[Federal Register Volume 70, Number 143 (Wednesday, July 27, 2005)]
[Proposed Rules]
[Pages 43349-43364]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-14103]


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DEPARTMENT OF AGRICULTURE

Forest Service

36 CFR Part 228

RIN 0596-AC20

DEPARTMENT OF THE INTERIOR

Bureau of Land Management

43 CFR Part 3160

[W0-610-411H12-24 1A]
RIN 1004-AD59


Onshore Oil and Gas Operations; Federal and Indian Oil and Gas 
Leases; Onshore Oil and Gas Order Number 1, Approval of Operations

AGENCIES: U.S. Forest Service, Agriculture; Bureau of Land Management, 
Interior.

ACTION: Joint proposed rule.

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SUMMARY: This proposed rule would revise existing Onshore Oil and Gas 
Order Number 1, which was published in the October 21, 1983, edition of 
the Federal Register. The Order provides the requirements necessary for 
the approval of all proposed oil and gas exploratory, development, or 
service wells on all Federal and Indian (except Osage tribe) onshore 
oil and gas leases, including leases where the surface is managed by 
the U.S. Forest Service (FS). It also covers most approvals necessary 
for subsequent well operations, including abandonment. The revision is 
necessary due to provisions of the 1987 Federal Onshore Oil and Gas 
Leasing Reform Act (Reform Act), legal opinions, court cases since the 
Order was issued, and other policy and procedural changes. The revised 
Order would address the submittal of a complete Application for Permit 
to Drill or Deepen package (APD), including a Drilling Plan, Surface 
Use Plan of Operations, evidence of bond coverage and Operator 
Certification.

DATES: Send your comments to reach the Bureau of Land Management (BLM) 
on or before August 26, 2005. The BLM and the FS will not necessarily 
consider any comments received after the above date during its decision 
on the proposed rule.

[[Page 43350]]


ADDRESSES: Mail: Director (630), Bureau of Land Management, Eastern 
States Office, 7450 Boston Boulevard, Springfield, VA 22153.
    Hand Delivery: 1620 L Street, NW., Suite 401, Washington, DC 20036.
    E-mail: [email protected]. Federal eRulemaking Portal: 
http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: James Burd at (202) 452-5017 or Ian 
Senio at (202) 452-5049 at BLM or Barry Burkhardt at (801) 625-5157 at 
the Forest Service. Persons who use a telecommunications device for the 
deaf (TDD) may contact these persons through the Federal Information 
Relay Service (FIRS) at 1-800-877-8339, 24 hours a day, 7 days a week.

SUPPLEMENTARY INFORMATION:

I. Public Comment Procedures
II. Background
III. Discussion of Proposed Rule
IV. Procedural Matters

I. Public Comment Procedures

A. How Do I File Comments?

    You may submit your comments by any one of several methods:
     You may mail your comments to: Director (630), Bureau of 
Land Management, Eastern States Office, 7450 Boston Boulevard, 
Springfield, Virginia 22153, Attention: RIN 1004-AD59.
     You may deliver comments to 1620 L Street NW., Suite 401, 
Washington, DC 20036.
     You may e-mail your comment to: [email protected] (Include ``Attn: AD59'' in the subject line).
    Please make your comments on the proposed rule as specific as 
possible, confine them to issues pertinent to the proposed rule, and 
explain the reason for any changes you recommend. Where possible, your 
comments should reference the specific section or paragraph of the 
proposal that you are addressing.
    The Department of the Interior and the FS may not necessarily 
consider or include in the Administrative Record for the final rule 
comments that we receive after the close of the comment period (see 
DATES) or comments delivered to an address other than those listed 
above (see ADDRESSES).

B. May I Review Comments Others Submit?

    BLM intends to post all comments on the internet. If you are 
requesting that your comment remain confidential, do not send us your 
comment at the direct internet address or the e-mail address because we 
immediately post all comments we receive on the internet. Also, 
comments, including names and street addresses of respondents, will be 
available for public review at the address listed under ``ADDRESSES: 
Personal or messenger delivery'' during regular business hours (7:45 
a.m. to 4:15 p.m.), Monday through Friday, except holidays.
    Individual respondents may request confidentiality, which we will 
honor to the extent allowable by law. If you wish to withhold your name 
or address, except for the city or town, you must state this 
prominently at the beginning of your comment. 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.

II. Background

    The regulations at 43 Code of Federal Regulations (CFR) part 3160, 
Onshore Oil and Gas Operations, in section 3164.1 provide for the 
issuance of Onshore Oil and Gas Orders to ``implement and supplement'' 
the regulations in part 3160. Also, 36 CFR 228.105 provides for the 
issuance of FS Onshore Orders or for the co-signing of Orders with BLM. 
Although they are not codified in the CFR, all onshore orders are 
issued using notice and comment rulemaking and, when issued in final 
form, apply nationwide to all Federal and Indian (except the Osage 
Tribe) onshore oil and gas leases. The table in 43 CFR 3164.1(b) lists 
existing Orders. This proposed rule would revise existing Onshore Oil 
and Gas Order Number 1 (the Order) which supplements primarily 43 CFR 
3162.3 and 3162.5. 43 CFR 3162.3 covers conduct of operations, 
applications to drill on a lease, subsequent well operations, other 
miscellaneous lease operations, and abandonment. Section 3162.5 covers 
environmental and safety obligations. The FS would adopt the Order 
which would supplement 36 CFR part 228 subpart E. The existing Order 
has been in effect since November 21, 1983. For further information, 
see the October 21, 1983 Federal Register at 48 FR 48916.

III. Discussion of the Proposed Rule

    There are four primary reasons the Order is being revised:
    1. The 1987 Reform Act, which amended the Mineral leasing Act, 30 
U.S.C. 181 et seq., included two significant changes affecting APD 
processing on Federal leases. The first important change is the 
addition of a provision for public notification of a proposed action 
before APD approval or substantial modification of the terms of a 
Federal lease.
    The second important change the Act made is the assignment of 
authority to the FS to approve and regulate the surface disturbing 
activity associated with oil and gas wells on National Forest System 
(NFS) lands. Where NFS lands are involved, a Surface Use Plan of 
Operations, included in an APD, is now approved by the FS. The FS also 
approves surface disturbing aspects of related and subsequent 
operations. The FS has actively participated in this revision, and is a 
cosigner of this Order. The Order would apply to FS review of oil and 
gas surface operations.
    2. In response to protests to two Resource Management Plans in 
April 1988, the Office of the Solicitor of the Department of the 
Interior issued two memorandums related to oil and gas issues. The 
first and most far-reaching (issued by the Associate Solicitor, Energy 
and Resources on April 1, 1988, titled ``Legal Responsibilities of BLM 
for Oil and Gas Leasing and Operations on Split Estate Lands''), 
concerned BLM responsibilities on Federal leases overlain by private 
surface (split-estate). In this memorandum the Solicitor's Office 
opined that the National Environmental Policy Act (NEPA), the 
Endangered Species Act (ESA), and the National Historic Preservation 
Act (NHPA) require BLM to regulate exploration, development, and 
abandonment on Federal leases on split-estate lands in essentially the 
same manner as a lease overlain by Federal surface. The memorandum also 
stated that while a private owner's wishes should be considered in 
decisions, they do not overrule requirements of these statutes and 
their implementing regulations.
    The second memorandum (issued by the Assistant Solicitor, Onshore 
Minerals, Division of Energy and Resources on April 4, 1988, titled 
``Legal Responsibilities of BLM for Oil and Gas Leasing and Operations 
under the National Historic Preservation Act'') lays out in more detail 
BLM's responsibilities under NHPA, elucidating further the discussion 
on cultural resources in the first opinion.
    The pertinent requirements of existing Order Number 1 do not fully 
conform to the memorandums issued by the Solicitor's Office in 1988.
    3. The existing Order does not adequately address BLM Rights-of-Way 
or FS Special Use Authorizations which are often required for off-lease 
facilities or those activities outside of lands committed to a unitized 
area. This has led to confusion and delays on the part

[[Page 43351]]

of both the agencies and industry. Under the existing Order, APD 
approval is often delayed pending completion and approval of a Right-
of-Way or Special Use Authorization. We intend for the proposal to 
eliminate or reduce this delay. The proposed rule provides for early 
identification of any needed Right-of-Way or Special Use Authorization, 
allows for conducting a single environmental analysis for the APD and 
Right-of-Way or Special Use Authorization, and permits concurrent 
approval of the Right-of-Way or Special Use Authorization with the APD. 
On NFS lands, the FS will approve off-lease activities directly related 
to the drilling and production of the well as part of the Surface Use 
Plan of Operations instead of through issuing a separate Special Use 
Authorization. Please specifically comment on the provisions in the 
proposal (see proposed Section V. Rights-of-Way (R/W) `` Special Use 
Authorization (SUA)) that would expedite Right-of-Way or Special Use 
Authorization approvals. We are interested in suggestions of other 
methods BLM and the FS could incorporate to expedite approval of energy 
projects.
    4. Existing Order Number 1 is over 20 years old. Conditions, 
regulations, policies, procedures, and requirements have been altered, 
added, and eliminated since the Order was issued. BLM is in the process 
of reviewing field office practices and the preliminary findings from 
that review were considered in the proposed revisions to the Order. BLM 
has reorganized the Order to follow the review and approval process and 
the processing timeframes for each step are now in one section. Also, 
split estate operations are discussed in more detail.
    BLM encourages operators to employ best management practices when 
they develop their APDs. Best management practices are innovative, 
dynamic, and economically feasible mitigation measures applied on a 
site-specific basis to reduce, prevent, or avoid adverse environmental 
or social impacts. BLM field offices incorporate appropriate best 
management practices into proposed APDs and associated on and off-lease 
Rights-of-Way approvals after required NEPA evaluation. They can then 
be included in approved APDs as Conditions of Approval. Typical best 
management practices can currently be found on BLM's Web site at http://www.blm.gov/nhp/300/wo310/O&G/Ops/operations.html.
    The following chart explains the major changes between the existing 
Order and the proposed Order.

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           Existing order                   Proposed order                      Substantive changes
----------------------------------------------------------------------------------------------------------------
Introduction.......................  I. Introduction............  The proposed rule would add a discussion of
                                     A. Authority...............   the authority for issuing Orders and the
                                                                   requirements of the Federal Onshore Oil and
                                                                   Gas Leasing Reform Act. The rule would
                                                                   eliminate the discussion of summary
                                                                   information related to other sections in this
                                                                   Order because they are redundant of this
                                                                   proposed section.
I. Accountability..................  IV. General Operating        The rule would revise the accountability items
                                      Requirements.                and special situations in the existing Order
                                                                   and move them to Section IV. General
                                                                   Requirements.
None...............................  I.B. Purpose...............  The rule would add a new section describing
                                                                   the purpose of the Order.
None...............................  I.C. Scope.................  The rule would add a short section describing
                                                                   the extent to which the Order applies.
None...............................  II. Definitions............  The rule would add a section that defines key
                                                                   terms to ensure consistent understanding of
                                                                   the terms. Terms that are defined in other
                                                                   regulations or Orders are not repeated here.
                                                                   The rule defines the meaning of ``Complete
                                                                   APD'' for clarification and to ensure
                                                                   consistent application of these terms. Please
                                                                   see the more detailed discussion below. The
                                                                   rule would also add a definition of the new
                                                                   ``Master Development Plan.'' Utilizing a
                                                                   Master Development Plan would provide for
                                                                   environmental analysis and approval of field
                                                                   development or multiple proposed wells as a
                                                                   single approval. ``Days'' are defined as
                                                                   calendar days. The existing Order uses both
                                                                   ``business days'' and ``calendar days.''
II. Special Situations.............  IV. General Operating        The rule would amend the accountability items
                                      Requirements.                and special situations in the existing Order
                                                                   and move them to Section IV. General
                                                                   Requirements.
A. Surveying and Staking...........  III.E. 1. Surveying,         The rule would move the Surveying and Staking
III. Drilling Operations...........   Staking, and Inventories.    provisions to Section III.E. and include new
                                                                   information related to more current surveying
                                                                   technology. Maps would be required in both
                                                                   paper and electronic geospatial database
                                                                   format. The rule also contains a provision
                                                                   that the operator make an effort to obtain
                                                                   approval from the surface owner before
                                                                   entering private lands. This provision does
                                                                   not require approval before entry, only a
                                                                   good faith effort to obtain approval.
B. Material to be Filed............  None.......................  The information in existing Section III.A.
1. Notice of Staking...............  III.F. Notice of Staking...   would be incorporated into proposed Sections
2. Application for Permit to Drill.                                III.E. Required Components of a Complete APD
                                                                   Package and III.F. Notice of Staking option
                                                                   is retained.
C. Conferences and Inspections.....  III.C.2. Processing........  The requirements for, and scheduling of,
D. Processing Time Frames..........                                onsite inspections and the overall processing
                                                                   timeframes would be incorporated into a new
                                                                   section on processing. The new section would
                                                                   consolidate all references to processing
                                                                   issues into one section.
E. Cultural Resources Clearance....  IV. General Operating        Information pertaining to cultural resources,
F. Threatened and Endangered          Requirements.                threatened and endangered species, watershed
 Species Clearance and Other                                       protection, and safety would be moved to
 Critical Environmental Concerns.                                  Section IV. General Operating Requirements.

