[Federal Register Volume 76, Number 219 (Monday, November 14, 2011)]
[Notices]
[Pages 70486-70489]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-29298]


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DEPARTMENT OF THE INTERIOR

Office of Natural Resources Revenue

[Docket No. ONRR-2011-0008]


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

AGENCY: Office of Natural Resources Revenue, 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), the 
Office of Natural Resources Revenue (ONRR) is 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 part 1243. 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 December 14, 2011.

ADDRESSES: Submit written comments by either FAX (202) 395-5806 or 
email ([email protected]) directly to the Office of Information 
and Regulatory Affairs, OMB, Attention: Desk Officer for the Department 
of the Interior (OMB Control Number 1012-0006).
    Please also submit a copy of your comments to ONRR by one of the 
following methods:
     Electronically go to http://www.regulations.gov. In the 
entry titled ``Enter Keyword or ID,'' enter ONRR-2011-0008, and then 
click search. Follow the instructions to submit public comments. We 
will post all comments.
     Mail comments to Hyla Hurst, Regulatory Specialist, Office 
of Natural Resources Revenue, P.O. Box 25165, MS 64000A, Denver, 
Colorado 80225. Please reference ICR 1012-0006 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 1012-0006 in your comments.

FOR FURTHER INFORMATION CONTACT: Hyla Hurst, telephone (303) 231-3495, 
or email [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. You 
may also review the ICR online at http://www.reginfo.gov/public/do/PRAMain.

SUPPLEMENTARY INFORMATION:
    Title: 30 CFR part 1243--Suspensions Pending Appeal and Bonding--
Office of Natural Resources Revenue.
    OMB Control Number: 1012-0006.
    Bureau Form Numbers: ONRR-4435, ONRR-4436, and ONRR-4437.
    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 from Federal and 
Indian lands and the OCS, collect the royalties and other mineral 
revenues due, and distribute the funds collected in accordance with 
applicable laws. The Secretary also has a trust responsibility to 
manage Indian lands and seek advice and information from Indian 
beneficiaries. The ONRR performs the minerals revenue management 
functions for the Secretary and assists the Secretary in carrying out 
the Department's trust responsibility for Indian lands. Public laws 
pertaining to mineral leases on Federal and Indian lands are posted on 
our Web site at http://www.onrr.gov/Laws_R_D/PublicLawsAMR.htm.
    If ONRR determines that a lessee has not properly reported or paid, 
we may issue an order to pay additional royalties, a Notice of 
Noncompliance, or a Civil Penalty Notice requiring correct reporting or 
payment. Lessees then have a right to appeal those ONRR actions.
    Regulations at 30 CFR part 1243 govern the submission of 
appropriate surety instruments to suspend compliance with orders or 
decisions and to stay the accrual of civil penalties (if the Office of 
Hearings and Appeals grants a lessee's petition to stay accrual of 
civil penalties), pending administrative appeal for Federal and Indian 
leases. For Federal oil and gas leases, under 30 U.S.C. 1724(l) and its 
implementing regulations in 30 CFR part 1243, appellants who are 
requesting a suspension without providing a surety may submit 
information to demonstrate financial solvency. This ICR covers the 
burden hours associated with submitting financial statements or surety 
instruments required to stay an ONRR order, decision, or accrual of 
civil penalties.

Stay of Payment Pending Appeal

    Title 30 CFR 1243.1 explains how lessees or recipients of ONRR 
orders may suspend compliance with an order if they appeal in 
accordance with 30 CFR part 1290. Pending appeal, ONRR

[[Page 70487]]

