Agency Information Collection Activities; Proposals, Submissions, and Approvals
Federal Register: August 1, 2008 (Volume 73, Number 149)
Notices
Page 45055-45065
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
DOCID:fr01au08-100
DEPARTMENT OF THE INTERIOR
Minerals Management Service
Docket No. MMS-2008-MRM-0029
Agency Information Collection Activities: Proposed Collection,
Comment Request
AGENCY: Minerals Management Service (MMS), Interior.
ACTION: Notice of an extension of a currently approved information collection (OMB Control Number 1010-0103).
SUMMARY: To comply with the Paperwork Reduction Act of 1995 (PRA), we are inviting comments on a collection of information that we will submit to the Office of Management and Budget (OMB) for review and approval. We changed the title of this information collection request
(ICR) to meet OMB requirements. The new title of this ICR is ``30 CFR
Parts 202, 206, and 207, Indian Oil and Gas Valuation.''
DATES: Submit written comments on or before September 2, 2008.
ADDRESSES: You may submit comments by the following methods:
Electronically go to http://www.regulations.gov. In the
``Comment or Submission'' column, enter ``MMS-2008-MRM-0029'' to view supporting and related materials for this ICR. Click on ``Send a comment or submission'' link to submit public comments. Information on using Regulations.gov, including instructions for accessing documents, submitting comments, and viewing the docket after the close of the comment period, is available through the site's ``User Tips'' link. All comments submitted will be posted to the docket.
Mail comments to Hyla Hurst, Regulatory Specialist,
Minerals Management Service, Minerals Revenue Management, P.O. Box 25165, MS 302B2, Denver, Colorado 80225. Please reference ICR 1010-0103 in your comments.
Hand-carry comments or use an overnight courier service.
Our courier address is Building 85, Room A-614, Denver Federal Center,
West 6th Ave. and Kipling Blvd., Denver, Colorado 80225. Please reference ICR 1010-0103 in your comments.
FOR FURTHER INFORMATION CONTACT: Hyla Hurst, telephone (303) 231-3495, or e-mail Hyla.Hurst@mms.gov. You may also contact Hyla Hurst to obtain copies, at no cost, of (1) The ICR, (2) any associated forms, and (3) the regulations that require the subject collection of information.
SUPPLEMENTARY INFORMATION:
Title: 30 CFR Parts 202, 206, and 207, Indian Oil and Gas
Valuation.
OMB Control Number: 1010-0103.
Bureau Form Number: Forms MMS-4109, MMS-4110, MMS-4295, MMS-4410, and MMS-4411.
Abstract: The Secretary of the U.S. Department of the Interior
(Secretary) is responsible for matters relevant to mineral resource development on Federal and Indian lands and the Outer Continental Shelf
(OCS). Under the Mineral Leasing Act (30 U.S.C. 1923), the Indian
Mineral Development Act of 1982 (25 U.S.C. 2103), and the Outer
Continental Shelf Lands Act (43 U.S.C. 1353), the Secretary is responsible for (1) Managing the production of minerals from Federal and Indian lands and the OCS; (2) collecting royalties and other mineral revenues from lessees who produce minerals; and (3) distributing the funds collected in accordance with applicable laws.
The Secretary also has a trust responsibility to manage Indian lands and seek advice and information from Indian beneficiaries. The MMS performs the minerals revenue management functions and assists the
Secretary in carrying out the Department's trust responsibility for
Indian lands. Applicable laws pertaining to mineral royalties are located on our Web site at http://www.mrm.mms.gov/Laws_R_D/
PublicLawsAMR.htm.
Regulations at 30 CFR part 202, subparts C and J, pertain to royalties; part 206, subparts B and E, govern the valuation of oil and gas produced from leases on Indian lands; and part 207 pertains to recordkeeping. Indian tribes and individual Indian mineral owners receive all royalties generated from their lands. Determining product valuation is essential to ensure that Indian tribes and individual
Indian mineral owners receive payment on the full value of the minerals removed from their lands. Failure to collect the data described in this information collection could result in the undervaluation of leased minerals on Indian lands. All data reported is subject to subsequent audit and adjustment.