[[Page 43352]]

 
G. Components of a Complete          III.E. Components of a       Some of the information contained in the first
 Application for Permit to Drill.     Complete ADP Package.        subsections of existing Section III.G. would
                                                                   be moved into the Drilling Plan (i.e., item
                                                                   3.e.) in the proposed Order and duplication
                                                                   eliminated. The requirements would be
                                                                   unchanged.
IV. Subsequent Operations..........  VIII. Subsequent Operations/ The rule would delete language in the existing
                                      Sundry Notice.               Order that addresses well conversions because
                                                                   it would be addressed in Section IX. of the
                                                                   proposed Order.
A. Production Facilities...........  None.......................  The rule would incorporate information
                                                                   relative to production facilities into other
                                                                   sections.
B. Other Operations................  VIII.A. Surface Disturbing   The rule would make minor editorial changes
                                      Operations.                  especially to incorporate FS approval of
                                                                   subsequent surface disturbing activities.
C. Emergency Repairs...............  VIII.B. Emergency Repairs..  There would be no substantive change to these
                                                                   provisions.
D. Environmental Review............  None.......................  The rule would delete this section since the
                                                                   information would be covered in proposed
                                                                   Section III.C.2. Processing.
V. Well-Abandonment................  XI. Abandonment............  The rule would divide this section into two
                                                                   subsections; A) Plugging and B) Reclamation.
                                                                   The rule would also incorporate additional
                                                                   information and make clearer the reclamation
                                                                   subsection.
None...............................  V. Rights-of-Way (R/W)--     The rule would add this section to explain
                                      Special Use Authorization    when the BLM or FS may require a Right-of-Way
                                      (SUA).                       or Special Use Authorization and how these
                                                                   authorizations would be incorporated into the
                                                                   APD approval process.
VI. Water Well Conversion..........  IX. Well Conversions.......  The rule would add a paragraph to address
                                                                   conversion to a class II injection well and
                                                                   would clarify the process to convert a well
                                                                   to a water well.
VII. Privately Owned Surface.......  VI. Operating on Lands with  This section would change the provisions
A. Federal oil and gas leases......   Private/State Surface and    regarding compensation to surface owners to
B. Indian oil and gas cases........   Federal or Indian Oil and    that which is required by the authority that
                                      Gas.                         granted the surface patent. It would
                                     VII. Leases for Indian Oil    incorporate the latest policy requiring a
                                      and Gas.                     statement from the operator regarding whether
                                                                   or not there is surface owner agreement. If
                                                                   the operator cannot reach an agreement with
                                                                   the surface owner, the operator must provide
                                                                   a bond for the benefit of the surface owner.
                                                                   The bond must must be sufficient to
                                                                   compensate the surface owner in an amount
                                                                   established by the original land patent or
                                                                   statute authorizing the patent.
VIII. Reports and Activities         None.......................
 Required After Well Completion.
                                     X. Variances...............  The rule would move the the requirements to
                                                                   submit completion or recompletion reports to
                                                                   Section IV. General Requirements.
                                     XII. Appeal Procedures.....
                                     The rule would add a new
                                      section to explain how an
                                      operator may request a
                                      variance from a
                                      requirement of the Order
                                      or a waiver, exemption, or
                                      modification of a lease
                                      stipulation and appeals
                                      from denials of those
                                      requests..
                                     The rule would add a new
                                      section to identify the
                                      various appeal processes
                                      and the timeframes
                                      associated with certain FS
                                      appeals. This section
                                      would also clarify that
                                      the incorporation of a FS
                                      approved Surface Use Plan
                                      of Operations into the
                                      approval of an APD is not
                                      subject to protest to BLM
                                      or appeal to IBLA..
----------------------------------------------------------------------------------------------------------------

Discussion of Major Changes

Definition of Complete APD

    The most significant change in the proposed rule is that it would 
eliminate the term ``Technically and Administratively Complete'' and 
replace it with a clear definition of ``Complete APD.'' This new 
definition is consistent with the common practice in many field offices 
and would require all field offices to adopt the same convention. The 
new definition would bring needed consistency to the approval process. 
BLM previously considered defining Administratively and Technically 
complete separately, but decided to abandon this distinction because of 
the difficulty in separating the two concepts and in potential delays 
that might be caused in processing APDs in certain circumstances.
    The Reform Act requires each APD (except on Indian lands) to be 
posted for public review for 30 days. BLM, and the Surface Managing 
Entity if appropriate, will post the required parts of the APD 
immediately after receiving the application, therefore the 30 days will 
commence immediately after the APD or Notice of Staking is filed. No 
decision can be made before the end of the 30 day posting period. This 
is not a change to existing practice. When possible, a copy will be 
posted electronically on the internet.
    Under the proposed process, BLM would review the APD package, 
consult with FS if appropriate, and within 10

[[Page 43353]]

days of the filing determine if the package contains all the documents 
and information sufficient and necessary for processing. If the APD 
package did not contain the minimum documentation and information, BLM 
or the FS would notify the operator about the deficiencies. If an 
incomplete package were to contain sufficient information to continue 
processing, BLM or the FS would process the package to the point where 
continued processing would either be impractical or impossible without 
additional information. Generally, a ``complete'' determination would 
follow after the applicant submits any additional material.
    Under the proposal, within 10 days of receiving an APD package or a 
Notice of Staking, BLM will establish a future date for an onsite 
inspection. Under the existing Order, the onsite is held within 15 days 
of filing. Under this proposal, BLM and/or the FS would hold the onsite 
inspection as soon as practical after filing. Providing more 
flexibility in scheduling the onsite inspection will allow BLM to take 
into account weather conditions and the availability of the operator 
and agency staff, as well as the surface owner if split estate is 
involved. It is both agencies' intent to hold the onsite as soon as 
possible and normally within 15 days after filing. The agencies 
recognize that conducting this event so soon after filing may be 
difficult, but we consider it, nevertheless, desirable and necessary.
    The proposal makes BLM, rather than the operator, responsible for 
inviting surface owners to participate in onsite inspections.
    BLM would initiate the review of the APD package as soon as 
practical after filing by the operator. Some deficiencies are difficult 
to detect and may not be evident until the onsite inspection. 
Therefore, a determination of completeness may be delayed beyond 10 
days after filing. Under this proposed Order, BLM may notify the 
operator of any remaining deficiencies and any other changes necessary 
within 7 days after the onsite inspection.
    The operator is encouraged to respond to BLM requests for 
additional information or to correct deficiencies within 45 days of the 
request. Faster response times by the operator will help to expedite 
the review process. BLM envisions that the operator may be asked for 
additional information on more than one occasion. The technical review 
of the APD package is made by many different specialists. In an effort 
to expedite the approval process, BLM will not wait to compile a 
complete list of all deficiencies in a particular application. Instead, 
BLM will provide requests for additional information to the operator as 
soon as BLM or FS staff identifies a specific deficiency. Waiting to 
notify the operator of separate issues may unnecessarily slow the 
approval process.
    Under the proposed Order, after the operator provides all requested 
information, BLM would determine if the package is complete, that is, 
that the data submitted is accurate, complete, meets BLM standards 
where applicable, and fully describes the proposed action. A complete 
package must contain the information listed in 43 CFR 3162.3-1 and 43 
CFR 3164.1, as appropriate, and the information this Order would 
require. A complete application does not include a cultural or wildlife 
inventory, NEPA documentation, or other materials that are not 
requirements of the sections cited above or in this Order. It is the 
policy of BLM and FS to begin the NEPA analysis and other inventories 
as soon as sufficient information is present to support the work.
    It is the intent of BLM and the FS to process APDs within 30 days 
after the APD package is complete. However, other regulatory 
requirements, such as those in the NEPA, NHPA, and ESA, may result in 
further delay. Neither BLM nor the FS can make a final decision on any 
APD or Surface Use Plan of Operations until these regulatory 
requirements are completed. Compliance in some cases may depend on 
actions taken by other agencies over which BLM and the FS have no 
administrative control. Therefore, neither BLM nor the FS can commit to 
processing all APDs within a given time, but intend to process all APDs 
within the minimum time necessary to meet all regulatory requirements. 
This is consistent with existing policy and practice. The existing 
Order, effective in 1983, says that ``the 30-day time frame for 
completion of the APD process may sometimes be exceeded where it is 
necessary to prepare an EA. * * *'' BLM did not routinely prepare EAs 
for each APD in 1983 because they were categorically excluded from NEPA 
analysis until 1992. We now conduct some form of NEPA analysis for all 
submitted APD packages. In addition, since the 1983 Order, NHPA and ESA 
requirements have become more extensive. With these added regulatory 
requirements, it is not realistic for BLM to commit to processing all 
APDs in 30 days.

Drilling and Surface Use Plans

    This proposal would make specific changes to the drilling and 
surface use plans as follows:
    The former 8-point Drilling Program (also referred to as the 
Subsurface Use Plan) would be replaced with a 9-point Drilling Plan. 
This proposal would expand the required description in the existing 
Order addressing the anticipated casing program, and add a new 
requirement to the Drilling Plan to address the type and amount of 
cement operators propose to use in setting each casing string.
    We would replace the former 13-point Surface Use Program (or Plan) 
with a 12-point Surface Use Plan of Operations. We would remove the 
former point 13 of the Surface Use Plan of Operations ``Operator 
Certification'' and make it a separate component of the APD package. 
This change makes it clear that the Operator Certification covers the 
entire APD package and not just the Surface Use Plan of Operations.
    The 13-point Surface Use Plan is currently codified in Forest 
Service Regulations at 36 CFR 228 Subpart E, Appendix A. Under this 
rule, Appendix A would be deleted. Although it would not be codified in 
36 CFR, section III.E. of the proposed Order would apply to surface use 
operations on NFS lands. That proposed section defines the components 
of a complete Surface Use Plan of Operations or Master Development 
Plan. The rule would also revise 36 CFR 228.105(a)(1) to direct 
operators to submit surface use plans or Master Development Plans in 
accordance with the proposed Order, or other applicable onshore orders.

Master Development Plans

    This proposal would establish a new approval process for multiple 
well proposals called a Master Development Plan. This process would be 
used by an operator to submit plans for field development or a multiple 
well program in lieu of several individual APDs.
    These proposals could be addressed in a single NEPA analysis and 
approval. This process would facilitate the consideration of cumulative 
effects early in the process and enable broad application of identified 
mitigation measures, while minimizing or significantly reducing the 
cumulative timeframe for approval. We also anticipate that this 
approval will lead to better planning of field development which will 
minimize adverse environmental impacts.
    The proposed rule envisions the APD as an application for a 
proposed action that is impacted by other analytical requirements such 
as the NHPA and the ESA. The documents other statutes require are not 
part of a complete APD package. This proposal also explains the 
approval process for certain subsequent

[[Page 43354]]

well operations. The revised Order would describe the relationship 
between the APD package and any application for an associated BLM 
Right-of-Way or FS Special Use Authorization that may be required. This 
Order would replace the 1983 Order incorporated by the FS into its oil 
and gas regulations.