suspends the payment requirement if the appellant submits a formal 
agreement of payment in case of default, such as a bond or other 
surety, or, for Federal oil and gas leases, demonstrates financial 
solvency. If the Office of Hearings and Appeals grants a lessee's, or 
other recipient of a Notice of Noncompliance or Civil Penalty Notice, 
request to stay the accrual of civil penalties under 30 CFR 
1241.55(b)(2) and 1241.63(b)(2), the lessee or other recipient must 
post a bond or other surety, or, for Federal oil and gas leases, 
demonstrate financial solvency.
    The ONRR accepts the following surety types: Form ONRR-4435, 
Administrative Appeal Bond (formerly Form MMS-4435); Form ONRR-4436, 
Letter of Credit (formerly Form MMS-4436); Form ONRR-4437, Assignment 
of Certificate of Deposit (formerly Form MMS-4437); Self-bonding; and 
U.S. Treasury Securities.
    When an appellant selects and puts one of the surety types in 
place, the appellant must maintain the surety until completion of the 
appeal. If the appeal is decided in favor of the appellant, ONRR 
returns the surety to the appellant. If the appeal is decided in favor 
of ONRR, then we may take action to collect the total amount due or 
draw down on the surety. We draw down on a surety if the appellant 
fails to pay or fails to comply with requirements relating to amount 
due, timeframe, or surety submission or resubmission. Whenever ONRR 
must draw down on a surety, we must draw down the total amount due, 
which is defined as unpaid principal plus the interest accrued to the 
projected receipt date of the surety payment. Appellants may refer to 
the Surety Instrument Posting Instructions, which are on our Web site 
at http://www.onrr.gov/FM/Forms/default.htm.

Forms and Other Surety Types

Form ONRR-4435, Administrative Appeal Bond

    Appellants may file Form ONRR-4435, Administrative Appeal Bond, 
which ONRR uses to secure the financial interests of the public and 
Indian lessors during the entire administrative and judicial appeal 
process. Under 30 CFR 1243.4, appellants must submit their contact and 
surety amount information on the bond to obtain the benefit of 
suspension of an obligation to comply with an order. A surety company 
that the U.S. Department of the Treasury approves (see Department of 
the Treasury Circular No. 570, as revised periodically in the Federal 
Register) must issue the bond. The ONRR Director or the ONRR-delegated 
bond-approving officer maintains these bonds in a secure facility. 
After the appeal has concluded, ONRR may release and return the bond to 
the appellant or collect payment on the bond. If collection is 
necessary for a remaining balance, ONRR will issue a demand for payment 
to the surety company with a notice to the appellant. We also will 
include all interest accrued on the affected bill.

Form ONRR-4436, Letter of Credit

    Appellants may choose to file Form ONRR-4436, Letter of Credit 
(LOC), with no modifications. Requirements at 30 CFR 1243.4 continue to 
apply. A bank with a minimum Fitch rating of ``C'' must notarize and 
issue the LOC for appellants for a LOC of less than $1 million; ``B/C'' 
for a LOC between $1 million and $10 million; or ``B'' for a LOC over 
$10 million. A Fitch rating is a bank rating provided by Fitch, Inc., 
and is available at http://www.fitchratings.com. The LOC must have a 
minimum coverage period of 1 year and be automatically renewable for up 
to 5 years.
    The appellant is responsible for verifying that the bank provides a 
current Fitch rating to ONRR. If the issuing bank's rating falls below 
the minimum acceptable level, the appellant must submit a satisfactory 
replacement surety within 14 days or ONRR will draw down the existing 
LOC. If the bank issuing the LOC chooses not to renew the existing LOC, 
it must provide ONRR with a notice of its decision not to renew 30 days 
prior to expiration of the LOC. After the appeal concludes, ONRR may 
release and return the LOC to the appellant or collect payment on the 
LOC. If collection is necessary for a remaining payment balance, ONRR 
will issue a demand for payment, which includes all interest assessed 
on the affected bill, to the bank with a notice to the appellant.

Form ONRR-4437, Assignment of Certificate of Deposit

    Appellants also may choose to secure a debt using a Certificate of 
Deposit (CD) from their bank and by submitting Form ONRR-4437, 
Assignment of Certificate of Deposit. Appellants must file the request 
with ONRR prior to the invoice due date. We will accept only a book-
entry CD that explicitly assigns the CD to the ONRR Director. The CD 
must be issued by a bank with the minimum required Fitch rating or be 
confirmed by a bank with an acceptable rating. The acceptable ratings 
for a CD are the same as for a LOC discussed above. If collection of 
the CD is necessary for a payment balance, ONRR will return unused CD 
funds to the appellant after total settlement of the appealed issues 
including applicable interest charges.

