[Federal Register Volume 74, Number 58 (Friday, March 27, 2009)]
[Notices]
[Pages 13463-13473]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-6901]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service

[Docket No. MMS-2008-MRM-0029]


Agency Information Collection Activities: Proposed Collection, 
Comment Request

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Notice of an extension of a currently approved information 
collection (OMB Control Number 1010-0103).

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SUMMARY: To comply with the Paperwork Reduction Act of 1995 (PRA), we 
are notifying the public that we have submitted to the Office of 
Management and Budget (OMB) an information collection request (ICR) to 
renew approval of the paperwork requirements in the regulations under 
30 CFR parts 202, 206, and 207. This notice also provides the public a 
second opportunity to comment on the paperwork burden of these 
regulatory requirements.

DATES: Submit written comments on or before April 27, 2009.

ADDRESSES: Submit written comments by either FAX (202) 395-7245 or e-
mail ([email protected]) directly to the Office of Information 
and Regulatory Affairs, OMB, Attention: Desk Officer for the Department 
of the Interior (OMB Control Number 1010-0103).
    Please submit copies of your comments to MMS by one of the 
following methods:
     Electronically go to http://www.regulations.gov. In the 
``Comment or Submission'' column, enter ``MMS-2008-MRM-0029'' to view 
supporting and related materials for this ICR. Click on ``Send a 
comment or submission'' link to submit public comments. Information on 
using Regulations.gov, including instructions for accessing documents, 
submitting comments, and viewing the docket after the close of the 
comment period, is available through the site's ``User Tips'' link. All 
comments submitted will be posted to the docket.
     Mail comments to Hyla Hurst, Regulatory Specialist, 
Minerals Management Service, Minerals Revenue Management, P.O. Box 
25165, MS 302B2, Denver, Colorado 80225. Please reference ICR 1010-0103 
in your comments.
     Hand-carry comments or use an overnight courier service. 
Our courier address is Building 85, Room A-614, Denver Federal Center, 
West 6th Ave. and Kipling St., Denver, Colorado 80225. Please reference 
ICR 1010-0103 in your comments.

FOR FURTHER INFORMATION CONTACT: Hyla Hurst, telephone (303) 231-3495, 
or e-mail [email protected]. You may also contact Hyla Hurst to obtain 
copies, at no cost, of (1) the ICR, (2) any associated forms, and (3) 
the regulations that require the subject collection of information.

SUPPLEMENTARY INFORMATION:
    Title: 30 CFR parts 202, 206, and 207, Indian Oil and Gas 
Valuation.
    OMB Control Number: 1010-0103.
    Bureau Form Number: Forms MMS-4109, MMS-4110, MMS-4295, MMS-4410, 
and MMS-4411.
    Abstract: The Secretary of the U.S. Department of the Interior is 
responsible for mineral resource development on Federal and Indian 
lands and the Outer Continental Shelf (OCS). The Secretary is required 
by various laws to manage mineral resource production on Federal and 
Indian lands and the OCS, collect the royalties and other mineral 
revenues due, and distribute the funds in accordance with those laws. 
Applicable laws pertaining to mineral leases on Federal and Indian 
lands are posted on our Web site at http://www.mrm.mms.gov/Laws_R_D/PublicLawsAMR.htm.
    The Secretary also has a trust responsibility to manage Indian 
lands and seek advice and information from Indian beneficiaries. The 
MMS performs the minerals revenue management functions and assists the 
Secretary in carrying out the Department's trust responsibility for 
Indian lands.
    When a company or an individual enters into a lease to explore, 
develop, produce, and dispose of minerals from Federal or Indian lands, 
that company or individual agrees to pay the lessor a share in an 
amount or value of production from the leased lands. The lessee is 
required to report various kinds of information to the lessor relative 
to the disposition of the leased minerals. Such information is 
generally available within the records of the lessee or others involved 
in developing, transporting, processing, purchasing, or selling of such 
minerals. We collect this information to ensure that royalties are 
accurately valued and appropriately paid.
    Information collections covered in this ICR are found at 30 CFR 
part 202, subparts C and J, which pertain to royalties; part 206, 
subparts B and E, which govern the valuation of oil and gas produced 
from leases on Indian lands; and part 207, which pertains to 
recordkeeping. Indian tribes and individual Indian mineral owners 
receive all royalties generated from their lands. Determining product 
valuation is essential to ensure that Indian tribes and individual 
Indian mineral owners receive payment on the full value of the minerals 
removed from their lands. Failure to collect the data described in this 
information collection could result in the undervaluation of leased 
minerals on Indian lands. All data reported is subject to subsequent 
audit and adjustment.

Indian Oil

    Regulations at 30 CFR part 206, subpart B, govern the valuation for 
royalty purposes of all oil produced from Indian oil and gas leases 
(tribal and allotted), except leases on the Osage Indian Reservation, 
and must be consistent with mineral leasing laws, other applicable 
laws, and lease terms. Generally, the regulations provide that lessees 
determine the value of oil based upon the higher of (1) the gross 
proceeds under an arm's-length contract; or (2) major portion analysis.
    These oil valuation methods are eligible for applicable 
transportation allowances. From information collected on Form MMS-4110, 
Oil Transportation Allowance Report, (1) MMS verifies transportation 
allowances to determine if the lessee reported and paid the proper 
royalty amount; and (2) MMS and tribal personnel evaluate whether the 
transportation allowances reported and claimed by lessees are within 
regulatory allowance limitations and are calculated in accordance with 
applicable regulations.

