[Federal Register Volume 88, Number 74 (Tuesday, April 18, 2023)]
[Rules and Regulations]
[Pages 23569-23581]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-08051]
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DEPARTMENT OF THE INTERIOR
Bureau of Safety and Environmental Enforcement
30 CFR Part 250
[Docket ID: BSEE-2020-0016] 234E1700D2; ETISF0000.EAQ000 EEEE500000]
RIN 1082-AA02
Risk Management, Financial Assurance, and Loss Prevention--
Decommissioning Activities and Obligations
AGENCY: Bureau of Safety and Environmental Enforcement, Interior.
ACTION: Final rule.
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SUMMARY: The Bureau of Safety and Environmental Enforcement (BSEE)
issues this final rule to clarify and formalize its regulations related
to decommissioning responsibilities of Outer Continental Shelf (OCS)
oil, gas, and sulfur lessees and grant holders to ensure compliance
with lease, grant, and regulatory obligations. This rule implements
provisions of the proposed rule intended to clarify decommissioning
responsibilities of right-of-use and easement (RUE) grant holders and
to formalize BSEE's policies regarding performance by predecessors
ordered to decommission OCS facilities. This rule withdraws the
proposal to amend BSEE's regulations to require BSEE to proceed in
reverse chronological order against predecessor lessees, owners of
operating rights, and grant holders when requiring such entities to
perform their accrued decommissioning obligations if the current
lessees, owners, or holders have failed to perform.
DATES: This rule is effective May 18, 2023.
FOR FURTHER INFORMATION CONTACT: Kirk Malstrom, BSEE, at
[email protected] or at (703) 787-1751.
SUPPLEMENTARY INFORMATION:
Executive Summary
On October 16, 2020, the Bureau of Ocean Energy Management (BOEM)
and BSEE published a proposed rule entitled ``Risk Management,
Financial Assurance and Loss Prevention.'' (85 FR 65904). In this final
rule, the Department of the Interior (Department or DOI) implements
certain proposed revisions to regulations administered by BSEE. BOEM
intends to issue a new proposed rule for the provisions within its
regulatory purview.
The BSEE-administered portion of the proposed rule would have
established that BSEE could only proceed in reverse chronological order
against predecessor lessees, owners of operating rights, and grant
holders when requiring them to perform their accrued decommissioning
obligations if the current lessees, owners, or holders failed to
perform. The BSEE-administered provisions also proposed to clarify
decommissioning responsibilities for RUE grant holders, promulgate as
regulations BSEE policy surrounding the obligations of predecessors
when ordered to decommission, and require that any party appealing and
seeking to stay a final decommissioning order post a surety bond.
This final rule focuses on clarifying decommissioning obligations
of RUE grant holders and promulgating as regulations BSEE policy
regarding the obligations of predecessors ordered to perform
decommissioning. BSEE has decided to withdraw its proposal that would
have established the reverse chronological order constraint on BSEE's
pursuit of predecessor lessees, owners of operating rights, and grant
holders for performance of their accrued decommissioning obligations.
BSEE has also chosen not to finalize the proposed appeal bonding
requirements.
Table of Contents
I. Preamble Acronyms and Abbreviations
II. Background of BSEE Regulations
A. BSEE Statutory and Regulatory Authority and Responsibilities
B. Summary of Differences Between the Proposed and Final Rules
for BSEE Provisions
III. Discussion of Comments
A. Overview of Comments on the BSEE Portion of the Proposed Rule
B. Specific Comments on the BSEE Portion of the Proposed Rule
IV. Section-by-Section Discussion of Revisions
V. Procedural Matters
A. Regulatory Planning and Review (Executive Orders (E.O.)
12866, 13563 and 13771)
B. Regulatory Flexibility Act
C. Congressional Review Act
D. Unfunded Mandates Reform Act of 1995
E. Takings Implication Assessment (E.O. 12630)
F. Federalism (E.O. 13132)
G. Civil Justice Reform (E.O. 12988)
H. Consultation With Indian Tribes (E.O. 13175 and Departmental
Policy)
I. Paperwork Reduction Act (PRA)
J. National Environmental Policy Act
K. Data Quality Act
L. Effects on the Nation's Energy Supply (E.O. 13211)
M. Clarity of This Regulation
I. Preamble Acronyms and Abbreviations
To ease the reading of this preamble and for reference purposes,
the following acronyms and abbreviations are used in the preamble:
ASLM Assistant Secretary for Land and Minerals Management
BOEM Bureau of Ocean Energy Management
BSEE Bureau of Safety and Environmental Enforcement
DOI or Department Department of the Interior
E.O. Executive Order
FR Federal Register
IBLA Interior Board of Land Appeals
IC Information Collection
IRIA Initial Regulatory Impact Analysis
NTL Notice to Lessees and Operators
OCS Outer Continental Shelf
OCSLA Outer Continental Shelf Lands Act
OIRA Office of Information and Regulatory Affairs (a sub-agency
within OMB)
OMB Office of Management and Budget
PRA Paperwork Reduction Act
RCO Reverse Chronological Order
RIA Regulatory Impact Analysis
ROW Right-of-Way
RUE Right-of-Use and Easement
[[Page 23570]]
SBA Small Business Administration
Secretary Secretary of the Interior
S.O. Secretary's Order
II. Background of BSEE Regulations
A. BSEE Statutory and Regulatory Authority and Responsibilities
BSEE derives its authority primarily from the OCS Lands Act
(OCSLA), which authorizes the Secretary of the Interior (Secretary) to
regulate oil and gas exploration, development, and production
operations on the OCS. Secretary's Order 3299 delegated authority to
perform certain of these regulatory functions to BSEE. To carry out its
responsibilities, BSEE regulates offshore oil and gas operations to
enhance the safety of exploration for and development of oil and gas on
the OCS, and to ensure that those operations protect the environment,
conserve the natural resources of the OCS, and implement advancements
in technology. BSEE's regulatory program covers a wide range of
facilities and activities, including decommissioning requirements,
which are the primary focus of this rulemaking. Detailed information
concerning BSEE's regulations and guidance to the offshore oil and gas
industry may be found on BSEE's website at: http://www.bsee.gov/Regulations-and-Guidance/index.
B. Summary of Differences Between the Proposed and Final Rules for BSEE
Provisions
For a comprehensive discussion of the proposed rule provisions,
please refer to the notice of proposed rulemaking published in the
Federal Register on October 16, 2020 (85 FR 65904). BSEE's responses to
submitted comments is found in section III of this preamble. The
changes made in response to comments include:
1. Timeframes for Responding to Decommissioning Orders--Sec. Sec.
250.1704 and 250.1708(b)(1) Through (3)
BSEE may issue an order to predecessors to perform accrued
decommissioning obligations if subsequent assignees have failed to
perform them. In the proposed rule, BSEE proposed to require such
predecessors to take certain actions following receipt of an order to
perform, including:
(1) Beginning maintenance and monitoring within 30 days,
(2) Designating an operator for decommissioning within 60 days, and
(3) Submitting a decommissioning plan within 90 days.
Multiple commenters asserted that the proposed 30/60/90-day
timeframes for taking those actions were too short. In this final rule,
BSEE is moving the provisions to Sec. 250.1708(a), retaining the 30-
day timeframe for beginning maintenance and monitoring, and extending
the timeframes for compliance with the other two requirements as
follows:
(1) Designate an operator (or agent) for the decommissioning
activities within 90 days of receiving the order; and
(2) Submit a decommissioning plan to BSEE within 150 days of
receiving the order.
These revised timeframes provide clarity and consistency and allow
sufficient time to implement the decommissioning process expeditiously
and effectively.
2. Requiring a Surety Bond To Stay the Effectiveness of Decommissioning
Orders During Appeal--Sec. 250.1709 and 30 CFR 290.7
In the proposed rule, BSEE proposed to require a party that files
an appeal of a BSEE decommissioning order and seeks to obtain a stay of
that order during the appeal to post a surety bond in an amount
adequate to ensure completion of the decommissioning activities.
Multiple commenters asserted that such a surety bond is not necessary
in light of other existing and adequate financial assurance
requirements designed to secure decommissioning obligations. BSEE
agrees with these commenters and is not finalizing the proposed appeal
bond provisions in Sec. 250.1709 and 30 CFR 290.7.