Self-Bonding

    For Federal oil and gas leases, regulations at 30 CFR 1243.201 do 
not require a surety instrument when an appellant periodically 
demonstrates, to the satisfaction of ONRR, that the guarantor or 
appellant is financially solvent or otherwise able to pay the 
obligation. Appellants must submit a written request to ``self-bond'' 
every time a new appeal is filed. To evaluate the financial solvency 
and exemption from requirements of appellants to maintain a surety 
related to an appeal, ONRR requires appellants to submit a consolidated 
balance sheet subject to annual audit. In some cases, we also require 
copies of the most recent tax returns (up to 3 years) filed by 
appellants.
    In addition, appellants must annually submit financial statements 
subject to annual audit to support a minimum net worth of $300 million. 
The ONRR uses the consolidated balance sheet or business information 
supplied to evaluate the financial solvency of a lessee, designee, or 
payor seeking to demonstrate financial solvency to stay its payment 
obligation pending appeal. If appellants do not have a consolidated 
balance sheet documenting their net worth or if they do not meet the 
$300 million net worth requirement, ONRR selects a business information 
or credit reporting service to provide information concerning an 
appellant's financial solvency. We charge the appellant a $50 fee each 
time we need to review data from a business information or credit 
reporting service. The fee covers our costs to determine an appellant's 
financial solvency.

U.S. Treasury Securities

    Appellants may choose to secure their debts by requesting to use a 
U.S. Treasury Security (TS). Appellants must file a letter of request 
with ONRR prior to the invoice due date. The TS must: (1) Be a U.S. 
Treasury note or bond with maturity equal to or greater than 1 year; 
(2) 120 percent of the appealed amount plus 1 year of estimated 
interest (necessary to protect ONRR against interest rate 
fluctuations); and (3) be a book-entry TS. Book-entry securities are 
securities that are recorded in electronic records rather than as paper 
certificates.

OMB Approval

    We are requesting OMB's approval to continue to collect this 
information. Not collecting this information would limit the 
Secretary's ability to discharge the

[[Page 70488]]

fiduciary duties of the office and also may result in loss of royalty 
and other payments.
    The ONRR protects proprietary information submitted under this 
collection. We do not collect information of a sensitive nature in this 
ICR. A response is mandatory in order to suspend compliance with an 
order pending appeal.
    Frequency: Annually and on occasion.
    Estimated Number and Description of Respondents: 105 Federal or 
Indian appellants.
    Estimated Annual Reporting and Recordkeeping ``Hour'' Burden: 210 
hours. We have not included in our estimates certain requirements 
performed in the normal course of business and considered usual and 
customary. The following table shows the estimated burden hours by CFR 
section and paragraph:

                                                       Respondents' Estimated Annual Burden Hours
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                                         Reporting and recordkeeping                                                                      Annual  burden
    Citation 30 CFR part 1243                    requirement                    Hour burden         Average number of annual responses         hours
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1243.4(a)(1).....................  How do I suspend compliance with an     2 hours..............  40 (Forms ONRR-4435, ONRR-4436, ONRR-               80
                                    order?                                                         4437; or TS).
                                   (a) If you timely appeal an order, and
                                    if that order or portion of that
                                    order: (1) Requires you to make a
                                    payment, and you want to suspend
                                    compliance with that order, you must
                                    post a bond or other surety
                                    instrument or demonstrate financial
                                    solvency * * *.
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1243.6...........................  When must I or another person meet the                 Burden hours covered under Sec.   1243.4(a)(1).
                                    bonding or financial solvency
                                    requirements under this part?
                                   If you must meet the bonding or
                                    financial solvency requirements under
                                    Sec.   1243.4(a)(1), or if another
                                    person is meeting your bonding or
                                    financial solvency requirements, then
                                    either you or the other person must
                                    post a bond or other surety
                                    instrument or demonstrate financial
                                    solvency within 60 days after you
                                    receive the order or the Notice of
                                    Order.
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1243.7(a)........................  What must a person do when posting a                   Burden hours covered under Sec.   1243.4(a)(1).
                                    bond or other surety instrument or
                                    demonstrating financial solvency on
                                    behalf of an appellant?
                                   If you assume an appellant's
                                    responsibility to post a bond or
                                    other surety instrument or
                                    demonstrate financial solvency * * *
                                    (a) Must notify ONRR in writing * * *
                                    that you are assuming the appellant's
                                    responsibility * * *.
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1243.8(a)(2) and (b)(2)..........  When will ONRR suspend my obligation                   Burden hours covered under Sec.   1243.4(a)(1).
                                    to comply with an order?
                                   (a) Federal leases. * * * (2) If the
                                    amount under appeal is $10,000 or
                                    more, ONRR will suspend your
                                    obligation to comply with that order
                                    if you:
                                   (i) Submit an ONRR-specified surety
                                    instrument under subpart B of this
                                    part within a time period ONRR
                                    prescribes; or
                                   (ii) Demonstrate financial solvency
                                    under subpart C.
                                   (b) Indian leases. * * * (2) If the
                                    amount under appeal is $1,000 or
                                    more, ONRR will suspend your
                                    obligation to comply with that order
                                    if you submit an ONRR-specified
                                    surety instrument under subpart B of
                                    this part within a time period ONRR
                                    prescribes.
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1243.101(b)......................  How will ONRR determine the amount of                  Burden hours covered under Sec.   1243.4(a)(1).
                                    my bond or other surety instrument?
                                   * * * (b) If your appeal is not
                                    decided within 1 year from the filing
                                    date, you must increase the surety
                                    amount to cover additional estimated
                                    interest for another 1-year period.
                                    You must continue to do this annually
                                    * * *.
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1243.200(a) and (b)..............  How do I demonstrate financial          2 hours..............  65 (Self-bonding submissions).........             130
                                    solvency?
                                   (a) To demonstrate financial solvency
                                    under this part, you must submit an
                                    audited consolidated balance sheet,
                                    and, if requested by the ONRR bond-
                                    approving officer, up to 3 years of
                                    tax returns to the ONRR, * * *.

