount above the whole dollar will be ignored by the MMS. Details 
of the information required on the bid(s) and the bid envelope(s) are 
specified in the document ``Bid Form and Envelope'' contained in the 
Final Notice of Sale 182 package.
    The MMS published a list of restricted joint bidders, which applies 
to this sale, in the Federal Register at 66 FR 52150, on October 12, 
2001. Bidders must execute all documents in conformance with signatory 
authorizations on file in the MMS Gulf of Mexico Region's Adjudication 
Unit. Partnerships also must submit or have on file a list of 
signatories authorized to bind the partnership. Bidders submitting 
joint bids must state on the bid form the proportionate interest of 
each participating bidder, in percent to a maximum of five decimal 
places, e.g., 33.33333 percent. The MMS may require bidders to submit 
other documents in accordance with 30 CFR 256.46. The MMS warns bidders 
against violation of 18 U.S.C. 1860 prohibiting unlawful combination or 
intimidation of bidders. Bidders are advised that the MMS considers the 
signed bid to be a legally binding obligation on the part of the 
bidder(s) to comply with all applicable regulations, including paying 
the \1/5\ bonus on all high bids. A statement to this effect must be 
included on each bid (see the document ``Bid Form and Envelope'' 
contained in the Final Notice of Sale 182 package).
    Bid Deposit: Submitters of high bids must deposit the \1/5\ bonus 
by using electronic funds transfer procedures, following the detailed 
instructions contained in the document ``Instructions for Making EFT 
Bonus Payments'' included in the Final Notice of Sale 182 package. All 
payments must be electronically deposited into an interest-bearing 
account in the U.S. Treasury (account specified in the EFT 
instructions) during the period the bids are being considered. Such a 
deposit does not constitute and shall not be construed as acceptance of 
any bid on behalf of the United States.


    Please Note: Certain bid submitters (i.e., those that do NOT 
currently own or operate an OCS mineral lease OR those that have 
ever defaulted on a \1/5\ bonus payment (EFT or otherwise)) are 
required to guarantee (secure) their \1/5\ bonus payment. For those 
who must secure the EFT \1/5\ bonus payment, one of the following 
options may be used: (1) Provide a third-party guaranty; (2) amend 
development bond coverage; (3) provide a letter of credit; or (4) 
provide a lump sum payment via EFT prior to the submission of bids. 
The EFT instructions specify the requirements for each option.


    Withdrawal of Blocks: The United States reserves the right to 
withdraw any block from this sale prior to issuance of a written 
acceptance of a bid for the block.
    Acceptance, Rejection, or Return of Bids: The United States 
reserves the right to reject any and all bids. In any case, no bid will 
be accepted, and no lease for any block will be awarded to any bidder, 
unless the bidder has complied with all requirements of this Notice, 
including the documents contained in the associated Final Notice of 
Sale 182 package and applicable regulations; the bid is the highest 
valid bid; and the amount of the bid has been determined to be adequate 
by the authorized officer. The Attorney General may also review the 
results of the lease sale prior to the acceptance of bids and issuance 
of leases. Any bid submitted which does not conform to the requirements 
of this Notice, the OCS Lands Act, as amended, and other applicable 
regulations may be returned to the person submitting that bid by the RD 
and will not be considered for acceptance. To ensure that the 
Government receives a fair return for the conveyance of lease rights 
for this sale, high bids will be evaluated in accordance with MMS bid 
adequacy procedures. A copy of the current procedures, ``Modifications 
to the Bid Adequacy Procedures'' (64 FR 37560 of July 12, 1999), can be 
obtained from the MMS Gulf of Mexico Region's Public Information Unit 
via the Internet.
    Successful Bidders: As required by MMS, each company that has been 
awarded a lease must execute all copies of the lease (Form MMS-2005 
(March 1986) as amended), pay by EFT the balance of the cash bonus bid 
along

[[Page 7196]]

with the first year's annual rental for each lease issued in accordance 
with the requirements of 30 CFR 218.155, and satisfy the bonding 
requirements of 30 CFR part 256, subpart I, as amended. Each bidder in 
a successful high bid must have on file, in the MMS Gulf of Mexico 
Region's Adjudication Unit, a currently valid certification (Debarment 
Certification Form) certifying that the bidder is not excluded from 
participation in primary covered transactions under Federal 
nonprocurement programs and activities. A certification previously 
provided to that office remains currently valid until new or revised 
information applicable to that certification becomes available. In the 
event of new or revised applicable information, the MMS will require a 
subsequent certification before lease issuance can occur. Persons 
submitting such certifications should review the requirements of 43 
CFR, part 12, subpart D. A copy of the Debarment Certification Form is 
contained in the Final Notice of Sale 182 package.
    Affirmative Action: The MMS requests that the certification 
required by 41 CFR 60-1.7(b) and Executive Order No. 11246 of September 
24, 1965, as amended by Executive Order No. 11375 of October 13, 1967, 
on the Compliance Report Certification Form, Form MMS-2033 (June 1985), 
and the Affirmative Action Representation Form, Form MMS-2032 (June 
1985), be on file in the MMS Gulf of Mexico Region's Adjudication Unit 
prior to bidding. In any event, these forms are required to be on file 
in the MMS Gulf of Mexico Region's Adjudication Unit prior to execution 
of any lease contract. Bidders must also comply with the requirements 
of 41 CFR part 60.
    Information to Lessees: The Final Notice of Sale 182 package 
contains a document titled ``Information to Lessees.'' These 
Information to Lessees items provide information on various matters of 
interest to potential bidders.

Notice of Bidding Systems

    Section 8(a)(8) (43 U.S.C. 1337(a)(8)) of the OCS Lands Act, as 
amended, requires that at least 30 days before any lease sale, a Notice 
be submitted to Congress and published in the Federal Register. This 
Notice of Bidding Systems is for Sale 182, Central Gulf of Mexico, 
scheduled to be held in March 2002.
    In Sale 182, unleased blocks and partial blocks are being offered 
under a bidding system that uses a cash bonus and fixed royalty rates 
of 16\2/3\ percent for blocks in water depths of less than 400 meters 
and 12\1/2\ percent in water depths of 400 meters or deeper, except 
during periods of royalty suspension.
    This bidding system is authorized under 30 CFR 260.110(a)(7), which 
allows use of a cash bonus bid with a royalty rate of not less than 
12\1/2\ percent and with suspension of royalties for a period, volume, 
or value of production, and an annual rental.
    Analysis performed by the MMS indicates that use of this system 
with the royalty suspension volumes and price thresholds specified in 
the Final Notice of Sale provides an incentive for development of this 
area while ensuring that a fair sharing of revenues will result if 
major discoveries are made and produced.
    Specific provisions for Sale 182 are contained in the document 
``Royalty Suspension Provisions, Sale 182,'' and a map titled ``Lease 
Terms and Economic Conditions, Sale 182, Final'' depicts blocks and 
applicable royalty suspension volumes. Both documents are included in 
the Final Notice of Sale 182 package.
    The MMS expects to use these same leasing systems in OCS lease 
sales in the Central and Western Gulf of Mexico in the future. For 
these sales, the specific blocks offered under each system will be 
shown on the sale's ``Lease Terms and Economic Conditions'' map. The 
MMS will publish a new notice of leasing systems for Central and 
Western Gulf of Mexico sales for any sales in which different systems 
are used.

    Dated: February 11, 2002.
Lucy Querques Denett,
Acting Director, Minerals Management Service.
[FR Doc. 02-3818 Filed 2-14-02; 8:45 am]
BILLING CODE 4310-MR-P