Indian Gas

    Regulations at 30 CFR part 206, subpart E, govern the valuation for 
royalty purposes of natural gas produced from Indian oil and gas leases 
(tribal and allotted). The regulations

[[Page 13464]]

apply to all gas production from Indian oil and gas leases, except 
leases on the Osage Indian Reservation.
    Most Indian leases contain the requirement to perform accounting 
for comparison (dual accounting) for gas produced from the lease. 
Lessees must elect to perform actual dual accounting as defined in 30 
CFR 206.176 or alternative dual accounting as defined in 30 CFR 
206.173. Lessees use Form MMS-4410, Accounting for Comparison [Dual 
Accounting], to certify that dual accounting is not required on an 
Indian lease or to make an election for actual or alternative dual 
accounting for Indian leases.
    The regulations require lessees to submit Form MMS-4411, Safety Net 
Report, when gas production from an Indian oil or gas lease is sold 
beyond the first index pricing point. The safety net calculation 
establishes the minimum value, for royalty purposes, of natural gas 
production from Indian oil and gas leases. This reporting requirement 
ensures that Indian lessors receive all royalties due and aids MMS 
compliance efforts.
    From information collected on Form MMS-4295, Gas Transportation 
Allowance Report, (1) MMS verifies transportation allowances to 
determine if the lessee reported and paid the proper royalty amount; 
and (2) MMS and tribal personnel evaluate whether the transportation 
allowances reported and claimed by lessees are within regulatory 
allowance limitations and are calculated in accordance with applicable 
regulations.
    From information collected on Form MMS-4109, Gas Processing 
Allowance Summary Report, (1) MMS verifies processing allowances to 
determine if the lessee reported and paid the proper royalty amount; 
and (2) MMS and tribal personnel evaluate whether the processing 
allowances reported and claimed by lessees are within regulatory 
allowance limitations and are calculated in accordance with applicable 
regulations.

Indian Oil and Gas

    Form MMS-4393, Request to Exceed Regulatory Allowance Limitation, 
is used for both Federal and Indian leases. Most of the burden hours 
are incurred on Federal leases; therefore, the form is approved under 
ICR 1010-0136, pertaining to Federal oil and gas leases. However, we 
include a discussion of the form in this ICR, as well as the burden 
hours for Indian leases. To request permission to exceed a regulatory 
allowance limit, lessees must (1) submit a letter to MMS explaining why 
a higher allowance limit is necessary; and (2) provide supporting 
documentation, including a completed Form MMS-4393. This form provides 
MMS with the data necessary to make a decision whether to approve or 
deny the request and track deductions on royalty reports.

Summary

    The MMS is requesting OMB's approval to continue to collect this 
information. Not collecting this information would limit the 
Secretary's ability to discharge his/her duties and may also result in 
loss of royalty payments to Indian tribes and individual Indian mineral 
owners. Proprietary information submitted to MMS under this collection 
is protected, and no items of a sensitive nature are collected. The 
requirement to respond is mandatory for Form MMS-4410, Accounting for 
Comparison [Dual Accounting], and for Form MMS-4411, Safety Net Report, 
under certain circumstances. For all other forms in this collection, 
the requirement to respond is required to obtain a benefit.
    Frequency of Response: Annually and on occasion.
    Estimated Number and Description of Respondents: 302 potential 
Indian lessees.
    Estimated Annual Reporting and Recordkeeping ``Hour'' Burden: 1,074 
hours.
    We have not included in our estimates certain requirements 
performed in the normal course of business and considered usual and 
customary. The following chart shows the estimated burden hours by CFR 
section and paragraph:

                                   Respondents' Estimated Annual Burden Hours
----------------------------------------------------------------------------------------------------------------
                                                                                  Average number
               30 CFR                Reporting and recordkeeping    Hour burden      of annual     Annual burden
                                             requirement                             responses         hours
----------------------------------------------------------------------------------------------------------------
                                                 202--ROYALTIES
                                        Subpart C--Federal and Indian Oil
----------------------------------------------------------------------------------------------------------------
202.101............................  Standards for reporting and   Burden covered under OMB Control Number 1010-
                                      paying royalties.              0140 (expires 11/30/2009). Burden covered
                                     Oil volumes are to be                     under Sec.   210.52.
                                      reported in barrels of
                                      clean oil of 42 standard
                                      U.S. gallons (231 cubic
                                      inches each) at 60 [deg]F.
                                      . . ..
----------------------------------------------------------------------------------------------------------------
                                  Subpart J--Gas Production From Indian Leases
----------------------------------------------------------------------------------------------------------------
202.551(b).........................  How do I determine the        Burden covered under OMB Control Number 1010-
                                      volume of production for       0140. Burden covered under Sec.   210.52.
                                      which I must pay royalty
                                      if my lease is not in an
                                      approved Federal unit or
                                      communitization agreement
                                      (AFA)?.
                                     (b) You and all other
                                      persons paying royalties
                                      on the lease must report
                                      and pay royalties based on
                                      your takes. . . .
----------------------------------------------------------------------------------------------------------------
202.551(c).........................  (c) You and all other                     1               1               1
                                      persons paying royalties
                                      on the lease may ask MMS
                                      for permission . . . . to
                                      report entitlements . . ..
----------------------------------------------------------------------------------------------------------------
202.558(a) and (b).................  What standards do I use to    Burden covered under OMB Control Number 1010-
                                      report and pay royalties       0140. Burden covered under Sec.   210.52.
                                      on gas?.
                                     (a) You must report gas
                                      volumes as follows: . . ..

[[Page 13465]]

