[Federal Register Volume 69, Number 112 (Thursday, June 10, 2004)]
[Notices]
[Pages 32606-32609]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-13162]


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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 1010-0104).

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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 ``30 CFR 
Part 206, Subpart E--Indian Gas, Sections 206.172, 206.173, and 
206.176, Accounting for Comparison [Dual Accounting] (Form MMS-4410).'' 
We changed the title of this ICR to clarify the regulatory language we 
are covering under 30 CFR part 206. The previous title was ``Accounting 
for Comparison (Dual Accounting) (Form MMS-4410).''

DATES: Submit written comments on or before August 9, 2004.

ADDRESSES: Submit written comments to Sharron L. Gebhardt, Lead 
Regulatory Specialist, Minerals Management Service, Minerals Revenue 
Management, P.O. Box 25165, MS 302B2, 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 
e-mail 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 e-mail, contact Ms. Gebhardt 
at (303) 231-3211.

FOR FURTHER INFORMATION CONTACT: Sharron L. Gebhardt, telephone (303) 
231-3211, FAX (303) 231-3781, or e-mail [email protected].

SUPPLEMENTARY INFORMATION: 
    Title: 30 CFR Part 206, Subpart E--Indian Gas, Sections 206.172, 
206.173, and 206.176, Accounting for Comparison [Dual Accounting] (Form 
MMS-4410).
    OMB Control Number: 1010-0104.
    Bureau Form Number: Form MMS-4410.
    Abstract: The Secretary of the U.S. Department of the Interior 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. The Secretary also has an Indian trust 
responsibility to manage Indian lands and seek advice and information 
from Indian beneficiaries. The MMS performs the royalty management 
functions and assists the Secretary in carrying out the Department's 
Indian trust responsibility. Applicable citations of the laws 
pertaining to mineral leases on Indian

[[Page 32607]]

lands include 25 U.S.C. 369d (Chapter 12--Lease, Sale or Surrender of 
Allotted or Unallotted Lands); 25 U.S.C. 2103 (Indian Minerals 
Development Act); and Public Law 97-451--Jan. 12, 1983 (Federal Oil and 
Gas Royalty Management Act of 1982).
    When a company or an individual enters into a lease to explore, 
develop, produce, and dispose of minerals from Federal or Indian lands, 
that company or individual agrees to pay the lessor a share (royalty) 
of the value received from production from the leased lands. The lease 
creates a business relationship between the lessor and the lessee. The 
lessee is required to report various kinds of information to the lessor 
relative to the disposition of the leased minerals. Such information is 
similar to data reported to private and public mineral interest owners 
and is generally available within the records of the lessee or others 
involved in developing, transporting, processing, purchasing, or 
selling of such minerals. The information collected includes data 
necessary to ensure that the royalties are paid appropriately.
    Proprietary information submitted to MMS under this collection is 
protected.
    The product valuation determination process is essential to 
ensuring that Indians receive payment on the proper value of the 
minerals being removed. Indian tribes and individual Indian mineral 
owners receive all royalties generated from their lands. The Indian 
tribal representatives have expressed concern that the Secretary 
properly ensures the correct royalty is received. Failure to collect 
the data described in this information collection could result in the 
under valuation of leased minerals.
    Most Indian leases contain the requirement to perform accounting 
for comparison (dual accounting) for gas produced from the lease. 
According to 30 CFR 206.176, dual accounting is the greater of the 
following two values:
    (1) The value of gas prior to processing less any applicable 
allowances, or
    (2) The combined value of residue gas and gas plant products 
resulting from processing the gas less any applicable allowances plus 
any drip condensate associated with the processed gas recovered 
downstream of the point of royalty settlement without resorting to 
processing, less applicable allowances.
    On August 10, 1999, MMS published a final rule titled ``Amendments 
to Gas Valuation Regulations for Indian Leases'' (64 FR 43506) with an 
effective date of January 1, 2000. This regulation applies to all gas 
produced from Indian oil and gas leases, except leases on the Osage 
Indian Reservation. The intent of the rule was to ensure that Indian 
mineral lessors receive the maximum revenues from mineral resources on 
their land, consistent with the Secretary's trust responsibility and 
with lease terms. The rule requires lessees to elect to perform either 
actual dual accounting under 30 CFR 206.176, or the alternative 
methodology for dual accounting under 30 CFR 206.173.

Form MMS-4410 Reporting Information

    Payors use Form MMS-4410, Accounting for Comparison (Dual 
Accounting), to certify that dual accounting was not required on an 
Indian lease and to make an election for actual or alternative dual 
accounting.
    In this information collection request, we are asking approval to 
continue using the Form MMS-4410 to clarify the lessee's justification 
for not performing dual accounting and for the lessee's separate 
election to use the actual or alternative dual accounting methodology.

Form MMS-4410, Part A, Certification for Not Performing Dual Accounting

    Form MMS-4410, Part A, requires lessees to identify the MMS-
designated areas where the leases are located and provide specific 
justification for not performing dual accounting. Part A is a one-time 
notification. To assist the lessees in identifying the reason(s) for 
not performing dual accounting, Part A lists acceptable reasons for not 
performing dual accounting including: (1) The lease terms do not 
require dual accounting; (2) none of the gas from the lease is ever 
processed; (3) gas has a Btu content of 1000 Btu's per cubic foot or 
less at lease's facility measurement point(s); (4) none of the gas from 
the lease is processed until after gas flows into a pipeline with an 
index located in an index zone; and (5) none of the gas from the lease 
is processed until after gas flows into a mainline pipeline not located 
in an index zone.