3. The Reverse Chronological Order (RCO) Process for BSEE To Issue
Predecessor Decommissioning Orders--Sec. 250.1708
The proposed rule would have limited BSEE's ability to issue
decommissioning orders by requiring BSEE to issue the orders to
predecessors through an RCO process, i.e., to the most recent
predecessor first. Multiple commenters expressed concerns and divergent
views about this proposal and the appropriate approach for issuing
decommissioning orders to predecessors when current interest holders
fail to perform. Based on the comments received, BSEE is not finalizing
the RCO provisions. BSEE will continue to evaluate the process for
issuing decommissioning orders and will continue to issue
decommissioning orders in the most efficient manner on a case-by-case
basis, in accordance with its longstanding regulatory authority and
practice.
4. Revising References to Predecessors in Subpart Q Definition of
``You'' and ``I''--Sec. 250.1701(d)
The proposed rule would have added references to the predecessors
of various interest holders in the definitions of ``you'' and ``I''
applicable to the regulations in part 250 subpart Q. A commenter noted
that these revisions should be applicable only to the regulations
regarding the accrued decommissioning obligations of predecessors. BSEE
has rephrased the definitions in this final rule to better reflect this
intended outcome.
III. Discussion of Comments
The Bureaus divided the comments received on the proposed rule into
separate BOEM and BSEE dockets. In this section, BSEE addresses
comments received on its proposals, beginning with an overview of
comments and then proceeding to comments by section number.
A. Overview of Comments on the BSEE Portion of the Proposed Rule
In response to the proposed rule, BOEM and BSEE received
approximately 36 unique sets of comments from various entities,
including individual companies, industry organizations, non-
governmental organizations, and private citizens. Of those 36
commenters, 21 submitted comments on the BSEE-administered provisions.
Some entities submitted comments on both BOEM and BSEE provisions. All
relevant comments are posted at the Federal e-Rulemaking portal: http://www.regulations.gov. To access comments on the BSEE docket at that
website, enter BSEE-2020-0016 in the search box. BSEE reviewed all
comments submitted. This section summarizes notable comments and BSEE's
responses.
B. Specific Comments on the BSEE Portion of the Proposed Rule
Summary: The majority of the comments that BSEE received expressed
general support for the proposed rule. BSEE received supportive
comments from oil and gas companies, contractors, industry trade
groups, and a private citizen. Some of the commenters who expressed
general support for the proposed rule also provided detailed comments
on specific provisions, addressed further below. However, while these
commenters voiced support broadly for the proposed changes, some of the
commenters also asserted that specific provisions would impose
unnecessary regulatory burdens and suggested revisions to the proposed
regulatory text, as discussed below.
[[Page 23571]]
Other commenters expressed general opposition to the proposed rule
and many of its key provisions. For example, one non-governmental
organization suggested that BOEM and BSEE should ``withdraw'' the
proposed rule. For a discussion of the substantive comments in
opposition to specific provisions and BSEE's responses, refer to later
parts of this section.
1. RUE Grant Holders Accruing Liabilities
Comment: Several commenters responded favorably to the proposal to
amend part 250 subpart Q to expressly state that RUE grant holders
accrue decommissioning obligations in the same manner as lessees,
operating rights holders, and right-of-way (ROW) grant holders. One
commenter observed that the proposal's alignment of RUE references in
Sec. Sec. 250.1700, 250.1701, 250.1702, 250.1703, and 250.1725, in
conjunction with BOEM's proposed revisions to 30 CFR parts 550 and 556,
which would also use RUE terminology, more accurately reflect existing
practices on the OCS.
Response: BSEE agrees with the commenters and is including the
proposed provisions in the final rule without change.
2. 30/60/90 Day Timeframes for Responding to Predecessor
Decommissioning Orders
Comment: Multiple commenters submitted substantive comments on
proposed Sec. 250.1708(b), which proposed timeframes for predecessors
to take initial organizational measures and submit decommissioning
plans following receipt of an order to perform accrued decommissioning
obligations. Commenters generally embraced the concept of a tiered
series of dates for predecessors to begin monitoring and maintaining
facilities, select a designated operator, and submit a decommissioning
plan. However, these same commenters said the timeframes for completing
these steps at proposed Sec. 250.1708(b)(1) through (3) were
unreasonably short. The commenters stated that complex well fields and
platforms would require more time for development of suitably robust
decommissioning plans. Another commenter noted that predecessor parties
will need time to obtain records and diagrams of facilities from
current interest holders, who may not be cooperative in providing
access to documents or facilities.
Response: When current interest holders fail to perform required
decommissioning, BSEE must ensure that predecessors holding the accrued
obligations expeditiously and properly monitor, maintain, and
decommission wells, pipelines, and facilities to minimize safety
hazards, environmental harm, and interference with navigation or other
uses of the OCS (such as fishing and future resource development).
However, BSEE understands and agrees with the commenters' concerns
about the timeframes. Therefore, BSEE is modifying the proposed
timeframes, which are now found in final Sec. 250.1708(a), as follows:
(1) Begin maintaining and monitoring within 30 days of receiving
the order (as proposed);
(2) Designate the operator or agent for the decommissioning
activities within 90 days of receiving the order (as opposed to 60 days
in proposed rule); and
(3) Submit a decommissioning plan to BSEE within 150 days of
receiving the order (as opposed to 90 days in proposed rule).
BSEE also retains discretion to extend or shorten these timeframes
under extenuating circumstances to effectively implement the
decommissioning process.
3. Bonding for Appeals of Decommissioning Orders
Comment: BSEE's proposal (at Sec. 250.1709 and 30 CFR 290.7) to
require a surety bond for stays of decommissioning orders pending
appeal met with mixed views. Most commenters understood BSEE's
rationale for establishing a mechanism to protect against the risks of
default during the pendency of appeals filed with the Interior Board of
Land Appeals (IBLA). Some raised no objections to the surety bond
requirement as proposed. Other commenters contended that BSEE does not
need such bonds because BSEE can defend its order by opposing a motion
to stay. Furthermore, these commenters asserted that a party who
successfully obtains a stay of a decommissioning order under the IBLA's
standards should not be required to post security for the stayed order.
One commenter also asserted that the proposed surety bond raised due
process concerns.
Response: While BSEE disagrees that the proposed provisions raise
due process concerns, BSEE agrees with the commenters' assertions that
the proposed surety bond would be unnecessary given existing IBLA
procedures and existing requirements for financial assurance.
Accordingly, BSEE is not finalizing the proposed appeal bond
requirements.
Comment: Several commenters suggested that the surety bond
provisions should not apply to appellants who can demonstrate that they
qualify under credit rating standards proposed or promulgated by BOEM
at 30 CFR 550.166(d) and 556.901. The commenters questioned why BSEE
would require a surety bond from a predecessor or interest holder if
BOEM does not require additional financial assurance from that entity.
Another commenter suggested that BSEE should monitor credit ratings
continuously, like BOEM does, and rely on those credit ratings when
determining whether a surety bond is required. In this manner, the
commenter suggested that BSEE use BOEM's data to determine if a surety
bond on appeal is necessary.
Response: BSEE agrees that the proposed appeal bond is not
necessary in light of existing financial assurance requirements and is
not finalizing the proposed revisions to Sec. 250.1709 and 30 CFR
290.7. DOI will continue to rely on other existing financial assurance
requirements to ensure adequate security for decommissioning
obligations.
4. Reverse Chronological Order (RCO)
Comment: Many comments favored BSEE's proposal to constrain itself
to issuing decommissioning orders in RCO, asserting it would avoid
delays associated with the current process. As some commenters noted,
going down the chain-of-title to identify recent predecessors would
first focus on those parties that most recently obtained security for
the outstanding decommissioning obligations on which the current
interest holders defaulted. The use of an RCO method, according to some
commenters, would be ``a more efficient method of unlocking any
security posted by the defaulting party'' and would in turn hasten
performance of decommissioning work.
While these commenters broadly appreciated the RCO approach, they
expressed divergent views as to how BSEE should issue decommissioning
orders when current interest holders fail to perform their obligations.
Some commenters urged BSEE to issue orders to the immediate predecessor
of any defaulting party before engaging joint owners or co-lessees
among the current set of interest holders. Other commenters expressed
concern that BSEE would not use all available options to address
decommissioning obligations with current interest holders before
turning to predecessors.
Response: BSEE agrees in part with the commenters' divergent views
of the proposed RCO process and has determined that the process is not
the
[[Page 23572]]
most effective method for issuing decommissioning orders in all
situations. Accordingly, BSEE is not finalizing the proposed RCO
revisions. BSEE will continue to evaluate the process for issuing
decommissioning orders and will continue to issue decommissioning
orders to jointly and severally liable parties on a case-by-case basis.
