# General Provisions and Non-Federal Oil and Gas Rights > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3A2016-26489 ## Record - **Collection:** Federal Register - **Document type:** Rule - **Published:** November 4, 2016 - **Citation:** 81 FR 77972 ## Text DEPARTMENT OF THE INTERIOR National Park Service 36 CFR Parts 1 and 9 [NPS-WASO-NRSS-21688; GPO Deposit Account 4311H2] RIN 1024-AD78 General Provisions and Non-Federal Oil and Gas Rights AGENCY: National Park Service, Interior. ACTION: Final rule. SUMMARY: We are updating our service-wide regulations governing the exercise of non-federal oil and gas rights, to improve our ability to protect park resources, values, and visitors from potential impacts associated with nonfederal oil and gas operations located within National Park Service units outside Alaska. The rule also makes the regulations consistent with existing policies and practices, and updates the format to improve clarity and simplify application and compliance for oil and gas operators and our employees. DATES: This rule is effective December 5, 2016. FOR FURTHER INFORMATION CONTACT: Edward O. Kassman, Jr., Geologic Resources Division, National Park Service, P.O. Box 25287, Denver, Colorado 80225; edward_kassman@nps.gov ; (303) 969-2146. SUPPLEMENTARY INFORMATION: Background Proposed Rule and Public Comment Period On October 26, 2015, the National Park Service (NPS) published the proposed rule in the Federal Register (80 FR 65572). The rule was open for public comment for 60 days, until December 28, 2015. The NPS invited comments via mail and the Federal eRulemaking Portal at http://www.regulations.gov . At the start of the comment period, the NPS distributed over 1,000 newsletters to non-governmental organizations, individuals, industry groups, Alaska native corporations, and state agencies, primarily the oil and gas regulatory agencies from multiple states (Alaska, Alabama, California, Colorado, Florida, Indiana, Kentucky, Kansas, Louisiana, Mississippi, Montana, New Mexico, North Dakota, Ohio, Oklahoma, Pennsylvania, Tennessee, Texas, Utah, Virginia, West Virginia, Wyoming). These newsletters summarized the proposed rule, alternatives considered in the related draft environmental impact statement (DEIS), and how the public could comment on the proposed rule and DEIS. In an effort to reach an even broader audience, the NPS hosted a pre-recorded webinar describing the proposed rulemaking. This online webinar soliciting public comment on the DEIS and the proposed rule and was open to any member of the public. The NPS received 20 comment letters on the proposed rule during the comment period. These included unique comment letters and form letters. Some comment letters received were submitted improperly and not considered. Additionally, many comments were signed by more than one person. NPS counted a letter as a single set of comments, regardless of the number of signatories. A summary of comments and NPS responses is provided below in the section entitled “Summary of and Responses to Public Comments.” After considering the public comments and additional review, the NPS made changes in the final rule. These changes are summarized below in the section entitled “Changes in the Final Rule.” 1978 Regulations On December 8, 1978, the NPS promulgated the regulations at 36 CFR part 9, subpart B (43 FR 57825) (1978 Regulations), governing the exercise of non-federal oil and gas rights in units of the National Park System (System units). The 1978 Regulations applied to all activities associated with non-federal oil and gas exploration and development inside System unit boundaries where access is on, across, or through federally owned or controlled lands or waters (36 CFR 9.30(a)). Under the 1978 Regulations, an operator utilizing such access must obtain our approval of a plan of operations before commencing non-federal oil and gas operations in a System unit (36 CFR 9.32(b)). This requirement covered exploration, drilling, production, transportation, plugging, and reclamation operations. The proposed plan of operations was an operator's blueprint of all intended activities and was our primary means for evaluating the operation's potential adverse impacts on park resources and values. The operator must demonstrate that it is exercising a bona fide property right to non-federal oil and gas located within a System unit (36 CFR 9.36(a)(2)). Generally, the proposed plan of operations must also describe: • The proposed operation, including the equipment, methods, and materials to be used in the operation; • Access to the site; • Mitigation measures that will be implemented to protect NPS resources and values; • Environmental conditions in the vicinity of the site; • Alternatives to the proposal; and • The environmental impacts of the proposed operation (36 CFR 9.36(a)). In addition to the proposed plan of operations, and prior to approval, the operator must submit a performance bond to ensure that funds are available to reclaim a site if the operator defaults on its obligations under an approved plan (36 CFR 9.48). In order to make the regulatory process as efficient and transparent as possible, we work collaboratively with operators early in their planning process to provide guidance on information requirements, alternative area of operations locations, and potential mitigation and avoidance measures. During our approval process, we coordinate and consult with a variety of state and other federal regulatory agencies to ensure that approval complies with applicable laws, such as the National Environmental Policy Act of 1969, the Endangered Species Act, the National Historic Preservation Act, and the Clean Water Act. The 1978 Regulations required that operators conducting non-federal oil and gas operations in System units provide an affidavit that operations planned are in compliance with all applicable state and local laws (36 CFR 9.36(a)(15)). Although state oil and gas regulations may contain provisions designed to protect natural resources ( e.g., surface and groundwater), their primary focus is on oil and gas production and protection of associated ownership interests. The purpose and focus of the NPS's regulation of non-federal oil and gas operations is to protect the National Park System's natural and cultural resources and visitor values and safety. When the NPS Regional Director has determined that the proposal meets the requirements contained in the regulations and the NPS has completed the required environmental compliance, the Regional Director will approve the plan (36 CFR 9.37). The approved plan is the operator's authorization to conduct its operation in a System unit (36 CFR 9.32(a)). During the life of an oil or gas operation in a park, the park manager has the authority to monitor and ensure compliance with the approved plan of operations (36 CFR 9.37(f)). If there is a change in circumstances, the NPS or the operator can make a request to supplement or modify the plan (36 CFR 9.40). The 1978 Regulations authorize us to enforce the terms of the plan, as may be necessary, including suspending operations or revoking plan approval (36 CFR 9.51). The operator may appeal a Regional Director's decision (36 CFR 9.49). Authority To Promulgate the Regulations The authority to promulgate these regulations is the statute commonly known as the NPS Organic Act (54 U.S.C. 100101 et seq. ) as well as other statutes governing the administration of the National Park System. The Organic Act directs the Secretary of the Interior, acting through the NPS, to “promote and regulate the use of the National Park System by means and measures that conform to the fundamental purpose of the System units, which purpose is to conserve the scenery, natural and historic objects, and wild life in the System units and to provide for the enjoyment of the scenery, natural and historic objects, and wild life in such manner and by such means as will leave them unimpaired for the enjoyment of future generations.” The Organic Act also grants the NPS the authority to promulgate regulations “necessary or proper for the use and management of System units.” (54 U.S.C. 100751). This includes the authority to regulate the exercise of non-federal oil and gas rights within park boundaries for the purpose of protecting the resources and values administered by the NPS. In addition, the enabling acts for several System units contain specific provisions directing or authorizing us to regulate the exercise of non-federal oil and gas rights. In the authority section of the rule, we list the individual enabling statutes that address non-federal oil and gas rights in those System units. Our authority to promulgate regulations that govern the exercise of non-federal oil and gas operations has been recognized as a valid exercise of NPS's Organic Act authority by a U.S. District Court and the United States Court of Appeals for the Fifth Circuit. See Dunn-McCampbell Royalty Interest v. National Park Service, 964 F. Supp. 1125 (S.D. Tex. 1995), and Dunn-McCampbell Royalty Interest v. National Park Service, 630 F.3d 431 (5th Cir. 2011). Courts have also recognized NPS's authority to regulate other non-federal property interests within units of the National Park System. See, e.g., United States v. Vogler, 859 F.2d 638 (9th Cir. 1988), cert. denied, 488 U.S. 1006 (1989); United States v. Garfield County, 122 F. Supp. 2d 1201 (D. Utah 2000). See also Southern Utah Wilderness Alliance v. Bureau of Land Management, 425 F. 3d 735, 746-47 (10th Cir. 2005). System units in Alaska would have been subject to the regulations in the proposed rule. As explained in the preamble to the proposal, we relied upon Sturgeon v. Masica, 768 F.3d 1066, 1077-78 (9th Cir. 2014), for the proposition that “because these regulations are generally applicable to System units nationwide and to non-federal interests in those units, they are not `applicable solely to public lands within [units established under ANILCA],' and thus are not affected by section 103(c) of ANILCA.” This Ninth Circuit opinion recently was vacated by the Supreme Court and remanded for further consideration. Sturgeon v. Frost, 136 S.Ct. 1061 (2016). NPS also received several comments stating that application of the proposed rule to nonfederal oil and gas activities on private land would be contrary to section 103(c) of ANILCA. In light of the pending litigation, the applicability of the ANILCA Title XI regulations in 43 CFR part 36, and the lack of current oil and gas development proposals and resource threats, NPS has decided to apply this rule only to operations within System units outside of Alaska. NPS may reconsider this exemption upon receipt of a final decision in the Sturgeon litigation, and if appropriate, to consider Alaska specific special regulations which could be included along with the other NPS Alaska regulations in 36 CFR part 13. The rule has no effect on the above-referenced regulations at 43 CFR part 36, promulgated by the Department of the Interior in 1986 to implement section 1110(b) of ANILCA, which apply to persons who use lands and waters administered by NPS to conduct activities on, or for access to, non-federal inholdings within Alaska parks. A unique provision exists under section 8 of the Big Cypress National Preserve Addition Act of 1988 (Addition Act), codified at 16 U.S.C. 698m-4. In addition to authorizing the Secretary to promulgate rules and regulations specifically for Big Cypress National Preserve, the Addition Act authorized the Secretary to enter into interim agreements with owners of non-Federal oil and gas interests governing the conduct of oil and gas exploration, development, or production activities within the boundary of the Addition. 16 U.S.C. 698m-4(e). Such agreements had been interpreted to obviate the need for operators to propose a plan of operations under the 1978 Regulations for their operations on the Addition lands. Consistent with the statute, the present oil and gas operations within the Addition Area had been controlled under the terms of the Agreement Governing The Exercise Of Reserved Oil And Gas Rights Of Collier Enterprises And Barron Collier Company, which is Appendix 6 to the Agreement Among the United States of America, Collier Enterprises, Collier Development Corporation, and Barron Collier Company (May 12, 1988). This rule supersedes Appendix 6. Non-Federal Oil and Gas Rights in System Units Non-federal oil and gas rights exist within System units in situations where the United States does not own the oil and gas interest, either because: • The United States acquired the property from a grantor that did not own the oil and gas interest; or • The United States acquired the property from a grantor that reserved the oil and gas interest from the conveyance. Non-federal oil and gas interests can be held by individuals; nonprofit organizations; corporations; or state and local governments. Interests in non-federal oil and gas are property rights that may only be taken for public use with payment of just compensation in accordance with the Fifth Amendment of the U.S. Constitution. Accordingly, from their initial promulgation, the 1978 Regulations at 36 CFR 9.30(a) have stated that they are “not intended to result in the taking of a property interest, but rather to impose reasonable regulations on activities that involve and affect federally owned lands.” This rule includes this same provision. There are currently 534 non-federal oil and gas operations in a total of 12 System units. These units are: Alibates Flint Quarries National Monument, Texas (5 operations); Aztec Ruins National Monument, New Mexico (4 operations); Big Cypress National Preserve, Florida (20 operations); Big Thicket National Preserve, Texas (39 operations); Big South Fork National River and Recreation Area, Tennessee/Kentucky (152 operations); Cumberland Gap National Historical Park, Tennessee (2 operations); Cuyahoga Valley National Park, Ohio (90 operations); Gauley River National Recreation Area, West Virginia (28 operations); Lake Meredith National Recreation Area, Texas (174 operations); New River Gorge National River, West Virginia (1 operation; Obed Wild and Scenic River, Tennessee (5 operations); and Padre Island National Seashore, Texas (14 operations). Based on the presence of split estates, exploration and production occurring on adjacent or nearby lands, and likely increases in energy prices, NPS expects that future non-federal oil and gas operations within park boundaries could occur in up to 30 additional System units. Summary of Potential Impacts From Oil and Gas Operations on NPS Resources and Values Examples of non-federal oil and gas activities conducted in System units include geophysical (seismic) exploration; exploratory well drilling; field development well drilling; oil and gas well production operations, including installation and operation of well flowlines