 
                                     (b) You must report residue
                                      gas and gas plant product
                                      volumes as follows: . . .
----------------------------------------------------------------------------------------------------------------
                                             206--PRODUCT VALUATION
                                              Subpart B--Indian Oil
----------------------------------------------------------------------------------------------------------------
206.56(b)(2).......................  Transportation allowances--               4               1               4
                                      general.
                                     (b)(2) Upon request of a
                                      lessee, MMS may approve a
                                      transportation allowance
                                      deduction in excess of the
                                      limitation prescribed by
                                      paragraph (b)(1) of this
                                      section. . . . An
                                      application for exception
                                      (using Form MMS-4393,
                                      Request to Exceed
                                      Regulatory Allowance
                                      Limitation) must contain
                                      all relevant and
                                      supporting documentation
                                      necessary for MMS to make
                                      a determination. . . .
----------------------------------------------------------------------------------------------------------------
206.57(a)(1)(i)....................  Determination of                        AUDIT PROCESS. See note.
                                      transportation allowances.
                                     (a) Arm's-length
                                      transportation contracts
                                      (1)(i). . . The lessee
                                      shall have the burden of
                                      demonstrating that its
                                      contract is arm's-length.
----------------------------------------------------------------------------------------------------------------
206.57(a)(1)(i)....................  (a) Arm's-length               Burden covered under Sec.   206.57(c)(1)(i)
                                      transportation contracts.                     and (iii).
                                     (1)(i) . . . Before any
                                      deduction may be taken,
                                      the lessee must submit a
                                      completed page one of Form
                                      MMS-4110 (and Schedule 1),
                                      Oil Transportation
                                      Allowance Report . . .
----------------------------------------------------------------------------------------------------------------
206.57(a)(1)(iii)..................  (a) Arm's-length                        AUDIT PROCESS. See note.
                                      transportation contracts.
                                     (1)(iii) . . . When MMS
                                      determines that the value
                                      of the transportation may
                                      be unreasonable, MMS will
                                      notify the lessee and give
                                      the lessee an opportunity
                                      to provide written
                                      information justifying the
                                      lessee's transportation
                                      costs.
----------------------------------------------------------------------------------------------------------------
206.57(a)(2)(i)....................  (a) Arm's-length                Burden covered under Sec.   206.57(a)(3).
                                      transportation contracts.
                                     (2)(i) . . . Except as
                                      provided in this
                                      paragraph, no allowance
                                      may be taken for the costs
                                      of transporting lease
                                      production which is not
                                      royalty-bearing without
                                      MMS approval.
----------------------------------------------------------------------------------------------------------------
206.57(a)(2)(ii)...................  (a) Arm's-length                         20               1              20
                                      transportation contracts.
                                     (2)(ii) Notwithstanding the
                                      requirements of paragraph
                                      (i), the lessee may
                                      propose to MMS a cost
                                      allocation method on the
                                      basis of the values of the
                                      products transported. . .
                                      .
----------------------------------------------------------------------------------------------------------------
206.57(a)(3).......................  (a) Arm's-length                         40               1              40
                                      transportation contracts.
                                     (3) If an arm's-length
                                      transportation contract
                                      includes both gaseous and
                                      liquid products, and the
                                      transportation costs
                                      attributable to each
                                      product cannot be
                                      determined from the
                                      contract, the lessee shall
                                      propose an allocation
                                      procedure to MMS. . . .
                                      The lessee shall submit
                                      all available data to
                                      support its proposal. . .
                                      .
----------------------------------------------------------------------------------------------------------------
206.57(b)(1).......................  (b) Non-arm's-length or no     Burden covered under Sec.   206.57(c)(2)(i)
                                      contract.                                     and (iii).
                                     (1) . . . A transportation
                                      allowance may be claimed
                                      retroactively for a period
                                      of not more than 3 months
                                      prior to the first day of
                                      the month that Form MMS-
                                      4110 is filed with MMS,
                                      unless MMS approves a
                                      longer period upon a
                                      showing of good cause by
                                      the lessee. . . .
----------------------------------------------------------------------------------------------------------------
206.57(b)(1).......................  (b) Non-arm's-length or no    Burden covered under OMB Control Number 1010-
                                      contract.                      0140. Burden covered under Sec.   210.52.
                                     (1) . . . When necessary or
                                      appropriate, MMS may
                                      direct a lessee to modify
                                      its actual transportation
                                      allowance deduction.
----------------------------------------------------------------------------------------------------------------
206.57(b)(2)(iv)...................  (b) Non-arm's-length or no               20               1              20
                                      contract.

[[Page 13466]]

 
                                     (2)(iv) . . . After a
                                      lessee has elected to use
                                      either method for a
                                      transportation system, the
                                      lessee may not later elect
                                      to change to the other
                                      alternative without
                                      approval of MMS.
----------------------------------------------------------------------------------------------------------------
206.57(b)(2)(iv)(A)................  (b) Non-arm's-length or no               20               1              20
                                      contract.
                                     (2)(iv)(A) . . . After an
                                      election is made, the
                                      lessee may not change
                                      methods without MMS
                                      approval. . . .
----------------------------------------------------------------------------------------------------------------
206.57(b)(3)(i)....................  (b) Non-arm's-length or no               40               1              40
                                      contract.
                                     (3)(i) . . . Except as
                                      provided in this
                                      paragraph, the lessee may
                                      not take an allowance for
                                      transporting lease
                                      production which is not
                                      royalty bearing without
                                      MMS approval.
----------------------------------------------------------------------------------------------------------------
206.57(b)(3)(ii)...................  (b) Non-arm's-length or no               20               1              20
                                      contract.
                                     (3)(ii) Notwithstanding the
                                      requirements of paragraph
                                      (i), the lessee may
                                      propose to MMS a cost
                                      allocation method on the
                                      basis of the values of the
                                      products transported. . .
                                      .
----------------------------------------------------------------------------------------------------------------
206.57(b)(4).......................  (b) Non-arm's-length or no               20               1              20
                                      contract.
                                     (4) Where both gaseous and
                                      liquid products are
                                      transported through the
                                      same transportation
                                      system, the lessee shall
                                      propose a cost allocation
                                      procedure to MMS. . . .
                                      The lessee shall submit
                                      all available data to
                                      support its proposal. . .
                                      .
----------------------------------------------------------------------------------------------------------------
206.57(b)(5).......................  (b) Non-arm's-length or no               20               1              20
                                      contract.
                                     (5) A lessee may apply to
                                      MMS for an exception from
                                      the requirement that it
                                      compute actual costs in
                                      accordance with paragraphs
                                      (b)(1) through (b)(4) of
                                      this section. . . .
----------------------------------------------------------------------------------------------------------------
206.57(c)(1)(i)....................  (c) Reporting requirements.               4               4              16
                                     (1) Arm's-length contracts.
                                      (i) With the exception of
                                      those transportation
                                      allowances specified in
                                      paragraphs (c)(1)(v) and
                                      (c)(1)(vi) of this
                                      section, the lessee shall
                                      submit page one of the
                                      initial Form MMS-4110 (and
                                      Schedule 1), Oil
                                      Transportation Allowance
                                      Report, prior to, or at
                                      the same time as, the
                                      transportation allowance
                                      determined, under an arm's-
                                      length contract, is
                                      reported on Form MMS-2014,
                                      Report of Sales and
                                      Royalty Remittance. . . .
----------------------------------------------------------------------------------------------------------------
206.57(c)(1)(iii)..................  (c) Reporting requirements.               4               4              16
                                     (1) Arm's-length contracts.
                                      (iii) After the initial
                                      reporting period and for
                                      succeeding reporting
                                      periods, lessees must
                                      submit page one of Form
                                      MMS-4110 (and Schedule 1)
                                      within 3 months after the
                                      end of the calendar year,
                                      or after the applicable
                                      contract or rate
                                      terminates or is modified
                                      or amended, whichever is
                                      earlier, unless MMS
                                      approves a longer period
                                      (during which period the
                                      lessee shall continue to
                                      use the allowance from the
                                      previous reporting
                                      period).
----------------------------------------------------------------------------------------------------------------
206.57(c)(1)(iv)...................  (c) Reporting requirements.             AUDIT PROCESS. See note.
                                     (1) Arm's-length contracts.
                                      (iv) MMS may require that
                                      a lessee submit arm's-
                                      length transportation
                                      contracts, production
                                      agreements, operating
                                      agreements, and related
                                      documents. Documents shall
                                      be submitted within a
                                      reasonable time, as
                                      determined by MMS.
----------------------------------------------------------------------------------------------------------------
206.57(c)(2)(i)....................  (c) Reporting requirements.               6               1               6
                                     (2) Non-arm's-length or no
                                      contract.