[[Page 70489]]

 
                                   (b) You must submit an audited
                                    consolidated balance sheet annually,
                                    and, if requested, additional annual
                                    tax returns on the date ONRR first
                                    determined that you demonstrated
                                    financial solvency as long as you
                                    have active appeals, or whenever ONRR
                                    requests. * * *
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1243.201(c)(1), (c)(2)(i) and      How will ONRR determine if I am         Burden hours covered under Sec.  Sec.   1243.4(a)(1) and 1243.200(a) and (b).
 (c)(2)(ii) and (d)(2).             financially solvent?
                                   * * * (c) If your net worth, minus the
                                    amount we would require as surety
                                    under subpart B for all orders you
                                    have appealed is less than $300
                                    million, you must submit * * *:
                                   (1) A written request asking us to
                                    consult a business-information, or
                                    credit-reporting service or program
                                    to determine your financial solvency;
                                    and
                                   (2) A nonrefundable $50 processing
                                    fee:
                                   (i) You must pay the processing fee *
                                    * *;
                                   (ii) You must submit the fee with your
                                    request * * * and then annually on
                                    the date we first determined that you
                                    demonstrated financial solvency, as
                                    long as you are not able to
                                    demonstrate financial solvency * * *
                                    and you have active appeals.
                                   (d)* * * (2) For us to consider you
                                    financially solvent, the business-
                                    information or credit-reporting
                                    service or program must demonstrate
                                    your degree of risk as low to
                                    moderate: * * *
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1243.202(c)......................  When will ONRR monitor my financial                    Burden hours covered under Sec.   1243.4(a)(1).
                                    solvency?
                                   * * * (c) If our bond-approving
                                    officer determines that you are no
                                    longer financially solvent, you must
                                    post a bond or other ONRR-specified
                                    surety instrument under subpart B.
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    Total Burden.................  ......................................  .....................  105...................................             210
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Estimated Annual Reporting and Recordkeeping ``Non-hour'' Cost 
Burden: There are no additional recordkeeping costs associated with 
this information collection. However, ONRR estimates five appellants 
per year will pay a $50 fee to obtain credit data from a business 
information or credit reporting service, which is a total ``non-hour'' 
cost burden of $250 per year (5 appellants per year x $50 = $250).
    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 
``* * * 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 May 4, 2011 (76 FR 25367), 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 
December 14, 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, email 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.
    Information Collection Clearance Officer: Karen Burke (703) 487-
3896.

    Dated: November 7, 2011.
Gregory J. Gould,
Director, Office of Natural Resources Revenue.
[FR Doc. 2011-29298 Filed 11-10-11; 8:45 am]
BILLING CODE 4310-T2-P