and gathering lines; well plugging and abandonment; and site reclamation. Such oil and gas activities may adversely impact System unit resources in various ways: • Surface water quality degradation from spills, storm water runoff, erosion, and sedimentation. Through site inspections the NPS has documented 26 instances of in-park operation sites with surface contamination; • Soil and ground water contamination from existing drilling mud pits, poorly constructed wells, spills, and leaks. Through site inspections the NPS has documented 47 instances of sites with wellhead leaks, pump jack leaks, tank battery leaks, and operations and maintenance spills; • Air quality degradation from dust, natural gas flaring, hydrogen sulfide gas, and emissions from production operations and vehicles. Through site inspections the NPS has documented 14 instances of notable odors emanating from the wellhead; • Noise from seismic operations, blasting, construction, oil and gas drilling and production operations. Through site inspections the NPS has documented 6 instances of excess noise issues from well pad equipment; • Noise and human presence effects on wildlife behavior, breeding, and habitat utilization; • Disruption of wildlife migration routes; • Adverse effects on sensitive and endangered species. Through site inspections the NPS has documented 15 sites with sensitive species or habitat; • Viewshed intrusion by roads, traffic, drilling equipment, production equipment, pipelines, etc.; • Night sky intrusion from artificial lighting and gas flares; • Disturbance to archeological and cultural resources from blasting associated with seismic exploration and road/site preparation, maintenance activities, or by spills. Through site inspections the NPS has documented 6 sites with associated cultural resources; and • Visitor safety hazards from equipment, pressurized vessels and lines, presence of hydrogen sulfide gas, and leaking oil and gas that can create explosion and fire hazards. Through site inspections the NPS has documented 62 instances of visitor safety hazards. Examples of documented impacts can be found in many parks. For example, at Big South Fork natural-gas-fired pump jack engines can be heard at visitor overlooks that are 2 to 3 miles away. Simple mitigation such as a corrugated steel fence around the operations would abate this impact; however, due to the well's grandfathered status, the NPS has been unable to require this mitigation and is therefore forced to accept this adverse impact. Another example of avoidable impacts was found at Aztec Ruins National Monument where an operation exempt from the 1978 Regulations due to the grandfathered exemption contained a road that traversed an unexcavated archeological site. Only when this well lost its grandfathered status due to a change of operator was the NPS able to require the new operator to conduct a cultural resource survey to determine the impacts to the site. As mitigation the operator installed a layer of dirt between the archeological site and the road base to protect the resources. Final Rule Summary of Final Rule The summary below details the significant differences between the 1978 Regulations and this final rule. As appropriate, this summary also briefly describes the reasons changes were made to this rule as a result of public comments received. Purpose and Scope of the Regulation Interests Protected Under These Regulations After careful review we have found that the 1978 Regulations were inconsistent in their description of the interests that the regulations were designed to protect. This rule at § 9.30(a) and throughout consistently states that the purpose of the regulations is to protect federally owned or administered lands, waters, or resources of System units, visitor uses or experiences, and visitor or employee health and safety. The NPS evaluates operators' proposals on a case-by-case basis and applies avoidance and mitigation measures and requires financial assurance amounts to the extent necessary to protect the interests described above. Depending on the type of activity proposed, environmental factors, visitor use patterns, and land ownership status (activity either on federal or non-federal lands), the NPS will adjust its avoidance and mitigation measures and financial assurance amounts accordingly. This rule replaces the phrase “federally owned or controlled” with the phrase “federally owned or administered” to be consistent with the terminology we use in our general regulations, at 36 CFR 1.2, and 36 CFR 1.4(a) (definition of “National Park System”). Operators Subject to the Regulation Under § 9.30(a) of the 1978 Regulations, application of the rule was predicated on “access on, across, or through federally owned or controlled lands or waters.” This rule at 9.30(b) applies to all operators conducting non-federal oil or gas operations on lands or waters within a System unit, regardless of the ownership or legislative jurisdictional status of those lands or waters. Reasonable Regulation of Non-Federal Oil and Gas Rights Section 9.30(c) of this rule retains language from § 9.30(a) of the 1978 Regulations stating that the intention of this subpart is to reasonably regulate non-federal oil and gas activities in a System unit, but not to result in a taking of private property. Although the NPS has required mitigation measures on proposed operations, we have never, in the more than 37 years of applying this subpart, failed to approve a plan of operations. We will continue to work with operators to ensure they have reasonable access to their oil and gas rights while protecting park resources and values without resulting in a taking in violation of the Fifth Amendment of the United States Constitution. Scope of the Regulations Section 9.31(a) of this rule changes the scope to cover all nonfederal oil and gas operations within the boundary of a System unit outside of Alaska. Section 9.31(b) of this rule also covers those operations that become located within a System unit either by statutory boundary expansion or establishment of a new System unit. Section 9.31(c) of this rule covers those operations that access oil and gas rights from a surface location outside the park boundary but due to a boundary expansion or establishment of a new unit, the surface location is now within a System unit. Under § 9.31(b) and (c) such operations follow the same requirements and procedures as those for previously exempt operations at §§ 9.50 through 9.53 of this rule. Type of Authorization Required Section 9.32(a) of this rule provides that an operator must have either a temporary access permit before conducting reconnaissance surveys on NPS administered lands or an operations permit for operations in a System unit. Demonstration of Valid Existing Right The 1978 Regulations contained a requirement that operators demonstrate that they hold valid rights to conduct activities under the plan of operations information requirements. This rule moves this requirement to § 9.32(b) to clarify that all operators must demonstrate up front that they hold a valid existing right to conduct operations in a System unit. Until an operator can demonstrate a valid existing right to conduct all operations described in its operation permit application, we will not undertake formal review of an operator's operations permit application. Definitions This rule deletes several redundant definitions because the terms are defined at 36 CFR 1.4. The definitions being deleted from the 1978 Regulation are: “Secretary” (former § 9.31(a)), “Director” (former § 9.31(b)), “Person” (former § 9.31(e)), and “Superintendent” (former § 9.31(f)). This rule also deletes two definitions that are no longer used: “Commercial Vehicle” (former § 9.31(g)) and “Statement for Management” (former § 9.31(o)). This rule adds a new term, “Area of Operations,” to replace the term “Site,” at former § 9.31(m). The new term means all areas where an operator is authorized to conduct its activities, including access to the operations site. This rule expands the definition of “Contaminating Substances,” at former § 9.31(n), to include other toxic or hazardous substances. This definition no longer uses the term “waste,” and the rule includes a separate definition of “waste.” This rule deletes the term “Unit” and instead the text of the rule uses the statutory term “System unit,” which is defined at 54 U.S.C. 100102(6). This rule changes the definition of “Operations” at § 9.31(c) of the 1978 Regulation, to clarify that “access” includes “any means of ingress to or egress from an area of operations.” This change covers any and all types of access, including access via aircraft (time, place, and manner of aircraft landing on or taking off) to an area of operations. Accordingly, the NPS removed former § 9.32(c), which regulated 9B aircraft access. The definition of “Operations” under this rule also clarifies that the operation of a flowline or a gathering line is included within this definition, but not the installation, operation, or maintenance of trans-park oil and gas pipelines that are under authority of a deeded easement or other right-of-way and which are not covered by this regulation. This rule adds a new term “Operations permit” as the permitting instrument for all operations. An operations permit is a special use permit subject to cost recovery under 54 U.S.C. 103104, which authorizes the NPS to recover all costs associated with providing necessary services associated with special use permits. This rule updates the definition of “Operator” at § 9.31(d) of the 1978 Regulations by clarifying that responsibilities and liability under this subpart can attach to the operator or the operator's agents, assignees, designees, lessees, or representatives. This rule defines “owner” as a “person” (the definition of “person” is found at 36 CFR 1.4). This rule adds a new definition of “Previously exempt operation” to clarify which types of operations are covered under §§ 9.50 through 9.53. This definition does not include those operations where the operator was granted an exemption under § 9.32(e) of the 1978 Regulations to the plan of operations requirement by the NPS because it accessed oil and gas rights inside the park boundary from a surface location outside the park boundary (which are covered by § 9.33(b) of this rule). This rule adds a new term “Reconnaissance survey” to clarify that reconnaissance surveys do not include surface disturbance activities, except the minimal disturbance necessary to perform the surveys. This rule adds a new term “Right to operate” that incorporates much of the language in § 9.36(a)(2) of the 1978 Regulations (right to operate description for a Plan of Operations). This new definition clarifies that an operator's documentation must demonstrate that all proposed activities are within the scope of that right. This rule adds a new term “Technologically feasible, least damaging methods” to describe the general standard that all operators must satisfy when meeting applicable operating standards. This rule adds a new term “Temporary access permit” to clarify that the NPS grants temporary access only for reconnaissance surveys and to collect basic information necessary to prepare a permit application. This rule adds a new term “Third-party monitor” to identify a third-party monitor's necessary qualifications. This rule adds a new term “Usable water” to describe the criteria that the NPS uses to identify protected sources of groundwater. This rule adds a new term “Waste” to differentiate between “waste” and “contaminating substances.” Further, the NPS changed the definition of Waste from the proposed rule by replacing the term “toxic or hazardous substance” with the phrase “contaminating substance” to more clearly explain the differences between wastes and contaminating substances. This rule adds a new set of terms “We and us” to refer to the National Park Service. This rule adds a definition of “You” to be consistent with the plain language format of this subpart. Commercial Vehicles This rule deletes former § 9.32(d). This access is controlled by NPS commercial vehicle regulations at 36 CFR 5.6(c). Previously Exempt Operations This rule creates a new section “Previously Exempt Operations” to describe the process for bringing exempt operations under the 1978 Regulations into compliance with the requirements of this rule. These include operations that do not require access on, across, or through federal lands (former § 9.30) and grandfathered operations (former § 9.33). The 1978 Regulations applied only when an operator's “access [was] on, across, or through federally owned or controlled lands or waters.” Seventy-eight current operations (15% of all oil and gas operations in System units) did not require access on, across, or through federally owned or controlled lands or waters and thus were not covered by the 1978 Regulations. These operators were not required to obtain an approved NPS plan of operations, post financial assurance, or otherwise comply with this subpart to protect park resources and values. However, our experience over the past three decades has demonstrated that these operations have the potential to adversely affect NPS resources, values, and visitor health and safety. The NPS identified at least 10 instances of previously exempt sites with oil spills or leaks resulting in contamination of soils and water. Under this rule at §§ 9.30 through 9.33, all operators conducting operations within NPS boundaries are subject to permit requirements. The permitting process includes an evaluation to determine whether, and the extent to which, such operations would have an adverse effect on federally owned or administered lands, waters, or resources of System units, visitor uses or experiences, or visitor or employee health and safety. These operations are also subject to measures to mitigate such adverse effects, as well as to the financial assurance and reclamation requirements. Under § 9.33 of the 1978 Regulations, operators who were conducting operations at the time the regulations became effective (January 8, 1979) and who had already obtained any valid federal or state permit were “grandfathered.” These operators were not required to obtain an approved plan of operations; comply with NPS operating standards, including reclamation of their area of operations to NPS standards; or post a reclamation bond. The Superintendent had authority under § 9.33(c) of the 1978 Regulations to suspend grandfathered operations if there was an “immediate threat of significant injury to federally owned or controlled lands or waters.” Under § 9.33(a)(1) of the 1978 Regulations, when the existing federal or state permit expired and was replaced with a new permit, a plan of operations would then be required. In 1978, the NPS had expected that over time the permits associated with these operations would expire and that