Bonding

    This proposal would also clarify that BLM authority to require 
additional bond in 43 CFR 3104.5 applies to off-lease facilities 
required to further development of the lease, such as the large 
impoundments being created in Wyoming for produced water from Federal 
and nonfederal coalbed natural gas wells. BLM is obligated by the 
Reform Act to require sufficient bond to insure ``the restoration of 
any lands or surface waters adversely affected by lease operations 
after the abandonment or cessation of oil and gas operations on the 
lease'' 30 U.S.C. 226(g). An Assistant Solicitor's memorandum of July 
19, 2004, concluded that BLM has the authority to require additional 
bond for such facilities and that the current regulation does not limit 
BLM to increasing the required amount of an existing bond. Accordingly, 
the proposal does not represent a change in the regulatory scheme.
    Provisions in the final Order will supersede any inconsistent 
provisions of existing regulations, inasmuch as they will constitute a 
later exercise of Administrative Procedure Act rulemaking. To the 
maximum extent practical, we will identify such inconsistencies and 
include conforming amendments to titles 36 or 43, or both, of the CFR 
in the final rule.

IV. Procedural Matters

Executive Order 12866, Regulatory Planning and Review

    These proposed regulations are not a significant regulatory action 
and are not subject to review by Office of Management and Budget (OMB) 
under Executive Order 12866. OMB makes the final determination under 
the Executive Order. These proposed regulations will not have an effect 
of $100 million or more on the economy. They will not adversely affect 
in a material way the economy, productivity, competition, jobs, the 
environment, public health or safety, or state, local, or tribal 
governments or communities. These proposed regulations will not create 
a serious inconsistency or otherwise interfere with an action taken or 
planned by another agency. These proposed regulations do not alter the 
budgetary effects of entitlements, grants, user fees, or loan programs 
or the right or obligations of their recipients; nor do they raise 
novel legal or policy issues. The revisions this rule would make to the 
Order primarily involve changes to BLM and FS administrative processes. 
For example, changes to the term ``Administratively and Technically 
Complete'' only pertain to the process BLM and the FS would use to 
review APD packages and would not have any significant economic impact. 
Other changes, such as the proposal to add a provision for the use of a 
Master Development Plan, may improve processing and predictability of 
operations due to better advance planning of field development. 
Clarifying that our authority to require additional bond applies to 
off-lease facilities would have no economic impact since BLM already 
has the authority under the existing regulatory scheme to require this 
bond. Also, as a result of more clear rules, operators will have a 
better understanding of BLM and FS requirements, processes, and 
timelines leading to reduction in delays in processing and possible 
administrative cost savings for BLM, the FS, and operators.

Regulatory Flexibility Act

    Congress enacted the Regulatory Flexibility Act of 1980 (RFA), as 
amended, 5 U.S.C. 601-612, to ensure that Government regulations do not 
unnecessarily or disproportionately burden small entities. The RFA 
requires a regulatory flexibility analysis if a rule would have a 
significant economic impact, either detrimental or beneficial, on a 
substantial number of small entities. For the purposes of this 
analysis, we will assume that all entities (all lessees and operators) 
that may be impacted by these regulations are small entities.
    The rule principally deals with the requirements necessary for the 
approval of all proposed oil and gas exploratory, development, or 
service wells on all Federal and Indian (except Osage tribe) onshore 
oil and gas leases. These changes are not significantly different from 
the existing Order and primarily consist of changes to BLM and FS 
administrative processes that would not significantly impact operators 
or lessees. As a result of more clear rules, operators will have a 
better understanding of BLM and FS requirements, processes, and 
timelines leading to a reduction in delays in processing and some 
administrative cost savings for BLM, the FS, and operators. Therefore, 
BLM and the FS have determined that under the RFA this proposed rule 
would not have a significant economic impact on a substantial number of 
small entities.
    The use of best management practices in conditions of approval for 
a permit to drill is not new. BLM currently uses them as conditions of 
approval and therefore this provision will have no economic impact on 
small entities.
    The bonding provision in the rule would not impact small entities 
since the provisions merely reflect existing authority. As stated 
earlier, an Assistant Solicitor's opinion of July 19, 2004, concluded 
that BLM has the authority to require additional bond for such 
facilities and that the current regulation does not limit BLM to 
increasing the required amount of an existing bond. Accordingly, the 
proposal does not represent a change in the regulatory scheme.

Small Business Regulatory Enforcement Fairness Act

    These proposed regulations are not a ``major rule'' as defined at 5 
U.S.C. 804(2). For the reasons stated in the RFA discussion, this 
proposed rule would not have an annual effect on the economy greater 
than $100 million; it would not result in major cost or price increases 
for consumers, industries, government agencies, or regions; and it 
would not have significant adverse effects on competition, employment, 
investment, productivity, innovation, or the ability of U.S.-based 
enterprises to compete with foreign-based enterprises.

Unfunded Mandates Reform Act

    These proposed regulations do not impose an unfunded mandate on 
state, local, or tribal governments or the private sector of more than 
$100 million per year; nor do these proposed regulations have a 
significant or unique effect on state, local, or tribal governments or 
the private sector. This proposed rule would primarily involve changes 
to BLM's and the FS's administrative processes that would not have any 
significant effect monetarily, or otherwise, on the entities listed. 
Therefore, BLM and the FS are not required to prepare a statement 
containing the information required by the Unfunded Mandates Reform Act 
(2 U.S.C. 1531 et seq.).

Executive Order 12630, Governmental Actions and Interference With 
Constitutionally Protected Property Rights (Takings)

    The proposed rule does not represent a government action capable of 
interfering with constitutionally protected property rights. This 
proposed rule has no potential to effect property rights as the changes 
it would make to

[[Page 43355]]

existing procedures primarily involve changes to BLM's and the FS's 
administrative processes. Therefore, the Department of the Interior and 
the Department of Agriculture have determined that the rule would not 
cause a taking of private property or require further discussion of 
takings implications under this Executive Order.

Executive Order 13132, Federalism

    The proposed rule will not have a substantial direct effect on the 
states, on the relationship between the national government and the 
states, or on the distribution of power and responsibilities among the 
various levels of government. The proposal will not have any effect on 
any of the items listed. As stated above, the rule principally deals 
with the requirements necessary for the approval of all proposed oil 
and gas exploratory, development, or service wells on all Federal and 
Indian (except Osage tribe) onshore oil and gas leases. In other words, 
the rule affects the relationship between operators, lessees, and BLM 
and the FS and would not impact states. Therefore, in accordance with 
Executive Order 13132, BLM has determined that this proposed rule does 
not have sufficient Federalism implications to warrant preparation of a 
Federalism Assessment.

Executive Order 13175, Consultation and Coordination With Indian Tribal 
Governments

    BLM approves proposed operations on all Indian (except Osage) 
onshore oil and gas leases and agreements. BLM has begun consultation 
on the proposed revisions to the Order and will continue to consult 
with Tribes during the formal comment period on the rule.

Executive Order 12988, Civil Justice Reform

    Under Executive Order 12988, the Office of the Solicitor has 
determined that this proposed rule would not unduly burden the judicial 
system and that it meets the requirements of sections 3(a) and 3(b)(2) 
of the Order. We have reviewed these regulations to eliminate drafting 
errors and ambiguity. They have been written to minimize litigation, 
provide clear legal standards for affected conduct rather than general 
standards, and promote simplification. Drafting the regulations in 
clear language and working closely with legal counsel assists in all of 
these areas.

Paperwork Reduction Act

    These regulations contain information collection requirements. As 
required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et 
seq.), we submitted a copy of the proposed information collection 
requirements to the OMB for review. The OMB approved the information 
collection requirements under Control Number 1004-0137, which expires 
on March 31, 2007.

National Environmental Policy Act

    BLM and the FS have prepared an environmental assessment (EA) and 
have found that the proposed rule would not constitute a major Federal 
action significantly affecting the quality of the human environment 
under section 102(2)(C) of the NEPA, 42 U.S.C. 4332(2)(C). A detailed 
statement under NEPA is not required. BLM has placed the EA and the 
Finding of No Significant Impact on file in the BLM Administrative 
Record at the address specified in the ADDRESSES section.
    The proposed revisions to Order 1 would not impact the environment 
significantly. For the most part, the revisions would involve changes 
to BLM's and the FS's administrative processes. For example, replacing 
the term ``Administratively and Technically Complete'' with the term 
``Complete APD'' only changes the process BLM would use to review APD 
packages and would not have any impact on the environment whatsoever. 
Other changes, such as the proposal to add provisions for the use of a 
Master Development Plan, may actually provide improved environmental 
protection due to better advance planning of field development. The use 
of best management practices can lead to reduced environmental damage. 
Also, the procedural and clarifying changes would have no meaningful 
impact of any kind on the physical or economic environment. Any 
environmental effects of APDs on Federal lands are analyzed on a case-
by-case basis.

Executive Order 13211, Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use

    In accordance with Executive Order 13211, BLM has determined that 
the proposed rule will not have substantial direct effects on the 
energy supply, distribution or use, including a shortfall in supply or 
price increase. This rule would clarify the administrative processes 
involved in approving an APD and more clearly lay out the timeline for 
processing applications. It is not clear to what extent clarification 
of the rules will save BLM, the FS, or operators administrative cost, 
but we anticipate that the cost savings will be minimal, as will any 
direct effects on the energy supply, distribution or use.

Clarity of the Regulations

    Executive Order 12866 requires each agency to write regulations 
that are simple and easy to understand. We invite your comments on how 
to make these proposed regulations easier to understand, including 
answers to questions such as the following:
    1. Are the requirements in the proposed regulations clearly stated?
    2. Do the proposed regulations contain technical language or jargon 
that interferes with their clarity?
    3. Does the format of the proposed regulations (grouping and order 
of sections, use of headings, paragraphing, etc.) aid or reduce their 
clarity?
    4. Would the regulations be easier to understand if they were 
divided into more (but shorter) sections?
    5. Is the description of the proposed regulations in the 
SUPPLEMENTARY INFORMATION section of this preamble helpful in 
understanding the proposed regulations? How could this description be 
more helpful in making the proposed regulations easier to understand?
    Please send any comments you have on the clarity of the regulations 
to the address specified in the ADDRESSES section.

Authors

    The principal authors of this rule are: James Burd of the BLM 
Washington Office; Bo Brown of the BLM Alaska State Office; Brian 
Pruiett of the BLM Buffalo, Wyoming Field Office; Gary Stephens of the 
BLM New Mexico State Office; Hank Szymanski of the BLM Colorado State 
Office; Howard Clevinger of the BLM Vernal, Utah Field Office; Roy 
Swalling of the Montana State Office; and Barry Burkhardt of the FS 
Intermountain Regional Office, Ogden, Utah, and assisted by the staff 
of BLM's Regulatory Affairs Group and the Department of the Interior's 
Office of the Solicitor.

List of Subjects

36 CFR Part 228

    Environmental protection; Mines; National forests; Oil and gas 
exploration; Public lands-mineral resources; Public lands-rights-of-
way; Reporting and recordkeeping requirements; Surety bonds; Wilderness 
areas.

43 CFR part 3160

    Administrative practice and procedure; Government contracts; 
Indians-lands; Mineral royalties; Oil and gas exploration; Penalties; 
Public lands-

[[Page 43356]]

mineral resources; Reporting and recordkeeping requirements.

36 CFR Chapter II

    For the reasons set out in the joint preamble, the FS proposes to 
amend 36 CFR part 228 as follows:

PART 228--MINERALS

    1. The authority citation for part 228 continues to read as 
follows:

    Authority: 30 Stat. 35 and 36, as amended (16 U.S.C. 478, 551); 
41 Stat. 437, as amended, sec. 5102(d), 101 Stat. 1330-256 (30 
U.S.C. 226); 61 Stat. 681, as amended (30 U.S.C. 601); 61 Stat. 914, 
as amended (30 U.S.C. 352); 69 Stat. 368, as amended (30 U.S.C. 
611); and 94 Stat. 2400.

