[Federal Register Volume 68, Number 67 (Tuesday, April 8, 2003)]
[Notices]
[Pages 17075-17077]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-8534]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service


Agency Information Collection Activities: Proposed Collection, 
Comment Request

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Notice of an extension of a currently approved information 
collection (OMB control number 1010-0129.

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SUMMARY: To comply with the Paperwork Reduction Act (PRA) of 1995, we 
are inviting comments on a collection of information that we will 
submit to the Office of Management and Budget (OMB) for review and 
approval. The information collection request (ICR) is titled ``Royalty-
in-Kind Pilot Program `` Offers, Financial Statements and Surety 
Instruments for Sales of Royalty Oil and Gas.''

DATES: Submit written comments on or before June 9, 2003.

ADDRESSES: Submit written comments to Sharron L. Gebhardt, Regulatory 
Specialist, Minerals Management Service, Minerals Revenue Management, 
P.O. Box 25165, MS 320B2, Denver, Colorado 80225. If you use an 
overnight courier service, our courier address is Building 85, Room A-
614, Denver Federal Center, Denver, Colorado 80225. You may also email 
your comments to us at [email protected]. Include the title of the 
information collection and the OMB control number in the ``Attention'' 
line of your comment. Also include your name and return address. Submit 
electronic comments as an ASCII file avoiding the use of special 
characters and any form of encryption. If you do not receive a 
confirmation we have received your email, contact Ms. Gebhardt at (303) 
231-3211.

[[Page 17076]]


FOR FURTHER INFORMATION CONTACT: Sharron L. Gebhardt, telephone (303) 
231-3211, FAX (303) 231-3385 or email [email protected].

SUPPLEMENTARY INFORMATION:
    Title: ``Royalty-in-Kind Pilot Program--Offers, Financial 
Statements and Surety Instruments for Sales of Royalty Oil and Gas.''
    OMB Control Number: 1010-0129.
    Bureau Form Number: None.
    Abstract: The Secretary of the U.S. Department of the Interior 
(DOI) is responsible for collecting royalties from lessees who produce 
minerals from leased Federal and Indian lands. The Secretary is 
required by various laws to manage mineral resources production on 
Federal and Indian lands, collect the royalties due, and distribute the 
funds in accordance with those laws. MMS performs the royalty 
management functions for the Secretary.
    Taking and selling of the Government's royalty share in the form of 
production or ``in kind'' (RIK) is authorized by the Mineral Leasing 
Act (MLA), 30 U.S.C. 192, for onshore leases and the Outer Continental 
Shelf Lands Act (OCSLA), 43 U.S.C. 1353, for offshore leases. 
Recommendations in an MMS 1997 Feasibility Study concluded that, under 
the right conditions, RIK could be workable, revenue positive, and 
administratively more efficient for Government and industry. Pursuant 
to the 1997 study's recommendations, MMS is conducting the following 
pilots.
    [sbull] For oil from Federal leases in Wyoming which began October 
1, 1998;
    [sbull] For gas from Federal leases offshore the State of Texas 
[Texas 8(g)] which began December 1, 1998;
    [sbull] For gas from Federal offshore leases in the Gulf of Mexico 
(GOM) Region which began in October 1999. This will involve the largest 
production volumes; and
    [sbull] For oil from Federal offshore leases in the GOM Region 
which began in October 2000.
    In addition to the above pilots, on November 6, 2001, President 
Bush announced an initiative to refill the Strategic Petroleum Reserve 
(SPR). MMS, in coordination with the Department of Energy (DOE), 
entered into a joint, 3-year initiative to fill the remaining capacity 
of the SPR. Operators of Federal leases in the GOM will deliver royalty 
oil to MMS' exchange partner at or near the lease. MMS's exchange 
partner will then deliver similar quantities of crude oil to MMS or its 
designated agent at Gulf Coast market centers. MMS's designated agent 
will be either DOE or its exchange contractor. DOE will then contract 
for exchange or direct movement of exchange oil to the SPR.
    The feasibility and cost-effectiveness of MMS providing RIK 
production direct to other Federal agencies for their consumption is 
also being investigated in conjunction with the pilots.
    MMS, as the responsible steward of Federal mineral revenues, is 
conducting the pilot programs of oil and gas RIK sales and 
investigation of direct Federal consumption to show conclusively 
whether or not RIK is viable for the Federal Government, and, if so, 
how, when, and where it makes sense to exercise the RIK option.
    Offers, Financial Statements and Surety Instruments for Sales of 
Royalty Oil and Gas. The collections of information addressed in this 
ICR are necessary because the Secretary of the Interior is obligated to 
hold competition when selling to the public to protect actual RIK 
production before, during, and after any sale, and obtain a fair return 
on royalty production sold. MMS must fulfill those obligations for the 
Secretary. The reporting requirements are as follows:
    a. The actual offers that potential purchasers will submit when MMS 
offers production for competitive sales;
    b. Offerors' statements of financial qualification; and
    c. Surety Instruments, such as a Letter of Credit (LOC), Bond, 
prepayment, or Parent Guaranty.
    MMS has also re-evaluated the need for two reporting requirements 
that were approved by OMB in the last ICR submission and has decided 
that this information is no longer needed. These reporting requirements 
are (1) Form MMS-4440, Summary of Receipt and Delivery Volumes, and (2) 
Report of Gas Analysis. Also, the subject heading ``LOC'' has been 
changed to the more generic heading ``Surety Instruments'' to capture 
the broader field of financial instruments that may be collected under 
this ICR, such as Bonds, prepayments, and Parent Guarantees. That is, 
an LOC is just one of the many types of surety instruments used by MMS 
that provide a safeguard against non-payment by a respondent under an 
RIK contract.
    No proprietary information will be submitted to MMS under this 
collection. No items of a sensitive nature are collected. The 
requirement to respond is required to obtain or retain benefits.
    For clarification purposes, we have also changed the title of this 
ICR from ``Bids and Financial Statements for Sale of Royalty Oil and 
Gas (RIK Pilots) (Form MMS-4440) to ``'Royalty-in-Kind Pilot 
Program'Offers, Financial Statements and Surety Instruments for Sales 
of Royalty Oil and Gas.''
    Frequency of Response: On occasion.
    Estimated Number and Description of Respondents: 80 oil and gas 
companies.
    Estimated Annual Reporting and Recordkeeping ``Hour'' Burden: 940 
hours.
    The following chart shows the breakdown of the estimated burden 
hours:

