[Federal Register Volume 76, Number 156 (Friday, August 12, 2011)]
[Notices]
[Pages 50249-50252]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-20510]


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DEPARTMENT OF THE INTERIOR

Office of Natural Resources Revenue

[Docket No. ONRR-2011-0006]


Agency Information Collection Activities: Submitted for Office of 
Management and Budget (OMB) Review; Comment Request

AGENCY: Office of Natural Resources Revenue (ONRR), Interior.

ACTION: Notice of an extension of a currently approved information 
collection.

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SUMMARY: To comply with the Paperwork Reduction Act of 1995 (PRA), we 
are notifying the public that we have submitted to OMB an information 
collection request (ICR) to renew approval of the paperwork 
requirements in this ICR titled ``30 CFR Part 1220, OCS Net Profit 
Share Payment Reporting.'' 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 September 12, 2011.

ADDRESSES: Submit written comments by either FAX (202) 395-5806 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 1012-0009).
    Please also submit a copy of your comments by one of the following 
methods:
     Electronically go to http://www.regulations.gov. In the 
entry titled ``Enter Keyword or ID,'' enter ONRR-2011-0006, and then 
click search. Follow the instructions to submit public comments. The 
ONRR will post all comments.
     Mail comments to Armand Southall, Regulatory Specialist, 
ONRR, P.O. Box 25165, MS 61013C, Denver, Colorado 80225-0165. Please 
reference ICR 1012-0009 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 1012-0009 in your comments.

[[Page 50250]]


FOR FURTHER INFORMATION CONTACT: For questions on technical issues, 
contact Mary Ann Guilinger, Audit and Compliance Management (ACM), 
ONRR, telephone (303) 231-3408, or e-mail [email protected]. 
For other questions, contact Armand Southall, telephone (303) 231-3221, 
or e-mail [email protected]. You may also contact Mr. Southall 
to obtain copies, at no cost, of (1) the ICR and (2) the regulations 
that require the subject collection of information.

SUPPLEMENTARY INFORMATION: Title: 30 CFR Part 1220, OCS Net Profit 
Share Payment Reporting.
    OMB Control Number: 1012-0009.
    Bureau Form Number: None.
    Abstract: The Secretary of the U.S. Department of the Interior is 
responsible for collecting royalties from lessees who produce minerals 
from leased Federal and Indian lands and the Outer Continental Shelf 
(OCS). The Secretary is required by various laws to manage mineral 
resources production on Federal and Indian lands and the OCS, collect 
royalties due, and distribute the funds collected under those laws. The 
ONRR performs the royalty management functions for the Secretary.
    Public laws pertaining to mineral leases on Federal and Indian 
lands and the OCS are posted at http://www.onrr.gov/Laws_R_D/PublicLawsAMR.htm.

I. General Information

    The ONRR collects and uses this information to determine all 
allowable direct and allocable joint costs and credits under Sec.  
1220.011 incurred during the lease term, appropriate overhead allowance 
permitted on these costs under Sec.  1220.012, and allowances for 
capital recovery calculated under Sec.  1220.020. The ONRR also 
collects this information to ensure royalties or net profit share 
payments are accurately valued and appropriately paid. This ICR affects 
only oil and gas leases on submerged Federal lands on the OCS.

II. Information Collections

    Title 30 CFR part 1220 covers the net profit share lease (NPSL) 
program and establishes reporting requirements for determining the net 
profit share base under Sec.  1220.021 and calculating net profit share 
payments due the Federal Government for the production of oil and gas 
from leases under Sec.  1220.022.