[[Page 13467]]

 
                                     (i) With the exception of
                                      those transportation
                                      allowances specified in
                                      paragraphs (c)(2)(v),
                                      (c)(2)(vii) and
                                      (c)(2)(viii) of this
                                      section, the lessee shall
                                      submit an initial Form MMS-
                                      4110 prior to, or at the
                                      same time as, the
                                      transportation allowance
                                      determined under a non-
                                      arm's-length contract or
                                      no-contract situation is
                                      reported on Form MMS-2014.
                                      . . . The initial report
                                      may be based upon
                                      estimated costs.
----------------------------------------------------------------------------------------------------------------
206.57(c)(2)(iii)..................  (c) Reporting requirements.               6               3              18
                                     (2) Non-arm's-length or no
                                      contract.
                                     (iii) For calendar-year
                                      reporting periods
                                      succeeding the initial
                                      reporting period, the
                                      lessee shall submit a
                                      completed Form MMS-4110
                                      containing the actual
                                      costs for the previous
                                      reporting period. If oil
                                      transportation is
                                      continuing, the lessee
                                      shall include on Form MMS-
                                      4110 its estimated costs
                                      for the next calendar
                                      year. . . . MMS must
                                      receive the Form MMS-4110
                                      within 3 months after the
                                      end of the previous
                                      reporting period, unless
                                      MMS approves a longer
                                      period (during which
                                      period the lessee shall
                                      continue to use the
                                      allowance from the
                                      previous reporting
                                      period).
----------------------------------------------------------------------------------------------------------------
206.57(c)(2)(iv)...................  (c) Reporting requirements.   Burden covered under Sec.   206.57(c)(2)(i).
                                     (2) Non-arm's-length or no
                                      contract.
                                     (iv) For new transportation
                                      facilities or
                                      arrangements, the lessee's
                                      initial Form MMS-4110
                                      shall include estimates of
                                      the allowable oil
                                      transportation costs for
                                      the applicable period. . .
                                      .
----------------------------------------------------------------------------------------------------------------
206.57(c)(2)(v)....................  (c) Reporting requirements.   Burden covered under Sec.   206.57(c)(2)(i).
                                     (2) Non-arm's-length or no
                                      contract.
                                     (v) . . . only those
                                      allowances that have been
                                      approved by MMS in writing
                                      . . .
----------------------------------------------------------------------------------------------------------------
206.57(c)(2)(vi)...................  (c) Reporting requirements.             AUDIT PROCESS. See note.
                                     (2) Non-arm's-length or no
                                      contract.
                                     (vi) Upon request by MMS,
                                      the lessee shall submit
                                      all data used to prepare
                                      its Form MMS-4110. The
                                      data shall be provided
                                      within a reasonable period
                                      of time, as determined by
                                      MMS.
----------------------------------------------------------------------------------------------------------------
206.57(c)(4) and (e)(2)............  (c) Reporting requirements.   Burden covered under OMB Control Number 1010-
                                                                     0140. Burden covered under Sec.   210.52.
                                     (4) Transportation
                                      allowances must be
                                      reported as a separate
                                      line item on Form MMS-
                                      2014, . . .
                                     (e) Adjustments.
                                     (2) For lessees
                                      transporting production
                                      from Indian leases, the
                                      lessee must submit a
                                      corrected Form MMS-2014 to
                                      reflect actual costs, . .
                                      .
----------------------------------------------------------------------------------------------------------------
206.59.............................  May I ask MMS for valuation              20               1              20
                                      guidance?.
                                     You may ask MMS for
                                      guidance in determining
                                      value. You may propose a
                                      value method to MMS.
                                      Submit all available data
                                      related to your proposal
                                      and any additional
                                      information MMS deems
                                      necessary. . . .
----------------------------------------------------------------------------------------------------------------
206.61(a) and (b)..................  What records must I keep                AUDIT PROCESS. See note.
                                      and produce?.
                                     (a) On request, you must
                                      make available sales,
                                      volume, and transportation
                                      data for production you
                                      sold, purchased, or
                                      obtained from the field or
                                      area. You must make this
                                      data available to MMS,
                                      Indian representatives, or
                                      other authorized persons.
                                     (b) You must retain all
                                      data relevant to the
                                      determination of royalty
                                      value. . . .
----------------------------------------------------------------------------------------------------------------

[[Page 13468]]

