[Federal Register Volume 68, Number 121 (Tuesday, June 24, 2003)]
[Notices]
[Pages 37515-37517]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-15891]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service


Agency Information Collection Activities: Submitted for Office of 
Management and Budget (OMB) Review; 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 of 1995 (PRA), we 
are notifying the public that we have submitted to OMB an information 
collection request (ICR) to renew approval of this paperwork 
requirement. This notice also provides the public a second opportunity 
to comment on the paperwork burden of these regulatory requirements. 
The 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 July 24, 2003.

ADDRESSES: Submit written comments either by fax (202) 395-5806 or 
email ([email protected]) directly to the Office of Information 
and Regulatory Affairs, OMB, Attention: Desk Officer for the Department 
of the Interior (OMB Control Number 1010-0129). Mail or hand-carry a 
copy of your 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 that we have received your email, contact Ms. Gebhardt at 
(303) 231-3211.

FOR FURTHER INFORMATION CONTACT: Sharron L. Gebhardt, telephone (303) 
231-3211, FAX (303) 231-3781, email [email protected]. You may 
also contact Sharron Gebhardt to obtain a copy at no cost of the 
regulations that require the subject collection of information.

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 Department of the Interior (DOI) is responsible for 
matters relevant to mineral resource development on Federal and Indian 
lands and the Outer Continental Shelf (OCS). The Secretary of the 
Interior (Secretary) under the Mineral Leasing Act (MLA) (30 U.S.C. 
1923) and the OCS Lands Act (43 U.S.C. 1353) is responsible for 
managing the production of minerals from Federal and Indian lands and 
the OCS, collecting royalties from lessees who produce minerals, and 
distributing the funds collected in accordance with applicable 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 MLA, 30 U.S.C. 
192, for onshore leases and the OCS Lands Act, 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 involves 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's 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.

[[Page 37516]]

    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.
    MMS is requesting OMB's approval to continue to collect this 
information. Not collecting this information would limit the 
Secretary's ability to discharge his/her duties and may also result in 
loss of royalty payments. Proprietary information submitted is 
protected, and there are no questions of a sensitive nature included in 
this information collection.
    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'' 
to clarify the regulatory language.
    Frequency: 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 details the individual components and estimated 
hour burdens. In calculating the burdens, we assumed that respondents 
perform certain requirements in the normal course of their activities. 
Therefore, we consider these to be usual and customary and took that 
into account in estimating the burden.

                       Respondent Annual Burden Hour Chart--Royalty-in-Kind Pilot Projects
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                                                                   Burden hours    Annual number   Annual burden
                     Reporting requirements                        per response    of responses        hours
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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.
    Public Disclosure Statement: The PRA (44 U.S.C. 3501, et seq.) 
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.
    Comments: Section 3506(c)(2)(A) of the PRA requires each agency `` 
* * * to provide notice * * * and otherwise consult with members of 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.
    To comply with the public consultation process, we published a 
notice in the Federal Register on April 8, 2003 (68 FR 17075), 
announcing that we would submit this ICR to OMB for approval. The 
notice provided the required 60-day comment period. We received no 
comments in response to the notice.
    If you wish to comment in response to this notice, you may send 
your comments to the offices listed under the ADDRESSES section of this 
notice. OMB has up to 60 days to approve or disapprove the information 
collection but may respond after 30 days. Therefore, to ensure maximum 
consideration, OMB should receive public comments by July 24, 2003.
    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/InfoColl/InfoColCom.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 that 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

[[Page 37517]]

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: June 11, 2003.
Jan Bigelow,
Acting Associate Director for Minerals Revenue Management.
[FR Doc. 03-15891 Filed 6-23-03; 8:45 am]
BILLING CODE 4310-MR-P