the operators would then be required to come into compliance with the 1978 Regulations. However, the rate of permit expiration has been much slower than anticipated. This has resulted in approximately 45% of operations (241 wells service-wide) remaining exempt from the regulations despite the passage of over thirty-seven years. As discussed above, this has resulted in readily avoidable impacts to NPS-administered resources and values. The grandfather exemption was intended to provide for a “smooth and fair phase in of [the 1978] regulations.” (43 FR 57822) This rulemaking is intended to ensure that all operations within System units are conducted in a manner that protects park resources and values. This rule in §§ 9.50 through 9.53 sets forth the procedure for bringing previously exempt operations into compliance. Temporary Access This rule requires an operator to obtain a temporary access permit in order to conduct reconnaissance surveys on NPS administered lands and waters and removes provisions from the 1978 Regulations that allowed the NPS to authorize temporary access for existing operations and for new operations. Those provisions are no longer necessary because operations within the boundary of a System unit are required to obtain an Operations Permit. This rule identifies at §§ 9.60 through 9.63 the procedure for obtaining a temporary access permit and what information is necessary for the NPS to evaluate an operator's proposal. No comments were received on this provision of the proposed rule. Accessing Oil and Gas Rights From a Surface Location Outside The Park Boundary Section 9.32(e) of the 1978 Regulations allowed operators to apply for an exemption from the regulations if they directionally drilled from a surface location outside a System unit to reach a bottom hole located within NPS boundaries and the drillbore passed under any land or water the surface of which was owned by the United States. This exemption was available if operations within the park boundary posed no significant threat of damage to NPS resources, both surface and subsurface, resulting from surface subsidence, fracture of geological formations with resultant fresh water aquifer contamination, or natural gas escape. Surface activities located outside the NPS boundary were not within the scope of the 1978 Regulations. Under this regulation, regulatory authority over these operations is exercised beginning at the subsurface point where the proposed operation (borehole) crosses the park boundary, and applies to all infrastructure and activities within the System unit regardless of the ownership of the surface estate. NPS will review your proposed operations and provide an exemption from the operations permit requirement whenever it determines that your downhole operations within the park boundary do not pose a significant threat to park resources or park visitors. For further guidance on applying for an exemption for such operations, please see the 9B Operator's Handbook. The availability of the exemption is intended to continue to provide an incentive for operators to locate surface facilities outside a System unit. Location of operations outside a System unit generally avoids direct impacts to NPS resources and visitors. Therefore, this rule at § 9.70 is consistent with the concepts that underlay the former rule exemption, but operators are subject to the General Terms and Conditions and the Prohibitions and Penalties provisions for operations located within the boundary of a System unit. Operations Permit Application This rule details the information requirements that an operator must satisfy when submitting a complete Operations Permit application. These requirements are separated into the following categories: § 9.83, information that must be included in all applications; § 9.87, additional information that must be included for a proposed geophysical exploration; § 9.88, additional information that must be included for a proposed drilling operations; § 9.89 additional information must be included for a proposed well stimulation operations, including hydraulic fracturing; and, § 9.90 additional information that must be included for a proposed production operations. Additions to and Clarification of Existing Information Requirements This rule contains the following new or updated information requirements from the 1978 Regulations for all operations permit applications: • Contact Information —Section 9.83 of the 1978 Regulations limited identification of an operation's key personnel to the operator, owners, and lessees. To ensure that the NPS has all appropriate contact information, § 9.83(b) of this rule requires that operators also identify agents, assignees, designees, contractors, and other representatives. • Use of Water— Section 9.83(e) of this rule clarifies and expands upon § 9.36(a)(5) of the 1978 Regulations. Section 9.83(e) requires information regarding the source, transportation method and quantity of water to be used in addition to how the operator will manage waste water. • New Surface Disturbance and Construction —Section 9.84 of this rule requires an operator to specify site security measures and an operation's power sources and transmission systems. • The NPS has updated language from the proposed rule at § 9.84(a)(2) to add “wetlands, seepage areas, springs, shallow water aquifers, . . .” to the example list of natural features. • Environmental Conditions and Mitigation Actions— Section 9.85(a) of this rule has been updated from the proposed rule to clarify that natural resource conditions include baseline soil and water testing ( e.g., use of photoionization detectors, conductivity meters, or titration strips) within an operator's area of operation. Further, § 9.85(b) of this rule requires an operator to describe steps proposed to mitigate adverse environmental impacts and list and discuss the impacts that cannot be mitigated. Operators are required to consider and describe all alternative technologically feasible, least damaging methods. Technologically feasible, least damaging alternatives are defined in § 9.31 as those alternatives that are viable (based on economic, environmental, and technological considerations) and conform to federal, state, and local laws and regulations. • Cultural Resources— In this rule, the NPS eliminates § 9.47(a) of the 1978 Regulations, “Cultural Resource Protection,” because the section merely summarized the requirements of the Antiquities Act (54 U.S.C. 320301 et seq. ). Restating those statutory requirements in this rule is unnecessary, and the 1978 Regulations reference failed to include other statutes that also applied to such resources. • Spill Control and Emergency Preparedness Plan— Section 9.86 of this rule consolidates various provisions of the 1978 Regulations, includes a requirement that an operator must submit a Spill Control and Emergency Preparedness Plan (SCEPP) plan to the NPS, and identifies the information necessary for a SCEPP. The NPS has made nonsubstantive changes to the proposed rule so the term “Spill control and emergency preparedness plan” is used consistently throughout the final rule. This rule at § 9.87 clarifies the additional information a geophysical operator must submit to the NPS. Furthermore, this rule at §§ 9.88 through 9.90 clarifies the additional information an operator must submit if it is proposing to drill, stimulate, or produce a well. The final rule adds language to §§ 9.88 and 9.89 of the proposed rule to include any proposed stimulation technique including hydraulic fracturing. This rule also contains, § 9.89, a new set of information requirements for well stimulation, including hydraulic fracturing operations. Information requirements include identifying the geologic barriers between the target zone and the deepest usable water zone, verifying mechanical integrity of the wellbore, and describing water use and disposal management of flowback fluids. The NPS rule is similar to BLM's hydraulic fracturing information requirements at 43 CFR 3162.3-3(d)(1) through (7), which BLM recently promulgated under various authorities, including the Mineral Leasing Act, 30 U.S.C. 189, the Federal Land Policy and Management Act, 43 U.S.C. 1701 et seq. As previously discussed, that rule has not gone into effect, and is the subject of litigation. Regardless of BLM's authorities under the statutes it implements, we have determined, as discussed below, that the limited information and reporting requirements and performance standards for well stimulation activities under this rule are consistent with the Secretary's regulatory authority under the Organic Act. Additionally, since 2006 NPS has provided specific guidance on means to ensure that well integrity standards are met in its 9B Operator's Handbook. Operations Permit: Application Review Process Section 9.37(a)(1) of the 1978 Regulations required that, before approving a plan of operations, the Regional Director determine that the operator uses technologically feasible, least damaging methods that provide for protection of the park's resources and public health and safety. The 1978 Regulations had two different approval standards, depending on whether the operation was proposed on non-federally or federally owned surface. For operations proposed on non-federally owned surface a Regional Director could not approve an operation that would constitute a nuisance to federal lands or waters in the vicinity of the operations, or would significantly injure federally owned or controlled lands or waters. For operations proposed on federally owned surface a Regional Director could not approve an operation that would substantially interfere with management of the unit to ensure the preservation of its natural and ecological integrity in perpetuity, or would significantly injure federally owned or controlled lands or waters. If applying the standard for operations proposed on federally owned lands would constitute a taking of a property interest, the NPS could have either approved the operations if the operator used technologically feasible, least damaging methods or acquire the mineral interest. Section 9.37(b) and (c) of the 1978 Regulations required the NPS to make a decision on the plan of operations within 60 days after the date that the NPS determines that the materials submitted under the plan are adequate. Within 60 days, the Regional Director was required to make one of six final decisions in writing. The final decisions were: approval or rejection; conditional approval; modification to the plan or additional information is required; more time is necessary to complete review; environmental statement is required before approval; or more time is necessary for public participation and analysis of public comments. Section 9.37(c) of the 1978 Regulations provided that failure of the NPS to make a final decision within 60 days constituted a rejection of the plan for which the operator had the option of appealing immediately to the Regional Director under former § 9.49. This rule establishes a two-stage permit application review process, eliminates the dual approval standards, provides more realistic timeframes to provide notice back to an operator, and consolidates the final decisions the NPS can make on an operator's permit application. Stage One: Initial Review Section 9.101 of this rule describes the NPS's initial review of an operator's permit application. During initial review the NPS determines whether the applicant has supplied all information necessary for the NPS to evaluate the operation's potential impacts on federally owned or administered lands, waters, or resources of System units, visitor uses or experiences, or visitor or employee health and safety. The NPS will respond to applicants in writing within 30 days and notify them whether the information contained in their permit applications is complete. If the NPS needs more time to complete the initial review, the NPS will provide the applicant with an estimate of the amount of additional time reasonably needed and an explanation for the delay. Once a permit application is complete the NPS conducts a formal review. Stage Two: Formal Review During formal review under § 9.102, the NPS evaluates whether the proposed operation meets the NPS approval standards (§ 9.103) and complies with applicable federal statutes ( e.g. National Environmental Policy Act (NEPA), Endangered Species Act (ESA), and National Historic Preservation Act (NHPA)). Timeframe for Final Action In light of NPS experience over the past 37 years in implementing the 1978 Regulations, the 60-day period for reaching a final decision on a permit application has proven to be unrealistic. These decisions require time to adequately analyze an operator's proposal, work with the operator on a design that incorporates acceptable avoidance and mitigation measures, and comply with the associated statutory responsibilities such as NEPA, ESA, and NHPA. These regulations provide operators with realistic expectations of the timeframe necessary to process operations permits. Similarly, the NPS has taken into account time frames for its coordination with other federal and state agencies. Thus, § 9.104 allows the NPS to complete its legal compliance responsibilities and then take final action on the operations permit within 30 days. This rule allows for a longer period of time, if the parties agree to it, or if the NPS determines that it needs more time to comply with applicable legal requirements. This rule removes § 9.37(c) of the 1978 Regulations, which allowed an operator to immediately appeal the failure to reach a decision within 60 days. This rule, at § 9.104, authorizes the Superintendent to notify the operator in writing that additional time is necessary to make a final decision. Elimination of Dual Approval Standards Section 9.103 replaces the dual approval standards under the 1978 Regulations with a single three-part approval standard that applies to all operations, regardless of surface ownership. Oil and gas operations located on non-federally owned surface have the potential to impact federally owned or administered lands, waters, or resources of System units, visitor uses or experiences, or visitor or employee health and safety to the same degree as operations sited on federally owned surface. Section 9.103(a) of the proposed rule has been changed in two ways. First, in response to comment the NPS changed the introductory language to expressly provide that if an operator meets the approval standards, the Regional Director will approve the operation permit. Second, this section lists two (rather than three) determinations that the Regional Director must make in order to approve an operations permit. The NPS clarified the language in § 9.103(a)(1) to include statutes that may apply to operations in particular System units. The NPS also removed language in paragraph (b)(3) in the proposed