Comment: One commenter disagreed with BSEE's proposal to organize
groups of predecessors by changes in designated operators over time, as
proposed in Sec. 250.1708(a)(l), and urged BSEE to delete this
subsection, arguing it unnecessary and confusing. The commenter
recommended that, in the event a current lessee, sublessee, or grant
holder defaults on its decommissioning obligation, BSEE should issue
its decommissioning orders to the most recent predecessors in the chain
of title of the defaulting party.
Response: BSEE agrees in part with the commenter's suggestion to
remove certain provisions of proposed Sec. 250.1708, including the
relevant parts of the proposed Sec. 250.1708(a)(1). BSEE will retain
the existing flexibility to issue decommissioning orders to jointly and
severally liable parties on a case-by-case basis to ensure
decommissioning obligations are conducted in a manner that ensures
safety and protection of the environment.
Comment: A commenter suggested that BSEE should reconsider proposed
Sec. 250.1708(d), which would have allowed BSEE to depart from RCO in
certain circumstances. The commenter suggested redrafting that
provision to bring predictability to when and under what conditions RCO
would be implemented. The commenter asserted that proposed Sec.
250.1708(d) makes RCO ``unpredictable and wholly discretionary'' for
BSEE and its regional supervisor.
Response: Based on comments, BSEE is discarding the proposed RCO
process requirements, including the exceptions described in proposed
Sec. 250.1708(d). BSEE will retain the existing flexibility to issue
decommissioning orders to jointly and severally liable parties on a
case-by-case basis to ensure decommissioning obligations are conducted
in a manner that ensures safety and protection of the environment.
Comment: A commenter asserted that BSEE's proposed use of RCO would
erode the joint and several liability provisions of leases. The
commenter maintained that efforts to enforce decommissioning orders
against the most recent predecessor might incentivize other
predecessors to seek bankruptcy protection during the decommissioning
process (which could take years or decades to ultimately collect
funds), thus leading to fewer viable predecessors to perform
decommissioning. The commenter claimed that the rationale for surety
bonds demonstrates why the RCO process would be risky: while BSEE seeks
to enforce a decommissioning order, predecessors may become insolvent,
and infrastructure may deteriorate. While acknowledging that the
proposed appeal surety bond would slightly mitigate this risk, the
commenter noted that this bonding requirement would apply only to
appeals and not to other aspects of the decommissioning process.
Finally, the commenter argued that there ``is no good reason for BSEE
to adopt this [RCO] approach, as BSEE appears to acknowledge. Any
confusion and inefficiency among the parties is not an issue for BSEE
to resolve.'' The commenter indicated that adopting RCO would make the
decommissioning process less efficient and recommended that BSEE should
instead issue decommissioning orders to all jointly and severally
liable parties. Finally, the commenter requested that BSEE abandon the
proposed rule or require all potentially liable lessees to post surety
bonds pending final execution of and compliance with decommissioning
orders.
Response: BSEE shares the commenter's commitment to eliminating
risk associated with decommissioning liabilities and to ensuring BSEE
retains broad authority to enforce all decommissioning requirements. To
the extent that the commenter suggests that the final rule will
inadequately protect the public interest, BSEE disagrees. The
commenter's primary concerns lie with the proposed RCO requirements,
which BSEE is not codifying in this final rule. BSEE is finalizing the
requirements for timely monitoring of facilities, assessing risks, and
submitting plans once BSEE issues a decommissioning order to
predecessors. BSEE retains its discretion concerning issuance of
decommissioning orders, and BSEE will continue to exercise this
authority to avoid unreasonable delays in decommissioning. BSEE will
continue to evaluate the process for issuing decommissioning orders and
will ensure that decommissioning takes place in a timely manner to
safeguard safety and environmental protection.
5. Miscellaneous Comments
Comment: A commenter asserted that the proposed rule would create
more financial risks and that the proposed rule's financial assurance
procedures would be inadequate and would limit BOEM's and BSEE's
ability to enforce joint and several liability provisions. This
commenter also stated that the proposed rule would be ``highly likely
to cause environmental effects'' and, thus, would require an
environmental assessment or environmental impact statement under the
National Environmental Policy Act (NEPA).
The commenter also asserted that the proposed rule would result in
a mismatch between BOEM's proposal to ``base obligations on the
financial strength of the strongest co-lessee'' and BSEE's proposal to
``place primary decommissioning responsibilities on the most recent and
likely financially weakest co-lessee.'' The overall effect would be to
``shift the financial burden for decommissioning from large firms to
smaller firms that have less ability to cover decommissioning costs,''
the commenter said.
Response: To the extent that the commenter suggests that the final
rule will increase financial risks or implement an inadequate procedure
to protect the public interest, BSEE disagrees. BSEE also disagrees
that the provisions being codified in the final rule are likely to
cause environmental effects or that the final rule necessitates an
environmental assessment or environmental impact statement under NEPA.
BSEE is not finalizing the proposed provisions of primary concern to
the commenter in this final rule. The final rule clarifies and adds
transparency to the process by which BSEE will enforce decommissioning
obligations on existing lessees and RUE grant holders. The final rule
does not alter or relieve the accrued liability of any party or alter
or erode BSEE's enforcement authority. Accordingly, because the final
rule is of ``an administrative, financial, legal, technical, or
procedural nature,'' it meets the requirements for a Departmental
categorical exclusion at 43 CFR 46.210(i) under NEPA. Further,
extraordinary circumstances do not exist that would preclude the use of
this categorical exclusion under 43 CFR 46.215.
BSEE also disagrees that this rule diminishes BSEE's authority to
enforce joint and several liability. This rule does not undermine any
aspect of the joint and several liability regime. The commenter was
primarily concerned with the proposed RCO requirements,
[[Page 23573]]
which have been discarded. BSEE retains its decision-making discretion
concerning issuance of decommissioning orders, and BSEE will continue
to exercise this authority to avoid unreasonable delays in
decommissioning. BSEE will continue to evaluate the process for issuing
decommissioning orders and will ensure that decommissioning takes place
in a timely manner to safeguard safety and environmental protection.
Comment: A commenter stated that entities that default on
decommissioning obligations should be disqualified from operating on
the OCS. The commenter asserted that BSEE is encouraging these
operators to repeat their previous behavior and default again.
Response: BSEE disagrees that the proposed or final rule encourages
or rewards defaulting on obligations and notes that the regulatory
provisions regarding disqualification are beyond the scope of this
rulemaking. BSEE retains its full enforcement authority, including the
authority to issue notices of incidents of noncompliance, assess civil
penalties, and refer operators to BOEM for disqualification.
Comment: A commenter stated that all financial assurance available
for decommissioning infrastructure should be available to the
designated operator to assist in the decommissioning process.
Response: This comment is outside the scope of this rulemaking.
BOEM, not BSEE, is responsible for maintaining sufficient financial
assurance instruments and determining when such instruments should be
forfeited to bring the lease or grant into compliance with regulations
and lease or grant terms, including decommissioning requirements.
Comment: A commenter stated that BSEE should require certification
by all current owners, including non-operating owners, who receive a
decommissioning order stating that they have received the order and
will either commit to participate in the decommissioning operations or
explain why they contend that such performance is not required.
Response: This comment is outside the scope of this rulemaking.
Regardless, BSEE disagrees with the commenter's suggestion. BSEE
generally issues decommissioning orders to current interest holders
only in limited contexts (e.g., hazards, idle iron). BSEE's regulations
and lease terms plainly establish the parameters of decommissioning
responsibilities for current interest holders without need for an
order. Further, regulated entities who receive BSEE orders are required
to comply with those orders or be subject to further enforcement; such
commitments and explanations are not necessary or appropriate.
Comment: One commenter stated that ``BSEE's proposal to redefine
`you' '' may have unintended consequences that were unconsidered by the
Proposed Rule or its associated Regulatory Impact Analysis (RIA). For
example, it is unclear whether the term `predecessor' applies to
present operations (there is no limiting phrase such as `depending on
the context of the regulations' as found in BOEM's current regulations
in 30 CFR 556.105), and these potential effects have not been discussed
in the Preamble of the Proposed Rule nor assessed in BSEE's RIA.
Response: BSEE agrees in part with the commenter's suggestions.
BSEE's intent in adding references to predecessors as ``you'' or ``I''
in Sec. 250.1701(d) was only to ensure that those provisions of part
250 subpart Q applicable to the accrued decommissioning obligations of
predecessors could be clearly and appropriately applied to those
entities as intended. BSEE has modified the language in final Sec.