 
                                             206--PRODUCT VALUATION
                                              Subpart E--Indian Gas
----------------------------------------------------------------------------------------------------------------
206.172(b)(1)(ii)..................  How do I value gas produced               4              25             100
                                      from leases in an index
                                      zone?.
                                     (b) Valuing residue gas and
                                      gas before processing.
                                     (1)(ii) Gas production that
                                      you certify on Form MMS-
                                      4410, . . . is not
                                      processed before it flows
                                      into a pipeline with an
                                      index but which may be
                                      processed later; . . .
----------------------------------------------------------------------------------------------------------------
206.172(e)(6)(i) and (iii).........  (e) Determining the minimum               3              10              30
                                      value for royalty purposes
                                      of gas sold beyond the
                                      first index pricing point.
                                     (6)(i) You must report the
                                      safety net price for each
                                      index zone to MMS on Form
                                      MMS-4411, Safety Net
                                      Report, no later than June
                                      30 following each calendar
                                      year; . . .
                                     (iii) MMS may order you to
                                      amend your safety net
                                      price within one year from
                                      the date your Form MMS-
                                      4411 is due or is filed,
                                      whichever is later. . . .
----------------------------------------------------------------------------------------------------------------
206.172(e)(6)(ii)..................  (e) Determining the minimum   Burden covered under OMB Control Number 1010-
                                      value for royalty purposes     0140. Burden covered under Sec.   210.52.
                                      of gas sold beyond the
                                      first index pricing point.
                                     (6)(ii) You must pay and
                                      report on Form MMS-2014
                                      additional royalties due
                                      no later than June 30
                                      following each calendar
                                      year; . . .
----------------------------------------------------------------------------------------------------------------
206.172(f)(1)(ii), (f)(2), and       (f ) Excluding some or all               40               1              40
 (f)(3).                              tribal leases from
                                      valuation under this
                                      section.
                                     (1) An Indian tribe may ask
                                      MMS to exclude some or all
                                      of its leases from
                                      valuation under this
                                      section. . . .
                                     (ii) If an Indian tribe
                                      requests exclusion from an
                                      index zone for less than
                                      all of its leases, MMS
                                      will approve the request
                                      only if the excluded
                                      leases may be segregated
                                      into one or more groups
                                      based on separate fields
                                      within the reservation.
                                     (2) An Indian tribe may ask
                                      MMS to terminate exclusion
                                      of its leases from
                                      valuation under this
                                      section. . . .
                                     (3) The Indian tribe's
                                      request to MMS under
                                      either paragraph (f)(1) or
                                      (2) of this section must
                                      be in the form of a tribal
                                      resolution. . . .
----------------------------------------------------------------------------------------------------------------
206.173(a)(1)......................  How do I calculate the                    2              19              38
                                      alternative methodology
                                      for dual accounting?.
                                     (a) Electing a dual
                                      accounting method.
                                     (1) . . . You may elect to
                                      perform the dual
                                      accounting calculation
                                      according to either Sec.
                                      206.176(a) (called actual
                                      dual accounting), or
                                      paragraph (b) of this
                                      section (called the
                                      alternative methodology
                                      for dual accounting).
----------------------------------------------------------------------------------------------------------------
206.173(a)(2)......................  (a) Electing a dual            Burden covered under Sec.   206.173(a)(1).
                                      accounting method.
                                     (2) You must make a
                                      separate election to use
                                      the alternative
                                      methodology for dual
                                      accounting for your Indian
                                      leases in each MMS-
                                      designated area. . . .
----------------------------------------------------------------------------------------------------------------
206.174(a)(4)(ii)..................  How do I value gas            Burden covered under OMB Control Number 1010-
                                      production when an index-      0140. Burden covered under Sec.   210.52.
                                      based method cannot be
                                      used?.
                                     (a) Situations in which an
                                      index-based method cannot
                                      be used.
                                     (4)(ii) If the major
                                      portion value is higher,
                                      you must submit an amended
                                      Form MMS-2014 to MMS by
                                      the due date specified in
                                      the written notice from
                                      MMS of the major portion
                                      value. . . .
----------------------------------------------------------------------------------------------------------------

[[Page 13469]]

