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

DEPARTMENT OF THE INTERIOR

Minerals Management Service

Agency Information Collection Activities: Submission for Office

of Management and Budget Review; Comment Request

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Notice of revision of a currently approved collection of

information (OMB Control Number 1010-0071).

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SUMMARY: As required by the Paperwork Reduction Act of 1995 (Act), the

Department of the Interior has submitted the collection of information

discussed below to the Office of Management and Budget (OMB) for

approval. The Act provides that an agency may not conduct or sponsor,

and a person is not required to respond to, a collection of information

unless it displays a currently valid OMB control number.

DATES: Submit written comments by May 1, 1998.

ADDRESSES: Submit comments and suggestions directly to the Office of

Information and Regulatory Affairs, OMB, Attention: Desk Officer for

the Department of the Interior (1010-0071), 725 17th Street, NW,

Washington, D.C. 20503. Send a copy of your comments to the Minerals

Management Service, Attention: Rules Processing Team, Mail Stop 4024,

381 Elden Street, Herndon, Virginia 20170-4817.

FOR FURTHER INFORMATION CONTACT: Alexis London, Engineering and

Operations Division, Minerals Management Service, telephone (703) 787-

1600. You may obtain copies of the supporting statement and collection

of information by contacting MMS's Information Collection Clearance

Officer at (202) 208-7744.

SUPPLEMENTARY INFORMATION:

Title: 30 CFR Part 203, Relief or Reduction in Royalty Rates.

Abstract: The Outer Continental Shelf (OCS) Lands Act, as amended

by the

[[Page 15860]]

Deep Water Royalty Relief Act (DWRRA), gives the Secretary of the

Interior the authority to reduce or eliminate royalty or any net profit

share set forth in Outer Continental Shelf oil and gas leases to

promote increased production. The MMS final rule established the terms

and conditions for granting reductions in royalty rates under the OCS

Lands Act and royalty suspension volumes under the DWRRA for certain

leases in existence before November 28, 1995. It also defines the

information required for a complete application as required by 43

U.S.C. 1337(a)(3)(C). The final rule was published in the Federal

Register on January 16, 1998 (63 FR 2605). The preamble stated that the

new information collection requirement in Sec. 203.61 would not become

effective until approved by OMB. The preamble provided the required 60-

day comment period.

MMS will use the information to make decisions on the economic

viability of leases requesting a suspension or elimination of royalty

or net profit share. These decisions have enormous monetary impacts to

both the lessee and the Federal Government. Royalty relief can lead to

increased production of natural gas and oil, creating profits for

lessees and royalty and tax revenues for the Government that they might

not otherwise receive. An application for royalty relief must contain

sufficient financial, economic, reservoir, geologic and geophysical,

production, and engineering data and information for MMS to determine

whether relief should be granted according to applicable law. The

application also must be sufficient to determine whether the requested

relief will result in an ultimate increase in resource recovery and

receipts to the Federal Treasury and provide for reasonable returns on

project investments. The applicant's requirement to respond is related

only to a request to obtain royalty relief. The applicant has no

obligation to make such a request. The MMS will protect information

considered proprietary under applicable law and regulations at 30 CFR

203.63(b) and 30 CFR part 250.

Number and Description of Respondents: Approximately 130 Federal

OCS oil and gas lessees making an estimated 44 applications per year.

Frequency: On occasion.

Reporting and Recordkeeping Hour Burden: See chart below. Average

333 hours per response for a total estimated burden of 14,640 hours.

Reporting and Recordkeeping Cost Burden: See chart below.

(a) Application processing cost: average $22,000 per application

for a total estimated burden of $618,250.

(b) Some applications will require a report prepared by an

independent certified public accountant: average $45,000 per

application for an estimated burden of $1,215,000.

Burden Breakdown Chart

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Application/audit fees

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Requirement 30 CFR part 203 Hours per

Responses per year response Annual burden

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OCSLA Reporting

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Application--leases that generate 6..................................... 200 1,200

earnings that can't sustain

continued production (end-of-

life lease).