    2. Revise Sec.  228.105(a)(1) to read as follows:


Sec.  228.105  Issuance of onshore orders and notices to lessees.

    (a) * * *
    (1) Operators shall submit surface use plans of operations or 
Master Development Plans in accordance with the applicable Onshore Oil 
and Gas Order. Approval of a Master Development Plan constitutes 
approval of any surface use plan of operations submitted as a part of, 
or consistent with, the approved Master Development Plan.
* * * * *
    3. Revise Sec.  228.107(c) to read as follows:


Sec.  228.107  Review of surface use plan of operations.

* * * * *
    (c) The authorized Forest officer will give public notice of the 
decision on a plan and include in that notice whether the decision may 
be appealed under the applicable Forest Service appeal procedures.
* * * * *

Appendix A to Subpart E of Part 228 [Removed]

    4. Remove Appendix A to Subpart E of Part 228.

    Dated: August 26, 2004.
Sally D. Collins,
Acting Chief, USDA--Forest Service.

    Editorial Note: This document was received at the Office of the 
Federal Register on July 13, 2005.

43 CFR Chapter II

    For the reasons set out in the joint preamble, the Bureau of Land 
Management proposes to amend 43 CFR part 3160 as follows:

PART 3160--ONSHORE OIL AND GAS OPERATIONS

    1. The authority citation for part 3160 continues to read as 
follows:

    Authority: 25 U.S.C. 396d and 2107; 30 U.S.C. 189, 306, 359, and 
1751; and 43 U.S.C. 1732(b), 1733, and 1740.

    2. Amend Sec.  3164.1(b) by revising the first entry in the chart 
as follows:


Sec.  3164.1  Onshore Oil and Gas Orders.

* * * * *
    (b) * * *

----------------------------------------------------------------------------------------------------------------
                                                                                          Federal
          Order No.                        Subject                 Effective date        Register     Supersedes
                                                                                         reference
----------------------------------------------------------------------------------------------------------------
1............................  Approval of operations.........  [insert 60 days       70 FR * * *...  NTL-6
                                                                 after date of
                                                                 publication of
                                                                 final rule].
----------------------------------------------------------------------------------------------------------------

* * * * *

Appendix--Text of Oil and Gas Onshore Order

    Note --This appendix will not appear in the BLM regulations in 
43 Code of Federal Regulations.

    Dated: August 26, 2004.
Rebecca W. Watson,
Assistant Secretary, Land and Minerals Management.


    Editorial Note: This document was received at the Office of the 
Federal Register on July 13, 2005.
    The following Order would be implemented by the BLM and FS, but 
will not be codified in the Code of Federal Regulations.

Onshore Oil and Gas Order Number 1

Approval of Operations

I. Introduction
    A. Authority
    B. Purpose
    C. Scope
II. Definitions
III. Application for Permit to Drill (APD)
    A. Where to File
    B. Early Notification
    C. APD Posting and Processing
    D. Valid Period of Approved APD
    E. Components of a Complete APD Package
    F. Notice of Staking Option
    G. Approval of APDs
IV. General Operating Requirements
V. Rights-of-Way and Special Use Authorizations
VI. Operating on Lands with Private/State Surface and Federal or 
Indian Oil and Gas
VII. Leases for Indian Oil and Gas
    A. Approval of Operations
    B. Surface Use
VIII. Subsequent Operations and Sundry Notices
    A. Surface Disturbing Operations
    B. Emergency Repairs
IX. Well Conversions
X. Variances
XI. Abandonment
    A. Plugging
    B. Reclamation
XII. Appeal Procedures
Attachment I--Sample Format for Notice of Staking

Onshore Oil and Gas Order Number 1

Approval of Operations

I. Introduction

A. Authority

    The Secretaries of the Interior and Agriculture have authority 
under various Federal and Indian mineral leasing laws, as defined in 
30 U.S.C. 1702, to manage oil and gas operations. The Secretary of 
the Interior has delegated this authority to the BLM, which has 
issued onshore oil and gas operating regulations codified at part 
3160 of Title 43 of the Code of Federal Regulations. The operating 
regulations at 43 CFR 3164.1 authorize BLM's Director to issue 
Onshore Oil and Gas Orders when necessary to implement and 
supplement the operating regulations. The section also states that 
all such Orders are binding on the operator(s) of Federal and Indian 
onshore oil and gas leases (except the Osage Tribe). For leases on 
Indian lands, the delegation to BLM appears at 25 CFR parts 211, 
212, 213, 225, and 227.
    The Secretary of Agriculture has authority under the Federal 
Onshore Oil and Gas Leasing Reform Act of 1987 (Pub. L. 100-203) 
(Leasing Reform Act) to regulate surface disturbing activities on 
NFS lands. This authority has been delegated to the FS. Its 
regulatory authority is at Title 36 CFR, Chapter II, including, but 
not limited to, part 228 Subpart E, part 251 Subpart B, and part 
261. Section 228.105 of 36 CFR authorizes the Chief of the FS to 
issue, or cosign with the Director, BLM, Onshore Oil and Gas Orders 
necessary to implement and supplement the operating regulations. The 
FS is responsible only for approving and administering surface 
disturbing activities on NFS lands and appeals related to FS 
decisions or approvals.

B. Purpose

    The purpose of this Order is to state the application 
requirements for the approval of all proposed oil and gas and 
service wells, certain subsequent well operations, and abandonment.

C. Scope

    This Order applies to all onshore leases of Federal and Indian 
oil and gas (except those of the Osage Tribe), and Federally-
approved

[[Page 43357]]

unit or communitization agreements. It also applies to Indian 
Mineral Development Act agreements. References in this Order to 
leases means unit or communitization agreements, as applicable.

II. Definitions

    As used in this Order, the following definitions apply:
    Blooie Line means a discharge line used in conjunction with a 
rotating head in drilling operations when air or gas is used as the 
circulating medium.
    Complete APD means that BLM and the Surface Managing Entity, if 
appropriate, have determined that the information in the APD package 
is accurate and addresses all BLM requirements. The APD package must 
contain:
     A completed Form 3160-3 (Application for Permit to 
Drill or Reenter) (see 43 CFR 3162.3-1(d)),
     A well plat certified by a registered surveyor with a 
surveyor's original stamp (see Section III.E.1. of this Order),
     A Drilling Plan (see 43 CFR 3162.3-1(d) and Section 
III.E.2. of this Order),
     A Surface Use Plan of Operations (see 43 CFR 3162.3-
1(d) and Section III.E.3. of this Order),
     Evidence of bond coverage (see 43 CFR 3162.3-1(d) and 
Section III.E.5. of this Order),
     Operator certification (see Section III.E.6. of this 
Order),
     An original signature, which may be an electronic 
signature that meets BLM standards (see Section III.E.6. of this 
Order), and
     Other information that may be required by Order or 
Notice (see 43 CFR 3162.3-1(d)(4)).
    All maps and plats required as part of the APD must be submitted 
in both hard copy and geospatial database formats. BLM or the 
Surface Managing Entity, as appropriate, will review the APD package 
and determine that all information in the drilling plan, the surface 
use plan of operations, bonding requirements, and other information 
that BLM may require (43 CFR 3162.3-1(d)(4)), including the well 
location plat and geospatial databases, completely describe the 
proposed action. A complete APD is not defined to include cultural, 
wildlife, or other inventories that may be required or an 
environmental assessment or environmental impact statement that may 
be required by the NEPA.
    Condition of Approval (COA) means a site-specific requirement 
included in an approved APD or Sundry Notice that may limit or amend 
the specific actions proposed by the operator. Conditions of 
Approval minimize, mitigate, or prevent impacts to public lands or 
other resources. Best management practices may be incorporated as a 
Condition of Approval.
    Days means all calendar days including holidays.
    Drilling Plan means those documents an operator submits as part 
of an APD package or as a supplement to an approved plan of 
operations detailing the proposed drilling operations and containing 
the information required by 43 CFR 3160 and applicable Orders.
    Emergency Repairs means actions necessary to correct an 
unforeseen problem that could cause or threaten immediate 
substantial adverse impact on public health and safety or the 
environment.
    Geospatial Database means a set of georeferenced computer data 
that contains both spatial and attribute data. The spatial data 
defines the geometry of the object and the attribute data defines 
all other characteristics.
    Indian lands means any lands or interest in lands of an Indian 
tribe or an Indian allottee held in trust by the United States or 
which is subject to Federal restriction against alienation.
    Indian Oil and Gas means any oil and gas interest of an Indian 
tribe or on allotted lands where the interest is held in trust by 
the United States or is subject to Federal restrictions against 
alienation. It does not include minerals subject to the provisions 
of section 3 of the Act of June 28, 1906 (34 Stat. 539), but does 
include oil and gas on lands administered by the United States under 
section 14(g) of Public Law 92-203, as amended.
    Master Development Plan means information common to multiple 
planned wells, including drilling plans, surface use plans of 
operations, and plans for future production.
    National Forest System Lands means those Federal lands 
administered by the U.S. Forest Service, such as the National 
Forests and the National Grasslands.
    Onsite Inspection means an inspection of the proposed drill pad, 
access road, flowline route, and any associated Right-of-Way or 
Special Use Authorization needed for support facilities, conducted 
before the approval of the APD or Surface Use Plan of Operations and 
construction activities.
    Reclamation means returning disturbed land as near to its 
predisturbed condition as is reasonably practical.
    Split Estate means lands where the surface is owned by an entity 
or person other than the owner of the Federal or Indian oil and gas.
    Surface Managing Entity means any Federal or state agency having 
jurisdiction over the surface, or a private owner of the surface, 
overlying Federal or Indian oil and gas.
    Variance means an approved alternative to a provision or 
standard of an Order, Notice to Lessee, or other requirement (see 43 
CFR 3101.1-4).

III. Application for Permit To Drill (APD)

    An Application for Permit to Drill or Reenter (APD), on Form 
3160-3, is required for each proposed well, and for reentry and 
deepening of existing wells (including disposal and service wells), 
to develop an onshore lease for Federal or Indian oil and gas.

A. Where To File

    The operator must file an APD, Sundry Notice, or other required 
document in the BLM field office having jurisdiction over the lands 
described in the application. As an alternative to filing in a local 
BLM office, an operator may file an APD using BLM's electronic 
commerce application for oil and gas permitting and reporting. 
Contact the local BLM field office for details before using the 
electronic commerce application.

B. Early Notification

    The operator should contact BLM and any applicable Surface 
Managing Entity, including all private surface owners, to request an 
initial planning conference as soon as the operator has identified a 
potential area of development. Early notification is voluntary, but 
it allows the involved Surface Managing Entity to apprise the 
prospective operator of any unusual conditions on the lease area. 
Early notification also provides both the Surface Managing Entity 
and the prospective operator with the earliest possible 
identification of time-sensitive requirements and determination of 
potential areas of conflict. The prospective operator should have a 
map of the proposed project available for Surface Managing Entity 
review to determine if a cultural or wildlife inventory or other 
information may be required.

C. APD Posting and Processing

1. Posting

    The Mineral Leasing Act, 30 U.S.C. 181 et seq., as amended, 
requires BLM and the Federal Surface Managing Entity, if other than 
BLM, to provide at least 30 days public notice before BLM or the FS 
may approve an APD or Master Development Plan on a Federal oil and 
gas lease. Posting is not required for Indian leases.
    BLM will post the APD notice in an area of the BLM field office 
having jurisdiction that is readily accessible to the public and, 
when possible, electronically on the internet. If the surface is 
managed by a Federal agency other than BLM, that agency also is 
required to post the notice for 30 days. The posted notice is for 
informational purposes only and is not an appealable decision. The 
purpose of the posting is to give any interested party notification 
that a Federal approval of mineral development has been requested. 
BLM or the FS will not post confidential information.
    If the operator subsequently moves the proposed location of the 
well, reposting of the proposal for an additional 30-day period may 
be necessary if BLM or the FS determines that the change is 
significant.

