[Federal Register Volume 70, Number 34 (Tuesday, February 22, 2005)]
[Proposed Rules]
[Pages 8556-8557]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-3252]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service

30 CFR Part 206

RIN 1010-AD00


Public Workshop on Proposed Rule--Establishing Oil Value for 
Royalty Due on Indian Leases

AGENCY: Minerals Management Service, Interior.

ACTION: Notice of public workshops.

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SUMMARY: The Minerals Management Service (MMS) is giving notice of 
public workshops concerning the valuation of crude oil produced from 
Indian oil and gas leases.

DATES: The public workshop dates are:
    Workshop 1: Oklahoma City, Oklahoma, on March 8, 2005, beginning at 
8:30 a.m. and ending at 2 p.m., central time.
    Workshop 2: Albuquerque, New Mexico, on March 9, 2005, beginning at 
8:30 a.m. and ending at 2 p.m., mountain time.
    Workshop 3: Billings, Montana, on March 16, 2005, beginning at 8:30 
a.m. and ending at 2 p.m., mountain time.

ADDRESSES: Public workshop locations:
    Workshop 1 will be held at the Sheraton Downtown in the Frontier 
Room, One North Broadway, Oklahoma City, Oklahoma 73102 (telephone 
number (405) 235-2780).
    Workshop 2 will be held at the Wyndham Albuquerque in the 
Bernalillo Room, 2910 Yale Boulevard SE., Albuquerque, New Mexico 87106 
(telephone number (505) 843-7000).
    Workshop 3 will be held at the Sheraton Billings Hotel in the 
Avalanche Room, 27 North 27th Street, Billings, Montana 59101 
(telephone number (406) 252-7400).

FOR FURTHER INFORMATION CONTACT: Mr. John Barder, Supervisory Mineral 
Revenue Specialist, Minerals Management Service, Minerals Revenue 
Management, Indian Oil and Gas Compliance and Asset Management, 
telephone (303) 231-3702, Fax (303) 231-3755, e-mail to 
[email protected], P.O. Box 25165, MS 396B2, Denver, Colorado 80225-
0165.

SUPPLEMENTARY INFORMATION: On February 12, 1998, MMS published a notice 
of proposed rulemaking regarding the value for royalty purposes of 
crude oil produced from Indian tribal and allotted leases. 63 FR 7089. 
On January 5, 2000, MMS published a supplementary proposed Indian oil 
valuation rule. 65 FR 403. Because of the substantial amount of time 
that has passed since the last proposal, and because of changes that 
have occurred since then in the market for crude oil, MMS has decided 
not to promulgate a final rule based on the previous proposed rules and 
comments received. Therefore, MMS is withdrawing both the proposed rule 
and the supplementary proposed rule, and is starting a new rulemaking 
process regarding the royalty valuation of crude oil produced from 
Indian leases.
    The record compiled for the February 1998 proposed rule and the 
January 2000 supplementary proposed rule, including comments submitted 
on those proposals, will not be part of the record of the new 
rulemaking. At this time, MMS has made no decisions regarding the 
content of a future proposed rule or any future final rule that may 
result from this process. A new proposed rule may or may not include 
provisions similar to prior proposals.
    The MMS has decided to gather preliminary comments and conduct 
preliminary consultation in anticipation of publishing a new proposed 
rule regarding Indian oil royalty valuation. The MMS is conducting the 
series of public workshops identified above for that purpose.
    Among other things, MMS specifically seeks public comment on the 
following issues:
    1. The MMS published amendments to the Federal crude oil valuation 
rule on May 5, 2004 (69 FR 24959). Should MMS adopt any of those same 
changes in the Indian oil valuation rule (e.g., using NYMEX prices 
adjusted for location and quality and for transportation costs for oil 
that is not sold at arm's length, and using 1.3 times the Standard & 
Poor's BBB bond rate as the rate of return on undepreciated capital 
investment in calculating non-arm's-length transportation costs)?
    2. The current Indian oil valuation rule provides that Amajor 
portion''

[[Page 8557]]

prices are to be calculated on the basis of the arm's-length sales in 
the field or area. Should MMS revise the rule to use arm's-length 
reported values for production from a reservation or other designated 
area?
    3. Should MMS collect information to use in the major portion 
calculations to distinguish the quality of the oil (e.g., sweet crude, 
sour crude, yellow wax crude, etc.)? The workshops will be open to the 
public in order to discuss the valuation of crude oil produced from 
Indian leases. We encourage members of the public to attend these 
meetings. Those wishing to make formal presentations should sign up to 
do so upon arrival. The sign-up sheet will determine the order of 
speakers.
    Executive Order 13175 requires the Federal Government to consult 
and collaborate with the Indian community (tribes and individual Indian 
mineral owners) in the development of Federal policies that impact the 
Indian community. The locations of the workshops were chosen to allow 
for increased participation by the Indian community. In addition, MMS 
will send out letters to various leaders in the Indian community 
advising them of, and encouraging them to participate in, the 
workshops.
    The workshops will be open to the public without advance 
registration. Public attendance may be limited to the space available. 
We encourage a workshop atmosphere, and members of the public are 
encouraged to participate. We will post the minutes from each workshop 
on our Web site at http://www.mrm.mms.gov. You may submit written 
comments to MMS following the workshops by regular mail to P.O. Box 
25165, MS 396B2, Denver, Colorado 80225-0165, by e-mail to 
[email protected], or through our Internet public comment system at 
http://ocsconnect.mms.gov.

    Dated: February 9, 2005.
Lucy Querques Denett,
Associate Director for Minerals Revenue Management.
[FR Doc. 05-3252 Filed 2-18-05; 8:45 am]
BILLING CODE 4310-MR-P