250.1701(d) to note the inclusion of predecessors in those terms ``as
appropriate in the context of the particular regulation.''
Comment: A commenter stated that predecessors will be significantly
impacted by orders or demands placed on them by BSEE should current
lessees or grant holders default on their decommissioning obligations.
Response: BSEE disagrees with the implication that this rulemaking
will significantly alter the impacts to predecessors from default by
assignees. This rule does not address how or when the obligations
accrue or are held by multiple parties. Under existing and longstanding
regulations, all parties that accrue decommissioning obligations hold
those obligations jointly and severally until those obligations are met
(Sec. 250.1701). BSEE may call upon predecessors to perform their
accrued decommissioning obligations if their assignee or a subsequent
assignee fails to perform (30 CFR 556.710 and 556.805). This rule does
not alter the nature of those obligations or BSEE authorities for
issuing orders or demands to enforce them. Rather, it merely clarifies
the process by which BSEE will carry out those existing authorities,
largely in keeping with current practice and by providing greater
transparency to predecessors regarding what to expect from that
process. Accordingly, this comment does not warrant modifications to
this rule.
Comment: Multiple commenters asserted that Government approval of
an assignment of record title interest or operating rights marks the
point in time when no further decommissioning obligation accrues to an
assignor (predecessor) on the lease.
Response: This comment is outside the scope of this rulemaking.
Current regulations that are not the subject of this rulemaking
identify the point at which accrued obligations attach to assignors and
assignees. See, e.g., 30 CFR 556.710-556.713. This rulemaking does not
alter those provisions. Accordingly, this comment does not warrant any
modifications to the language in this final rule.
Comment: A commenter asserted that BSEE should use all the tools in
its toolbox to ensure that the current operator timely addresses its
idle iron obligations.
Response: While this comment is outside the scope of this
rulemaking, BSEE agrees with the commenter and currently exercises its
authority to ensure operators and lessees address idle iron to ensure
safety and environmental protection.
IV. Section-by-Section Discussion of Revisions
Part 250--Oil and Gas and Sulfur Operations in the Outer Continental
Shelf
Definitions (Sec. 250.105)
This section of the current regulations defines certain terms used
throughout part 250 and clarifies their meaning as used in certain
subparts or sections, as applicable.
Summary of proposed revisions:
BSEE proposed to amend Sec. 250.105 by removing the terms and
definitions for ``Easement'' and ``Right-of-use'' and replacing them
with a new term and definition for ``Right-of-Use and Easement (RUE).''
The revision would make BSEE's regulations consistent with BOEM's
regulations. The proposed amendment would clearly define an RUE grant
as an authorization to use a portion of the seabed not encompassed by
the holder's lease to construct, modify, or maintain platforms,
artificial islands, facilities, installations, and other devices
established to support the exploration, development, or production of
oil and gas, mineral, or energy resources on the OCS or a State
submerged lands lease.
Summary of final rule revisions:
BSEE considered the submitted comments and has included a slightly
revised definition in the final rule. The revised definition adds after
the word ``construct,'' ``secure to the seafloor,
[[Page 23574]]
use,'' and after the word ``platforms,'' ``sea floor production
equipment.'' These changes make the relevant definition in part 250
more consistent with BOEM's corresponding definitions proposed for 30
CFR 550.105 and 30 CFR 556.105, and more accurately reflect the scope
of rights available under an RUE grant.
What do the terms ``decommissioning,'' ``obstructions,'' and
``facility'' mean? (Sec. 250.1700)
This section of the current regulations defines certain terms used
throughout the decommissioning regulations in part 250 subpart Q.
Summary of proposed revisions:
BSEE proposed to revise the section heading to include the term
``predecessor'' and to revise paragraph (a)(2) to include the area of
an RUE grant among the areas that, through decommissioning, must be
returned to a condition that meets the requirements of BSEE and other
applicable agencies. This revision aligns with the other proposed
revisions to the decommissioning obligations associated with RUE
grants. BSEE also proposed to add a new paragraph (d) defining the term
``predecessor'' to mean a prior lessee, operating rights owner, or RUE
or ROW grant holder that is liable for accrued obligations on that
lease or grant. This definition is designed to clarify which entities,
including assignors, remain liable for the decommissioning obligations
that accrued during their prior ownership of an interest in a lease or
grant for purposes of the proposed provisions establishing BSEE's
modified approach toward enforcement of such obligations.
Summary of final rule revisions:
BSEE considered the comments submitted on the proposed section and
has included the proposed revisions in the final rule without any
substantive changes.
Who must meet the decommissioning obligations in this subpart? (Sec.
250.1701)
This section of the current regulations identifies who is
responsible and liable for decommissioning obligations.
Summary of proposed revisions:
BSEE proposed to add new paragraph (c) to this section and
redesignate the existing paragraph (c) as paragraph (d). The new
paragraph (c) would clarify that all holders of an RUE grant are
jointly and severally liable, along with other liable parties, for
meeting decommissioning obligations on their RUE, including those
pertaining to a well, pipeline, platform, or other facility, or an
obstruction, as the obligations accrue and until each obligation is
met. BSEE also proposed to revise the current definition of ``you'' in
existing paragraph (c) (redesignated as paragraph (d) under the
proposed rule) to include RUE grant holders and predecessors-in-
interest among the parties categorized as ``you'' or ``I'' for purposes
of the part 250 subpart Q decommissioning regulations. These revisions
were designed to ensure alignment between Sec. 250.1701 and the other
proposed revisions to subpart Q.
Summary of final rule revisions:
BSEE considered the comments submitted on this proposed section and
has included the proposed revisions in the final rule with two minor
changes. First, BSEE clarifies in new paragraph (c) that prior owners
of operating rights who accrued decommissioning obligations for
facilities or obstructions that remain on an RUE grant are still
jointly and severally liable until those obligation are met. This
revision provides consistency with paragraphs (a) and (b). Second, as
discussed above in section III of this preamble, in response to public
comment, BSEE has modified the incorporation of predecessors into the
definitions of ``you'' and ``I'' to attach only ``as appropriate in the
context of the particular regulation.''
When do I accrue decommissioning obligations? (Sec. 250.1702)
This section of the current regulations identifies certain
operations or actions by which decommissioning obligations accrue.
Summary of proposed revisions:
BSEE proposed to revise paragraph (e) to clarify that all holders
of a pipeline ROW grant would accrue the obligation to decommission.
BSEE also proposed to redesignate paragraph (f) as paragraph (g) and
add a new paragraph (f). Under the proposed paragraph (f), an entity
would accrue decommissioning obligations when it is or becomes the
holder of an RUE grant on which there is a well, pipeline, platform,
other facility, or an obstruction. These proposed changes were designed
to implement the RUE decommissioning principles discussed in the
preamble to the proposed rule and to reflect BSEE practice related to
multiple ROW grant holders.
Summary of final rule revisions:
BSEE considered the comments submitted on the proposed section and
has included the proposed revisions in the final rule with a minor
revision in paragraph (e) to add the word ``grant'' after ``right-of-
way'' to ensure the proper term is utilized correctly.
What are the general requirements for decommissioning? (Sec. 250.1703)
This section of the current regulations identifies certain steps or
actions that must be taken when a facility is no longer useful for
operations.
Summary of proposed revisions:
BSEE proposed to revise paragraph (e) to clarify that an RUE grant
holder must clear the seafloor of all facilities and obstructions
created by its RUE grant operations. This revision was designed to
ensure alignment between Sec. 250.1703 and the other proposed
revisions to subpart Q, including the RUE decommissioning principles
discussed in the preamble to the proposed rule.
Summary of final rule revisions:
BSEE considered the comments submitted on the proposed section and
has included the proposed revisions in the final rule with a minor
correction of a typographical error by replacing the proposed rule's
reference to ``right-way'' with the appropriate and intended ``right-
of-way.''
What decommissioning applications and reports must I submit and when
must I submit them? (Sec. 250.1704)
This section of the current regulations requires submittal of
specified decommissioning applications and reports. This section also
identifies the required timeframes to submit the applicable documents
to BSEE and includes additional instructions.
Summary of proposed revisions:
BSEE proposed to add a new paragraph (b) in the table to provide
that predecessors-in-interest who receive decommissioning orders under
proposed Sec. 250.1708 must submit a decommissioning plan for BSEE
approval within 90 days of receiving the order. The proposed Sec.