 
206.174(b)(1)(i) and (iii); (b)(2);  (b) Arm's-length contracts.             AUDIT PROCESS. See note.
 (d)(2).
                                     (1)(i) You have the burden
                                      of demonstrating that your
                                      contract is arm's-length.
                                      . . .
                                     (iii) . . . In these
                                      circumstances, MMS will
                                      notify you and give you an
                                      opportunity to provide
                                      written information
                                      justifying your value. . .
                                      .
                                     (2) MMS may require you to
                                      certify that your arm's-
                                      length contract provisions
                                      include all of the
                                      consideration the buyer
                                      pays, either directly or
                                      indirectly, for the gas,
                                      residue gas, or gas plant
                                      product.
                                     (d) Supporting data.
                                     (2) You must make all such
                                      data available upon
                                      request to the authorized
                                      MMS or Indian
                                      representatives, to the
                                      Office of the Inspector
                                      General of the Department,
                                      or other authorized
                                      persons. . . .
----------------------------------------------------------------------------------------------------------------
206.174(d).........................  (d) Supporting data If you    Burden covered under OMB Control Number 1010-
                                      determine the value of                           0140.
                                      production under paragraph
                                      (c) of this section, you
                                      must retain all data
                                      relevant to determination
                                      of royalty value.
----------------------------------------------------------------------------------------------------------------
206.174(f).........................  (f) Value guidance You may               40               1              40
                                      ask MMS for guidance in
                                      determining value. You may
                                      propose a valuation method
                                      to MMS. Submit all
                                      available data related to
                                      your proposal and any
                                      additional information MMS
                                      deems necessary. . . .?.
----------------------------------------------------------------------------------------------------------------
206.175(d)(4)......................  How do I determine                       20               1              20
                                      quantities and qualities
                                      of production for
                                      computing royalties?.
                                     (d)(4) You may request MMS
                                      approval of other methods
                                      for determining the
                                      quantity of residue gas
                                      and gas plant products
                                      allocable to each lease. .
                                      . .
----------------------------------------------------------------------------------------------------------------
206.176(b).........................  How do I perform accounting    Burden covered under Sec.   206.173(a)(1).
                                      for comparison?.
                                     (b) If you are required to
                                      account for comparison,
                                      you may elect to use the
                                      alternative dual
                                      accounting methodology
                                      provided for in Sec.
                                      206.173 instead of the
                                      provisions in paragraph
                                      (a) of this section.
----------------------------------------------------------------------------------------------------------------
206.176(c).........................  (c) . . . If you do not       Burden covered under Sec.   206.172(b)(1)(ii)
                                      perform dual accounting,
                                      you must certify to MMS
                                      that gas flows into such a
                                      pipeline before it is
                                      processed.
----------------------------------------------------------------------------------------------------------------
                                            Transportation Allowances
----------------------------------------------------------------------------------------------------------------
206.177(c)(2) and (c)(3)...........  What general requirements       Burden covered under Sec.   206.56(b)(2).
                                      regarding transportation
                                      allowances apply to me?.
                                     (c)(2) If you ask MMS, MMS
                                      may approve a
                                      transportation allowance
                                      deduction in excess of the
                                      limitation in paragraph
                                      (c)(1) of this section. .
                                      . .
                                     (3) Your application for
                                      exception (using Form MMS-
                                      4393, Request to Exceed
                                      Regulatory Allowance
                                      Limitation) must contain
                                      all relevant and
                                      supporting documentation
                                      necessary for MMS to make
                                      a determination.
----------------------------------------------------------------------------------------------------------------
206.178(a)(1)(i)...................  How do I determine a                      1              25              25
                                      transportation allowance?.
                                     (a) Determining a
                                      transportation allowance
                                      under an arm's-length
                                      contract.
                                     (1)(i) . . . You are
                                      required to submit to MMS
                                      a copy of your arm's-
                                      length transportation
                                      contract(s) and all
                                      subsequent amendments to
                                      the contract(s) within 2
                                      months of the date MMS
                                      receives your report which
                                      claims the allowance on
                                      the Form MMS-2014.
----------------------------------------------------------------------------------------------------------------
206.178(a)(1)(iii).................  (a) Determining a                       AUDIT PROCESS. See note.
                                      transportation allowance
                                      under an arm's-length
                                      contract.

[[Page 13470]]

 
                                     (1)(iii) If MMS determines
                                      that the consideration
                                      paid under an arm's-length
                                      transportation contract
                                      does not reflect the value
                                      of the transportation
                                      because of misconduct by
                                      or between the contracting
                                      parties . . . In these
                                      circumstances, MMS will
                                      notify you and give you an
                                      opportunity to provide
                                      written information
                                      justifying your
                                      transportation costs.
----------------------------------------------------------------------------------------------------------------
206.178............................  (a) Determining a                        20               1              20
(a)(2)(i) and (ii).................   transportation allowance
                                      under an arm's-length
                                      contract.
                                     (2)(i) . . . you cannot
                                      take an allowance for the
                                      costs of transporting
                                      lease production that is
                                      not royalty bearing
                                      without MMS approval, or
                                      without lessor approval on
                                      tribal leases.
                                     (ii) As an alternative to
                                      paragraph (a)(2)(i) of
                                      this section, you may
                                      propose to MMS a cost
                                      allocation method based on
                                      the values of the products
                                      transported. . . .
----------------------------------------------------------------------------------------------------------------
206.178(a)(3)(i) and (ii)..........  (a) Determining a                        40               1              40
                                      transportation allowance
                                      under an arm's-length
                                      contract.
                                     (3)(i) If your arm's-length
                                      transportation contract
                                      includes both gaseous and
                                      liquid products and the
                                      transportation costs
                                      attributable to each
                                      cannot be determined from
                                      the contract, you must
                                      propose an allocation
                                      procedure to MMS. . . .
                                     (ii) You are required to
                                      submit all relevant data
                                      to support your allocation
                                      proposal. . . .
----------------------------------------------------------------------------------------------------------------
206.178(b)(1)(ii)..................  (b) Determining a                        15               3              45
                                      transportation allowance
                                      under a non-arm's-length
                                      contract or no contract.
                                     (1)(ii) . . . You must
                                      submit the actual cost
                                      information to support the
                                      allowance to MMS on Form
                                      MMS-4295, Gas
                                      Transportation Allowance
                                      Report, within 3 months
                                      after the end of the 12-
                                      month period to which the
                                      allowance applies. . . .
----------------------------------------------------------------------------------------------------------------
206.178(b)(2)(iv)..................  (b) Determining a                        20               1              20
                                      transportation allowance
                                      under a non-arm's-length
                                      contract or no contract.
                                     (2)(iv) You may use either
                                      depreciation with a return
                                      on undepreciated capital
                                      investment or a return on
                                      depreciable capital
                                      investment. . . . you may
                                      not later elect to change
                                      to the other alternative
                                      without MMS approval.
----------------------------------------------------------------------------------------------------------------
206.178(b)(2)(iv)(A)...............  (b) Determining a                        20               1              20
                                      transportation allowance
                                      under a non-arm's-length
                                      contract or no contract.
                                     (2)(iv)(A) . . . Once you
                                      make an election, you may
                                      not change methods without
                                      MMS approval. . . .
----------------------------------------------------------------------------------------------------------------
206.178(b)(3)(i)...................  (b) Determining a                        40               1              40
                                      transportation allowance
                                      under a non-arm's-length
                                      contract or no contract.
                                     (3)(i) . . . Except as
                                      provided in this
                                      paragraph, you may not
                                      take an allowance for
                                      transporting a product
                                      that is not royalty
                                      bearing without MMS
                                      approval.
----------------------------------------------------------------------------------------------------------------
206.178(b)(3)(ii)..................  (b) Determining a                        20               1              20
                                      transportation allowance
                                      under a non-arm's-length
                                      contract or no contract.
                                     (3)(ii) As an alternative
                                      to the requirements of
                                      paragraph (b)(3)(i) of
                                      this section, you may
                                      propose to MMS a cost
                                      allocation method based on
                                      the values of the products
                                      transported. . . .
----------------------------------------------------------------------------------------------------------------
206.178(b)(5)......................  (b) Determining a                        40               1              40
                                      transportation allowance
                                      under a non-arm's-length
                                      contract or no contract.

