[Federal Register Volume 79, Number 209 (Wednesday, October 29, 2014)]
[Notices]
[Pages 64404-64407]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-25727]


-----------------------------------------------------------------------

DEPARTMENT OF THE INTERIOR

Office of Natural Resources Revenue

[Docket No. ONRR-2011-0006; DS63610000 DR2PS0000.CH7000 145D0102R2]


Agency Information Collection Activities: OCS Net Profit Share 
Payment Reporting--OMB Control Number 1012-0009; Comment Request

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

ACTION: Notice of extension.

-----------------------------------------------------------------------

SUMMARY: To comply with the Paperwork Reduction Act of 1995 (PRA), 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 1220. This notice also provides the public a second 
opportunity to comment on the paperwork burden of these regulatory 
requirements.

DATES: OMB has up to 60 days to approve or disapprove this information 
collection request but may respond after 30 days; therefore, you should 
submit your public comments to OMB by November 28, 2014 for the 
assurance of consideration.

ADDRESSES: You may submit your written comments directly to the Desk 
Officer for the Department of the Interior (OMB Control Number 1012-
0009), Office of Information and Regulatory Affairs, OMB, by email to 
[email protected] or telefax at (202) 395-5806. Please also 
mail a copy of your comments to Mr. Luis Aguilar, Regulatory 
Specialist, ONRR, P.O. Box 25165, MS 61030A, Denver, Colorado 80225-
0165, or by email to [email protected]. Please reference ICR 1012-
0009 in your comments.

FOR FURTHER INFORMATION CONTACT: For questions on technical issues, 
contact Mr. James Smith, Audit and Compliance Management (ACM), ONRR, 
telephone (303) 231-3705, or email [email protected]. For other 
questions, contact Luis Aguilar, telephone (303) 231-3418, or email 
[email protected]. You may also contact Mr. Aguilar to obtain 
copies, at no cost, of (1) the ICR and (2) the regulations that require 
us to collect the information. To see a copy of the entire ICR 
submitted to OMB, go to http://www.reginfo.gov/public/PRAMain and 
select ``Information Collection Review,'' then select ``Department of 
the Interior'' in the drop-down box under ``Currently Under Review.''

SUPPLEMENTARY INFORMATION: 
    Title: OCS Net Profit Share Payment Reporting--30 CFR part 1220.
    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). Under various laws, the Secretary's responsibility is to manage 
mineral resources production on Federal and Indian lands and the OCS, 
collect the royalties and other mineral revenues due, and distribute 
the funds collected under those laws. ONRR performs the royalty 
management functions and assists the Secretary in carrying out the 
Department's responsibility. Public laws pertaining to mineral leases 
on Federal and Indian lands and the OCS are posted at http://www.onrr.gov/Laws_R_D/PublicLaws.htm.

I. General Information

    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. 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.

[[Page 64405]]

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, promulgated regulations at 30 CFR 
part 260--Outer Continental Shelf Oil and Gas Leasing. Also, BOEM 
promulgated specific implementing regulations for the NPSL bidding 
system at Sec.  260.110(d). BOEM 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.
    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 the BOEM of their intent to take 
inventory so the BOEM Director may be represented at the taking of 
inventory under 1220.032. Each lessee must file a report after each 
inventory is taken, reporting the controllable material under Sec.  
1220.031.

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: 14 lessees.
    Estimated Annual Reporting and Recordkeeping ``Hour'' Burden: 2,451 
hours.
    All fourteen 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.

                                   Respondents' Estimated Annual Burden Hours
----------------------------------------------------------------------------------------------------------------
                                                                                     Number of
     Citation 30 CFR 1220          Reporting & recordkeeping        Hour burden       annual       Annual burden
                                          requirement                                responses         hours
----------------------------------------------------------------------------------------------------------------
  PART 1220--Accounting procedures for determining net profit share payment for outer continental shelf oil and
                                                   gas leases
----------------------------------------------------------------------------------------------------------------
                                      Sec.   1220.010 NPSL capital account
----------------------------------------------------------------------------------------------------------------
1220.010(a)..................  (a) For each NPSL tract, an NPSL                1               1               1
                                capital account shall be
                                established and maintained by
                                the lessee for NPSL operations .
                                . .
----------------------------------------------------------------------------------------------------------------
                                     Sec.   1220.030 Maintenance of records
----------------------------------------------------------------------------------------------------------------
1220.030(a) and (b)..........  (a) Each lessee . . . shall                     1              14              14
                                establish and maintain such
                                records as are necessary . . .
----------------------------------------------------------------------------------------------------------------
                               Sec.   1220.031 Reporting and payment requirements
----------------------------------------------------------------------------------------------------------------
1220.031(a)..................  (a) Each lessee subject to this                 1              14              14
                                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 . . .

[[Page 64406]]

 
1220.031(b)..................  (b) Beginning with the first                   13          \1\168           2,184
                                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 this    Burden hours covered under Sec.   1220.031(b).
                                Part 220 shall submit, together
                                with the report required . . .
                                any net profit share payment due
                                . . .
                                                                 -----------------------------------------------
1220.031(d)..................  (d) Each lessee . . . shall file                8              14             112
                                a report not later than 90 days
                                after each inventory is taken .
                                . .
1220.031(e)..................  (e) Each lessee . . . shall file                4              14              56
                                a final report, not later than
                                60 days following the cessation
                                of production . . .
----------------------------------------------------------------------------------------------------------------
                                           Sec.   1220.032 Inventories
----------------------------------------------------------------------------------------------------------------
1220.032(b)..................  (b) At reasonable intervals, but                1              14              14
                                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 . . .
----------------------------------------------------------------------------------------------------------------
                                             Sec.   1220.033 Audits
----------------------------------------------------------------------------------------------------------------
1220.033(b)(1)...............  (b)(1) When nonoperators of an                  2              14              28
                                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 call                2              14              28
                                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 kept      The Office of Regulatory Affairs determined
                                under Sec.   1220.030(a) shall       that the audit process is exempt from the
                                be made available for inspection    Paperwork Reduction Act of 1995 because MMS
                                by any authorized agent of DOI .   staff asks non-standard questions to resolve
                                . .                                                 exceptions.
                                                                 -----------------------------------------------
    Total Burden.............                                     ..............             267           2,451
----------------------------------------------------------------------------------------------------------------
\1\ (14 NPSL reports x 12 months = 168 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.
    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 May 20, 2014 (79 FR 28945), 
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. 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 November 28, 2014.
    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

[[Page 64407]]

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.
    Information Collection Clearance Officer: David Alspach (202) 219-
8526.

    Dated: October 21, 2014.
Gregory J. Gould,
Director for Office of Natural Resources Revenue.
[FR Doc. 2014-25727 Filed 10-28-14; 8:45 am]
BILLING CODE 4310-T2-P