Indian Oil
The regulations apply to all oil production from Indian oil and gas leases, except leases on the Osage Indian Reservation. The regulations provide that lessees determine the value of oil based on the higher of:
(1) The gross proceeds under an arm's-length contract, or (2) major portion analysis. These oil valuation methods are eligible for applicable transportation allowances. From information collected
Page 45056
on Form MMS-4110, Oil Transportation Allowance Report, MMS verifies transportation allowances during the product valuation verification to determine if the lessee reported and paid the proper royalty amount.
The MMS and tribal personnel evaluate whether the transportation allowances reported and claimed by lessees are within regulatory allowance limitations.
Indian Gas
The regulations apply to all gas production from Indian oil and gas leases, except leases on the Osage Indian Reservation. Most Indian leases contain the requirement to perform accounting for comparison
(dual accounting) for gas produced from the lease. Lessees must elect to perform actual dual accounting as defined in 30 CFR 206.176 or alternative dual accounting as defined in 30 CFR 206.173. Lessees use
Form MMS-4410, Accounting for Comparison [Dual Accounting], to certify that dual accounting is not required on an Indian lease or to make an election for actual or alternative dual accounting for Indian leases.
The regulations require lessees to submit Form MMS-4411, Safety Net
Report, when gas production from an Indian oil or gas lease is sold beyond the first index pricing point. The safety net calculation establishes the minimum value, for royalty purposes, of natural gas production from Indian oil and gas leases. This reporting requirement ensures that Indian lessors receive all royalties due and aids MMS compliance efforts.
The MMS and tribal personnel use the information collected on Form
MMS-4295, Gas Transportation Allowance Report, to evaluate whether transportation allowances reported under a non-arm's-length contract or no contract are reasonable, and actual costs are within regulatory allowance limitations.
The MMS and tribal personnel use the information collected on Form
MMS-4109, Gas Processing Allowance Summary Report, to evaluate whether processing allowances reported under a non-arm's-length contract or no contract are reasonable, and actual costs are within regulatory allowance limitations.
Indian Oil and Gas
Form MMS-4393, Request to Exceed Regulatory Allowance Limitation, is used for both Federal and Indian leases. Most of the burden hours are incurred on Federal leases; therefore, the form is approved under
ICR 1010-0136, pertaining to Federal oil and gas leases. However, we include a discussion of the form in this ICR, as well as the burden hours for Indian leases. To request permission to exceed a regulatory allowance limit, lessees must submit a letter to MMS explaining why a higher allowance limit is necessary and provide supporting documentation, including a completed Form MMS-4393. This form provides
MMS with the data necessary to make a decision whether to approve or deny the request and track deductions on royalty reports.
Summary
The MMS is requesting OMB's approval to continue to collect this information. Not collecting this information would limit the
Secretary's ability to discharge his/her duties and may also result in loss of royalty payments to Indian tribes and individual Indian mineral owners. Proprietary information submitted to MMS under this collection is protected, and no items of a sensitive nature are collected. The requirement to respond is mandatory for Form MMS-4411, Safety Net
Report, when certain circumstances exist. For all other forms in this collection, the requirement to respond is voluntary; i.e., a response is required to obtain a benefit.
Frequency of Response: Annually and on occasion.
Estimated Number and Description of Respondents: 302 Indian lessees.
Estimated Annual Reporting and Recordkeeping ``Hour'' Burden: 1,074 hours.
We have not included in our estimates certain requirements performed in the normal course of business and considered usual and customary. The following chart shows the estimated burden hours by CFR section and paragraph:
Respondents' Estimated Annual Burden Hours
Reporting and
Average number 30 CFR
recordkeeping
Hour burden
of annual
Annual burden requirement
responses
hours
202--ROYALTIES
Subpart C--Federal and Indian Oil
202.101................................. Standards for
Burden covered under OMB Control Number 1010- reporting and paying 0140 (expires 11/30/2009). Burden covered royalties.
under Sec. 210.52.
Oil volumes are to be reported in barrels of clean oil of 42 standard U.S. gallons
(231 cubic inches each) at 60 [deg]F. *
* *
Subpart J--Gas Production From Indian Leases
202.551(b).............................. How do I determine the Burden covered under OMB Control Number 1010- volume of production 0140. Burden covered under Sec. 210.52. for which I must pay royalty if my lease is not in an approved
Federal unit or communitization agreement (AFA)?