250.1708 would require that the decommissioning plan include a scope of
work and schedule to address wells, pipelines, and platforms. This
proposed revision reflects the changes in proposed Sec. 250.1708,
regarding decommissioning plans, discussed below.
Summary of final rule revisions:
After consideration of the comments received on this proposed
section and as explained in the responses to comments in section III of
this preamble, BSEE is extending the timeframe in paragraph (b) for
order recipients to submit their decommissioning plan from 90 to 150
days. These changes are necessary to reflect corresponding edits to
Sec. 250.1708(a). BSEE is also changing the word ``upon'' in the first
column of the proposed paragraph (b) to the word ``after,'' as a
grammatical correction, and updating internal regulatory cross-
[[Page 23575]]
references to address the below-discussed changes to Sec. 250.1708.
How will BSEE enforce accrued decommissioning obligations against
predecessors? (Sec. 250.1708)
As provided for in the proposed rule, this new section explains how
BSEE will issue decommissioning orders to predecessors-in-interest for
accrued decommissioning obligations. Additionally, this section
clarifies the actions predecessors must take once an order is issued.
Summary of proposed revisions:
BSEE proposed to add a new Sec. 250.1708 (in place of the
currently reserved Sec. 250.1708). Under proposed paragraph (a) of
this section, BSEE would issue decommissioning orders to predecessor
lessees and other interest holders in reverse chronological order
through the chain-of-title when holding such predecessors responsible
for accrued decommissioning obligations. Also under proposed paragraph
(a), BSEE would issue such orders to groups of predecessors organized
according to changes in the designated operator over time, as well as
to any predecessor who assigned interests to a party that has
defaulted.
Proposed paragraph (b) would require recipients of such
predecessor-in-interest orders to identify a single entity to begin
maintaining and monitoring any facility identified in the order within
30 days of receiving it. It would also require recipients to designate
a single entity as the operator for decommissioning operations within
60 days of receiving the order. Further, it would require recipients to
submit a decommissioning plan within 90 days of receiving the order
that included the scope of work and schedule for site clearance of all
facilities, pipelines, and obstructions identified in the order.
Finally, proposed paragraph (b) would require recipients to perform the
required decommissioning in the time and manner specified by BSEE in
its decommissioning plan approval.
Proposed paragraph (c) would specify that failure by a predecessor-
in-interest to comply with an order to maintain and monitor a facility
and to submit a decommissioning plan may result in various enforcement
actions, including civil penalties and disqualification as an operator.
Proposed paragraph (d) would allow BSEE to depart from the RCO
sequence and to issue orders to any or all predecessors-in-interest to
perform their respective accrued decommissioning obligations when:
(1) None of the predecessors who had been ordered to perform
obtained approval of a decommissioning plan or performed
decommissioning according to an approved decommissioning plan;
(2) The regional supervisor determined that there was an emergency
condition, safety concern, or environmental threat, such as improperly
maintained and monitored facilities, leaking wells or vessels,
sustained casing pressure on wells, or lack of required valve testing;
or
(3) The regional supervisor determined that applying the RCO
sequence would unreasonably delay decommissioning.
Proposed paragraph (e) would clarify that BSEE's issuance of
decommissioning orders to additional predecessors-in-interest does not
relieve any current lessee or grant holder, or any other predecessor,
of its obligations to comply with any prior decommissioning order or to
satisfy its accrued decommissioning obligations.
Proposed paragraph (f) would provide that the appeal of any
decommissioning order did not prevent BSEE from proceeding against
other predecessors under proposed paragraph (d).
Summary of final rule revisions:
BSEE considered comments on the proposed revisions and has modified
Sec. 250.1708 of the final rule as discussed here and above in section
III. BSEE discarded proposed paragraphs (a) and (d) because it is not
proceeding with the proposed RCO process. Proposed paragraphs (b) and
(c) are now paragraphs (a) and (b) respectively in the final rule with
minor revisions. Proposed paragraphs (e) and (f) are redesignated as
paragraphs (c) and (d) respectively in the final rule.
BSEE is revising paragraph Sec. 250.1708(a) in the final rule by
adding ``unless otherwise specified in the order'' to acknowledge its
authority under existing regulations to order performance on timelines
other than those established in paragraphs (a)(1) through (a)(3), when
warranted by the circumstances. See, e.g., Sec. Sec. 250.101, 250.106,
250.107, 250.1711, and 30 CFR 556.710. BSEE is revising paragraph Sec.
250.1708(a)(2) in the final rule to allow the designation of an
operator ``or agent,'' consistent with its current regulation. As
explained above in section III, in response to comments, BSEE is also
revising the timeframes in paragraphs Sec. 250.1708(a)(2) and (3) of
the final rule as follows:
(2) Designate the operator or agent for the decommissioning
activities within 90 days of receiving the order; and
(3) Submit a decommissioning plan to BSEE within 150 days of
receiving the order.
When do I have to remove platforms and other facilities? (Sec.
250.1725)
This section of the current regulations identifies the timeframes
and certain required actions when removing platforms and facilities.
Summary of proposed revisions:
BSEE proposed to expand the first sentence of paragraph (a) to
provide that an RUE grant holder must remove all platforms and other
facilities within 1 year after the RUE grant terminates unless the
grant holder receives approval to maintain the structure to conduct
other activities. This proposed revision was designed to ensure
alignment between Sec. 250.1725 and the other proposed revisions to
part 250 Subpart Q regarding the RUE decommissioning principles
discussed in the preamble to the proposed rule.
Summary of final rule revisions:
BSEE has considered the comments submitted on the relevant topics
of the proposed section, and BSEE has included the proposed language in
the final rule without change.
V. Procedural Matters
A. Regulatory Planning and Review (Executive Orders (E.O.) 12866, 13563
and 13771)
E.O. 12866 provides that the Office of Information and Regulatory
Affairs (OIRA) in the Office of Management and Budget (OMB) will review
all significant rules. OIRA has reviewed this final rule and determined
that, with the limited scope of proposed changes being finalized, it is
no longer a significant action under E.O. 12866.
E.O. 13563 reaffirms the principles of E.O. 12866 while calling for
improvements in the Nation's regulatory system to promote
predictability, reduce uncertainty, and use the best, most innovative,
and least burdensome tools for achieving regulatory ends. The E.O.
directs agencies to consider regulatory approaches that reduce burdens
and maintain flexibility and freedom of choice for the public where
these approaches are relevant, feasible, and consistent with regulatory
objectives. E.O. 13563 emphasizes that regulations must be based on the
best available science and that the rulemaking process must allow for
public participation and an open exchange of ideas. BSEE has developed
this rule in a manner consistent with these requirements.
B. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612, requires
agencies to analyze the economic impact of regulations when there is
likely to be a significant economic impact on a
[[Page 23576]]
substantial number of small entities and to consider regulatory
alternatives that will achieve the agency's goals while minimizing the
burden on small entities. Section 605 of the RFA allows an agency to
certify a rule, in lieu of preparing an analysis, if the regulation
will not have a significant economic impact on a substantial number of
small entities.
BSEE completed a final regulatory flexibility analysis to assess
the impact of this final rule on small entities. BSEE concludes its
changes will not result in any incremental change to the existing
burdens on small entities. This final rule merely clarifies and aligns
current regulations regarding accrual of decommissioning liability with
current policy and practice. The final rule provides clarity and
transparency regarding the manner in which BSEE enforces those existing
liabilities. Impacts on individual predecessors-in-interest that BSEE
may approach in any particular circumstances are highly case-dependent
and too uncertain to evaluate at a general level. Regardless, the final
rule largely leaves existing regulation and BSEE practice unchanged.
Public Comments in Response to the Initial Regulatory Flexibility
Analysis (IRFA)
BSEE did not receive any public comments on the IRFA, or that
addressed impacts on small businesses.
In response to public comments on other issues, BSEE discarded its
proposals to enforce accrued decommissioning obligations against
predecessor lessees, owners of operating rights, or grant holders in
RCO following default by the current lessees, owners, or interest
holders. BSEE also discarded its proposal to require any party
appealing and seeking to stay a final decommissioning order to post a
surety bond. Accordingly, any potential impacts on small entities
arising from these proposed revisions will not be realized.
This final rule focuses on clarifying the decommissioning
responsibilities of RUE grant holders and formalizing BSEE's practices
associated with decommissioning orders to predecessors-in-interest.