rule that required the Regional Director to make a “determination” that an operator was in compliance with all other applicable federal, state, and local laws. Rather, as a prerequisite to approval of an operations permit, the modified language requires that the operator provide the Regional Director with an affidavit stating that it is in compliance with all applicable federal, state, and local laws. Thus, revised § 9.103(b) requires three prerequisites for final approval: (1) Submittal of adequate financial assurance, (2) proof of adequate liability insurance, and (3) an affidavit stating that the operations planned are in compliance with all applicable Federal, State, and local laws and regulations. Final Actions Section 9.104 of this rule establishes two final actions: (1) Approved, with or without conditions, or (2) denial, and the justification for the denial. The Regional Director will notify the operator in writing of the final action. If approved, this written notification constitutes the NPS's authorization to conduct activities. The NPS has simplified the language at § 9.104(a)(2) to read “all applicable legal requirements.” The NPS has eliminated the proviso in the approval standard in current § 9.37(a)(3) of the 1978 Regulations, which allows for approval using only the “technologically feasible, least damaging methods” standard of § 9.37(a)(1) if application of the more stringent § 9.37(a)(3) standard would cause a taking of a property interest. Over the past 37 years of implementing the 1978 Regulations, the NPS has never invoked this exception. In every instance, the NPS been able to authorize operators' access while protecting park resources and values. Section 9.30(c) continues the 1978 regulatory statement that application of the regulations are not intended to result in a taking of mineral rights and § 9.104(b)(2) requires that any denial of an operations permit must be consistent with that provision. This change from the 1978 Regulations is not intended or expected to authorize any taking of property rights, and is intended solely to simplify the approval standards and avoid redundancy and confusion. The NPS will continue to work with operators to help plan and design their operations in a way that meets NPS operating standards and other applicable provisions of these regulations. Compliance With Big Cypress National Preserve Addition Act The Addition Act, 16 U.S.C. 698m-4, directs the NPS to promulgate rules and regulations governing the exploration for and development and production of nonfederal oil and gas interests within the Big Cypress National Preserve and Addition Area. Accordingly, § 9.105 of this rule describes the procedure for initial review of a proposed operation in Big Cypress National Preserve. This procedure differs slightly from the service-wide procedure described in §§ 9.101 and 9.102. The NPS's service-wide rule incorporates the 30-day initial review period from the Addition Act. However, the Addition Act at 16 U.S.C. 698m-4(b)(2)(C) places a limit on the amount of collaboration that can occur between the NPS and the operator. Under this provision, there is no mechanism for the NPS to require further information from an operator after the NPS has made its initial request for additional information. After making such a request, the NPS's only options are to approve or deny the application. This procedure could conceivably result in denial of applications that would have been approved if the NPS had the regulatory authority to again request the additional information necessary to fully evaluate a proposed operation. In practice, the NPS will continue to collaborate with prospective operators in Big Cypress National Preserve early in their planning process and as much as possible during initial review, in order to reduce such theoretical problems. The NPS is not using the Big Cypress procedure in its service-wide regulations, because it does not want to constrain its ability to have more robust collaboration with operators. The Addition Act also differs slightly from the proposed service-wide rule in that under the Addition Act the 90-day time period for final action begins upon submission of the permit application to the NPS. For the service-wide rule, the NPS has chosen not to adopt submission of the permit application as the triggering event for final action. Rather, the NPS service-wide rule provides that final action must occur within 30 days after the completion of NPS legal compliance responsibilities (such as NEPA, ESA, and NHPA). For proposals within Big Cypress National Preserve, the NPS will strive to meet the applicable timeframe for final action while otherwise complying with applicable laws including NEPA, ESA, and NHPA. The NPS has decided it is more appropriate to include these Big Cypress-specific provisions in this regulation instead of in a new park-specific regulation in part 7, because other provisions of this regulation still apply to oil and gas operations in Big Cypress National Preserve. It will be easier for operators to have all applicable provisions in one rule. Operating Standards Section 9.110 of this rule clarifies the purpose and function of operating standards. The NPS will maintain the current practice under the 1978 Regulations of setting non-prescriptive operating standards to allow operators the flexibility to design their proposed operation using the latest technological innovations that will best protect park system resources, values, and visitor health and safety. Section 9.110(a) of this rule clarifies the practice under the 1978 Regulations that applicable operating standards will be incorporated into an approved operations permit so that the operating standards become enforceable terms and conditions of an approved permit. Section 9.110(c) of this rule requires all operators to use technologically feasible, least damaging methods to protect NPS resources and values while assuring human health and safety. In the 1978 Regulations, “technologically feasible, least damaging methods” was part of an overall plan of operations approval standard at 36 CFR 9.37(a)(1). Reorganization of Operating Standards This rule organizes all operating standards into one section and separates the standards into the following categories: §§ 9.111 through 9.116, are operating standards that apply to all operations; § 9.117, additional operating standards that apply to geophysical operations; and § 9.118, additional operating standards that apply to drilling, stimulation, and production operations. Organizing the standards in this manner will allow the NPS and operators to readily understand which operating standards are applicable to the particular type of operation proposed. Clarification of and Additions to Former Operating Standards Some of the operating standards in the 1978 Regulations were minimally described. Additional operating standards were included in the NPS's 2006 9B Operator's Handbook. This rule now contains all operating standards. To the extent this rule incorporates operating standards from the 1978 Regulations without substantive change; those standards are not further discussed below. The operating standards summarized below are either clarifications to the 1978 Regulations, are new standards that the NPS has added, or are revisions to those included in the proposed rule. Operating Standards That Apply to All Operations This rule modifies language from § 9.112(a) of the proposed rule to remove the phrase “ground disturbing” because no activities incident to oil and gas operations, whether or not they disturb the ground, may be conducted within 500 feet of any structure or facility used by the NPS for interpretation, public recreation, or administration. The NPS moved § 9.112(a) of the proposed rule to § 9.111(a) of this rule. Section 9.111(a) of this rule modifies language from § 9.112(a) of the proposed rule to clarify that Superintendents may increase or decrease the 500 foot setback consistent with the need to protect federally owned or administered lands, water, or resources of System units, visitor uses or experiences, or visitor or employee health and safety. The NPS also added the phrase “within 500 feet of the mean high tide line” to § 9.111(a) of this rule to provide notice to operators that the general 500 foot setback also applies to tidal areas. This rule includes a new standard at § 9.111(b) to require that either existing or newly created surface disturbance is kept to the minimum necessary for safe conduct of operations. This rule modifies language from § 9.111(d) of the proposed rule to clarify how waste must be handled. This rule modifies language from § 9.111(g) of the proposed rule to clarify that hydrocarbon and air pollutant releases are to be minimized along with minimizing the flaring of gas. This rule adds new standards at §§ 9.114 and 9.115 that limit the visual and sound impacts of oil and gas operations on park visitor use and experience. This rule adds a new standard at § 9.111(h) that requires operators to control the introduction of exotic species. This rule adds new standards at § 9.112 that address hydrologic connectivity. Reclamation Operating Standards Section 9.116 of this rule describes the standards for reclamation. Operating Standards That Apply to Geophysical Operations Section 9.117 of this rule describes standards for geophysical surveying methods including source points, use of equipment and methods, and shot holes. Operating Standards That Apply to Drilling, Stimulation, and Production Operations Section 9.118(a)(1) of this rule requires all operators to use containerized mud systems during drilling, stimulation, and production operations. Section 9.118(a)(2) of this rule prohibits the establishment of new earthen pits for any use. Use of existing earthen pits may continue, however, the Superintendent may require the pits be lined or removed depending on site specific conditions. Section 9.118(b) of this rule establishes standards for well stimulation, including standards that address hydraulic fracturing operations, such as ensuring the mechanical integrity of the wellbore, water use and disposal, and management of flowback fluids. NPS's approach is to review an operator's submissions to determine if they meet the overall operating standard of using the most “technologically feasible, least damaging methods” that protect park resources and values, and any other applicable operation standards. If not, the NPS will add terms and conditions in the permits to address specific deficiencies. In light of our previous experience under the 1978 Regulations addressing downhole operations, we expect that application of these requirements will result in little or no change to well stimulation activities proposed by an operator and approved by the state. We also expect that in most cases the information needed to be reviewed by NPS will be that already submitted to the state for its approval. Guidance on specific means to meet NPS operating standards is found in NPS's 2006 9B Operator's Handbook, which is distributed to every operator and available electronically. General Terms and Conditions This rule contains a new “General Terms and Conditions” section listing terms and conditions that apply to all operations. This section consolidates the following sections from the 1978 Regulations: §§ 9.35, 9.36(a)(15), 9.37(f), 9.41(g), 9.42, 9.46, 9.47(b), and 9.51(a) and (b). Described below are either clarifications to the 1978 Regulations, new terms and conditions that the NPS has added, or revisions to those included in the proposed rule. The water use section at § 9.35 of the 1978 Regulations did not address all state water law systems under which water rights are established or decided. Section 9.120(b) of this rule requires that an operator may not use any surface water or groundwater owned or administered by the United States that has been diverted or withdrawn from a source located within the boundaries of a System unit unless the use has been approved in accordance with NPS policy. Because monitoring and reporting requirements are necessary for all operations, the NPS includes monitoring and reporting requirements under General Terms and Conditions. Section 9.121(a) authorizes the NPS to access an operator's area of operations at any time to monitor operations and to ensure compliance with the regulations. To the extent such operations are located on non-federally administered lands and waters, the NPS will provide the operator reasonable notice in advance of such access, other than in emergencies. Section 9.121(b) of this rule allows the NPS to require that operators hire third party monitors when they are necessary to ensure compliance and protection of park resources and values. The NPS had previously required in some operations plans the use of third party monitors to help ensure that it received unbiased, reliable, and timely monitoring information demonstrating an operator's compliance with its plan of operations. See, 2006 9B Operator's Handbook, Chapter 3 (Geophysical Exploration). Over the past fifteen years, operators at Big Thicket National Preserve, Padre Island National Seashore, Jean Lafitte National Historic Site, and Big Cypress National Preserve were required to use third party monitors for certain geographically extensive and logistically complex 3D seismic operations. The use of third party monitors allowed the NPS to augment monitoring by park staff while ensuring plan compliance and enabling operators to simultaneously engage in multiple operations at different locations. This provision also more closely conforms the NPS's requirements with practices of other federal agencies (BLM, the U.S. Forest Service, and the U.S. Fish and Wildlife Service have each in some instances required third party monitoring for oil and gas operations on lands they administer), as well as state oil and gas regulatory agencies. This section describes criteria that the NPS will consider when making the decision to require a third party monitor. The third party monitor will report directly to the NPS to ensure oversight and accountability. The NPS has modified language from § 9.121(c) and (d) of the proposed rule to clarify the timing for reporting of incidents occurring on an operations site and for reporting requirements for cultural or scientific resources encountered on an operations site, respectively. Section 9.121(e) broadens the reporting requirement from the 1978 Regulations to require that the operator submit any information requested by the Superintendent that is necessary to verify compliance with either a provision of the operations permit or this subpart. To ease this burden, the rule allows an operator to submit the same reports it submits to a state or other federal agency as long as those reports meet the information requirements of this subsection. This is similar to § 9.42 of the 1978 