(b) You and all other persons paying royalties on the lease must report and pay royalties based on your takes. * * *
202.551(c).............................. (c) You and all other
1
1
1 persons paying royalties on the lease may ask MMS for permission * * *
202.558(a) and (b)...................... What standards do I
Burden covered under OMB Control Number 1010- use to report and pay 0140. Burden covered under Sec. 210.52. royalties on gas?
(a) You must report gas volumes as follows: * * *
(b) You must report residue gas and gas plant product volumes as follows: * * *
Page 45057
206--PRODUCT VALUATION
Subpart B--Indian Oil
206.56(b)(2)............................ Transportation
Burden covered under OMB Control Number 1010- allowances--general. 0136 (expires 06/30/2009).
(b)(2) Upon request of a lessee, MMS may approve a transportation allowance deduction in excess of the limitation prescribed by paragraph (b)(1) of this section. * *
* An application for exception (using Form
MMS-4393, Request to
Exceed Regulatory
Allowance Limitation) must contain all relevant and supporting documentation necessary for MMS to make a determination.
* * *
206.57(a)(1)(i)......................... Determination of
AUDIT PROCESS. See note. transportation allowances.
(a) Arm's-length transportation contracts.
(1)(i) * * * The lessee shall have the burden of demonstrating that its contract is arm's- length.
206.57(a)(1)(i)......................... (a) Arm's-length
Burden covered under Sec. 206.57(c)(1)(i) transportation
and (iii). contracts.
(1)(i) * * * Before any deduction may be taken, the lessee must submit a completed page one of
Form MMS-4110 (and
Schedule 1), Oil
Transportation
Allowance Report * *
*
206.57(a)(1)(iii)....................... (a) Arm's-length
AUDIT PROCESS. See note. transportation contracts.
(1)(iii) * * * When
MMS determines that the value of the transportation may be unreasonable, MMS will notify the lessee and give the lessee an opportunity to provide written information justifying the lessee's transportation costs.
206.57(a)(2)(i)......................... (a) Arm's-length
Burden covered under Sec. 206.57(a)(3). transportation contracts.
(2)(i) * * * Except as provided in this paragraph, no allowance may be taken for the costs of transporting lease production which is not royalty-bearing without MMS approval.
206.57(a)(2)(ii)........................ (a) Arm's-length
20
1
20 transportation contracts.
(2)(ii)
Notwithstanding the requirements of paragraph (i), the lessee may propose to
MMS a cost allocation method on the basis of the values of the products transported.
* * *
206.57(a)(3)............................ (a) Arm's-length
40
1
40 transportation contracts.
(3) If an arm's-length transportation contract includes both gaseous and liquid products, and the transportation costs attributable to each product cannot be determined from the contract, the lessee shall propose an allocation procedure to MMS. * *
* The lessee shall submit all available data to support its proposal. * * *
206.57(b)(1)............................ (b) Non-arm's-length
Burden covered under Sec. 206.57(c)(2)(i), or no contract.
and (c)(2)(iii).
(1) * * * A transportation allowance may be claimed retroactively for a period of not more than 3 months prior to the first day of the month that
Form MMS-4110 is filed with MMS, unless MMS approves a longer period upon a showing of good cause by the lessee. * * *
206.57(b)(1)............................ (b) Non-arm's-length
Burden covered under OMB Control Number 1010- or no contract.
0140. Burden covered under Sec. 210.52.
(1) * * * When necessary or appropriate, MMS may direct a lessee to modify its actual transportation allowance deduction.
206.57(b)(2)(iv)........................ (b) Non-arm's-length
20
1
20 or no contract.
(2)(iv) * * * After a lessee has elected to use either method for a transportation system, the lessee may not later elect to change to the other alternative without approval of
MMS.
206.57(b)(2)(iv)(A)..................... (b) Non-arm's-length
20
1
20 or no contract.
(2)(iv)(A) * * * After an election is made, the lessee may not change methods without MMS approval.
* * *
Page 45058
206.57(b)(3)(i)......................... (b) Non-arm's-length
40
1
40 or no contract.
(3)(i) * * * Except as provided in this paragraph, the lessee may not take an allowance for transporting lease production which is not royalty bearing without MMS approval.
206.57(b)(3)(ii)........................ (b) Non-arm's-length
20
1
20 or no contract.