[[Page 13471]]

 
                                     (5) If you transport both
                                      gaseous and liquid
                                      products through the same
                                      transportation system, you
                                      must propose a cost
                                      allocation procedure to
                                      MMS. . . . You are
                                      required to submit all
                                      relevant data to support
                                      your proposal. . . .
----------------------------------------------------------------------------------------------------------------
206.178(d)(1)......................  (d) Reporting your                      AUDIT PROCESS. See note.
                                      transportation allowance.
                                     (1) If MMS requests, you
                                      must submit all data used
                                      to determine your
                                      transportation allowance .
                                      . .
----------------------------------------------------------------------------------------------------------------
206.178(d)(2), (e), and (f)(1).....  (d) Reporting your            Burden covered under OMB Control Number 1010-
                                      transportation allowance.      0140. Burden covered under Sec.   210.52.
                                     (2) You must report
                                      transportation allowances
                                      as a separate entry on
                                      Form MMS-2014. . . .
                                     (e) Adjusting incorrect
                                      allowances. If for any
                                      month the transportation
                                      allowance you are entitled
                                      to is less than the amount
                                      you took on Form MMS-2014,
                                      you are required to report
                                      and pay additional
                                      royalties due, plus
                                      interest computed under 30
                                      CFR 218.54 from the first
                                      day of the first month you
                                      deducted the improper
                                      transportation allowance
                                      until the date you pay the
                                      royalties due. . . .
                                     (f) Determining allowable
                                      costs for transportation
                                      allowances. . . .
                                     (1) Firm demand charges
                                      paid to pipelines. . . .
                                      You must modify the Form
                                      MMS-2014 by the amount
                                      received or credited for
                                      the affected reporting
                                      period.
----------------------------------------------------------------------------------------------------------------
                                              Processing Allowances
----------------------------------------------------------------------------------------------------------------
206.180(a)(1)(i)...................  How do I determine an                     1              15              15
                                      actual processing
                                      allowance?.
                                     (a) Determining a
                                      processing allowance if
                                      you have an arm's-length
                                      processing contract.
                                     (1)(i) . . . You have the
                                      burden of demonstrating
                                      that your contract is
                                      arm's-length. You are
                                      required to submit to MMS
                                      a copy of your arm's-
                                      length contract(s) and all
                                      subsequent amendments to
                                      the contract(s) within 2
                                      months of the date MMS
                                      receives your first report
                                      that deducts the allowance
                                      on the Form MMS-2014.
----------------------------------------------------------------------------------------------------------------
206.180(a)(1)(iii).................  (a) Determining a                       AUDIT PROCESS. See note.
                                      processing allowance if
                                      you have an arm's-length
                                      processing contract.
                                     (1)(iii) If MMS determines
                                      that the consideration
                                      paid under an arm's-length
                                      processing contract does
                                      not reflect the value of
                                      the processing because of
                                      misconduct by or between
                                      the contracting parties .
                                      . . In these
                                      circumstances, MMS will
                                      notify you and give you an
                                      opportunity to provide
                                      written information
                                      justifying your processing
                                      costs.
----------------------------------------------------------------------------------------------------------------
206.180(a)(3)......................  (a) Determining a                        40               1              40
                                      processing allowance if
                                      you have an arm's-length
                                      processing contract.
                                     (3) If your arm's-length
                                      processing contract
                                      includes more than one gas
                                      plant product and the
                                      processing costs
                                      attributable to each
                                      product cannot be
                                      determined from the
                                      contract, you must propose
                                      an allocation procedure to
                                      MMS. . . . You are
                                      required to submit all
                                      relevant data to support
                                      your proposal. . . .
----------------------------------------------------------------------------------------------------------------
206.180(b)(1)(ii)..................  (b) Determining a                        20               5             100
                                      processing allowance if
                                      you have a non-arm's-
                                      length contract or no
                                      contract.

[[Page 13472]]