A. NPSL Bidding System

    To encourage exploration and development of oil and gas leases on 
submerged Federal lands on the Outer Continental Shelf (OCS), the 
Bureau of Ocean Energy Management, Regulations, and Enforcement 
(BOEMRE, the former Offshore Energy and Minerals Management [OEMM] of 
Minerals Management Service [MMS]) promulgated regulations at 30 CFR 
part 260--Outer Continental Shelf Oil and Gas Leasing. Also, BOEMRE 
promulgated specific implementing regulations for the NPSL bidding 
system at Sec.  260.110(d). The BOEMRE established the NPSL bidding 
system to balance a fair market return to the Federal Government for 
the lease of its public lands with a fair profit to companies risking 
their investment capital. The system provides an incentive for early 
and expeditious exploration and development and provides for sharing 
the risks by the lessee and the Federal Government. The NPSL bidding 
system incorporates a fixed capital recovery system as a means through 
which the lessee recovers costs of exploration and development from 
production revenues, along with a reasonable return on investment.

B. NPSL Capital Account

    The Federal Government does not receive a profit share payment from 
an NPSL until the lessee shows a credit balance in its capital account; 
that is, cumulative revenues and other credits exceed cumulative costs. 
Lessees multiply the credit balance by the net profit share rate (30 to 
50 percent), resulting in the amount of net profit share payment due 
the Federal Government.
    The ONRR requires lessees to maintain an NPSL capital account for 
each lease under Sec.  1220.010, which transfers to a new owner when 
sold. Following the cessation of production, lessees are also required 
to provide either an annual or a monthly report to the Federal 
Government, using data from the capital account until the lease is 
terminated, expired, or relinquished.

C. NPSL Inventories

    The NPSL lessees must notify ONRR of their intent to perform an 
inventory and file a report after each inventory of controllable 
materiel under Sec.  1220.032.

D. NPSL Audits

    When non-operators of an NPSL call for an audit, they must notify 
ONRR. When ONRR calls for an audit, the lessee must notify all non-
operators on the lease. These requirements are located at Sec.  
1220.033.

III. OMB Approval

    The information we collect under this ICR is essential in order to 
determine when net profit share payments are due and to ensure lessees 
properly value and pay royalties or net profit share payments.
    We are requesting OMB approval to continue to collect this 
information. Not collecting this information would limit the 
Secretary's ability to discharge fiduciary duties and may also result 
in the inability to confirm the accurate royalty value. Proprietary 
information submitted to ONRR under this collection is protected, and 
no items of a sensitive nature are included in this information 
collection.
    Frequency: Annually, monthly, and on occasion.
    Estimated Number and Description of Respondents: 6 lessees.
    Estimated Annual Reporting and Recordkeeping ``Hour'' Burden: 1,046 
hours.
    All six lessees report monthly because all current NPSLs are in 
producing status. Because the requirements for establishment of capital 
accounts at Sec.  1220.010(a) and capital account annual reporting at 
Sec.  1220.031(a) are necessary only during non-producing status of a 
lease, we included only one response annually for these requirements, 
in case a new NPSL is established. We have not included in our 
estimates certain requirements performed in the normal course of 
business, which are considered usual and customary. The following table 
shows the estimated annual burden hours by CFR section and paragraph.

[[Page 50251]]