(3)(ii)
Notwithstanding the requirements of paragraph (i), the lessee may propose to
MMS a cost allocation method on the basis of the values of the products transported.
* * *
206.57(b)(4)............................ (b) Non-arm's-length
20
1
20 or no contract.
(4) Where both gaseous and liquid products are transported through the same transportation system, the lessee shall propose a cost allocation procedure to MMS. * * * The lessee shall submit all available data to support its proposal.
* * *
206.57(b)(5)............................ (b) Non-arm's-length
20
1
20 or no contract.
(5) A lessee may apply to MMS for an exception from the requirement that it compute actual costs in accordance with paragraphs (b)(1) through (b)(4) of this section. * * *
206.57(c)(1)(i)......................... (c) Reporting
4
4
16 requirements.
(1) Arm's-length contracts. (i) With the exception of those transportation allowances specified in paragraphs
(c)(1)(v) and
(c)(1)(vi) of this section, the lessee shall submit page one of the initial Form
MMS-4110 (and
Schedule 1), Oil
Transportation
Allowance Report, prior to, or at the same time as, the transportation allowance determined, under an arm's-length contract, is reported on Form MMS-2014,
Report of Sales and
Royalty Remittance. *
* *
206.57(c)(1)(iii)....................... (c) Reporting
4
4
16 requirements.
(1) Arm's-length contracts. (iii)
After the initial reporting period and for succeeding reporting periods, lessees must submit page one of Form MMS- 4110 (and Schedule 1) within 3 months after the end of the calendar year, or after the applicable contract or rate terminates or is modified or amended, whichever is earlier, unless MMS approves a longer period (during which period the lessee shall continue to use the allowance from the previous reporting period).
206.57(c)(1)(iv)........................ (c) Reporting
AUDIT PROCESS. See note. requirements.
(1) Arm's-length contracts. (iv) MMS may require that a lessee submit arm's- length transportation contracts, production agreements, operating agreements, and related documents.
Documents shall be submitted within a reasonable time, as determined by MMS.
206.57(c)(2)(i)......................... (c) Reporting
6
1
6 requirements.
(2) Non-arm's-length or no contract.
(i) With the exception of those transportation allowances specified in paragraphs
(c)(2)(v),
(c)(2)(vii) and
(c)(2)(viii) of this section, the lessee shall submit an initial Form MMS-4110 prior to, or at the same time as, the transportation allowance determined under a non-arm's- length contract or no- contract situation is reported on Form MMS- 2014. * * * The initial report may be based upon estimated costs.
Page 45059
206.57(c)(2)(iii)....................... (c) Reporting
6
3
18 requirements.
(2) Non-arm's-length or no contract.
(iii) For calendar- year reporting periods succeeding the initial reporting period, the lessee shall submit a completed Form MMS- 4110 containing the actual costs for the previous reporting period. If oil transportation is continuing, the lessee shall include on Form MMS-4110 its estimated costs for the next calendar year. * * * MMS must receive the Form MMS- 4110 within 3 months after the end of the previous reporting period, unless MMS approves a longer period (during which period the lessee shall continue to use the allowance from the previous reporting period).
206.57(c)(2)(iv)........................ (c) Reporting
Burden covered under Sec. 206.57(c)(2)(i). requirements.
(2) Non-arm's-length or no contract.
(iv) For new transportation facilities or arrangements, the lessee's initial Form
MMS-4110 shall include estimates of the allowable oil transportation costs for the applicable period. * * *
206.57(c)(2)(v)......................... (c) Reporting
Burden covered under Sec. 206.57(c)(2)(i). requirements.
(2) Non-arm's-length or no contract.
(v) * * * only those allowances that have been approved by MMS in writing * * *
206.57(c)(2)(vi)........................ (c) Reporting
AUDIT PROCESS. See note. requirements.
(2) Non-arm's-length or no contract.
(vi) Upon request by
MMS, the lessee shall submit all data used to prepare its Form
MMS-4110. The data shall be provided within a reasonable period of time, as determined by MMS.
206.57(c)(4) and (e)(2)................. (c) Reporting
Burden covered under OMB Control Number 1010- requirements.
0140. Burden covered under Sec. 210.52.
(4) Transportation allowances must be reported as a separate line item on
Form MMS-2014 * * *
(e) Adjustments.