BSEE is making its procedures for enforcing decommissioning compliance
more transparent. This will provide the affected companies with greater
certainty regarding when they may be approached and how they will be
expected to comply with BSEE's decommissioning orders. BSEE considers
these changes to be a regulatory codification of long-standing
practice. As a result, BSEE concludes that all companies--large or
small--operating on the OCS will not face an increased burden over the
current baseline of regulatory requirements and current practice.
Description of and, Where Feasible, an Estimate of the Number of Small
Entities to Which the Final Rule Will Apply
The RFA defines a small entity as either a small business, a small
not-for-profit organization, or a small governmental jurisdiction. BSEE
determined that the final rule will not impact small not-for-profit
organizations or small government jurisdictions. Thus this analysis
focuses on impacts to small businesses.
The final rule will affect OCS lessees and RUE and pipeline ROW
grant holders. BSEE adopts and incorporates the relevant analysis from
BOEM's IRFA analysis. BOEM estimated that 455 companies have ownership
interests in OCS leases and grants. The definition of small business
varies from industry to industry to reflect industry size differences.
Companies that will operate under this final rule are classified
primarily under North American Industry Classification System (NAICS)
codes 211120 (``Crude Petroleum Extraction''), 211130 (``Natural Gas
Extraction''), and 486110 (``Pipeline Transportation of Crude Oil and
Natural Gas''). For NAICS classifications 211120 and 211130, the Small
Business Administration defines a small business as one with fewer than
1,250 employees; for NAICS code 486110, as one with fewer than 1,500
employees. Based on this criterion, approximately 319 (70 percent) of
the companies subject to this final rule met the definition of a small
business. All these small businesses are potentially impacted by this
rule. Therefore, BSEE expects that the final rule will affect a
substantial number of small entities.
BSEE notes that small businesses that acquire interests in OCS
leases and grants do so with full knowledge of the joint and several
liability regulatory framework. This framework binds them to a
decommissioning obligation until it is met, even when that obligation
might be contingent upon an assignee's default. This final rule
clarifies and aligns BSEE's regulatory framework governing liability
and decommissioning obligation with its current policy and practice.
Therefore, BSEE believes the additional cost of this final rule is zero
for all affected companies, including small businesses, because the
rule reinforces the current baseline. For these reasons, BSEE believes
the final rule is unlikely to significantly affect small businesses.
C. Congressional Review Act
This rule will clarify and add transparency to existing
requirements. The changes will not have any negative impact on the
economy or any economic sector, productivity, jobs, the environment, or
other units of government. The changes codified in the final rule
clarify interested parties' decommissioning liabilities for facilities
on RUE grants and provide predecessors-in-interest with explicit
decommissioning compliance expectations. Accordingly, this rule is not
a major rule under 5 U.S.C. 804(2) of the Congressional Review Act
because implementation of this rule will not:
(a) Have an annual effect on the economy of $100 million or more;
(b) Result in a major increase in costs or prices for consumers,
individual industries, Federal, State, or local government agencies, or
geographic regions; or
(c) Result in significant adverse effects on competition,
employment, investment, productivity, innovation, or on the ability of
U.S.-based enterprises to compete with foreign-based enterprises in
domestic and export markets.
D. Unfunded Mandates Reform Act of 1995
This rule does not impose an unfunded mandate on State, local, or
Tribal governments, or the private sector of more than $189 million per
year.\1\ This rule does not have a significant or unique effect on
State, local, or Tribal governments or the private sector. Moreover,
the rule would not have disproportionate budgetary effects on these
governments. A statement containing the information required by the
Unfunded Mandates Reform Act (2 U.S.C. 1531 et seq.) is not required,
and BSEE has chosen not to prepare such a statement.
---------------------------------------------------------------------------
\1\ The private-sector cost threshold established in UMRA in
1996 was $100 million. After adjusting for inflation, the 2022
private-sector threshold is $189 million.
---------------------------------------------------------------------------
E. Takings Implication Assessment (E.O. 12630)
This final rule does not effect a taking of private property or
otherwise have takings implications under E.O. 12630. Therefore, a
takings implication assessment is not required.
F. Federalism (E.O. 13132)
Under the criteria in section 1 of E.O. 13132, this rule does not
have sufficient
[[Page 23577]]
federalism implications to warrant the preparation of a federalism
summary impact statement. Therefore, a federalism summary impact
statement is not required.
G. Civil Justice Reform (E.O. 12988)
This rule complies with the requirements of E.O. 12988.
Specifically, this rule:
(a) Meets the criteria of section 3(a) requiring that all
regulations be reviewed to eliminate errors and ambiguity and be
written to minimize litigation; and
(b) Meets the criteria of section 3(b)(2) requiring that all
regulations be written in clear language and contain clear legal
standards.
H. Consultation With Indian Tribes (E.O. 13175 and Departmental Policy)
BSEE strives to strengthen its government-to-government
relationships with American Indian and Alaska Native Tribes through a
commitment to consultation with the Tribes and recognition of their
right to self-governance and Tribal sovereignty. We are also respectful
of our responsibilities for consultation with Alaska Native Claims
Settlement Act (ANCSA) Corporations. We have evaluated the rule under
the Department's consultation policy, under Departmental Manual part
512 chapters 4 and 5, and under the criteria in E.O. 13175 and
determined that there are no substantial direct effects on Tribes.
I. Paperwork Reduction Act (PRA)
This final rule contains a collection of information that we have
submitted to OMB for review and approval under the Paperwork Reduction
Act of 1995 (44 U.S.C. 3501 et seq.). We may not conduct or sponsor,
and you are not required to respond to, a collection of information
unless it displays a currently valid OMB control number. OMB previously
reviewed and approved the information collection requirements in part
250 Subpart Q and assigned OMB Control Number 1014-0010, which expires
April 30, 2023. We are seeking OMB renewal of this control number for
another 3 years.
The proposed rule was published in the Federal Register on October
16, 2020 (85 FR 65904) and solicited comments on the collections of
information for 60 days. Those comments are discussed below.
This final rule will add new collections of information under 30
CFR part 250 Subpart Q related to the decommissioning of oil, gas, and
sulfur infrastructure on the OCS. These regulatory requirements are the
subject of this information collection request.
We use the information collected under Subpart Q to ensure that OCS
operations are carried out in a safe and environmentally protective
manner, do not interfere with the rights of other OCS users, and
balance the conservation and development of OCS resources. The
following regulatory changes will affect the annual burden hours;
however, they will not impact non-hour cost burdens.
The final rule will formalize and make explicit BSEE practice and
expectations surrounding enforcement of accrued decommissioning
obligations against predecessors-in-interest following failure to
perform by current lessees, operating rights holders, and grantees.
Changes to the IC Between the Proposed Rule and the Final Rule Based on
Comments
After consideration of the public comments and as explained in
section III of this preamble, BSEE is extending the timeframe for
submitting decommissioning plans in new Sec. 250.1708(a) from 90 to
150 days. The final rule will require all predecessors-in-interest who
receive a decommissioning order to submit a work plan and schedule as
directed under Sec. Sec. 250.1704(b) and 250.1708(a). BSEE considers
this necessary to protect the public from incurring future
decommissioning costs and to prevent safety and environmental risks
posed by delayed decommissioning. Within 150 days of receiving a
decommissioning order under Sec. 250.1708, the recipients must submit
a work plan and schedule that addresses all wells, platforms, other
facilities, pipelines, and site clearance. This requirement will add an
estimated 4,320 annual burden hours to the existing OMB control number
(+4,320 annual burden hours).
After consideration of the public comments and as explained in
section III of this preamble, BSEE is discarding its proposal to
require any party appealing and seeking a stay of a decommission order
to post a surety bond.
Title of Collection: ``Revisions to Regulations under 30 CFR part
250 Subpart Q--Decommissioning.''
OMB Control Number: 1014-0010.
Form Number: None.
Type of Review: Revision of a currently approved collection of
information.
Respondents/Affected Public: Potential respondents are Federal OCS
oil, gas, and sulfur lessees and operators and RUE and ROW grant
holders.
Total Estimated Number of Annual Respondents: Currently, there are
approximately 550 Federal OCS oil, gas, and sulfur lessees and RUE and
ROW grant holders. Not all the potential respondents will submit
information in any given year, and some may submit multiple times.
Total Estimated Number of Annual Responses: 3,248 responses.
Total Estimated Number of Annual Burden Hours: 15,997 hours.
Respondent's Obligation: Mandatory.
Frequency of Collection: Submissions are generally on occasion.