Form MMS-4410, Part B, Election to Perform Actual Dual Accounting or 
Alternate Dual Accounting

    Effective January 2002, we collected elections to perform actual 
dual accounting or alternative dual accounting from lessees on Part B, 
``Election to Perform Actual Dual Accounting or Alternate Dual 
Accounting.'' A lessee makes an election by checking either the actual 
or alternative dual accounting box for each MMS-designated area where 
its leases are located. Part B also includes lease prefixes within each 
MMS-designated area to assist lessees in making the appropriate 
election. The election to perform actual or alternative dual accounting 
applies to all of a lessee's Indian leases in each MMS-designated area. 
The first election on Part B to use the alternative dual accounting is 
effective from the time of election through the end of the following 
calendar year. Thereafter, each election to use the alternative dual 
accounting methodology must remain in effect for 2 calendar years. 
However, lessees may return to the actual dual accounting method only 
at the beginning of the next election period or with written approval 
of MMS and the tribal lessors for tribal leases, and MMS for Indian 
allotted leases in the MMS-designated area (30 CFR 206.173(a)).
    Frequency of Response: On occasion.
    Estimated Number and Description of Respondents: 370 payors of 
Indian gas royalties.
    Estimated Annual Reporting and Recordkeeping ``Hour'' Burden: 170 
hours.
    Since the previous renewal of this ICR, we have obtained more 
accurate estimates of the number of respondents and the time required 
to provide the information requested. There are approximately 370 
payors of Indian gas royalties. The form related to this ICR is only 
required if the payor wants to change their dual accounting election. 
We have adjusted the burden hours accordingly. We reviewed actual data 
from past years to project burden hours for future years. We estimate 
that we will receive 60 responses from 50 payors of Indian gas 
royalties. The following chart shows the estimated burden hours by CFR 
section and paragraph:

                                Respondents' Estimated Annual Burden Hours Chart
----------------------------------------------------------------------------------------------------------------
                                   Reporting or recordkeeping      Burden hours    Annual number   Annual burden
        30 CFR section                     requirement             per response    of responses        hours
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206.172(b)(1)(ii).............  How do I value gas produced from               4              25             100
                                 leases in an index zone?.

[[Page 32608]]

 
                                * * * (b) Valuing residue gas
                                 and gas before processing. (1)
                                 * * * (ii) Gas production that
                                 you certify on Form MMS-4410,
                                 Certification for Not
                                 Performing Accounting for
                                 Comparison (Dual Accounting),
                                 is not processed before it
                                 flows into a pipeline with an
                                 index but which may be
                                 processed later; * * *.
                                (Part A of revised Form MMS-      ..............  ..............  ..............
                                 4410).
206.173(a)(1).................  How do I calculate the                         2              35              70
                                 alternative methodology for
                                 dual accounting?.
                                (a) Electing a dual accounting    ..............  ..............  ..............
                                 method.
                                (1) * * * You may elect to        ..............  ..............  ..............
                                 perform the dual accounting
                                 calculation according to either
                                 Sec.   206.176(a) (called
                                 actual dual accounting), or
                                 paragraph (b) of this section
                                 (called the alternative
                                 methodology for dual
                                 accounting).
                                (Part B of revised Form MMS-      ..............  ..............  ..............
                                 4410).
206.173(a)(2).................  How do I calculate the                       See 206.173 (a)(1) above.
                                 alternative methodology for
                                 dual accounting?.
                                (a) Electing a dual accounting    ..............  ..............  ..............
                                 method..
                                * * *...........................  ..............  ..............  ..............
                                (2) You must make a separate      ..............  ..............  ..............
                                 election to use the alternative
                                 methodology for dual accounting
                                 for your Indian leases in each
                                 MMS-designated area.
                                * * *...........................  ..............  ..............  ..............
                                (Part B of revised Form MMS-      ..............  ..............  ..............
                                 4410).
206.176(b)....................  How do I perform accounting for              See 206.173 (a)(1) above.
                                 comparison?.
                                * * * (b) If you are required to  ..............  ..............  ..............
                                 account for comparison, you may
                                 elect to use the alternative
                                 dual accounting methodology
                                 provided for in Sec.   206.173
                                 instead of the provisions in
                                 paragraph (a) of this section.
                                (Part B of revised Form MMS-
                                 4410).
206.176(c)....................  How do I perform accounting for             See 206.172(b)(1)(ii) above.
                                 comparison?.
                                * * * (c) * * * If you do not     ..............  ..............  ..............
                                 perform above. dual accounting,
                                 you must certify to MMS that
                                 gas flows into such a pipeline
                                 before it is processed.
                                (Part A of revised Form MMS-      ..............  ..............  ..............
                                 4410).
                                                                 -----------------
      Totals..................  ................................  ..............              60             170
----------------------------------------------------------------------------------------------------------------

    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 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. Before submitting an ICR to OMB, PRA section 
3506(c)(2)(A) 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.
    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, and 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. The ICR also will 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 also will make copies of the comments 
available

[[Page 32609]]

for public review, including names and addresses of respondents, during 
regular business hours at our offices in Lakewood, Colorado. Upon 
request, we will withhold an individual respondent's home address from 
the public record, as 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 your request 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: Arlene Bajusz (202) 
208-7744.

    Dated: June 4, 2004.
Cathy J. Hamilton,
Acting, Associate Director for Minerals Revenue Management.
[FR Doc. 04-13162 Filed 6-9-04; 8:45 am]
BILLING CODE 4310-MR-P