(2) For lessees transporting production from
Indian leases, the lessee must submit a corrected Form MMS- 2014 to reflect actual costs * * *
206.59.................................. May I ask MMS for
20
1
20 valuation guidance?
You may ask MMS for guidance in determining value.
You may propose a value method to MMS.
Submit all available data related to your proposal and any additional information MMS deems necessary. * * *
206.61(a) and (b)....................... What records must I
AUDIT PROCESS. See note. keep and produce?
(a) On request, you must make available sales, volume, and transportation data for production you sold, purchased, or obtained from the field or area. You must make this data available to MMS,
Indian representatives, or other authorized persons.
(b) You must retain all data relevant to the determination of royalty value. * * *
206--PRODUCT VALUATION
Subpart E--Indian Gas
206.172(b)(1)(ii)....................... How do I value gas
4
25
100 produced from leases in an index zone?
(b) Valuing residue gas and gas before processing.
(1)(ii) Gas production that you certify on
Form MMS-4410 * * * is not processed before it flows into a pipeline with an index but which may be processed later *
* *
Page 45060
206.172(e)(6)(i) and (iii).............. (e) Determining the
3
10
30 minimum value for royalty purposes of gas sold beyond the first index pricing point.
(6)(i) You must report the safety net price for each index zone to MMS on Form MMS- 4411, Safety Net
Report, no later than
June 30 following each calendar year; *
* *
(iii) MMS may order you to amend your safety net price within one year from the date your Form
MMS-4411 is due or is filed, whichever is later. * * *
206.172(e)(6)(ii)....................... (e) Determining the
Burden covered under OMB Control Number 1010- minimum value for
0140. Burden covered under Sec. 210.52. royalty purposes of gas sold beyond the first index pricing point.
(6)(ii) You must pay and report on Form
MMS-2014 additional royalties due no later than June 30 following each calendar year * * *
206.172(f)(1)(ii), (f)(2), and (f)(3)... (f) Excluding some or
40
1
40 all tribal leases from valuation under this section.
(1) An Indian tribe may ask MMS to exclude some or all of its leases from valuation under this section. * * *
(ii) If an Indian tribe requests exclusion from an index zone for less than all of its leases, MMS will approve the request only if the excluded leases may be segregated into one or more groups based on separate fields within the reservation.
(2) An Indian tribe may ask MMS to terminate exclusion of its leases from valuation under this section. * * *
(3) The Indian tribe's request to MMS under either paragraph
(f)(1) or (2) of this section must be in the form of a tribal resolution. * * *
206.173(a)(1)........................... How do I calculate the
2
19
38 alternative methodology for dual accounting?
(a) Electing a dual accounting method.
(1) * * * You may elect to perform the dual accounting calculation according to either 206.176(a)
(called actual dual accounting), or paragraph (b) of this section (called the alternative methodology for dual accounting).
206.173(a)(2)........................... (a) Electing a dual
Burden covered under Sec. 206.173(a)(1). accounting method.
(2) You must make a separate election to use the alternative methodology for dual accounting for your
Indian leases in each
MMS-designated area.
* * *
206.174(a)(4)(ii)....................... How do I value gas
Burden covered under OMB Control Number 1010- production when an
0140. Burden covered under Sec. 210.52. index-based method cannot be used?
(a) Situations in which an index-based method cannot be used.
(4)(ii) If the major portion value is higher, you must submit an amended
Form MMS-2014 to MMS by the due date specified in the written notice from
MMS of the major portion value. * * *
206.174(b)(1)(i) and (iii); (b)(2);
(b) Arm's-length
AUDIT PROCESS. See note.
(d)(2).
contracts.
(1)(i) You have the burden of demonstrating that your contract is arm's-length. * * *
(iii) * * * In these circumstances, MMS will notify you and give you an opportunity to provide written information justifying your value. * * *
(2) MMS may require you to certify that your arm's-length contract provisions include all of the consideration the buyer pays, either directly or indirectly, for the gas, residue gas, or gas plant product.
(d) Supporting data.
(2) You must make all such data available upon request to the authorized MMS or
Indian representatives, to the Office of the
Inspector General of the Department, or other authorized persons. * * *
Page 45061
206.174(d).............................. (d) Supporting data.
Burden covered under OMB Control Number 1010-
If you determine the 0140. value of production under paragraph (c) of this section, you must retain all data relevant to determination of royalty value.