2. Processing

    The timeframes established in this subsection apply to both 
individual APDs and to the multiple APDs included in Master 
Development Plans.
    (a) Within 10 days of receiving an APD package, BLM, in 
consultation with the FS, if appropriate, will notify the operator 
as to whether or not the APD is complete and will request additional 
information and correction of any deficiencies if necessary. If 
there is enough information to begin processing the APD package, BLM 
and the FS will do so up to the point that missing information or 
uncorrected deficiencies renders further processing impractical or 
impossible. The operator has 45 days after receiving notice from BLM 
to provide any additional information requested or the APD may be 
returned to the operator.

[[Page 43358]]

    (b) Within 10 days of receiving the APD package, BLM, in 
coordination with the operator and Surface Managing Entity 
(including, in the case of split estate, the private surface 
owners), if appropriate, will schedule a future date for the onsite 
inspection unless the onsite inspection was held as part of the 
Notice of Staking (see Section III.F. of this Order). The onsite 
inspection will be held as soon as practicable based on schedules 
and weather conditions. Within 7 days of the onsite inspection, BLM, 
and the FS if appropriate, will notify the operator that the APD is 
complete or that additional information is required to make the APD 
complete.
    The operator has 45 days after receiving notice from BLM or the 
FS to submit additional information or correct deficiencies noted 
during or after the onsite inspection. BLM may return the APD 
without taking action if any additional information is not received 
or deficiencies are not corrected within that period. Within 7 days 
of receiving requested information, BLM will notify the operator if 
the APD is complete.
    (c) Once the APD or the Master Development Plan is complete, BLM 
and the FS will expeditiously review and process the APD or Master 
Development Plan. Neither BLM nor the FS can make a final decision 
on any APD, Master Development Plan, or Surface Use Plan of 
Operations until the regulatory requirements of the Endangered 
Species Act, the National Historic Preservation Act, and the 
National Environmental Policy Act have been satisfied.
    (d) For APDs on NFS lands, the decision to approve a Surface Use 
Plan of Operations or Master Development Plan may be subject to the 
current applicable FS appeal procedures and may take up to 105 days 
from the date of the decision before that decision can be 
implemented.
    BLM does not approve Surface Use Plans of Operations for 
National Forest Service lands. The FS notifies BLM of its Surface 
Use Plan of Operations approval and BLM proceeds with its APD 
review.

D. Valid Period of Approved APD

    1. An APD approval is valid for 1 year from the date that it is 
approved, or until lease expiration, whichever occurs sooner. Lease 
suspension will not extend the 1 year APD approval period. If the 
operator submits a written request before the expiration of the 
original approval, BLM in coordination with the FS, as appropriate, 
may extend the APD's validity for up to 1 additional year.
    2. If no drilling occurs during the original or extended 
periods, the APD expires. If the operator later decides to drill a 
well, it must submit a new APD package for approval. The operator 
cannot start drilling operations if the APD has expired. The 
operator is responsible for reclaiming any surface disturbance that 
resulted from its actions, even if a well was not drilled.

E. Components of a Complete APD Package

    Best management practices help to minimize the footprint of 
energy development. The BLM has developed a best management 
practices policy that includes smart, up-front planning and good 
implementation to reduce short- and long-term environmental impacts 
to public and private resources. Best management practices are 
voluntary unless they have been analyzed as mitigation measures in 
the NEPA process for a plan of development, APD, right-of-way, or 
other related facility and included as a Condition of Approval for 
an APD. Operators are encouraged to incorporate best management 
practices into their APDs because they can result in reduced 
processing times and appeals, protests, and litigation.
    An APD package must include a completed Form 3160-3 and the 
following information that technical specialists of the appropriate 
agency will review to determine its technical adequacy:

1. Surveying, Staking, and Inventories

    (a) Surveying, staking, and inventories are necessary casual 
uses, typically involving negligible surface disturbance, and may be 
done without advance approval from the Surface Managing Entity, 
except for:
     Lands administered by the Department of Defense,
     Other lands used for military purposes,
     Indian lands, or
     Where more than negligible surface disturbance is 
likely to occur.
    No entry on private lands for surveying, staking, and 
inventories should occur without the operator first making an effort 
to obtain approval from the surface owner. Also, operators are 
encouraged to notify BLM or FS, as appropriate, before entering the 
lands.
    Typical off-road vehicular use, when conducted in conjunction 
with these activities, will not cause the activity to be considered 
more than casual use because it is a necessary action for obtaining 
a permit for a regulated activity.
    Operators must include in the APD package a well location plat 
prepared by a registered surveyor depicting the proposed location of 
the well and identifying the points of control and datum used to 
establish the section lines or metes and bounds. The purpose of this 
plat is to ensure that operations are within the boundaries of the 
lease/agreement and that the depiction of these operations is 
accurately recorded both as to location (latitude and longitude) and 
in relation to the surrounding lease/agreement boundaries (public 
land survey corner and boundary ties). The registered surveyor 
should coordinate with the cadastral survey section of the 
appropriate BLM State Office, particularly where the lands have not 
been surveyed under the Rectangular Survey System.
    The plat and geospatial database must describe the location of 
operations in:
     Geographical coordinates referenced to the National 
Spatial Reference System, North American Datum 1983, and
     In feet and direction from the nearest two adjacent 
section lines, or, if not within the Rectangular Survey System, the 
nearest two adjacent property lines, generated from BLM's current 
Geographic Coordinate Data Base.
    The surveyor who prepared the plat must sign it, certifying that 
the location has been staked on the ground as shown on the plat.
    (b) The operator is responsible for making access arrangements 
with the appropriate Surface Managing Entity (other than BLM and FS) 
before surveying, staking, conducting inventories, or for other 
purposes. On allotted Indian lands, the operator must contact the 
appropriate Area Office of the Bureau of Indian Affairs (BIA) to 
make access arrangements.
    (c) Staking of the proposed drill pad must include:
     The well location,
     Two 200-foot (61-meter) directional reference stakes,
     The exterior pad dimensions,
     The reserve pit,
     Cuts and fills,
     Outer limits of the area to be disturbed (catch 
points), and
     Any off-location facilities.
    All surface disturbances that will result from construction of 
ancillary facilities must also be staked. Proposed new roads require 
centerline flagging with stakes clearly visible from one to the 
next. In rugged terrain, cut and fill staking and/or slopestaking of 
proposed new access roads and locations for ancillary facilities may 
be necessary, as determined by BLM or the FS.
    (d) The onsite inspection will not occur until the required 
surveying and staking is complete, and any new access road(s) have 
been flagged, unless a variance is first granted under Section X. of 
this Order.

2. Drilling Plan

    With each copy of Form 3160-3 the operator must submit to BLM 
either a Drilling Plan or reference a previously approved field-wide 
drilling plan. These plans must be in sufficient detail to permit a 
complete appraisal of the technical adequacy of, and environmental 
effects associated with, the proposed project. The Drilling Plan 
must adhere to the provisions and standards of Onshore Oil and Gas 
Order Number 2 (see 53 FR 46790) (Order 2) and, if applicable, 
Onshore Oil and Gas Order Number 6 (see 55 FR 48958) (Order 6), and 
must include the following information:
    a. Names and estimated tops of all geologic groups, formations, 
members, or zones.
    b. Estimated depth and thickness of formations, members, or 
zones potentially containing usable water, oil, gas, or 
prospectively valuable deposits of other minerals that the operator 
expects to encounter, and the operator's plans for protecting such 
resources.
    c. The operator's minimum specifications for blowout prevention 
equipment and diverter systems to be used, including size, pressure 
rating, configuration, and the testing procedure and frequency. 
Blowout prevention equipment must meet the minimum standards 
outlined in Order 2.
    d. The operator's proposed casing program, including size, 
grade, weight, type of thread and coupling, the setting depth of 
each string, and its condition. The operator must include the 
minimum design criteria, including casing loading assumptions and 
corresponding safety factors for burst, collapse, and tensions (body 
yield, and joint

[[Page 43359]]

strength). The operator must also include the lengths and setting 
depth of each casing when a tapered casing string is proposed. The 
hole size for each section of hole drilled must be included. Special 
casing designs such as the use of coiled tubing or expandable casing 
may necessitate additional information.
    e. The estimated amount and type(s) of cement expected to be 
used in the setting of each casing string. If stage cementing will 
be used, provide the setting depth of the stage tool(s) and amount 
and type of cement, including additives, to be used for each stage. 
Provide the yield of each cement slurry and the expected top of 
cement, with excess, for each cemented string or stage.
    f. Type and characteristics of the proposed circulating medium 
or mediums proposed for the drilling of each well bore section, the 
quantities and types of mud and weighting material to be maintained, 
and the monitoring equipment to be used on the circulating system. 
The operator must submit the following information when air or gas 
drilling is proposed:
     Length, size, and location of the blooie line, 
including the gas ignition and dust suppression systems,
     Location and capacity of the compressor equipment, 
including safety devices, the distance from the well bore, and 
location on the drill site, and
     Anticipated amounts, types, and other characteristics 
as defined in this Section, of the stand-by mud or kill fluid and 
associated circulating equipment.
    g. The testing, logging, and coring procedures proposed, 
including drill stem testing procedures, equipment, and safety 
measures.
    h. The expected bottom-hole pressure and any anticipated 
abnormal pressures, temperatures, or potential hazards that the 
operator expects to encounter, such as lost circulation and hydrogen 
sulfide (see Onshore Oil and Gas Order Number 6 (55 FR 48958) for 
information on hydrogen sulfide operations). A description of the 
operator's plans for mitigating such hazards must be included.
    i. Any other facets of the proposed operation that the operator 
would like BLM to consider in reviewing the application. Examples 
include, but are not limited to:
     For directional wells include proposed directional 
design, plan view and vertical section in true vertical and measured 
depths,
     Horizontal drilling, and
     Coil tubing operations.