                                       Respondent Annual Burden Hour Chart
----------------------------------------------------------------------------------------------------------------
                                                                   Burden hours   Annual  number  Annual  burden
  Royalty-in-kind  pilot projects      Reporting  requirements     per response    of  responses       hours
----------------------------------------------------------------------------------------------------------------
                                    Offers......................               1             840             840
                                    Financial Statements........               1              20              20
                                    Surety Instruments..........               4              20              80
                                                                 -----------------
                                    ............................           Total             880            940
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 (Note: A respondent is counted each time they respond. Unsuccessful offerors will submit only 2 responses.)

    Estimated Annual Reporting and Recordkeeping ``Non-hour Cost'' 
Burden: We have identified no ``non-hour'' cost burdens.
    Comments: The PRA (44 U.S.C. 3501, et seq.) provides 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. Before submitting an ICR to OMB, PRA Section 
3506(c)(2)(A) requires each agency ``* * * to provide notice * * * and 
otherwise consult with members of

[[Page 17077]]

the public and affected agencies concerning each proposed collection of 
information * * *.'' Agencies must specifically solicit comments to: 
(a) Evaluate whether the proposed collection of information is 
necessary for the agency to perform its duties, including whether the 
information is useful; (b) evaluate the accuracy of the agency's 
estimate of the burden of the proposed collection of information; (c) 
enhance the quality, usefulness, and clarity of the information to be 
collected; and (d) minimize the burden on the respondents, including 
the use of automated collection techniques or other forms of 
information technology.
    The PRA also requires agencies to estimate the total annual 
reporting ``non-hour cost'' burden to respondents or recordkeepers 
resulting from the collection of information. We have not identified 
non-hour cost burdens for this information collection. If you have 
costs to generate, maintain, and disclose this information, you should 
comment and provide your total capital and startup cost components or 
annual operation, maintenance, and purchase of service components. You 
should describe the methods you use to estimate major cost factors, 
including system and technology acquisition, expected useful life of 
capital equipment, discount rate(s), and the period over which you 
incur costs. Capital and startup costs include, among other items, 
computers and software you purchase to prepare for collecting 
information; monitoring, sampling, testing equipment; and record 
storage facilities. Generally, your estimates should not include 
equipment or services purchased: (i) Before October 1, 1995; (ii) to 
comply with requirements not associated with the information 
collection; (iii) for reasons other than to provide information or keep 
records for the Government; or (iv) as part of customary and usual 
business or private practices.
    We will summarize written responses to this notice and address them 
in our ICR submission for OMB approval, including appropriate 
adjustments to the estimated burden. We will provide a copy of the ICR 
to you without charge upon request and the ICR will also be posted on 
our Web site at http://www.mrm.mms.gov/Laws_R_D/FRNotices/FRInfColl.htm.
    Public Comment Policy: We will post all comments in response to 
this notice on our Web site at http://www.mrm.mms.gov/Laws_R_D/FRNotices/FRInfColl.htm. We will also make copies of the comments 
available for public review, including names and addresses of 
respondents, during regular business hours at our offices in Lakewood, 
Colorado. Individual respondents may request we withhold their home 
address from the public record, which we will honor to the extent 
allowable by law. There also may be circumstances in which we would 
withhold from the rulemaking record a respondent's identity, as 
allowable by law. If you request that we withhold your name and/or 
address, state this prominently at the beginning of your comment. 
However, we will not consider anonymous comments. We will make all 
submissions from organizations or businesses, and from individuals 
identifying themselves as representatives or officials of organizations 
or businesses, available for public inspection in their entirety.
    MMS Information Collection Clearance Officer: Jo Ann Lauterbach, 
(202) 208-7744.

    Dated: April 3, 2003.
Lucy Querques Denett,
Associate Director for Minerals Revenue Management.
[FR Doc. 03-8534 Filed 4-7-03; 8:45 am]
BILLING CODE 4310-MR-P