206.174(f).............................. (f) Value guidance.
40
1
40
You may ask MMS for guidance in determining value.
You may propose a valuation method to
MMS. Submit all available data related to your proposal and any additional information MMS deems necessary. * * *
206.175(d)(4)........................... How do I determine
20
1
20 quantities and qualities of production for computing royalties?
(d)(4) You may request
MMS approval of other methods for determining the quantity of residue gas and gas plant products allocable to each lease. * * *
206.176(b).............................. How do I perform
Burden covered under Sec. 206.173(a)(1). accounting for comparison?
(b) If you are required to account for comparison, you may elect to use the alternative dual accounting methodology provided for in Sec. 206.173 instead of the provisions in paragraph (a) of this section.
206.176(c).............................. (c) * * * If you do
Burden covered under Sec. 206.172(b)(1)(ii). not perform dual accounting, you must certify to MMS that gas flows into such a pipeline before it is processed.
Transportation Allowances
206.177(c)(2) and (c)(3)................ What general
4
1
4 requirements regarding transportation allowances apply to me?
(c)(2) If you ask MMS,
MMS may approve a transportation allowance deduction in excess of the limitation in paragraph (c)(1) of this section. * * *
(3) Your application for exception (using
Form MMS-4393,
Request to Exceed
Regulatory Allowance
Limitation) must contain all relevant and supporting documentation necessary for MMS to make a determination.
206.178(a)(1)(i)........................ How do I determine a
1
25
25 transportation allowance?
(a) Determining a transportation allowance under an arm's-length contract.
(1)(i) * * * You are required to submit to
MMS a copy of your arm's-length transportation contract(s) and all subsequent amendments to the contract(s) within 2 months of the date MMS receives your report which claims the allowance on the Form MMS-2014.
206.178(a)(1)(iii)...................... (a) Determining a
AUDIT PROCESS. See note. transportation allowance under an arm's-length contract.
(1)(iii) If MMS determines that the consideration paid under an arm's-length transportation contract does not reflect the value of the transportation because of misconduct by or between the contracting parties *
* * In these circumstances, MMS will notify you and give you an opportunity to provide written information justifying your transportation costs.
206.178(a)(2)(i) and (ii)............... (a) Determining a
20
1
20 transportation allowance under an arm's-length contract.
(2)(i) * * * you cannot take an allowance for the costs of transporting lease production that is not royalty bearing without MMS approval, or without lessor approval on tribal leases.
(ii) As an alternative to paragraph
(a)(2)(i) of this section, you may propose to MMS a cost allocation method based on the values of the products transported. * * *
Page 45062
206.178(a)(3)(i) and (ii)............... (a) Determining a
40
1
40 transportation allowance under an arm's-length contract.
(3)(i) If your arm's- length transportation contract includes both gaseous and liquid products and the transportation costs attributable to each cannot be determined from the contract, you must propose an allocation procedure to MMS. * *
*
(ii) You are required to submit all relevant data to support your allocation proposal.
* * *
206.178(b)(1)(ii)....................... (b) Determining a
15
3
45 transportation allowance under a non- arm's-length contract or no contract.
(1)(ii) * * * You must submit the actual cost information to support the allowance to MMS on Form MMS- 4295, Gas
Transportation
Allowance Report, within 3 months after the end of the 12- month period to which the allowance applies. * * *
206.178(b)(2)(iv)....................... (b) Determining a
20
1
20 transportation allowance under a non- arm's-length contract or no contract.
(2)(iv) You may use either depreciation with a return on undepreciated capital investment or a return on depreciable capital investment. *
* * you may not later elect to change to the other alternative without MMS approval.
206.178(b)(2)(iv)(A).................... (b) Determining a
20
1
20 transportation allowance under a non- arm's-length contract or no contract.
(2)(iv)(A) * * * Once you make an election, you may not change methods without MMS approval. * * *
206.178(b)(3)(i)........................ (b) Determining a
40
1
40 transportation allowance under a non- arm's-length contract or no contract.
(3)(i) * * * Except as provided in this paragraph, you may not take an allowance for transporting a product that is not royalty bearing without MMS approval.
206.178(b)(3)(ii)....................... (b) Determining a
20
1
20 transportation allowance under a non- arm's-length contract or no contract.