3. Surface Use Plan of Operations

    With each copy of Form 3160-3, the operator must submit to BLM a 
Surface Use Plan of Operations. The Surface Use Plan of Operations 
must:
     Describe the access road(s) and drill pad, the 
construction methods that the operator plans to use, and the 
proposed means for containment and disposal of all waste materials,
     Provide for safe operations, adequate protection of 
surface resources, groundwater, and other environmental components,
     Include adequate measures for stabilization and 
reclamation of disturbed lands, and
     Where the surface is privately owned, include a 
certification of surface owner agreement or an adequate bond, as 
described in Section VI. of this Order.
    The Surface Use Plan of Operations must describe any best 
management practices the operator plans to use or is required to 
use.
    All maps that are included in the Surface Use Plan of Operations 
must be of a scale no smaller than 1:24,000, unless otherwise stated 
below. Geospatial vector and raster data must include appropriate 
attributes and metadata. Georeferenced raster images must be from 
the same source as hardcopy plats and maps submitted in the APD 
package.
    Maps, plats, and narrative descriptions must include the 
following:
    a. Existing Roads: The operator must submit a legible map such 
as a highway or county road, United States Geological Survey (USGS) 
topographic, Alaska Borough, or other such map that shows the 
proposed well site and access route to the proposed well in relation 
to a town, village, or other locatable public access point.
    (1) The operator must improve or maintain existing roads in a 
condition the same as or better than before operations began. The 
operator must provide any plans for improvement and/or maintenance 
of existing roads. The information provided by the operator for 
construction and use of roads will be used by BLM for any Right-of-
Way application, as described in Section V. of this Order. The 
operator may use existing terrain and two-track trails, where 
appropriate, to assure environmental protection. The operator should 
consider using best management practices in improving or maintaining 
existing roads.
    (2) The operator may use existing roads under the jurisdiction 
of the FS for access if they meet the transportation objectives of 
the FS. When access involves the use of existing roads, the FS may 
require that the operator contribute to road maintenance. This is 
usually authorized by a Special Use Authorization or a joint road 
use agreement. The FS will charge the operator a pro rata share of 
the costs of road maintenance and improvement, based upon the 
anticipated use of the road.
    Information required by the paragraphs that follow that relate 
to the Surface Use Plan of Operations also may be shown on this map, 
if appropriately labeled, or on a separate plat or map.
    b. New or Reconstructed Access Roads. The operator must identify 
on a map or plat all permanent and temporary access roads that it 
plans to construct or reconstruct in connection with the drilling of 
the proposed well. Locations of all existing and proposed road 
structures (culverts, bridges, low water crossings, etc.) must be 
shown. The proposed route to the proposed drill site must be shown, 
including distances from the point where the access route exits 
established roads. All permanent and temporary access roads must be 
located and designed to meet the applicable standards of the 
appropriate Surface Managing Entity, and be consistent with the 
needs of the operator. Final route location may be made by the 
Surface Managing Entity at the time of the onsite inspection or 
during approval of the APD. The operator should consider using best 
management practices in designing road construction.
    The operator must design roads based upon the class or type of 
road, the safety requirements, traffic characteristics, 
environmental conditions, and the vehicles the road is expected to 
carry. The operator must describe for all road construction or 
reconstruction:
     Road width,
     Maximum grade,
     Crown design,
     Turnouts,
     Drainage and ditch design,
     On and off site erosion control,
     Re-vegetation of disturbed areas,
     Location and size of culverts and/or bridges,
     Fence cuts and/or cattleguards,
     Major cuts and fills,
     Source and storage sites of topsoil, and
     Type of surfacing materials, if any will be used.
    c. Location of Existing Wells: The operator must include a map 
or plat and geospatial database that includes all known wells, 
regardless of status, within a 1-mile radius of the proposed 
location.
    d. Location of Existing and/or Proposed Production Facilities: 
The operator must include a plat diagram and geospatial database of 
facilities planned either on or off the well pad that shows, to the 
extent known or anticipated, the location of all production 
facilities and lines likely to be installed if the well is 
successfully completed for production.
    The map and geospatial database must show and differentiate 
between proposed and existing flow lines, overhead and buried power 
lines, and water lines. If facilities will be located on the well 
pad, the information should be consistent with the layout provided 
in item i. of this Section.
    The operator must show the dimensions of the facility layouts 
for all new construction. This information may be used by BLM or the 
FS for Right-of-Way or Special Use Authorization application 
information, as specified in Section V. of this Order.
    If the operator has not developed information regarding 
production facilities, it may defer submission of that information 
until a production well is completed, in which case the operator 
will follow the procedures in Section VIII. of this Order. However, 
for purposes of NEPA analysis, BLM will need a reasonable estimate 
of the facilities to be employed.
    e. Location and Types of Water Supply: Information concerning 
water supply, such as rivers, creeks, springs, lakes, ponds, and 
wells, may be shown by quarter-quarter section on a map or plat, or 
may be described in writing. The operator must identify the source, 
access route, and transportation method for all water anticipated 
for use in drilling the proposed well. The operator must describe 
any newly constructed or reconstructed access roads crossing Federal 
or Indian lands that are needed to haul the water as provided in 
item b. of this Section. The operator must indicate if it plans to 
drill a water supply well on the lease and, if so, the operator must 
describe the location,

[[Page 43360]]

construction details, and expected production requirements, 
including a description of how water will be transported and 
procedures for well abandonment.
    f. Construction Materials: The operator must state the character 
and intended use of all construction materials, such as sand, 
gravel, stone, and soil material. If these materials are Federally-
owned, the proposed source must be shown on a quarter-quarter 
section either of a map or plat, or in a written description. See 43 
CFR 3602.33 for additional guidance.
    The affected Surface Managing Entity or private or Indian 
mineral materials owner must be contacted and agreement reached on 
the use of mineral materials before those mineral materials are 
used.
    g. Methods for Handling Waste: The Surface Use Plan of 
Operations must contain a written description of the methods and 
locations proposed for safe containment and disposal of each type of 
waste material (e.g., cuttings, garbage, salts, chemicals, sewage, 
etc.) that results from drilling the proposed well. Likewise, the 
narrative must include plans for the eventual disposal of drilling 
fluids and any produced oil or water recovered during testing 
operations. The operator must describe plans for the construction 
and lining, if necessary, of the reserve pit.
    h. Ancillary Facilities: The operator must identify the location 
and construction methods and materials for all anticipated ancillary 
facilities such as camps, airstrips, and staging areas on a map or 
plat. The operator must stake on the ground the approximate center 
of proposed camps and the centerline of airstrips. If the ancillary 
facilities are located off-lease, depending on Surface Managing 
Entity policy, BLM or the FS may require the operator to obtain an 
additional authorization, such as a Right-of-Way or Special Use 
Authorization.
    i. Well Site Layout: The plat and geospatial database must have 
an arrow indicating the north direction. Plats and geospatial 
database with cuts and fills must be surveyed, designed, drawn, 
digitized, and certified by licensed professional surveyors or 
engineers. The operator must submit a plat of a scale of not less 
than 1 inch = 50 feet showing:
     The proposed drill pad,
     Reserve pit/blooie line/flare pit location,
     Access road entry points and their approximate location 
with respect to topographic features, along with cross section 
diagrams of the drill pad, and
     The reserve pit showing all cuts and fills and the 
relation to topography.
    The plat and geospatial database must also include the 
approximate proposed location and orientation of the:
     Drilling rig,
     Dikes and ditches to be constructed, and
     Topsoil and/or spoil material stockpiles.
    j. Plans for Surface Reclamation: The operator must submit a 
plan for the surface reclamation or stabilization of all disturbed 
areas. This plan must address interim (during production) 
reclamation for the area of the well pad not needed for production, 
as well as final abandonment of the well location. Such plans must 
include, as appropriate:
     Configuration of the reshaped topography,
     Drainage systems,
     Segregation of spoil materials,
     Surface manipulations,
     Back fill requirements,
     Proposals for pit/sump closures,
     Redistribution of topsoil,
     Soil treatments,
     Seeding or other steps to reestablish vegetation,
     Weed control, and
     Practices necessary to reclaim all disturbed areas, 
including any access roads and pipelines.
    The operator may amend this reclamation plan at the time of 
abandonment. Further details for reclamation are contained in 
Section XI. of this Order.
    k. Surface Ownership: The operator must indicate the surface 
ownership at the well location, and of all lands crossed by roads 
that the operator plans to construct or upgrade, including, if 
known, the name of the agency or owner, phone number, and address.
    Other Information: The operator must include other information 
required by applicable orders and notices (43 CFR 3162.3-1(d)-(4)). 
When an integrated pest management program is needed for weed or 
insect control, the operator must coordinate plans with state or 
local management agencies and include the pest management program in 
the Surface Use Plan of Operations. BLM also encourages the operator 
to submit any additional information that may be helpful in 
processing the application.

4. Master Development Plans

    An operator may elect to submit a Master Development Plan 
addressing two or more APDs that share a common drilling plan, 
Surface Use Plan of Operations, and plans for future development and 
production. Submitting a Master Development Plan facilitates early 
planning, orderly development, and the cumulative effects analysis 
for all the APDs expected in a developing field. Approval of a 
Master Development Plan constitutes approval of all of the APDs 
submitted with the Plan. Processing of a Master Development Plan 
follows the processes in Section III.C.2. of this Order. After the 
Master Development Plan is approved, subsequent APDs can reference 
the Master Development Plan in future applications. Therefore, an 
approved Master Development Plan results in timelier processing of 
subsequent APDs. Each subsequent proposed well must have a survey 
plat and an APD (Form 3160-3) that references the Master Development 
Plan and any specific variations for that well.

5. Bonding

    (a) Most bonding needs for oil and gas operations on Federal 
leases are discussed in 43 CFR subpart 3104. The operator must 
obtain a bond in its own name as principal, or a bond in the name of 
the lessee or sublessee. If the operator uses the lessee's or 
sublessee's bond, the operator must furnish a rider (consent of 
surety and principal) that includes the operator under the coverage 
of the bond. The operator must specify on the APD, Form 3160-3, the 
type of bond and bond number under which the operations will be 
conducted.
    For Indian oil and gas, the appropriate provisions at 25 CFR 
part 200, Subchapter I, govern bonding.
    Under the regulations at 43 CFR 3104.5 and 36 CFR 228.109, BLM 
or the FS may require additional bond coverage for specific APDs. 
Other factors that BLM or the FS may consider include:
     History of previous violations,
     Location and depth of wells,
     The total number of wells involved,
     The age and production capability of the field, and
     Unique environmental issues.
    These bonds may be in addition to any statewide, nationwide, or 
separate lease bond already applicable to the lease. In determining 
the bond amount, BLM may consider impacts of activities on both 
Federal and nonfederal lands required to develop the lease that 
impact lands, waters, and other resources off the lease.
    Separate bonds may be required for associated Rights-of-Way and/
or Special Use Authorizations that authorize activities not covered 
by the approved APD.
    (b) On Federal leases, operators may request a phased release of 
an individual lease bond. BLM will grant this reduction only if the 
operator:
     Has satisfied the terms and conditions in the plan for 
surface reclamation for that particular operation, and
     No longer has any down-hole liability.
    If appropriate, BLM may reduce the bond in the amount requested 
by the appropriate Surface Managing Entity. The FS also may reduce 
bonds it requires (but not BLM-required bonds). BLM and the FS will 
base the amount of the bond reduction on a calculation of the sum 
that is sufficient to cover the remaining operations and 
abandonment, including reclamation, as authorized by the Surface Use 
Plan of Operations.

6. Operator Certification

    The operator must include its name, address, and telephone 
number, and the same information for its field representative, in 
the APD package. The following certification must carry the 
operator's original signature or meet BLM standards for electronic 
commerce:
    I hereby certify that I, or someone under my direct supervision, 
have inspected the drill site and access route proposed herein; that 
I am familiar with the conditions which currently exist; that I have 
full knowledge of state and Federal laws applicable to this 
operation; that the statements made in this APD package are, to the 
best of my knowledge, true and correct; and that the work associated 
with the operations proposed herein will be performed in conformity 
with this APD package and the terms and conditions under which it is 
approved. I also certify that I, or the company I represent, am 
responsible for the operations conducted under this application. 
Bond coverage is provided under BLM/BIA bond ------. These 
statements are subject to the provisions of 18 U.S.C. 1001 for the 
filing of false statements.

    Executed this ---- day of --------, 20----.
 Name------------------------------------------------------------------


[[Page 43361]]

-----------------------------------------------------------------------
 Position Title--------------------------------------------------------

 Address---------------------------------------------------------------

 Telephone-------------------------------------------------------------

 Field representative (if not above signatory).------------------------

 Address (if different from above).------------------------------------

 Telephone (if different from above).----------------------------------
    Agents not directly employed by the operator must submit a 
letter from the operator authorizing that agent to act or file this 
application on their behalf.

F. Notice of Staking Option

    Before filing an APD or Master Development Plan, the operator 
may file a Notice of Staking with BLM. The purpose of the Notice of 
Staking is to provide the operator with an opportunity to gather 
information to better address site-specific resource concerns before 
preparing the APD package. This may expedite approval of the APD. 
Attachment I, Sample Format for Notice of Staking, provides the 
information for the Notice of Staking option.
    For Federal lands managed by other Surface Managing Entities, 
BLM will provide a copy of the Notice of Staking to the appropriate 
Surface Managing Entity office. In Alaska, when a subsistence 
stipulation is part of the lease, the operator must also send a copy 
of the Notice of Staking to the appropriate Borough and/or Native 
Regional or Village Corporation.
    Within 10 days of receiving the Notice of Staking, BLM or the FS 
will review it for completeness and schedule a date for the onsite 
inspection. The onsite inspection will be conducted as soon as 
weather and other conditions permit. The operator must complete 
staking of the proposed drill pad and ancillary facilities, and 
flagging of new or reconstructed access routes, before the onsite 
inspection. The staking must include a center stake for the proposed 
well, two reference stakes, and a flagged access road centerline. 
Staking activities are considered casual use unless the particular 
activity is likely to cause more than negligible disturbance or 
damage. Off-road vehicular use is casual use unless, in a particular 
case, it is likely to cause more than negligible disturbance or 
damage. Before APD approval, the operator must submit a complete 
survey as described in Section III. E. of this Order.
    If the surface is privately owned, the operator must furnish the 
name, address, and telephone number of the surface owner if known. 
The BLM will invite the surface owner to participate in the onsite 
inspection. Within 7 days of the onsite inspection, all parties, 
including the Surface Management Entity, will jointly develop a list 
of resource concerns that the operator must address in the APD. 
Surface owner concerns will be considered to the extent practical 
within the law. Failure to submit an APD within 60 days of the 
onsite inspection will result in the Notice of Staking being 
returned to the operator.