Regulations. Section 9.122 requires reporting related to the hydraulic fracturing process, including the disclosure of chemicals used in the hydraulic fracturing process and the volume of recovered fluids. In § 9.122, NPS has used BLM's post-hydraulic fracturing reporting requirements, but did not include two provisions (requirement for affidavit of compliance and general supporting documentation), as those requirements are addressed in other sections of this rule. Access to Oil and Gas Rights This rule contains a new section that addresses access across federally owned or administered lands or waters to reach the boundary of an operator's oil and gas right. Section 9.50 of the 1978 Regulations authorized the NPS to charge a fee for commercial vehicles using NPS administered roads. Despite this longstanding authority, we are not aware that such fees had actually been collected. This new section expands upon former § 9.50. Section 9.131(a)(1) of this rule allows the NPS to charge an operator a fee based on fair market value for access ( e.g., use of existing roads as well as constructing new roads, or running gathering lines) across federal lands outside the scope of an operator's oil and gas right. The NPS will set fees consistent with NPS part 14 rights-of-way guidance (NPS Reference Manual 53, Special Park Uses, Appendix 5, Exhibit 2). Section 9.131(b) provides that NPS will not charge a fee for access that is within the scope of the operator's oil and gas right, or access that is otherwise provided for by law. Section 9.132 addresses access across federally owned or administered lands or waters necessary to respond to an emergency. Financial Assurance The NPS renamed this section of the rule “Financial Assurance” (titled “Performance Bond” under the 1978 Regulations) to better reflect the variety of instruments that operators can provide to the NPS to meet their obligation under this section. Section 9.48(a) of the 1978 Regulations required an operator to file a performance bond, or other acceptable method of financial assurance, for all types of non-federal oil and gas operations and all phases of the operations. The performance bond requirement ensured that in the event an operator becomes insolvent or defaults on its obligations under an approved plan of operations, the defaulted funds would be paid to the United States. Section 9.48(d)(3) of the 1978 Regulations limited the performance bond amount to $200,000 per operator, per System unit. Therefore, if one operator had multiple wells in an System unit, the NPS could only require up to $200,000 financial assurance from that operator. The $200,000 limit was established in 1979 and in most cases did not reflect the potential costs of reclamation. In the event of a default by the operator, reclamation costs exceeding the limit could have required the NPS to bring a civil action in federal court to recover the additional costs. Section 9.140 of this rule requires the operator to file with the NPS financial assurance in a form acceptable to the Regional Director. The current 9B Operator's Handbook identifies acceptable forms of financial assurance as including: corporate surety bonds, US Treasury bonds, irrevocable letters of credit, cash. The NPS will update the Handbook as additional guidance is provided. Section 9.141 of this rule makes the financial assurance amount equal to the estimated cost of reclamation. This substantially reduces the risk of the American taxpayers being left to assume reclamation costs in the event of operator default. Section 9.142 of this rule outlines the process for adjusting the amount of financial assurance due to changed conditions. Section 9.143 describes the conditions under which the NPS will release the financial assurance. Section 9.144 describes those circumstances that will result in forfeiture. Section 9.144(b)(3) of this rule allows the NPS to suspend review of an operator's pending permit applications, if that operator has forfeited its financial assurance in any System unit. Suspension would last until the Superintendent determines that all violations have been resolved. Modification to an Operation Section 9.150 of this rule renames the “Supplementation or Revision of Plan of Operations” section as “Modification to an Operation” to characterize any change to an approved operations permit. This section clarifies that either the NPS or the operator can request modification of the operator's permit, and describes the modification procedures. Approval of any modification to an approved permit must meet the relevant criteria applicable to Temporary Access Permits (§§ 9.60 through 9.63) or Operations Permit: Application Review Process (§§ 9.100 through 9.105). Section 9.150(c) of this rule prohibits an operator from implementing a modification until the NPS has provided written approval of the modification. No comments were received on this provision of the proposed rule. Change of Operator This section renames § 9.34 “Transfer of Interest” of the 1978 Regulations to “Change of Operator.” Section 9.34(a) of the 1978 Regulations provided that a previous operator remained liable on its financial assurance until it informed the NPS that the rights had been transferred to another party. A new operator could not operate until it posted financial assurance and ratified the existing plan of operations. Once the previous operator provided notice to the Superintendent, the previous owner could request release of its financial assurance before the new owner posted its own financial assurance with the NPS. Therefore, if the new operator abandoned operations before posting financial assurance with the NPS, the burden of reclaiming the site would fall on the taxpayers. Section 9.160(a) requires the previous operator to notify the NPS of a transfer of operations and provide contact information. Section 9.160(b) holds the previous operator responsible to the NPS until the new operator adopts and agrees to the terms and conditions of the previous operator's permit; and provides financial assurance; provides proof of liability insurance; and an affidavit demonstrating compliance with applicable federal, state, or local laws. Section 9.160(c) addresses a transfer of operation where the previous operator did not have an operations permit. Section 9.161(a) of this rule requires the new operator who acquires an operation that was under an operations permit to adopt the previous permit. Section 9.161(b) addresses the transfer of an operation where an exemption has been granted under § 9.72 of this rule. Section 9.161(c) addresses transfer of an operation where the previous operator did not have an operations permit. No comments were received on this provision of the proposed rule. Well Plugging This section replaces, in part, § 9.39(a)(2)(iv) of the 1978 Regulations and creates a new section entitled “Well Plugging.” Section 9.39(a)(2)(iv) of the 1978 Regulations required operators to plug and cap all non-productive wells and to fill dump holes, ditches, reserve pits, and other excavations. Section 9.116(d)(1) (Operating Standards) retains the requirement that an operator conduct reclamation by plugging all wells. However, the 1978 Regulations did not directly address whether NPS could require an operator to plug wells that have been in an extended shut-in status. As a result, inactive wells have remained unplugged for years and, in some instances, decades. Such unplugged wells have caused adverse impacts to park resources and presented risks to park visitors. Section 9.170(a) of this rule requires operators to plug a well within 60 days after cessation of drilling, or 1 year after completion of production operations, or upon the expiration of NPS approved shut-in status. Under § 9.171, an operator may obtain an extension to the plugging requirement if the operator demonstrates mechanical integrity, a plan for future use of the well, and that the operator will follow maintenance requirements. These procedures are consistent with the way many states approach the issue of inactive wells, and recognize that certain economical or logistical reasons exist to justify maintenance of wells in shut-in status for extended periods of time. Rather than a “produce or plug” policy, the rule is intended to ensure that shut-in wells are maintained in an environmentally sound and safe manner. Prohibitions and Penalties Section 9.51(c) of the 1978 Regulations provided two different compliance procedures for suspending an operation, depending on whether or not the violation posed an “immediate threat of significant injury to federally owned lands or waters.” Section 9.181 of this rule authorizes the Superintendent to suspend an operation regardless of whether an operator's violation poses an “immediate threat of significant injury.” Whether the threat is immediate or not, any violation that results in a threat of damage to park resources and values should be addressed by the Superintendent. Prohibited Acts Section 9.180 lists prohibited acts to provide operators with notice of the acts that constitute a violation of these regulations. The prohibited acts in this rule include violations of the terms and conditions of an Operations Permit, as well as violations of other provisions of these regulations. Incorporation of 36 CFR 1.3 Penalties Section 9.51 of the 1978 Regulation authorized the NPS to suspend an operation for non-compliance, and if the violation or damage was not corrected, revoke an operator's plan of operations. The process to suspend an operation required coordination between park staff and other NPS offices, during which time damage to park system resources and values may continue. Additionally, suspension and revocation were not necessarily the most appropriate means to correct minor acts of non-compliance (minor leaks and spills, improper road maintenance, or not maintaining proper site security). Therefore, we are incorporating our existing penalties provision at 36 CFR 1.3, which allows NPS law enforcement rangers and special agents to issue citations, which result in fines for minor acts of non-compliance, while treating serious acts as ones that may be subject to a fine or imprisonment, or both. No New Authorization Unless Operator Is in Compliance Under § 9.182 of this rule, NPS will not review any new operating permit applications or continue review of any pending permit applications in any System unit until an operator comes into compliance with this subpart or the terms or conditions of an operations permit. No comments were received on this provision of the proposed rule. Reconsideration and Appeals Most of the procedures outlined in § 9.49 of the 1978 Regulations remain the same. The operator continues to have the right to appeal a decision made by either the Superintendent or the Regional Director. The operator now must exhaust these remedies before the NPS decision is a final agency action that is subject to review under the Administrative Procedure Act (APA). This rule renames the first step of the process as a request for “reconsideration,” rather than an appeal, since it is directed to the same official who issued the original decision. The rule also includes other clarifications of the existing language, makes editorial corrections, and reorganizes the sequence of some of the paragraphs. Consistent with the APA, § 9.193(a) of this rule provides that during the reconsideration and appeals process the NPS's decision will be suspended and the decision will not become effective until the completion of the appeals process. Section 9.193(b) addresses suspension of operations due to emergencies that pose an immediate threat of injury to injury to federally owned or administered lands or waters. Under section 9.194, if the Superintendent has the authority to make the original decision, requests for reconsideration and appeals are to be filed in the manner provided under §§ 9.190 through 9.193, except that requests for reconsideration are directed to the Superintendent, and appeals are directed to the Regional Director. No comments were received on these provisions of the proposed rule. Public Participation The rule renames the “Public Inspection of Documents” section to “Public Participation.” Section 9.52(a) of the 1978 Regulation required a Superintendent to publish a notice in a local newspaper of a request to conduct non-federal oil and gas operations whether or not a complete plan of operations was ever submitted by an operator. Section 9.52(b) of the 1978 Regulation further required a Superintendent to publish a notice in the Federal Register of receipt of a plan of operations. This rule eliminates the public notice steps currently required under § 9.52(a) and (b) of the 1978 Regulation and replaces them with a more efficient public involvement and review process. The rule retains the ability for an operator to protect proprietary or confidential information from disclosure to the public. Operators need to clearly mark those documents that they wish to protect from public disclosure as “proprietary or confidential information” such that these documents are readily identifiable by the NPS decision maker. The NPS has also included provisions that allow an operator engaged in hydraulic fracturing operations to withhold chemical formulations that are deemed to be a trade secret. The NPS has updated § 9.200(c) from the proposed rule to include reference to §§ 9.88 and 9.89 to allow operators to maintain proprietary information for stimulation techniques. The NPS has also removed language from § 9.200(g) of the proposed rule regarding record retention for operations on Indian and Federal lands to make this provision conform to the scope of this regulation. Information Collection See Paperwork Reduction Act discussion below. Summary of and Responses to Public Comments A summary of substantive comments and NPS responses is provided below followed by a table that sets out changes we have made in the final rule based on the analysis of the comments and other considerations. NPS Authority To Regulate Non-Federal Oil and Gas Rights 1. Comment: Commenters noted that additional regulation of private oil and gas rights on NPS land could infringe on private property rights or could represent a taking. NPS Response: Based on its long experience implementing the 1978 Regulation, NPS disagrees with the commenter's conclusion that application of this rule is likely to result in an actual taking of private property. This is discussed in further detail in the takings analysis above. 