(2)Application: 6 x

$8,000=$48,000

(2)Audit: 1 x $12,500=$12,500

Application--NRS expansion 0..................................... 0 0

project.

Sec. 203.55 Renounce relief

arrangement.

(1)Seldom, if ever will be used; 0.....................................

burden minimal to prepare letter

Sec. 203.81 Required reports.....

(1)Burden included with 0.....................................

applications

Subtotal OCS Lands Act....... 6..................................... N/A 1,200

(2)Processing Fees $60,500

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DWRRA Reporting

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Application--leases in designated 3..................................... 600 1,800

areas of GOM deep water acquired

in lease sale before 11/28/95

and are producing (deep water

expansion project).

(2)Application: 3 x

$19,500=$58,500

(2)Audit: 1 x $18,750=$18,750

Application--leases in designated 8..................................... 1,000 8,000

areas of GOM deep water acquired

in lease sale before 11/28/95

and have not produced (pre-act

deep water leases).

(2)Application: 8 x

$34,000=$272,000

(2)Audit: 2 x $37,500=75,000

Application--short form to add or 7..................................... 40 280

assign pre-act lease.

(2)Application: 7 x $1,000=$7,000

(2)No Audit:

Application--preview assessment.. 2..................................... 900 1,800

(2)Application: 2 x

$28,500=$57,000

(2)No Audit:

Redetermination.................. 2..................................... 500 1,000

(2)Application: 2 x

$16,000=$32,000

(2)Audit: 1 x $37,500=$37,500

Sec. 203.70 Submit fabricator's 8..................................... 20 160

confirmation report.

Sec. 203.70 Submit post- 8..................................... 50 400

production development report.

Sec. 203.77 Renounce relief

arrangement.

(1)Seldom, if ever will be used; 0.....................................

burden minimal to prepare letter

Sec. 203.79 Appeal MMS decisions.

(1)Exempt as defined in 5 CFR 0.....................................

1320.3(h)(9)

Sec. 203.81 Required reports.....

(1)Burden included with 0.....................................

applications

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Subtotal DWRRA............... 38.................................... N/A 13,440

[[Page 15861]]

(2)Processing Fees $557,750

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Total Annual Reporting Burden 44 Responses.......................... N/A 14,640 Hours

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(2)Processing Fees $618,250

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Recordkeeping

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Sec. 203.91 Retain supporting 8 Record keepers...................... 8 64 Hours

cost records for post-production

development and fabrication

reports.

Total Annual Recordkeeping

Burden.

(2)Respondents would retain

records as usual and customary

business practice; minimal

burden to make them available at

MMS request.

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Comments

Section 3506(c)(2)(A) of the Paperwork Reduction Act requires each

agency ``. . . to provide notice . . . and otherwise consult with

members of the public and affected agencies concerning each proposed

collection of information. . . .'' Agencies must specifically solicit

comments to: (a) evaluate whether the proposed collection of

information is necessary for the agency to perform its duties,

including whether the information is useful; (b) evaluate the accuracy

of the agency's estimate of the burden of the proposed collection of

information; (c) enhance the quality, usefulness, and clarity of the

information to be collected; and (d) minimize the burden on the

respondents, including the use of automated collection techniques or

other forms of information technology.

Send your comments directly to the offices listed under the

addresses section of this notice. OMB has up to 60 days to approve or

disapprove the information collection but may respond after 30 days.

Therefore, to ensure maximum consideration, OMB should receive public

comments by May 1, 1998.

MMS Information Collection Clearance Officer: Jo Ann Lauterbach,

(202) 208-7744.

Dated: March 25, 1998.

E. P. Danenberger,

Chief, Engineering and Operations Division.

[FR Doc. 98-8485 Filed 3-31-98; 8:45 am]

BILLING CODE 4310-MR-P