G. Approval of APDs

    (a)(1) Except for NFS lands, BLM has the lead responsibility for 
completing the environmental review process.
    (2) BLM cannot approve an APD or Master Development Plan until 
it complies with certain other laws and regulations including NEPA, 
the National Historic Preservation Act, and the Endangered Species 
Act. BLM must document that the needed reviews have been adequately 
conducted. In some cases, operators conduct these reviews, but BLM 
remains responsible for their scope and content and makes its own 
evaluation of the environmental issues, as required by 40 CFR 
1506.5(b).
    (3) The approved APD will contain Conditions of Approval that 
reflect necessary mitigation measures, if necessary.
    (4) BLM will establish the terms and Conditions of Approval for 
both the APD and any associated Right-of-Way when the application is 
approved.
    (b) For NFS lands, the FS will establish the terms and 
Conditions of Approval for both the Surface Use Plan of Operations 
and any associated Surface Use Authorization.
    After the FS notifies BLM it has approved a Surface Use Plan of 
Operations on NFS lands, BLM must approve the APD before the 
operator may begin any surface-disturbing activity. BLM will not 
approve an APD until it is complete.
    (c) On Indian lands, BIA has responsibility for approving 
Rights-of-Way. In these cases, the BLM will be a cooperating or co-
lead agency for NEPA compliance.
    The responsible agency will incorporate any mitigation 
requirements, identified through the APD review and associated NEPA 
and related analyses, as Conditions of Approval to the APD. In 
accordance with 43 CFR 3101.1-2 and 36 CFR 228.107, the BLM or the 
FS may require reasonable mitigation measures to ensure that the 
proposed operations minimize adverse impacts to other resources, 
uses, and users, consistent with granted lease rights.

IV. General Operating Requirements

Operator Responsibilities

    In the APD package, the operator must describe or show, as set 
forth in this Order, the procedures, equipment, and materials to be 
used in the proposed operations. The operator must conduct 
operations to minimize adverse effects to surface and subsurface 
resources, prevent unnecessary surface disturbance, and conform with 
currently available technology and practice. While compliance with 
certain statutes, such as NEPA, the National Historic Preservation 
Act, and the Endangered Species Act, are Federal responsibilities, 
the operator may choose to conduct inventories and provide other 
supporting documentation to meet these requirements. The inventories 
and other work may require entering the lease and adjacent lands 
before approval of the APD. As in Staking and Surveying, the 
operator is urged to contact the Surface Managing Entity before 
entry upon the lands for these purposes.
    The operator can not commence either drilling operations or 
preliminary construction activities before BLM's approval of the 
APD. Operators are responsible for their contractor's and 
subcontractor's compliance with the requirements of the approved APD 
and/or plan. Drilling without approval or causing surface 
disturbance without approval is a violation of 43 CFR 3162.3-1(c) 
and is subject to an immediate daily assessment under 43 CFR 
3163.1(b)(2).
    The operator must comply with the provisions of the approved 
APD, and applicable laws, regulations, Orders, and notices to 
lessees, including, but not limited to, those that address:
    a. Cultural and Historic Resources. If historic or 
archaeological materials are uncovered during construction, the 
operator must immediately stop work that might further disturb such 
materials, and contact BLM and, if appropriate, the FS or other 
Surface Managing Entity. BLM or the FS will inform the operator 
within 7 days as to whether the materials appear eligible for 
listing on the National Register of Historic Places.
    The operator is responsible for recording the location of any 
historic or archaeological resource that is discovered as a result 
of the operator's actions, even if the operator decides to relocate 
operations to avoid further costs to mitigate the site. The operator 
also is responsible for stabilizing the exposed cultural material if 
the operator created an unstable condition that must be addressed 
immediately. BLM, the FS, or other appropriate Surface Managing 
Entity will assume responsibility for further work related to the 
historic or archaeological site.
    If the operator does not relocate, the operator is responsible 
for mitigation and stabilization costs and BLM, the FS, or 
appropriate Surface Managing Entity will provide technical and 
procedural guidelines for conducting mitigation. The operator may 
resume construction when BLM or the FS verifies that the operator 
has completed the required mitigation. Relocation of activities may 
subject the proposal to additional environmental review. Therefore, 
if the presence of such sites is suspected, the operator may want to 
submit alternate locations for advance approval before starting 
construction.
    b. Endangered Species Act. To comply with the Endangered Species 
Act , as amended (16 U.S.C. 1531, et seq.), and its implementing 
regulations (50 CFR part 402), the operator must conduct all 
operations to avoid jeopardizing protected fisheries, wildlife, 
plants, and their habitats.
    c. Watershed Protection. Except as otherwise provided in an 
approved Surface Use Plan of Operations, the operator must not 
conduct operations in areas subject to mass soil movement, riparian 
areas, floodplains, lakeshores, and/or wetlands. The operator also 
must take measures to minimize or prevent erosion and sediment 
production. Such measures may include, but are not limited to:
     Avoiding steep slopes and excessive land clearing when 
siting structures, facilities, and other improvements, and
     Temporarily suspending operations when frozen ground, 
thawing, or other weather-related conditions would cause otherwise 
avoidable or excessive impacts.
    d. Safety Measures. The operator must maintain structures, 
facilities, improvements, and equipment in a safe condition in 
accordance with the approved APD. The operator must also take 
appropriate measures as specified in Orders and Notices to Lessees

[[Page 43362]]

and Operators to protect the public from any hazardous conditions 
resulting from operations.
    In the event of an emergency, the operator may take immediate 
action without prior Surface Managing Entity approval to safeguard 
life or to prevent significant environmental degradation. BLM or the 
FS must receive notification of the emergency situation and the 
remedial action taken by the operator as soon as possible, but not 
later than 24 hours after the emergency occurred. If the emergency 
involves surface resources on Surface Managing Entity lands, the 
operator must notify the Surface Managing Entity within 24 hours. 
Upon conclusion of the emergency, BLM or the FS, where appropriate, 
will review the incident and take appropriate action. If the 
emergency only affected drilling operations and had no surface 
impacts, only BLM must be notified.
    (e) Completion Reports. Within 30 days after the well 
completion, the lessee or operator must submit to BLM two copies of 
Form 3160-4, Well Completion or Recompletion Report and Log. Well 
logs may be submitted to BLM in an electronic format such as 
``.LAS'' format. Surface and bottom hole locations must be in 
latitude and longitude.

V. Rights-of-Way and Special Use Authorizations

    BLM or the FS will notify the operator of any additional Rights-
of-Way, Special Use Authorizations, licenses, or other permits that 
are needed for roads and support facilities for drilling or off-
lease access. This will normally occur at the time the operator 
submits the APD or Notice of Staking package, or Sundry Notice, or 
during the onsite inspection.
    BLM or the FS, as appropriate, will approve or accept on-lease 
activities that are associated with actions proposed in the APD or 
Sundry Notice and that will occur on the lease as part of the APD or 
Sundry Notice. These actions do not require a Right-of-Way or 
Special Use Authorization. For pipeline Rights-of-Way crossing lands 
under the jurisdiction of two or more Federal Surface Managing 
Entities, except lands in the NPS or Indian lands, applications 
should be submitted to BLM. Refer to 43 CFR parts 2800 and 2880 for 
guidance on BLM Right-of-Ways and 36 CFR part 251 for guidance on FS 
Special Use Authorizations.
    A. Rights-of-Way (BLM). For BLM lands, the APD package may serve 
as the supporting document for the Right-of-Way application in lieu 
of a Right-of-Way plan of development. Any additional information, 
specified in 43 CFR parts 2800 and 2880, will be required in order 
to process the Right-of-Way.
    BLM will notify the operator within 10 days of receipt of a 
Notice of Staking, APD, or other notification if any parts of the 
project require a Right-of-Way. This information may be submitted by 
the operator with the APD package if the Notice of Staking option 
has been used.
    B. Special Use Authorizations (FS) (36 CFR 251 Subpart B). On 
NFS lands, uses directly related to the drilling and production of a 
well (e.g., an access road off-lease or crew camp, or connecting 
pipeline to a gathering system), will be incorporated into the 
approved Surface Use Plan of Operations, rather than a separate 
Special Use Authorization. When a Special Use Authorization is 
required, the Surface Use Plan of Operations may serve as the 
application for the Special Use Authorization if the facility for 
which a Special Use Authorization is required is adequately 
described. Conditions regulating the authorized use may be imposed 
to protect the public interest, to ensure compatibility with other 
NFS lands programs and activities, and to comply with directions 
provided in the Forest Land and Resources Management Plan. The 
Special Use Authorization requires payment of an annual fee in 
advance, commensurate with the fair market value of the rights or 
privileges authorized, except where otherwise authorized by statute 
or regulation. A Special Use Authorization will include terms and 
conditions (36 CFR 251.56) and may require a specific reclamation 
plan or incorporate applicable parts of the Surface Use Plan of 
Operations reclamation plan by reference.

VI. Operating on Lands With Private/State Surface and Federal or Indian 
Oil and Gas

    When authorizing lease operations on split estate lands where 
the surface is not Federally-owned and the oil and gas is Federal or 
Indian, BLM must comply with NEPA, the National Historic 
Preservation Act, the Endangered Species Act, and related Federal 
statutes. For split estate lands within FS administrative 
boundaries, BLM has the lead responsibility, unless there is a local 
BLM/FS agreement that gives the FS this responsibility. For any 
split estate involving Indian lands, refer to Section VII.B. of this 
Order.
    The operator must make a good faith effort to notify the private 
surface owner before entry and obtain an access agreement from the 
surface owner. The access agreement may include terms or conditions 
of use, be a wavier, or an agreement for compensation. The operator 
must certify to BLM that (1) it made a good faith effort to notify 
the surface owner before entry and (2) that an agreement with the 
surface owner has been reached or that a good faith effort to reach 
an agreement failed. If no agreement was reached, the operator must 
submit an adequate bond to BLM for the benefit of the surface owner 
sufficient to pay for loss or damages, such as loss of or damage to 
agriculture, other tangible improvements, or structures, as required 
by the specific statutory authority under which the surface was 
patented or the terms of the lease. The minimum acceptable bond 
amount is $1,000.
    Surface owners have the right to appeal the sufficiency of the 
bond. Before the approval of the APD, BLM will make a good faith 
effort to contact the surface owner to assure that they understand 
their rights of appeal.
    The operator must describe the terms of the Surface Owner 
Agreement, if one was obtained, in sufficient detail in the Surface 
Use Plan of Operations to enable BLM to evaluate impacts to adjacent 
off-site Federal and Indian lands and resources and prepare the 
necessary NEPA documentation. BLM will make the final determination 
of appropriate surface use requirements. In doing so, BLM will 
carefully consider the views of the surface owner and the effect on 
the surface owner's use of the surface before implementing 
mitigation measures. The operator must submit the name, address, and 
phone number of the surface owner, if known. BLM will invite the 
surface owner to the onsite inspection to assure that their concerns 
are considered. Surface owner concerns will be considered to the 
extent that they are consistent with Federal land management policy.