(3)(ii) As an alternative to the requirements of paragraph (b)(3)(i) of this section, you may propose to MMS a cost allocation method based on the values of the products transported.
* * *
206.178(b)(5)........................... (b) Determining a
40
1
40 transportation allowance under a non- arm's-length contract or no contract.
(5) If you transport both gaseous and liquid products through the same transportation system, you must propose a cost allocation procedure to MMS. * * * You are required to submit all relevant data to support your proposal. * * *
206.178(d)(1)........................... (d) Reporting your
AUDIT PROCESS. See note. transportation allowance.
(1) If MMS requests, you must submit all data used to determine your transportation allowance * * *
206.178(d)(2), (e), and (f)(1).......... (d) Reporting your
Burden covered under OMB Control Number 1010- transportation
0140. Burden covered under Sec. 210.52. allowance.
(2) You must report transportation allowances as a separate entry on
Form MMS-2014. * * *
(e) Adjusting incorrect allowances.
If for any month the transportation allowance you are entitled to is less than the amount you took on Form MMS- 2014, you are required to report and pay additional royalties due, plus interest computed under 30 CFR 218.54 from the first day of the first month you deducted the improper transportation allowance until the date you pay the royalties due. * * *
(f) Determining allowable costs for transportation allowances. * * *
(1) Firm demand charges paid to pipelines. * * * You must modify the Form
MMS-2014 by the amount received or credited for the affected reporting period.
Page 45063
Processing Allowances
206.180(a)(1)(i)........................ How do I determine an
1
15
15 actual processing allowance?
(a) Determining a processing allowance if you have an arm's- length processing contract.
(1)(i) * * * You have the burden of demonstrating that your contract is arm's-length. You are required to submit to
MMS a copy of your arm's-length contract(s) and all subsequent amendments to the contract(s) within 2 months of the date MMS receives your first report that deducts the allowance on the Form
MMS-2014.
206.180(a)(1)(iii)...................... (a) Determining a
AUDIT PROCESS. See note. processing allowance if you have an arm's- length processing contract.
(1)(iii) If MMS determines that the consideration paid under an arm's-length processing contract does not reflect the value of the processing because of misconduct by or between the contracting parties *
* * In these circumstances, MMS will notify you and give you an opportunity to provide written information justifying your processing costs.
206.180(a)(3)........................... (a) Determining a
40
1
40 processing allowance if you have an arm's- length processing contract.
(3) If your arm's- length processing contract includes more than one gas plant product and the processing costs attributable to each product cannot be determined from the contract, you must propose an allocation procedure to MMS. * *
* You are required to submit all relevant data to support your proposal. * * *
206.180(b)(1)(ii)....................... (b) Determining a
20
5
100 processing allowance if you have a non- arm's-length contract or no contract.
(1)(ii) * * * You must submit the actual cost information to support the allowance to MMS on Form MMS- 4109, Gas Processing
Allowance Summary
Report, within 3 months after the end of the 12-month period for which the allowance applies. *
* *
206.180(b)(2)(iv)....................... (b) Determining a
20
1
20 processing allowance if you have a non- arm's-length contract or no contract.
(2)(iv) You may use either depreciation with a return on undepreciable capital investment or a return on depreciable capital investment.*
* * you may not later elect to change to the other alternative without MMS approval.
206.180(b)(2)(iv)(A).................... (b) Determining a
20
1
20 processing allowance if you have a non- arm's-length contract or no contract.
(2)(iv)(A) * * * Once you make an election, you may not change methods without MMS approval. * * *
206.180(b)(3)........................... (b) Determining a
20
1
20 processing allowance if you have a non- arm's-length contract or no contract.
(3) Your processing allowance under this paragraph (b) must be determined based upon a calendar year or other period if you and MMS agree to an alternative.
206.180(c)(1)........................... (c) Reporting your
AUDIT PROCESS. See note. processing allowance.
(1) If MMS requests, you must submit all data used to determine your processing allowance.
* * *
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206.180(c)(2) and (d)................... (c) Reporting your
Burden covered under OMB Control Number 1010- processing allowance. 0140. Burden covered under Sec. 210.52.