Total Estimated Annual Non-Hour Burden Cost: $1,143,556.
Burden Table--Burden Breakdown
[New requirements shown in bold; Changes to existing requirements are italicized.]
----------------------------------------------------------------------------------------------------------------
Annual burden
Citation 30 CFR part 250 Reporting requirement Hour burden Average number of hours
subpart Q * annual responses (rounded)
----------------------------------------------------------------------------------------------------------------
Non-hour cost burdens
----------------------------------------------------------------------------------------------------------------
General
----------------------------------------------------------------------------------------------------------------
1704(h); 1706(a), (f); 1712; These sections contain APM burden covered under 1014-0026. ..............
1715; 1716; 1721(a),(d), (f)- references to
(g); 1722(a), (b), (d); information,
1723(b); 1743(a); Sub G. approvals, requests,
payments, etc., which
are submitted with an
Application for
Permit to Modify
(APM), the burdens
for which are covered
under its own
information
collection.
----------------------------------------------------------------------------------------------------------------
1700 thru 1754................. General departure and Burden covered under Subpart A 1014- 0
alternative 0022.
compliance requests
not specifically
covered elsewhere in
Subpart Q.
----------------------------------------------------------------------------------------------------------------
1703; 1704..................... Request approval for Burden included below. 0
decommissioning.
----------------------------------------------------------------------------------------------------------------
[[Page 23578]]
1704(b); 1708(a)............... Submit work plan & 1,440............... 3 submittals..... 4,320
schedule under Sec.
250.1708(a) that
addresses all wells,
platforms and other
facilities,
pipelines, and site
clearance within 150
days upon receiving
an order to perform
decommissioning;
additional
information as
requested by BSEE.
1704(j), (k)................... Submit to BSEE, within 1................... 1,320 summaries 1,320
120 days after (including
completion of each pipelines)/
decommissioning additional
activity (including information.
pipelines), a summary
of expenditures
incurred; any
additional
information that will
support and/or verify
the summary.
----------------------------------------------------------------------------------------------------------------
1704(j); NTL................... Request and obtain 15 min.............. 75 requests...... 19
approval for
extension of 120-day
reporting period;
including
justification.
----------------------------------------------------------------------------------------------------------------
1704(j)........................ Submit certified Exempt from the PRA under 5 CFR 0
statement attesting 1320.3(i)(1).
to accuracy of the
summary for
expenditures incurred.
----------------------------------------------------------------------------------------------------------------
1712........................... Required data if Requirement not considered information 0
permanently plugging collection under 5 CFR 1320.3(h)(9).
a well.
----------------------------------------------------------------------------------------------------------------
1713........................... Notify BSEE 48 hours 0.5................. 725 notices...... 363
before beginning
operations to
permanently plug a
well.
----------------------------------------------------------------------------------------------------------------
1721(f)........................ Install a protector Burden covered under subpart I 1014- 0
structure designed 0011
according to 30 CFR
part 250, Subpart I,
and equipped with
aids to navigation.
(These requests are
processed via the
appropriate platform
application, 30 CFR
part 250 subpart I by
the Office of
Structural and
Technical Support
(OSTS.))
----------------------------------------------------------------------------------------------------------------
1721(e); 1722(e), (h)(1); Identify and report U.S. Coast Guard requirements. 0
1741(c). subsea wellheads,
casing stubs, or
other obstructions;
mark wells protected
by a dome; mark
location to be
cleared as navigation
hazard.
----------------------------------------------------------------------------------------------------------------
1722(c), (g)(2); 1704(i)....... Notify BSEE within 5 1................... 11 notices....... 11
days if trawl does
not pass over
protective device or
causes damages to it;
or if inspection
reveals casing stub
or mud line
suspension is no
longer protected.
----------------------------------------------------------------------------------------------------------------
1722(f), (g)(3)................ Submit annual report 2.5................. 98 reports....... 245
on plans for re-entry
to complete or
permanently abandon
the well and
inspection report.
----------------------------------------------------------------------------------------------------------------
1722(h)........................ Request waiver of 1.5................. 4 requests....... 6
trawling test.
----------------------------------------------------------------------------------------------------------------
1725(a)........................ Requests to maintain Burden covered under Subpart I 1014- 0
the structure to 0011
conduct other
activities are
processed, evaluated
and permitted by the
OSTS via the
appropriate Platform
Application process,
30 CFR part 250
Subpart I. (Other
activities include
but are not limited
to activities
conducted under the
grants of rights-of-
way (ROWs), rights--
of-use and easement
(RUEs), and alternate
use rights-of-use and
easement authority
issued under 30 CFR
part 250 Subpart J,
30 CFR 550.160, or 30
CFR part 585, etc.)
----------------------------------------------------------------------------------------------------------------
1725(e)........................ Notify BSEE 48 hours 0.5................. 133 Notices...... 67
before beginning
removal of platform
and other facilities.
----------------------------------------------------------------------------------------------------------------
1726; 1704(a).................. Submit initial 20.................. 2 applications... 40
decommissioning
application in the
Pacific and Alaska
OCS regions.
----------------------------------------------------------------------------------------------------------------
1727; 1728; 1730; 1703; Submit final 28.................. 153 applications. 4,284
1704(c); 1725(b). application and
appropriate data to
remove platform or
other subsea facility
structures (This
included alternate
depth departures and/
or approvals of
partial removal or
toppling for
conversion to an
artificial reef.)
----------------------------------------------------------------------------------------------------------------
$4,684 fee x 153 = $716,652
----------------------------------------------------------------------------------------------------------------
1729; 1704(d).................. Submit post platform 9.5................. 133 Reports...... 1,264
or other facility
removal report;
supporting
documentation; signed
statements, etc.
----------------------------------------------------------------------------------------------------------------
1740; 1741(g).................. Request approval to 12.75............... 30 requests/ 383
use alternative contacts.
methods of well site,
platform, or other
facility clearance;
contact pipeline
owner/operator before
trawling to determine
its condition.
----------------------------------------------------------------------------------------------------------------
1743(b); 1704(g), (i).......... Verify permanently 5................... 117 585
plugged well, certifications.
platform, or other
facility removal site
cleared of
obstructions;
supporting
documentation; and
submit certification
letter.
----------------------------------------------------------------------------------------------------------------
1750; 1751; 1752; 1754; 1704(e) Submit application to 10.................. 142 L/T 1,420
decommission pipeline applications.
in place or remove
pipeline (Lease Term
or Right-of-Way).
--------------------------------------------------------
[[Page 23579]]
$1,142 L/T decommission fee x 142 = $162,164.
--------------------------------------------------------
10.................. 122 ROW 1,220
applications.
--------------------------------------------------------
$2,170 ROW decommissioning fees x 122 = $264,740.
----------------------------------------------------------------------------------------------------------------
1753; 1704(f).................. Submit post pipeline 2.5................. 180 reports...... 450
decommissioning
report.
----------------------------------------------------------------------------------------------------------------
Total Burden............... ...................... .................... 3,248 Responses.. 15,997 hours.
----------------------------------
$1,143,556 Non-Hour Cost Burdens.
----------------------------------------------------------------------------------------------------------------
L/T = Lease Term.
ROW = Right-of-Way.
J. National Environmental Policy Act
A detailed environmental analysis under NEPA is not required if a
rule is covered by a categorical exclusion (see 43 CFR 46.205). This
rule meets the criteria set forth at 43 CFR 46.210(i) for a
Departmental categorical exclusion because this rule is ``of an
administrative, financial, legal, technical, or procedural nature.'' We
have also determined that the rule does not implicate any of the
extraordinary circumstances listed in 43 CFR 46.215 that would require
further analysis under NEPA.
K. Data Quality Act
In developing this rule, we did not conduct or use a study,
experiment, or survey requiring peer review under the Data Quality Act
(Pub. L. 106-554, app. C, sec. 515, 114 Stat. 2763, 2763A-153-154).
L. Effects on the Nation's Energy Supply (E.O. 13211)
Under E.O. 13211, agencies are required to prepare and submit to
OMB a statement of energy effects for ``significant energy actions.''
This statement should include details of any adverse effects on energy
supply, distribution, or use (including a shortfall in supply, price
increases, and increased use of foreign supplies) expected to result
from the action and a discussion of reasonable alternatives and their
effects.
The rule does not add new regulatory compliance requirements that
lead to adverse effects on the Nation's energy supply, distribution, or
use. The rule is not expected to affect the cost of energy. The
provision regarding decommissioning responsibility for facilities on
RUE grants does not increase the cost borne by industry but could share
the financial burden and responsibility among applicable parties in a
manner consistent with current regulatory and industry practice.