2. Comment: Commenters stated that the NPS does not have authority to regulate oil and gas operations taking place on lands outside of a System unit boundary or on non-federally owned lands within the boundaries of System units. NPS Response: This rule states that the regulations only apply to operations that are conducted within the boundaries of System units. See § 9.30(a) and (b), the definition of “Operations” at § 9.40, and § 9.70. Although the NPS does not generally assert regulatory authority over activities on non-federal lands, see 36 CFR 1.2(b), the NPS has long regulated three types of activities on non-federal lands that have a high potential to harm park resources and values—the operation of solid waste disposal sites, 1872 Mining Law claims and operations, and non-federal oil and gas operations. As stated above, courts have consistently recognized NPS's authority to regulate non-federal interests within units of the National Park System. Courts have also recognized that on split estate lands. Where the federal government owns the surface estate and the mineral estate is privately held, the subsurface is within the boundary of a National Park System unit. This rule applies to all operations conducted within the boundary of a System unit, with the exception of System units in the State of Alaska, where this rule does not apply. As explained in the preamble to the proposed rule: “ [NPS's] experience over the past three decades has demonstrated that [operations conducted on non-federal lands] have the potential to have adverse effects on NPS resources, values, and visitor health and safety. Through site inspections, the NPS has found at least 10 instances of sites [on non-federal lands] with oil spills or leaks resulting in contamination of soils and water.” (80 FR 65575). That an operation is located on non-federal lands within a System unit does not mean that the operation has no potential to affect NPS administered resources and values. 3. Comment: One commenter suggested the NPS require the mineral owner and the operator to assume joint and several liability arising from oil and gas operations. NPS Response: The NPS included joint and several liability as an alternative in the DEIS because it could encourage owners to emphasize to their lessees requirements for strict compliance with applicable laws and regulations, including the responsibility to plug and reclaim their operations. Because we have included in this rule a bonding requirement that covers the full estimated cost of reclamation, we have concluded that the joint and several liability provision is unnecessary. State Oil and Gas Regulation 4. Comment: One commenter opposed the rule, stating that existing state oil and gas laws and regulations already provide sufficient oversight. NPS Response: In reviewing the state oil and gas regulations for the 8 states where non-federal oil and gas operations are currently undertaken in System units, the NPS found that the focus of these state regulations is primarily limited to the protection of mineral rights, maximization of production of oil and gas resources, protection of water resources, and managing waste by-products of oil and gas operations. While these states have general provisions that address protection of the environment and public health, they do not adequately protect NPS administered resources to the standards developed under this rule. Congress mandated that System units be managed “for the benefit and inspiration of all the people of the United States.” In the context of these regulations, the NPS fulfills its mandate by applying a consistent set of Servicewide standards to govern oil and gas activities in all System units. These regulations are designed to protect the unique and nationally significant natural and cultural resources that constitute each System unit, including: Geological resources, air quality, water quality and quantity, vegetation, fish and wildlife and their habitat, floodplains and wetlands, archeological resources, paleontological resources, soundscapes, night skies, viewsheds, cultural landscapes, and ethnographic resources. These regulations are also designed to protect visitor health and safety. 5. Comment: One commenter expressed concern that the rule duplicates requirements in state regulations. NPS Response: To fulfill the NPS's mission to protect park resources and values, the NPS must have sufficient information from an applicant to adequately evaluate an operator's proposed operations. When applying for an operations permit, § 9.81(b) allows an operator to submit the same reports it submits to a state or other federal agency as long as those reports meet the information requirements of this subsection. This is similar to § 9.42 of the 1978 Regulations. The NPS will review this information and determine if it meets NPS information requirements and operating standards. This reduces the potential burden on applicants who have already applied for a state permit. Big Cypress National Preserve 6. Comment: Commenters requested the NPS clarify how these regulations will apply to oil and gas activities in Big Cypress National Preserve in light of existing statutory provisions included in the Big Cypress enabling legislation. NPS Response: The relationship between this rule and Appendix 6 (to the Agreement Among the United States of America, Collier Enterprises, Collier Development Corporation, and Barron Collier Company (May 12, 1988)) is explained in the Summary of Final Rule section above. The Addition Act states that such “agreements shall be superseded by the rules and regulations promulgated by the Secretary, when applicable . . .” 16 U.S.C. 698m-4(e). This rule applies to operations in both the original preserve and the Addition Area. National Environmental Policy Act 7. Comment: One commenter suggested that operators should be able to submit Environmental Assessments for agency use, and that the regulations should be updated to allow an operations permit application to function as a draft Environmental Assessment. NPS Response: The NPS will comply with Council on Environmental Quality and DOI NEPA regulations, and NPS NEPA guidance documents. This rule does not alter those requirements. An operations permit application generally does not contain all of the required elements of an Environmental Assessment. The NPS will continue its existing practice of allowing applicants to prepare the draft of the appropriate NEPA document. NPS will update its guidance manual to reflect this practice. Purpose and Scope 8. Comment: One commenter suggested that 9B Rules be expanded to govern other non-federal mineral rights such as sand, gravel, and coal. NPS Response: Regulating the extraction of sand, gravel, and coal is beyond the scope of this rulemaking, which was to revise the former rules applicable to the exercise of non-federal oil and gas rights. Coal extraction is generally prohibited within System units under the Surface Mining Control and Reclamation Act. There are no current coal operations in any System units. The NPS generally is able to regulate non-federal sand and gravel extraction through the use of special use permits and applicable provisions of regulations set forth at 36 CFR part 6. 9. Comment: Commenters suggested that the NPS consider buying out nonfederal mineral rights. NPS Response: The NPS has determined that acquisition of all mineral rights in System units is economically inefficient, financially infeasible, and unnecessary to protect park system resources and values. NPS will continue to determine, on a case by case basis and in collaboration with prospective operators, whether a proposed operation meets the operating standards and approval standards of these regulations. If the proposed operation does not meet 9B approval standards, the NPS has the authority to seek to acquire the mineral right from the operator. 10. Comment: One commenter stated that the NPS has not demonstrated that there are systemic problems with the 1978 Regulations, or that existing regulatory schemes (including the 1978 Regulations) are inadequate. NPS Response: As described above in the “Summary of Potential Impacts from Oil and Gas Operations on NPS Resources and Values,” the NPS concluded the problems that necessitated this rule were systemic and that existing laws or regulatory schemes were inadequate to address protection of the nationally significant resources administered by the NPS. Demonstration of Right To Conduct Operations 11. Comment: One commenter suggested that the rule clarify that an operator does not need to demonstrate a right to conduct oil and gas operations beneath the operator's access route, in cases where an operator needs to traverse some other area of the unit to access its operations area. NPS Response: As addressed by § 9.130—Access to Oil and Gas Rights, the NPS may have the discretion to grant access rights outside the boundary of an operator's oil and gas right when the operator does not hold a statutory or deeded right of access. In such cases, the operator does not need to demonstrate a right to conduct operations. 12. Comment: One commenter suggested that the rule should better define the type of information that operators may submit to demonstrate the right to conduct operations. This commenter proposed other types of documents that could demonstrate a right to operate. NPS Response: The definition of “right to operate” in § 9.40 of the rule lists specific examples of documents—deed, lease, memorandum of lease, designation of operator, assignment of right—that would meet the requirement. The NPS has included the phrase “other documentation” in the rule because there may be documentation that is not listed that would demonstrate a legal right to conduct the operations in a System unit. This provides greater flexibility to the applicant. What the NPS deems an acceptable demonstration of a legal right to conduct operations is evaluated on a case by case basis. 13. Comment: One commenter stated that the NPS should implement a conditional approval process that would allow the operator to access a mineral right over NPS land, subject to later demonstrating that the operator has acquired access to that mineral right. NPS Response: The NPS has long required the operator to demonstrate a right to operate prior to formally analyzing a proposal. This requirement ensures the NPS does not expend taxpayer funds on proposals that are ultimately not viable because an operator lacks sufficient rights. A parallel or contingent approval process would further complicate the regulations, and any time and cost savings for certain viable proposals would be outweighed by the unnecessary time and cost spent reviewing proposals that are not viable. However, an operator who has acquired only a portion of the rights it expects to eventually hold may, under § 9.82(b), submit its application in phases covering only those rights it holds at the time of the application. 14. Comment: One commenter suggested that the permit review and approval process run parallel to the NPS's review of the operator's right to operate documentation. NPS Response: As explained in the previous response, NPS requires complete demonstration of a right to operate prior to formally analyzing a proposal, which includes the permit review and approval process. This provision is meant to ensure that the agency does not expend taxpayer money unnecessarily on proposals that may not be possible because of the lack of complete acquisition of the right to operate. For example, an operator proposing a 3D seismic survey covering many acres within a park may not ultimately be able to acquire all rights within the proposed operations area. Definitions 15. Comment: One commenter suggested that the definition of “Waste” should not include items such as fuel drums, pipes, oil, or contaminated soil that have any residue of oil, which contains benzene, toluene, xylene, and other hazardous chemicals. This commenter said these items should instead be included under the definition of “Contaminating Substances.” NPS Response: The items described by the commenter fall under the definitions of both “waste” and “contaminating substances.” Any “waste” that contains a “contaminating substance” is required to be properly discarded from an operations site, but also handled in a manner that ensures proper containment and clean-up of the contaminating substance. 16. Comment: One commenter suggested that the definition of “usable water” should not just refer to whether the water is usable for humans but also should include whether the water is usable for wildlife, ecosystems, and people's wells. NPS Response: The definition of the term “usable water” is the same as the definition of the term “underground source of drinking water” that is used by the Environmental Protection Agency (EPA) in the Underground Injection Control Program. A similar definition is used by several states with NPS units that have non-federal oil and gas operations (Texas, New Mexico, Florida). The EPA and these states use these definitions to regulate specific downhole activities of oil and gas operations and ensure protection of zones of groundwater. Water that is used by wildlife, ecosystems, and people's wells is addressed by other standards and requirements of the rule. See, hydrologic operating standards at § 9.112, and water use requirements at § 9.120. The definition for usable water does not need to be changed. Previously Exempt Operations 17. Comment: One commenter expressed concern that elimination of the access and grandfathered exemptions would negatively impact individuals who rely on mineral resources located within the National Park System. NPS Response: The NPS has analyzed the effects of this rulemaking on the regulated public and found that the updates to the 1978 Regulations will not have a significant economic impact on a substantial number of 9B operators. The cost-benefit and regulatory flexibility analysis, Cost-Benefit and Regulatory Flexibility Analyses: U.S. Department of the Interior, National Park Service for Proposed Revisions to 36 CFR part 9, subpart B, can be viewed at https://parkplanning.nps.gov/CBA_9B . 