(2) You must report gas processing allowances as a separate entry on the
Form MMS-2014. * * *
(d) Adjusting incorrect processing allowances. If for any month the gas processing allowance you are entitled to is less than the amount you took on
Form MMS-2014, you are required to pay additional royalties, plus interest computed under 30 CFR 218.54 from the first day of the first month you deducted a processing allowance until the date you pay the royalties due. * * *
206.181(c).............................. How do I establish
40
1
40 processing costs for dual accounting purposes when I do not process the gas?
(c) A proposed comparable processing fee submitted to either the tribe and
MMS (for tribal leases) or MMS (for allotted leases) with your supporting documentation submitted to MMS. If
MMS does not take action on your proposal within 120 days, the proposal will be deemed to be denied and subject to appeal to the MMS
Director under 30 CFR part 290.
207--SALES AGREEMENTS OR CONTRACTS GOVERNING THE DISPOSAL OF LEASE PRODUCTS
Subpart A--General Provisions
207.4(b)................................ Contracts made
AUDIT PROCESS. See note. pursuant to old form leases.
(b) The stipulation, the substance of which must be included in the contract, or be made the subject matter of a separate instrument properly identifying the leases affected thereby, is as follows: * * *
207.5................................... Contract and sales
AUDIT PROCESS. See note. agreement retention.
Copies of all sales contracts, posted price bulletins, etc., and copies of all agreements, other contracts, or other documents which are relevant to the valuation of production are to be maintained by the lessee and made available upon request during normal working hours to authorized MMS, State or Indian representatives, other MMS or BLM officials, auditors of the General
Accounting Office, or other persons authorized to receive such documents, or shall be submitted to
MMS within a reasonable period of time, as determined by MMS. Any oral sales arrangement negotiated by the lessee must be placed in written form and retained by the lessee. Records shall be retained in accordance with 30
CFR part 212.
Total Burden................................................................
140
1,074
Note: AUDIT PROCESS--The Office of Regulatory Affairs determined that the audit process is exempt from the
Paperwork Reduction Act of 1995 because MMS staff asks non-standard questions to resolve exceptions.
Estimated Annual Reporting and Recordkeeping ``Non-hour'' Cost
Burden: We have identified no ``non-hour'' cost burdens.
Public Disclosure Statement: The PRA (44 U.S.C. 3501 et seq.) provides that an agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.
Comments: Before submitting an ICR to OMB, PRA Section 3506(c)(2)(A) requires each agency ``* * * to provide notice * * * 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.
The PRA also requires agencies to estimate the total annual reporting ``non-hour cost'' burden to respondents or recordkeepers resulting from the collection of information. If you have costs to generate, maintain, and disclose this information, you should comment and provide your total capital and startup cost components or annual operation, maintenance, and purchase of service components. You should describe the methods you use to estimate major cost factors, including system and technology acquisition, expected useful life of capital equipment, discount rate(s), and the period over which you incur costs.
Page 45065
Capital and startup costs include, among other items, computers and software you purchase to prepare for collecting information; monitoring, sampling, and testing equipment; and record storage facilities. Generally, your estimates should not include equipment or services purchased: (i) Before October 1, 1995; (ii) to comply with requirements not associated with the information collection; (iii) for reasons other than to provide information or keep records for the
Government; or (iv) as part of customary and usual business or private practices.
We will summarize written responses to this notice and address them in our ICR submission for OMB approval, including appropriate adjustments to the estimated burden. We will provide a copy of the ICR to you without charge upon request. The ICR also will be posted at http://www.mrm.mms.gov/Laws_R_D/FRNotices/FRInfColl.htm.
Public Comment Policy: We will post all comments in response to this notice at http://www.mrm.mms.gov/Laws_R_D/FRNotices/
FRInfColl.htm. We also will make copies of the comments available for public view, including names and addresses of respondents, during regular business hours at our offices in Lakewood, Colorado. Before including your address, phone number, e-mail address, or other personal identifying information in your comment, be advised that your entire comment--including your personal identifying information--may be made publicly available at any time. While you can ask us in your comment to withhold from public view your personal identifying information, we cannot guarantee that we will be able to do so.
MMS Information Collection Clearance Officer: Arlene Bajusz (202) 208-7744.
Dated: July 21, 2008.
Richard J. Adamski,
Acting Associate Director for Minerals Revenue Management.
FR Doc. E8-17730 Filed 7-31-08; 8:45 am
BILLING CODE 4310-MR-P