 
                                     (1)(ii) . . . You must
                                      submit the actual cost
                                      information to support the
                                      allowance to MMS on Form
                                      MMS-4109, Gas Processing
                                      Allowance Summary Report,
                                      within 3 months after the
                                      end of the 12-month period
                                      for which the allowance
                                      applies. . . .
----------------------------------------------------------------------------------------------------------------
206.180(b)(2)(iv)..................  (b) Determining a                        20               1              20
                                      processing allowance if
                                      you have a non-arm's-
                                      length contract or no
                                      contract.
                                     (2)(iv) You may use either
                                      depreciation with a return
                                      on undepreciable capital
                                      investment or a return on
                                      depreciable capital
                                      investment. . . . you may
                                      not later elect to change
                                      to the other alternative
                                      without MMS approval.
----------------------------------------------------------------------------------------------------------------
206.180(b)(2)(iv)(A)...............  (b) Determining a                        20               1              20
                                      processing allowance if
                                      you have a non-arm's-
                                      length contract or no
                                      contract.
                                     (2)(iv)(A) . . . Once you
                                      make an election, you may
                                      not change methods without
                                      MMS approval. . . .
----------------------------------------------------------------------------------------------------------------
206.180(b)(3)......................  (b) Determining a                        20               1              20
                                      processing allowance if
                                      you have a non-arm's-
                                      length contract or no
                                      contract.
                                     (3) Your processing
                                      allowance under this
                                      paragraph (b) must be
                                      determined based upon a
                                      calendar year or other
                                      period if you and MMS
                                      agree to an alternative.
----------------------------------------------------------------------------------------------------------------
206.180(c)(1)......................  (c) Reporting your                      AUDIT PROCESS. See note.
                                      processing allowance.
                                     (1) If MMS requests, you
                                      must submit all data used
                                      to determine your
                                      processing allowance. . .
                                      .
----------------------------------------------------------------------------------------------------------------
206.180(c)(2) and (d)..............  (c) Reporting your            Burden covered under OMB Control Number 1010-
                                      processing allowance.          0140. Burden covered under Sec.   210.52.
                                     (2) You must report gas
                                      processing allowances as a
                                      separate entry on the Form
                                      MMS-2014. . . ..
                                     (d) Adjusting incorrect
                                      processing allowances. If
                                      for any month the gas
                                      processing allowance you
                                      are entitled to is less
                                      than the amount you took
                                      on Form MMS-2014, you are
                                      required to pay additional
                                      royalties, plus interest
                                      computed under 30 CFR
                                      218.54 from the first day
                                      of the first month you
                                      deducted a processing
                                      allowance until the date
                                      you pay the royalties due.
                                      . . .
----------------------------------------------------------------------------------------------------------------
206.181(c).........................  How do I establish                       40               1              40
                                      processing costs for dual
                                      accounting purposes when I
                                      do not process the gas?.
                                     (c) A proposed comparable
                                      processing fee submitted
                                      to either the tribe and
                                      MMS (for tribal leases) or
                                      MMS (for allotted leases)
                                      with your supporting
                                      documentation submitted to
                                      MMS. If MMS does not take
                                      action on your proposal
                                      within 120 days, the
                                      proposal will be deemed to
                                      be denied and subject to
                                      appeal to the MMS Director
                                      under 30 CFR part 290.
----------------------------------------------------------------------------------------------------------------
                   207--SALES AGREEMENTS OR CONTRACTS GOVERNING THE DISPOSAL OF LEASE PRODUCTS
                                          Subpart A--General Provisions
----------------------------------------------------------------------------------------------------------------
207.4(b)...........................  Contracts made pursuant to              AUDIT PROCESS. See note.
                                      old form leases.
                                     (b) The stipulation, the
                                      substance of which must be
                                      included in the contract,
                                      or be made the subject
                                      matter of a separate
                                      instrument properly
                                      identifying the leases
                                      affected thereby, is as
                                      follows . . .
----------------------------------------------------------------------------------------------------------------
207.5..............................  Contract and sales                      AUDIT PROCESS. See note.
                                      agreement retention.

[[Page 13473]]

 
                                     Copies of all sales
                                      contracts, posted price
                                      bulletins, etc., and
                                      copies of all agreements,
                                      other contracts, or other
                                      documents which are
                                      relevant to the valuation
                                      of production are to be
                                      maintained by the lessee
                                      and made available upon
                                      request during normal
                                      working hours to
                                      authorized MMS, State or
                                      Indian representatives,
                                      other MMS or BLM
                                      officials, auditors of the
                                      General Accounting Office,
                                      or other persons
                                      authorized to receive such
                                      documents, or shall be
                                      submitted to MMS within a
                                      reasonable period of time,
                                      as determined by MMS. Any
                                      oral sales arrangement
                                      negotiated by the lessee
                                      must be placed in written
                                      form and retained by the
                                      lessee. Records shall be
                                      retained in accordance
                                      with 30 CFR part 212.
----------------------------------------------------------------------------------------------------------------
    Total Burden...................  ...........................  ..............             140           1,074
----------------------------------------------------------------------------------------------------------------
Note: AUDIT PROCESS--The Office of Regulatory Affairs determined that the audit process is exempt from the
  Paperwork Reduction Act of 1995 because MMS staff asks non-standard questions to resolve exceptions.

    Estimated Annual Reporting and Recordkeeping ``Non-hour'' Cost 
Burden: We have identified no ``non-hour'' cost burdens.
    Public Disclosure Statement: The PRA (44 U.S.C. 3501 et seq.) 
provides that an agency may not conduct or sponsor, and a person is not 
required to respond to, a collection of information unless it displays 
a currently valid OMB control number.
    Comments: Section 3506(c)(2)(A) of the PRA requires each agency to 
``* * * publish a 60-day notice in the Federal Register * * * and 
otherwise consult with members of the public and affected agencies 
concerning each proposed collection of information * * *.'' Agencies 
must specifically solicit comments to: (a) Evaluate whether the 
proposed collection of information is necessary for the agency to 
perform its duties, including whether the information is useful; (b) 
evaluate the accuracy of the agency's estimate of the burden of the 
proposed collection of information; (c) enhance the quality, 
usefulness, and clarity of the information to be collected; and (d) 
minimize the burden on the respondents, including the use of automated 
collection techniques or other forms of information technology.
    To comply with the public consultation process, we published a 
notice in the Federal Register on August 1, 2008 (73 FR 45055), 
announcing that we would submit this ICR to OMB for approval. (The 
Federal Register printed an additional notice correcting the response 
date for comments on August 8, 2008 (73 FR 46367).) The notice provided 
the required 60-day comment period. We received no comments in response 
to the notice.
    If you wish to comment in response to this notice, you may send 
your comments to the offices listed under the ADDRESSES section of this 
notice. The OMB has up to 60 days to approve or disapprove the 
information collection but may respond after 30 days. Therefore, to 
ensure maximum consideration, OMB should receive public comments by 
April 27, 2009.
    Public Comment Policy: We will post all comments in response to 
this notice on our Web site at http://www.mrm.mms.gov/Laws_R_D/InfoColl/InfoColCom.htm. We also will post all comments, including 
names and addresses of respondents, at http://www.regulations.gov. 
Before including your address, phone number, e-mail address, or other 
personal identifying information in your comment, be advised that your 
entire comment--including your personal identifying information--may be 
made publicly available at any time. While you can ask us in your 
comment to withhold from public view your personal identifying 
information, we cannot guarantee that we will be able to do so.
    MMS Information Collection Clearance Officer: Arlene Bajusz, (202) 
208-7744.

    Dated: February 6, 2009.
Mary A. Williams,
Acting Associate Director for Minerals Revenue Management.
 [FR Doc. E9-6901 Filed 3-26-09; 8:45 am]
BILLING CODE 4310-MR-P