18. Comment: One commenter stated that the rule should phase out previously exempt “grandfathered” operations over a period of time, rather than requiring these operations to comply with the rule immediately. NPS Response: While not all previously exempt operations present an immediate threat to park resources and values, there are a significant number of operations exhibiting operating conditions not consistent with current NPS standards that the NPS concludes are necessary to address as soon as possible. These operations qualified for the regulatory exemption under the 1978 Regulations because they were in operation as of January 8, 1979, and the operators held a valid state or federal permit at that time. More than 37 years have passed during which these operations have not been subject to NPS regulation. The NPS is promulgating this rule to bring these operations up to NPS operating standards, including NPS reclamation and financial assurance standards, in order to protect park resources and values. Accessing Oil and Gas Rights From a Surface Location Outside the Park Boundary 19. Comment: Some commenters opposed the provision in the rule that would authorize the NPS to exempt directional drilling operations outside the park boundary from the operations permit requirement. Commenters also sought clarification regarding what aspects of a directional drilling operation are covered by these regulations. NPS Response: As stated in the preamble to the proposed rule: “The availability of the exemption [for directional drilling operations] provides an incentive for operators to locate surface facilities outside a System unit. Location of operations outside a System unit generally avoids direct impacts to NPS resources and values.” (80 FR 65578). Regulating surface activities outside the boundary of the park would eliminate this incentive. Such surface activities are not themselves located on NPS-administered land. While there might be some benefits to the neighboring or nearby NPS-administered property, based on our years of experience, on the whole any such benefits would be outweighed by the loss of the incentive to place such operations outside the boundary, resulting in more direct impacts to park resources and values. Although law review articles and the Office of the Solicitor have indicated that the Organic Act could be interpreted to authorize NPS to regulate activities occurring outside park boundaries, to date NPS has not promulgated any such regulations. Regulatory authority over directional drilling operations begins at the subsurface point where the proposed operation (borehole) crosses the park boundary and enters federally owned or administered lands or water, and applies to all infrastructure and activities within the System unit. Section 9.70 of this rule states that “downhole activities inside an NPS unit are subject to these regulations.” The NPS does not require financial assurance from directional drilling operators because, although the operation is drilling to a bottom hole location within the System unit, the surface operation is located outside the park boundary on lands not administered by the NPS. Each state has requirements for plugging, abandonment, surface reclamation, and financial assurance from the operator. The NPS examines each exemption application to ensure that the downhole portion of the operation that is inside the park boundary meets the NPS approval standard. If the NPS finds, through monitoring of the operation, that the operation inside the park is causing damage to park administered resources or values, the NPS may require the operator to rectify the violation. The NPS has additional guidance describing the process for applying for such an exemption in the 9B Operator's Handbook. 20. Comment: One commenter questioned whether the NPS has the authority to apply the General Terms and Conditions and Prohibitions and Penalties to directional drilling operations that cross beneath privately owned surface estate inside the System unit boundary. NPS Response: The General Terms and Conditions and the Prohibitions and Penalties provisions in the rule apply to operations located inside the boundaries of the System unit. The authority to apply these provisions to operations inside the unit on non-federal lands is summarized in the preamble to the proposed rule at 80 FR 65573. 21. Comment: One commenter suggested that the rule require operators to comply with mitigation measures required by other natural resource agencies for directional drilling operations where the surface location is located outside the boundaries of System units. NPS Response: NPS has concluded that it does not need to separately enforce the requirements of other natural resource agencies or determine whether operators are in compliance with those authorities. NPS does generally coordinate and share information with other federal and state agencies, but it does not need to provide for duplicative enforcement of mitigation measures required by other authorities. Nothing in this rule relieves the permittee from compliance with other applicable, Federal, State, and local laws and regulations. 22. Comment: One commenter suggested that the rule require mandatory rather than voluntary mitigation requirements for directional drilling operations located outside the boundary of the System unit. NPS Response: This rule requires mandatory rather than voluntary mitigation requirements for directional drilling operations Therefore, these operating standards are mandatory for operations conducted inside the park boundary. To maintain the incentive to have operators locate surface facilities outside the System unit, mandatory operating standards only apply to operations located with the boundary of the System unit. The NPS will not apply mandatory mitigation measures to operations outside System units. Operations Permit Requirement 23. Comment: One commenter suggested that the rule should not require oil and gas operations to carry out mitigation and reclamation that are not required for other commercial activities. NPS Response: Exploration and development of non-federal oil and gas resources are high-impact industrial activities that can generally be expected to have some adverse effects on park resources. The mitigation and reclamation requirements contained in the final rule are similar to those required for other high impact industrial activities occurring within System units, e.g., mining activities under the part 9A regulations but do differ from those that may apply to other types of commercial activities, e.g., park concessions. 24. Comment: One commenter requested that well permitting standards should require a baseline assessment of environmental conditions, including groundwater testing, before construction and operations commence. NPS Response: The proposed rule was intended to allow NPS to require the applicant to undertake specified testing and submit baseline data for evaluation. Section 9.85(a) of this rule has been updated from the proposed rule to clarify that the NPS may require any information it needs about natural and cultural resources, including groundwater resources that may reasonably be impacted by surface operations. This information may include data from baseline testing of soils and surface waters within the area of operations. 25. Comment: One commenter suggested the examples listed for natural features should also include wetlands, seepage areas, springs, and shallow water aquifers. NPS Response: The NPS has included these as additional examples of natural features in the final rule. 26. Comment: One commenter noted that the phrase spill control environmental preparedness plan was not referred to consistently throughout the proposed regulation. NPS Response: NPS has made nonsubstantive changes to address this in the final rule. 27. Comment: One commenter suggested that maps of surface and subsurface operations be recorded in land records so that future oil and gas operations do not damage existing or closed wells. NPS Response: Operators proposing new operations within System units must submit a state drilling permit as part of an operations permit application. As part of the state permitting process, the state conducts an evaluation of the proposed well path in relation to existing (including plugged and abandoned) wells. Records of surface and subsurface operations, including maps and permit applications, are kept by the state oil and gas permitting agency and are used by the state to evaluate subsequent applications. Operations Permit Approval 28. Comment: Commenters suggested that the permit approval standards could be interpreted to give the NPS the authority to determine whether an operator has complied with state and local law. NPS Response: NPS did not intend to make such determinations. As a result, we have clarified this rule so that it simply requires at § 9.120(c) that an operator provide an affidavit to the NPS stating that it is in compliance with all applicable Federal, state, and local laws. The Regional Director will review affidavits submitted by an operator prior to approval of an operations permit. 29. Comment: The NPS sought comments on whether the 180 day timeline for final action is reasonable and on any resulting incremental impacts on operators. Commenters expressed concern that the rule gives the NPS too much time to review a permit application, and that the NPS could take more time in order to comply with applicable laws without a hard deadline for taking a final action. One commenter suggested that the NPS review all operations permit applications within 90 days, with an automatic 60-day extension if needed as well as additional time as the applicant agrees. The commenter modeled that recommendation on the time frame for reviewing biological opinions in the Endangered Species Act, which allows for a total of 185 days for review. One commenter recommended that the NPS add a provision that would allow for automatic approval of an operations permit if the NPS did not reach a deadline. NPS Response: In response to comments and upon further review, the NPS has decided to change the timeframe for final action in this rule to “within 30 days of completing all required legal compliance, including compliance with the National Environmental Policy Act . . .” The NPS is making this change because it more accurately reflects the timeframe for the process that the NPS must follow before taking final action on an Operations Permit. Under this rule, the NPS has 30 days to conduct its “initial review” to determine whether an operator's application is complete, request more information from the operator, or inform the operator that more time is necessary and written justification for the delay. Once an application is deemed complete the NPS must complete its legal compliance responsibilities, which include, but are not limited to, compliance with NEPA (for example, preparing an Environmental Assessment and a Finding of No Significant Impact), compliance with the ESA (for example, consulting with the U.S. Fish & Wildlife Service under Section 7), and consultation with Indian tribes. Once the legal compliance is completed, the NPS will take final action within 30 days. The NPS may only take more time if the operator agrees, or if it is necessary for the NPS to comply with unanticipated legal requirements. Providing for automatic approval of a permit application if the NPS does not meet a deadline would most likely violate procedural and substantive legal requirements for agency actions. 30. Comment: One commenter recommended that the rule: (1) State the criteria on which the NPS will deny operation permit applications; (2) state that the NPS shall approve a plan of operations if the plan complies with existing law and applicable operating standards; and (3) include a reference to the enabling statutes for System units and any standards that may be contained therein. NPS Response: Operations permits would be approved or denied based on whether the plan meets the approval standards. Therefore this rule only needs one set of standards. Accordingly, the NPS has clarified the language in this rule. The final rule states that the Regional Director will approve an operations permit if the NPS determines that the operations meet the approval standards. Section 9.103(a)(1) of this rule has been updated from the proposed rule to reflect that the Regional Director must determine that the operations will not impair park resources and values under the NPS Organic Act, or violate other statutes governing administration of specific units of the National Park System. Enabling statutes are mentioned because NPS is required to comply with requirements imposed by Congress for individual System units. Operating Standards 31. Comment: One commenter requested that the rule exempt certain operations from specific operating standards on a case by case basis. NPS Response: To the extent that certain operating standards are not applicable to a particular proposal, those standards would not be applied by the NPS. Accordingly, there is no need for an exemption. The NPS does not find it necessary or advisable to allow for exemptions to otherwise applicable operating standards. 32. Comment: One commenter suggested the rule clarify the: (1) Applicability of the technologically feasible, least damaging methods standard to site specific conditions regarding environmental and operating methods that are presented by an operator's proposal; and (2) prohibition of “ground disturbing operations” within 500 feet of any structure or facility used by the NPS for interpretation, public recreation, or administration. NPS Response: Section 9.110(c) of this rule requires operators, when applying standards to a particular operation, to use technologically feasible, least damaging methods to protect federally owned or administered lands, waters, and resources of System units, visitor uses and experiences, and visitor and employee health and safety. The NPS applies the “technologically feasible, least damaging methods” standard consistently to all aspects of an operation. The NPS included the phrase “to a particular operation” in this section, however, to recognize that the methods used to meet the technologically feasible, least damaging methods standard may vary depending on the individual operation and the environmental conditions of the proposed operation. The NPS has removed the phrase “ground disturbing” from this rule because generally no activities incident to oil and gas operations, whether or not they disturb the ground, may be conducted within 500 feet of any structure or facility used by the NPS for interpretation, public recreation, or administration. We have clarified the language in this rule regarding the Superintendent's discretion to increase or decrease this distance consistent with the need to protect federally owned or administered lands, waters, or resources of System units, visitor uses or experiences, or visitor or employee health and safety. 33. Comment: Commenters suggested that the rule should require the use of best management practices and specific, prescriptive performance standards. NPS Response: Executive Order 12866 requires federal agencies, to the extent feasible, to specify performance objectives, rather than specifying the behavior or manner of compliance that regulated entities must adopt. Consistent with this direction, and because this approach has worked well under the 1978 Regulations, this rule maintains the current practice of setting non-prescriptive operating standards that provide operators the flexibility to design their proposed operation using the latest technological innovations that best protect park system resources, values, and visitor health and safety. Wildlife and Habitat Protection 34. Comment: One commenter suggested that the proposed rule address how listed species under the Endangered Species Act (ESA) will be conserved in areas impacted by oil and gas activities, including those using hydraulic fracturing completion methods. NPS Response: NPS will consult with FWS and NOAA in accordance with the requirements of Section 7 of the ESA. It is not necessary to repeat or separately incorporate those requirements in this regulation. 