                                   Respondents' Estimated Annual Burden Hours
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                                                                                     Number of
       Citation 30 CFR 1220           Reporting & recordkeeping     Hour burden       annual      Annual  burden
                                             requirement                             responses         hours
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  Part 1220--Accounting Procedures for Determining Net Profit Share Payment for Outer Continental Shelf Oil and
                                                   Gas Leases
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                                      Sec.   1220.010 NPSL capital account
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1220.010(a).......................  (a) For each NPSL tract, an                1               1               1
                                     NPSL capital account shall
                                     be established and
                                     maintained by the lessee
                                     for NPSL operations * * *.
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                                     Sec.   1220.030 Maintenance of records
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1220.030(a) and (b)...............  (a) Each lessee * * * shall                1               6               6
                                     establish and maintain such
                                     records as are necessary *
                                     * *.
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                               Sec.   1220.031 Reporting and payment requirements
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1220.031(a).......................  (a) Each lessee subject to                 1               1               1
                                     this part shall file an
                                     annual report during the
                                     period from issuance of the
                                     NPSL until the first month
                                     in which production
                                     revenues are credited to
                                     the NPSL capital account *
                                     * *.
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1220.031(b).......................  (b) Beginning with the first              13          72 \1\             936
                                     month in which production
                                     revenues are credited to
                                     the NPSL capital account,
                                     each lessee * * * shall
                                     file a report for each
                                     NPSL, not later than 60
                                     days following the end of
                                     each month * * *.
----------------------------------------------------------------------------------------------------------------
1220.031(c).......................  (c) Each lessee subject to    Burden hours covered under Sec.   1220.031(b).
                                     this Part 220 shall submit,
                                     together with the report
                                     required * * * any net
                                     profit share payment due *
                                     * *.
----------------------------------------------------------------------------------------------------------------
1220.031(d).......................  (d) Each lessee * * * shall                8               6              48
                                     file a report not later
                                     than 90 days after each
                                     inventory is taken * * *.
----------------------------------------------------------------------------------------------------------------
1220.031(e).......................  (e) Each lessee * * * shall                4               6              24
                                     file a final report, not
                                     later than 60 days
                                     following the cessation of
                                     production * * *.
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                                           Sec.   1220.032 Inventories
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1220.032(b).......................  (b) At reasonable intervals,               1               6               6
                                     but at least once every
                                     three years, inventories of
                                     controllable materiel shall
                                     be taken by the lessee.
                                     Written notice of intention
                                     to take inventory shall be
                                     given by the lessee at
                                     least 30 days before any
                                     inventory is to be taken so
                                     that the Director may be
                                     represented at the taking
                                     of inventory * * *.
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                                             Sec.   1220.033 Audits
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1220.033(b)(1)....................  (b)(1) When nonoperators of                2               6              12
                                     an NPSL lease call an audit
                                     in accordance with the
                                     terms of their operating
                                     agreement, the Director
                                     shall be notified of the
                                     audit call * * *.
----------------------------------------------------------------------------------------------------------------
1220.033(b)(2)....................  (b)(2) If DOI determines to                2               6              12
                                     call for an audit, DOI
                                     shall notify the lessee of
                                     its audit call and set a
                                     time and place for the
                                     audit * * * The lessee
                                     shall send copies of the
                                     notice to the nonoperators
                                     on the lease * * *.
----------------------------------------------------------------------------------------------------------------
1220.033(e).......................  (e) Records required to be      The Office of Regulatory Affairs determined
                                     kept under Sec.                 that the audit process is exempt from the
                                     1220.030(a) shall be made      Paperwork Reduction Act of 1995 because MMS
                                     available for inspection by   staff asks non-standard questions to resolve
                                     any authorized agent of DOI                    exceptions.
                                     * * *.
----------------------------------------------------------------------------------------------------------------
    TOTAL BURDEN................................................................             110           1,046
----------------------------------------------------------------------------------------------------------------
\1\ (6 NPSL reports x 12 months = 72 reports)

    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.

[[Page 50252]]

    Comments: Before submitting an ICR to OMB, PRA section 
3506(c)(2)(A) requires each agency to ``* * * provide 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 March 25, 2011 (76 FR 16816), 
announcing that we would submit this ICR to OMB for approval. The 
notice provided the required 60-day comment period. We received no 
comments in response to the notice.
    If you wish to comment in response to this notice, you may send 
your comments to the offices listed under the ADDRESSES section of this 
notice. 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 
September 12, 2011.
    Public Comment Policy: We 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 your personal identifying information from public view, we 
cannot guarantee that we will be able to do so.
    ONRR Information Collection Clearance Officer: Hyla Hurst (303) 
231-3495.

    Dated: August 2, 2011.
Gregory J. Gould,
Director for Office of Natural Resources Revenue.
[FR Doc. 2011-20510 Filed 8-11-11; 8:45 am]
BILLING CODE 4310-MR-P