VII. Leases for Indian Oil and Gas

A. Approval of Operations

    BLM will process APDs, Master Development Plans, and Sundry 
Notices on Indian tribal and allotted oil and gas leases and Indian 
Mineral Development Act mineral agreements in a manner similar to 
Federal leases. However, the approval procedures, including 
environmental and archaeological clearance procedures, may vary 
between Reservations depending on tribal ordinances. For processing 
such applications, BLM considers the tribe to be the Surface 
Managing Entity for tribal lands and the BIA to be the Surface 
Managing Entity for allotted lands. Operators are responsible for 
obtaining any special use or access permits from appropriate BIA and 
tribal offices. BLM is not required to post for public inspection 
APDs for minerals subject to Indian leases or agreements.

B. Surface Use

    Where the wellsite and/or access road is proposed on Indian 
lands, the operator is responsible for entering into a surface use 
agreement with the Indian tribe or the BIA on behalf of the 
individual Indian owners. This agreement must specify the 
requirements for protection of surface resources, mitigation, and 
reclamation of disturbed areas. The BIA (25 CFR 211.4, 212.4 and 
225.4), the tribe, and BLM will develop the Conditions of Approval .

VIII. Subsequent Operations and Sundry Notices

    Subsequent operations must follow 43 CFR part 3160, applicable 
lease stipulations, and APD Conditions of Approval.

A. Surface Disturbing Operations

    Lessees and operators must submit for BLM or FS approval, an 
amendment to the approved APD on Form 3160-5 before:
     Undertaking any subsequent new construction outside the 
approved area of operations, or
     Reconstructing, or altering existing facilities 
including, but not limited to, roads, emergency pits, firewalls, 
flowlines, or other production facilities on any lease that will 
result in additional surface disturbance.
    If, at the time the original APD was filed, the lessee or 
operator elected to defer submitting information under Section 
III.E.3.d. (Location of Existing and/or Proposed Facilities) of this 
Order, the lessee or operator must supply this information before 
construction and installation of the facilities. BLM, in 
consultation with any other involved Surface Managing Entity, may

[[Page 43363]]

require a field inspection before approving the proposal. The lessee 
or operator may not begin construction until BLM approves the 
proposed plan in writing.

B. Emergency Repairs

    Lessees or operators may undertake emergency repairs without 
prior approval if they promptly notify BLM. Lessees or operators 
must submit sufficient information to BLM or the FS to permit a 
proper evaluation of any:
     Resulting surface disturbing activities, or
     Planned accommodations necessary to mitigate potential 
adverse environmental effects.

IX. Well Conversions

(a) Conversion to an Injection Well

    When subsequent operations will result in a well being converted 
to a Class II injection well (i.e., for disposal of produced water, 
oil and gas production enhancement, or underground storage of 
hydrocarbons), the operator must file with the appropriate BLM 
office and the Surface Managing Entity a Sundry Notice, Notice of 
Intent to Convert to Injection on Form 3160-5. BLM, and the Surface 
Managing Entity, if appropriate, will review the information to 
ensure its technical and administrative adequacy. Following the 
review, BLM, and the Surface Managing Entity, where applicable, will 
decide upon the approval or disapproval of the application based 
upon relevant laws and regulations and the circumstances (e.g., well 
used for lease or non-lease operations, surface ownership, and 
protection of subsurface mineral ownership). BLM will determine if a 
Right-of-Way or Special Use Authorization and additional bonding are 
necessary and notify the operator.

(b) Conversion to a Water Supply Well

    In cases where the Surface Managing Entity desires to acquire an 
oil and gas well and convert it to a water supply well or acquire a 
water supply well that was drilled by the operator to support lease 
operations, the Surface Managing Entity must inform the appropriate 
BLM office of its intent before the approval of the APD in the case 
of a dry hole and no later than the time a Notice of Intent to 
Abandon is submitted for a depleted production well. The operator 
must abandon the well according to BLM instructions, and must 
complete the surface cleanup and reclamation, in conjunction with 
the approved APD, Surface Use Plan of Operations, or Notice of 
Intent to Abandon, if BLM or the FS require it. The Surface Managing 
Entity must reach agreement with the operator as to the satisfactory 
completion of reclamation operations before BLM will approve any 
abandonment or reclamation. BLM approval of the partial abandonment 
under this section, completion of any required reclamation 
operations, and the signed release agreement will relieve the 
operator of further obligation for the well.

X. Variances

    The operator may make a written request to the agency with 
jurisdiction to request a variance from this Order. The operator may 
include the request in the APD package. A variance from the 
requirements of this Order does not constitute a variance to 
provisions of other regulations, laws, or orders. When BLM is the 
decision maker on a request for a variance, the decision whether to 
grant or deny the variance request is entirely within BLM's 
discretion. The decision is not subject to administrative appeals 
either to the State Director or pursuant to 43 CFR part 4.
    An operator may also request that BLM waive, except or modify a 
lease stipulation for a Federal lease. An exception is a one-time 
waiver. In the case of Federal leases, a request to waive, except or 
modify a stipulation should also include information demonstrating 
that the factors leading to its inclusion in the lease have changed 
sufficiently to make the protection provided by the stipulation no 
longer justified or that the proposed operation would not cause 
unacceptable impacts.
    When the waiver, exception or modification is substantial, the 
proposed waiver, exception or modification is subject to public 
review for thirty days. Prior to such public review, the BLM, and 
when applicable the FS, will post it in their local field office 
and, when possible, electronically on the internet. When the request 
is included in the Notice of Staking or APD, the request will be 
included as part of the well posting under Section III. C. of this 
Order. Prior to granting a waiver, exception or modification, the 
BLM will obtain the concurrence or approval of the FS or Federal 
surface management entity. Decisions on such waivers, exceptions or 
modifications are subject to administrative review by the State 
Director and thereafter appeal pursuant to 43 CFR Part 4.
    After drilling has commenced, the BLM and FS may consider verbal 
requests for variances. However, the operator must submit a written 
notice within 7 days after the verbal request. BLM and the FS will 
confirm in writing any verbal approval. Decisions on waivers, 
exceptions or modifications submitted after drilling has commenced 
are final for the Department and not subject to administrative 
review by the State Director or pursuant to 43 CFR Part 4.

XI. Abandonment

    In accordance with the requirements of 43 CFR 3162.3-4, before 
starting abandonment operations the operator must submit a Notice of 
Intent to Abandon on Sundry Notices and Reports Form 3160-5. If the 
operator proposes to modify the plans for surface reclamation 
approved at the APD stage, the operator must attach these 
modifications to the Notice of Intent to Abandon.

A. Plugging

    The operator must obtain BLM approval for the plugging of the 
well by submitting a Notice of Intent to Abandon. In the case of dry 
holes, drilling failures, and in emergency situations, verbal 
approval for plugging may be obtained from BLM, with the Notice of 
Intent to Abandon promptly submitted as written confirmation. Within 
30 days following completion of well plugging, the operator must 
file with BLM a Subsequent Report of Plug and Abandon, using Sundry 
Notices and Reports Form 3160-5. For depleted production wells, the 
operator must submit a Notice of Intent to Abandon in advance of 
plugging.

B. Reclamation

    Plans for surface reclamation are a part of the Surface Use Plan 
of Operations, as specified in Section III.E.3.j., and must be 
designed to return the disturbed area to productive use and to meet 
the objectives of the land and resource management plan. If the 
operator proposes to modify the plans for surface reclamation 
approved at the APD stage, the operator must attach these 
modifications to the Subsequent Report of Plug and Abandon using 
Sundry Notices and Reports Form 3160-5.
    For wells not having an approved plan for surface reclamation, 
operators must submit a proposal describing the procedures to be 
followed for complete abandonment, including a map showing the 
disturbed area and roads to be reclaimed. The operator must submit 
the request to BLM. BLM will forward the request to the FS or other 
Surface Managing Entity, if appropriate. Neither BLM nor the FS will 
approve the complete abandonment of an well if the Surface Managing 
Entity commits to acquiring the well for water use purposes. The 
party acquiring the well assumes liability for the well.
    Earthwork for intermediate and final reclamation must be 
completed within 6 months of well completion or well plugging 
(weather permitting). All pads, pits, and roads must be reclaimed to 
a satisfactorily revegetated, safe, and stable condition, unless an 
agreement is made with the landowner or Surface Managing Entity to 
keep the road or pad in place. Pits containing fluid must not be 
breached (cut) and pit fluids must be removed or solidified before 
backfilling. Pits may be allowed to air dry subject to BLM or FS 
approval, but the use of chemicals to aid in fluid evaporation, 
stabilization, or solidification must have prior BLM or FS approval. 
Seeding or other activities to reestablish vegetation must be 
completed within the time period approved by BLM or the FS.
    Upon completion of reclamation operations, the lessee or 
operator must notify BLM or the FS using Form 3160-5, Final 
Abandonment Notice, when the location is ready for inspection. Final 
abandonment will not be approved until the surface reclamation work 
required in the Surface Use Plan of Operations or Subsequent Report 
of Plug and Abandon has been completed to the satisfaction of BLM or 
the FS and Surface Managing Entity, if appropriate.

XII. Appeal Procedures

    Complete information concerning the review and appeal processes 
for BLM actions is contained in 43 CFR part 4 and subpart 3165. 
Incorporation of an FS approved Surface Use Plan of Operations into 
the approval of an APD or a Master Development Plan is not subject 
to protest to BLM or appeal to the Interior Board of Land Appeals.
    FS decisions approving use of National Forest System Lands are 
subject to agency appeal procedures, currently in accordance with 36 
CFR part 215 or 251. Decisions governing Surface Use Plan of 
Operations

[[Page 43364]]

and Special Use Authorization approvals on NFS lands that involve 
analysis, documentation, and other requirements of the NEPA are 
subject to agency appeal procedures, currently under 36 CFR part 
215. If an appeal is filed, the FS must respond within 45 days and 
operations must not occur for 15 days following the date of appeal 
disposition.
    FS regulations at 36 CFR part 251 govern appeals of written 
decisions of the FS related to issuance, denial, or administration 
of written instruments to occupy and use NFS lands. A list of the 
types of written instruments is provided at 36 CFR 251.82, and 
includes an SUA and Surface Use Plan of Operations related to the 
authorized use and occupancy of a particular site or area.
    The operator may appeal decisions of the BIA under 25 CFR part 
2.

Attachment I--Sample Format for Notice of Staking

Attachment I--Sample Format for Notice of Staking

(Not to be used in place of Application for Permit to Drill Form 
3160-3)

    1. Oil Well, Gas Well, Other (Specify).
    2. Name, Address, and Telephone of Operator.
    3. Name and Telephone of Specific Contact Person.
    4. Surface Location of Well.
    Attach:
    (a) Sketch showing road entry onto pad, pad dimensions, and 
reserve pit.
    (b) Topographical or other acceptable map showing location, 
access road, and lease boundaries.
    4a. A map (e.g., a USGS 7\1/2\'' Quadrangle) of the area 
including the proposed well location and access road.
    5. Lease Number.
    6. If Indian, Allottee or Tribe Name.
    7. Unit Agreement Name.
    8. Well Name and Number.
    9. American Petroleum Institute Well Number (if available).
    10. Field Name or Wildcat.
    11. Section, Township, Range, Meridian; or Block and Survey; or 
Area.
    12. County, Parish, or Borough.
    13. State.
    14. Name and Depth of Formation Objective(s).
    15. Estimated Well Depth.
    16. For directional or horizontal wells, anticipated bottom hole 
location, if known.
    17. Additional Information (as appropriate; include surface 
owner's name, address and, if known, telephone).

    18. Signed -------- Title -------- Date


    Note: When the Bureau of Land Management or Forest Service, as 
appropriate, receives this Notice, the agency will schedule the date 
of the onsite inspection. You must stake the location and flag the 
access road before the onsite inspection. Operators should consider 
the following before the onsite inspection and incorporate these 
considerations into the Notice of Staking Option, as appropriate:

    (a) H2S Potential.
    (b) Cultural Resources (Archeology).
    (c) Federal Right-of-Way or Special Use Permit.

[FR Doc. 05-14103 Filed 7-26-05; 8:45 am]
BILLING CODE 3410-11-P; 4310-84-P