35. Comment: One commenter suggested that the rule identify habitats and implement seasonal closures and other time limitations to protect wildlife and other resources. NPS Response: Through interdisciplinary review of each site-specific proposal under the regulation, the NPS identifies potential effects from oil and gas operations on species and habitat. The NPS applies mitigation and avoidance measures, which may include seasonal closures, to protect these resources, and also implements requirements imposed or recommended by FWS and NOAA through the Section 7 process. Hydraulic Fracturing Completion Methods 36. Comment: One commenter expressed concern that the rules for hydraulic fracturing are premature due to ongoing litigation concerning the Bureau of Land Management (BLM) final rule to manage hydraulic fracturing on federal and tribal lands (80 FR 16128). NPS Response: The U.S. District Court for the District of Wyoming, in State of Wyoming v. U.S. Department of the Interior, Case No. 2:15-CV-043-SWS, issued an order on June 21, 2016, setting aside the BLM regulations. That order is under appeal in the U.S. Court of Appeals for the Tenth Circuit. That case concerns different statutory authorities that do not apply to the NPS, and is unlikely to set any precedent that is applicable to regulations issued under NPS's authorities, which require NPS to conserve park resources and protect against their impairment, and which do not generally provide for any development of federally owned oil and gas in System units. 37. Comment: One commenter opposed the rule because it would allow operators to withhold disclosure of fracking chemicals. NPS Response: The NPS supports and through this rule requires the disclosure of all chemicals used in any hydraulic fracturing operation. Operators may provide this information to the NPS through FracFocus or another existing database available to the public. Because Federal law provides for the protection of trade secrets, the NPS will allow that information to be withheld if the operator and any other owner of the trade secret submits to the NPS an affidavit containing specific information explaining the reasons for the claim for protection. If the NPS has questions about the validity of the claim for protection, the NPS may require the operator to provide the withheld information to the NPS, and the NPS will then determine whether the data must be disclosed to the public. 38. Comment: One commenter recommended that the rule be revised to require disclosure of chemicals for all types of well stimulation operations, not just hydraulic fracturing operations. NPS Response: NPS has added language in §§ 9.88 and 9.89 of the rule to clarify that operators must disclose all chemicals used for well stimulation activities in a System unit. These disclosures are subject to any lawful trade secret protections that may be demonstrated by an operator. 39. Comment: One commenter suggested that the rule ban hydraulic fracturing or set specific standards to protect park resources from the potential effects of hydraulic fracturing. NPS Response: Congress has directed the NPS to “ensure that management of System units is enhanced by the availability and utilization of a broad program of the highest quality science and information.” 54 U.S.C. 100702. Some studies show that oil and gas operations that include hydraulic fracturing stimulation methods can negatively affect surrounding resources and the environment and can increase the risks of such impacts where appropriate measures are not taken before, during, and after hydraulic fracturing operations ( e.g., improper cementing of casing and well integrity issues or surface mismanagement of fracking and flowback fluids). However, studies also show that proper implementation of such measures can substantially reduce—to a level close to that of conventional well operations—the risks to the surrounding environment from hydraulic fracturing operations. Based on the NPS's research and review of studies provided during the public comment period, a blanket ban on hydraulic fracturing completion methods in System units is not necessary at this time. The NPS will continue to review information on hydraulic fracturing completion methods as it becomes available. Proposed well completion programs using hydraulic fracturing are not given blanket approval. The rule includes operating standards and approval standards that are designed to ensure that operators employ the least damaging methods that are technologically feasible, and that such methods do not impair park system resources or values. The NPS will consider hydraulic fracturing operations on a case by case basis and analyze potential impacts on park resources and values according to the approval standards in the rule. 40. Comment: One commenter expressed concern that operators are not required to retain records long enough to provide adequate protections from hydraulic fracturing operations. NPS Response: The rule requires the operator (and any subsequent operators) to maintain records until the later of when the NPS releases the operator's financial assurance or 7 years after completion of hydraulic fracturing operations. The rule does not allow the operator to destroy withheld information before the NPS releases the operator's financial assurance. The NPS does not release the operator's financial assurance until the operator has completed operations, including site reclamation. These timeframes provide for an adequate length of time to require an operator to retain records, and are consistent with other federal agency requirements for record retention, see BLM Oil and Gas; Hydraulic Fracturing on Federal and Indian Lands (80 FR 16128). The NPS has determined that a perpetual retention requirement is not necessary. General Terms and Conditions 41. Comment: One commenter suggested that the rule contain language that would ensure that third party monitors have no conflict of interest. NPS Response: Although the third party monitor, if required by the NPS, is hired by the operator, the monitor reports directly to the NPS. Additionally, this rule requires that the monitor demonstrate its qualifications to the NPS. These requirements are sufficient to avoid conflicts of interest. 42. Comment: One commenter suggested shortening the notification and reporting timeframe for equipment failure (including loss of mechanical integrity), accident, injury to persons or resources, or notification of change of operator. NPS Response: The reporting and notification timeframes are appropriate to protect park resources and values. The NPS is declining to shorten the time frames because we conclude that the proposed timeframes sufficiently address both protection of park resources and the practical needs of the operator for time to prepare appropriate notices to NPS. For loss of mechanical integrity, the rule requires the operator to immediately cease the operation and notify the Superintendent as soon as feasible, but no later than 24 hours after the incident. For accidents and injury to persons and resources, § 9.121(c) and (d) of this rule has been updated from the proposed rule to require notification as soon as feasible, but no later than 24 hours. For change of operator, the rule reduces the seller's notification time from 60 in existing regulations to 30 days. This 30 day period is sufficient because the rule holds the previous owner responsible until the Regional Director accepts the new operator's financial assurance. Access Fees 43. Comment: One commenter questioned the legal authority of the NPS to charge access fees to parties who own subsurface oil and gas rights underneath the access route leading to the boundary of the oil and gas right being developed and the legal basis for charging access fees for oil and gas operators in excess of those it charges for other recreational users. NPS Response: Federal law states that charges should be assessed against each identifiable recipient for special benefits beyond those received by the general public from Federally-permitted activities. 31 U.S.C. 9701. This statute authorizes the NPS to impose a user charge for the value of the facilities or lands used, or the services provided. The NPS does not charge oil and gas operators for access that is pursuant to a right ( e.g., access within the boundary of the oil and gas right that is being developed) or via a deeded or statutory right to use the park-administered lands. NPS is only charging for access that is granted as a privilege “outside the scope of an operator's oil and gas right.” This sort of access is a special benefit that warrants such a user charge. Unless otherwise authorized by law, such funds collected are deposited in the general fund of the Treasury as miscellaneous receipts. 44. Comment: One commenter suggested the rule should contain criteria that would be used to determine how the NPS would authorize an operator to undertake compensatory mitigation in lieu of paying a fee to access oil and gas rights. NPS Response: At this time, the NPS is unable to identify the necessary statutory authority to promulgate a regulatory provision authorizing use of compensatory mitigation in lieu of payment of fees for access. However, if such authority becomes available in the future, the NPS intends to re-evaluate whether it can then authorize the substitution of compensatory mitigation projects. Financial Assurance 45. Comment: One commenter stated that the removal of the bond cap and the mechanism for calculating a bond amount for non-federal lands is not adequately explained in the rule. NPS Response: The NPS applies the financial assurance provisions on a case by case basis, including the calculation of the amount of financial assurance necessary to reclaim and restore the federally owned surface estate. To calculate the amount of financial assurance, the NPS considers the following costs: Plugging wells (if applicable), removing all equipment and debris, restoring topographic grade, replacing topsoil, vegetation planting/seeding, exotic species control, and monitoring the success of reclamation. For proposed operations that are located on non-federal surface estate within a System unit, the NPS will consider whether that operation requires any reclamation of adjacent federal lands ( e.g., reclamation of temporary access road across NPS administered lands). If a particular operation located on non-federal land has no potential to require reclamation of federal land, the NPS will not require financial assurance from that operator. 46. Comment: One commenter suggested that the amount of financial assurance required for oil and gas operations should incorporate the amount of financial assurance already required under state law, such that the total amount of financial assurance provided to all government entities be considered when determining if the amount of financial assurance meets the total potential cost of reclamation. The commenter gave an example that if the total cost of reclamation by a third party would be $500,000, and the state is requiring a $200,000 reclamation bond, then the NPS should only require an additional $300,000 financial assurance ($500,000−$200,000) for the project. This would protect taxpayers in the event of a default, and would not require an operator to pledge financial assurance that is in excess of the required amount. NPS Response: The NPS is responsible for ensuring that an operator fulfills its reclamation responsibilities after operations cease protecting park resources and values and ensuring that there is adequate bonding to do so is a high priority. In many states, the required reclamation bond is a blanket bond. In the commenter's example, the state-required $200,000 reclamation bond is likely not for a single well, but would cover multiple wells. For example, the State of Texas allows operators to post a blanket bond of $250,000 to cover one hundred or more wells. (Texas Statewide Rule 78). In this scenario, should an operator become insolvent and not meet its reclamation requirements, the state required blanket bond is likely not an adequate amount to reclaim each of the operator's 100-plus well sites. Further, the State could not ensure the NPS that the bonded funds would be available to reclaim the operator's sites within a System unit. In many states, funds collected from insolvent operators go into a plugging fund, and funds are assigned to oil and gas sites based on a prioritized list established by the State. We are not aware of any state assurance programs, where the amount paid to the State would with certainty be available to NPS. For these reasons, the rule requires the full estimated amount of assurance be provided to NPS. Well Plugging 47. Comment: One commenter suggested the NPS shorten the approval period for a shut-in well so that public lands are not left in a degraded condition any longer than necessary. NPS Response: Five years is a reasonable amount of time to allow an operator to meet the criteria it needs to obtain authorization to shut in its well. All applicable laws and regulation related to well-bore integrity and testing will still apply during the shut-in period, which will protect park resources and values until the operator obtains the shut-in authorization. Public Participation 48. Comment: One commenter expressed concern about the removal of specific public notice requirements under the proposed rule. NPS Response: Sections 9.52(a) and (b) of the 1978 Regulations are removed by this rule because these provisions created an inefficient method of public involvement. Section 9.52(a) of the 1978 Regulations required the Superintendent to publish a notice of access requests in a newspaper of general circulation in the county(s) where the lands were situated, or in publications deemed appropriate by the Superintendent. At that point in the operator's planning process, the scope and methods of the proposed operation were not finalized. Further, after initial scoping and planning, an operator may sometimes abandon its proposal. Notice to the public at such a preliminary stage of the operator's planning was premature for meaningful public engagement. Section 9.52(b) of the 1978 Regulations required the Superintendent to publish a notice in the Federal Register advising the public that the plan of operations was available for public review and comment. Under this rule, the NPS will provide the opportunity for public review and comment (on both the complete permit applic [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A2016-26489. Public record. Not legal advice.