Moreover, because BSEE's regulatory changes apply only after activities
(e.g., exploration, development, and production) have ended, those
changes would not affect the Nation's energy supply, distribution, and
use. This rule is not a significant energy action under the definition
in E.O. 13211. Therefore, a statement of energy effects is not
required.
M. Clarity of This Regulation
BSEE is required by E.O. 12866, E.O. 12988, and Presidential
memorandum of June 1, 1998, to write all rules in plain language. This
means that each rule BSEE publishes must:
(1) Be logically organized;
(2) Use the active voice to address readers directly;
(3) Use clear language rather than jargon;
(4) Be divided into short sections and sentences; and
(5) Use lists and tables wherever possible.
BSEE has drafted this rule in compliance with these requirements.
List of Subjects in 30 CFR Part 250
Administrative practice and procedure, Continental shelf,
Environmental impact statements, Environmental protection, Federal
lands, Government contracts, Investigations, Mineral resources, Oil and
gas exploration, Outer continental shelf, Penalties, Pipelines, Rights-
of-way, Reporting and recordkeeping requirements, Sulfur.
Laura Daniel-Davis,
Principal Deputy Assistant Secretary, Land and Minerals Management.
For the reasons stated in the preamble, BSEE amends 30 CFR part 250
as follows:
PART 250--OIL AND GAS AND SULFUR OPERATIONS IN THE OUTER
CONTINENTAL SHELF
0
1. The authority citation for part 250 continues to read as follows:
Authority: 30 U.S.C. 1751; 31 U.S.C. 9701; 33 U.S.C.
1321(j)(1)(C); 43 U.S.C. 1334.
Subpart A--General
0
2. Amend Sec. 250.105 by removing the definitions of ``Easement'' and
``Right-of-use'' and adding, in alphabetical order, the definition for
``Right-of-Use and Easement (RUE)'' to read as follows:
Sec. 250.105 Definitions.
* * * * *
Right-of-Use and Easement (RUE) means a right to use a portion of
the seabed at an OCS site, other than on a lease you own, to construct,
secure to the seafloor, use, modify, or maintain platforms, sea floor
production equipment, artificial islands, facilities, installations,
and other devices, established to support the exploration, development,
or production of oil and gas, mineral, or energy resources from an OCS
or State submerged lands lease.
* * * * *
Subpart Q--Decommissioning Activities
0
3. Amend Sec. 250.1700 by revising the section heading and paragraph
(a)(2) and adding paragraph (d) to read as follows:
[[Page 23580]]
Sec. 250.1700 What do the terms ``decommissioning,''
``obstructions,'' ``facility,'' and ``predecessor'' mean in this
subpart?
(a) * * *
(2) Returning the lease, pipeline right-of-way, or the area of a
right-of-use and easement to a condition that meets the requirements of
BSEE and other agencies that have jurisdiction over decommissioning
activities.
* * * * *
(d) Predecessor means a prior lessee or owner of operating rights,
or a prior holder of a right-of-use and easement grant or a pipeline
right-of-way grant, that is liable for accrued obligations on that
lease or grant.
0
4. Revise Sec. 250.1701 to read as follows:
Sec. 250.1701 Who must meet the decommissioning obligations in this
subpart?
(a) Lessees, owners of operating rights, and their predecessors are
jointly and severally liable for meeting decommissioning obligations
for facilities on leases, including the obligations related to lease-
term pipelines, as the obligations accrue and until each obligation is
met.
(b) All holders of a right-of-way grant and their predecessors are
jointly and severally liable for meeting decommissioning obligations
for facilities on their right-of-way, including right-of-way pipelines,
as the obligations accrue and until each obligation is met.
(c) All right-of-use and easement grant holders and prior lessees
or owners of operating rights of the parcel on whose leases there
existed facilities or obstructions that remain on the right-of-use and
easement grant are jointly and severally liable for meeting
decommissioning obligations, including obligations for any well,
pipeline, platform or other facility, or an obstruction, on their
right-of-use and easement, as the obligations accrue and until each
obligation is met.
(d) In this subpart, the terms ``you'' or ``I'' refer to lessees
and owners of operating rights as to facilities installed under the
authority of a lease; to pipeline right-of-way grant holders as to
facilities installed under the authority of a pipeline right-of-way
grant; and to right-of-use and easement grant holders as to facilities
constructed, modified, or maintained under the authority of the right-
of-use and easement grant. Predecessors to any of these interest
holders are also included within the scope of these terms as
appropriate in the context of the particular regulation.
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5. Amend Sec. 250.1702 by revising paragraph (e), redesignating
paragraph (f) as paragraph (g), and adding new paragraph (f) to read as
follows:
Sec. 250.1702 When do I accrue decommissioning obligations?
* * * * *
(e) Are or become a holder of a pipeline right-of-way grant on
which there is a pipeline, platform, other facility, or an obstruction;
(f) Are or become the holder of a right-of-use and easement grant
on which there is a well, pipeline, platform, other facility, or an
obstruction; or
* * * * *
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6. Amend Sec. 250.1703 by revising paragraph (e) to read as follows:
Sec. 250.1703 What are the general requirements for decommissioning?
* * * * *
(e) Clear the seafloor of all obstructions created by your lease,
pipeline right-of-way, or right-of-use and easement operations;
* * * * *
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7. Amend Sec. 250.1704 by redesignating paragraphs (b) through (j) as
paragraphs (c) through (k) respectively, and adding new paragraph (b)
to read as follows:
Sec. 250.1704 What decommissioning applications and reports must I
submit and when must I submit them?
* * * * *
Decommissioning Applications and Reports Table
------------------------------------------------------------------------
Decommissioning applications and
reports When to submit Instructions
------------------------------------------------------------------------
* * * * * * *
(b) Submit decommissioning plan Within 150 days of Include
per Sec. 250.1708(a)(3) that receiving an information
addresses all wells, platforms order to perform required under
and other facilities, decommissioning Sec.
pipelines, and site clearance under Sec. 250.1708(a)(2)
after receiving an order to 250.1708. and (3).
perform decommissioning.
* * * * * * *
------------------------------------------------------------------------
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8. Add Sec. 250.1708 to read as follows:
Sec. 250.1708 How will BSEE enforce accrued decommissioning
obligations against predecessors?
(a) When BSEE issues an order to predecessors to perform accrued
decommissioning obligations, the order recipients must, unless
otherwise specified in the order:
(1) Within 30 days of receiving the order, begin maintaining and
monitoring, through a single entity identified to BSEE, any facility,
including wells and pipelines, as identified by BSEE in the order and
in accordance with applicable requirements under this part (including,
but not limited to, testing safety valves and sensors, draining
vessels, and performing pollution inspections);
(2) Within 90 days of receiving the order, designate a single
entity to serve as operator or agent for the decommissioning
operations;
(3) Within 150 days of receiving the order, submit through the
entity identified in paragraph (a)(2) of this section a decommissioning
plan for approval by the Regional Supervisor that includes the scope of
work and a reasonable decommissioning schedule for all wells, platforms
and other facilities, pipelines, and site clearance, as identified in
the order; and
(4) Perform the required decommissioning in the time and manner
specified by BSEE in its decommissioning plan approval.
(b) Failure to comply with the obligations under paragraph (a) of
this section to maintain and monitor a facility or to submit a
decommissioning plan may result in a Notice of Incident of
Noncompliance and potentially other enforcement actions, including
civil penalties and disqualification as an operator.
(c) BSEE's issuance of orders to any predecessors will not relieve
any current lessee or grant holder, or any other predecessor, of its
obligations to comply with any prior decommissioning order or to
satisfy any accrued decommissioning obligations.
[[Page 23581]]
(d) A pending appeal, pursuant to 30 CFR part 290, of any
decommissioning order does not preclude BSEE from proceeding against
any or all predecessors other than the appellant.
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9. Amend Sec. 250.1725 by revising the first sentence of paragraph (a)
introductory text to read as follows:
Sec. 250.1725 When do I have to remove platforms and other
facilities?
(a) You must remove all platforms and other facilities within 1
year after the lease, pipeline right-of-way, or right-of-use and
easement terminates, unless you receive approval to maintain the
structure to conduct other activities. * * *
* * * * *
[FR Doc. 2023-08051 Filed 4-17-23; 8:45 am]
BILLING CODE 4310-MR-P