Agency Information Collection Activities: Submitted for Office of Management and Budget Review, Comment Request

DEPARTMENT OF THE INTERIOR

Minerals Management Service

Agency Information Collection Activities: Submitted for Office of

Management and Budget Review, Comment Request

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Notice of information collection request.

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SUMMARY: To comply with the Paperwork Reduction Act (44 U.S.C. 3501 et

seq.), we are notifying you that an information collection request

(ICR) has been forwarded to the Office of Management and Budget (OMB)

for review and approval. We are also soliciting your comments on the

ICR describing the information collection, its expected costs and

burdens, and how the data will be collected.

DATES: Written comments should be received on or before January 3,

2000.

ADDRESSES: You may submit comments directly to the Office of

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

the Interior Department (OMB Control Number 1010-0103), 725 17th

Street, NW, Washington, DC 20503 (telephone (202) 395-7340). You should

also send copies of these comments to us. Our mailing address for

written comments regarding this information collection is David S.

Guzy, Chief, Rules and Publications Staff, Minerals Management Service,

Royalty Management Program, P.O. Box 25165, MS 3021, Denver, Colorado

80225. Courier or overnight delivery address is Building 85, Room A-

613, Denver Federal Center, Denver, Colorado 80225. Email address is

RMP.[email protected].

PUBLIC COMMENT PROCEDURE: Your comments and copies of your comments may

be submitted to the addresses listed above. Please submit Internet

comments as an ASCII file avoiding the use of special characters and

any form of encryption. Please also include Attn: Safety Net Report,

Form MMS-4411, OMB Control Number 1010-0103, and your name and return

address in your Internet message. If you do not receive a confirmation

from the system that we have received your Internet message, contact

David S. Guzy directly at (303) 231-3432.

We will post public comments after the comment period closes on the

Internet at http://www.rmp.mms.gov. You may arrange to view paper

copies of the comments by contacting David S. Guzy, Chief, Rules and

Publications Staff, telephone (303) 231-3432, FAX (303) 231-3385. Our

practice is to make comments, including names and addresses of

respondents, available for public review on the Internet and during

regular business hours at our offices in Lakewood, Colorado. Individual

respondents may request that we withhold their home address from the

rulemaking record, which we will honor to the extent allowable by law.

There also may be circumstances in which we would withhold from the

rulemaking record a respondent's identity, as allowable by law. If you

wish us to withhold your name and/or address, you must state this

prominently at the beginning of your comment. However, we will not

consider anonymous comments. We will make all submissions from

organizations or businesses, and from individuals identifying

themselves as representatives or officials of organizations or

businesses, available for public inspection in their entirety.

FOR FURTHER INFORMATION CONTACT: Dennis C. Jones, Rules and

Publications Staff, phone (303) 231-3046, FAX (303) 231-3385, email

Dennis.C.J[email protected].

SUPPLEMENTARY INFORMATION:

Title: Safety Net Report.

OMB Control Number: 1010-0103.

Abstract: The Secretary of the Interior is responsible for

collecting royalties from leases producing minerals from leased Federal

and Indian lands. The Secretary is required by various laws to manage

the production of mineral resources on Indian lands and Federal onshore

and offshore leases, to collect the royalties due, and to distribute

the funds in accordance with those laws; we perform these royalty

management functions for the Secretary.

On August 10, 1999, the Minerals Management Service (MMS) published

in the Federal Register (64 FR 43506) the notice of a final rulemaking

titled ``Amendments to Gas Valuation Regulations for Indian Leases,''

with an effective date of January 1, 2000. In that Notice, MMS requires

that lessees submit the Safety Net Report, Form MMS-4411, when gas

production from an Indian lease is sold beyond the first index pricing

point.

The Safety Net Report is part of MMS's final rulemaking amending

its regulations governing the valuation, for royalty purposes, of

natural gas produced from Indian leases. The gas regulations apply to

all gas production from Indian (tribal or allotted) oil and gas leases

(except leases on the Osage Indian Reservation). The new regulations

resulted from a negotiated rulemaking between Indian tribes and

allottees, oil and gas industry, and Government.

The safety net calculation establishes the minimum value, for

royalty purposes, of natural gas produced from Indian leases. This

reporting requirement will assist the Indian lessor in receiving all

the royalties that are due and aid MMS in its compliance efforts. The

rule requires the lessee to calculate the safety net price using prices

received for gas sold downstream of the first index pricing point. It

will include only the lessee's or lessee's affiliate's arm's-length

contracts and will not require detailed calculations for the costs of

transportation. By June 30 following any calendar year, the rule

requires the lessee to calculate for each month of the previous

calendar year a safety net price. The rule requires the lessee to

submit a separate Form MMS-

[[Page 67300]]

4411 for each index zone where the lessee has an Indian lease. The

safety net price will capture the significantly higher values for sales

occurring beyond the first index pricing point. The lessee will submit

its safety net prices to MMS annually (by June 30) using the Form MMS-

4411.

The Safety Net Report will allow MMS and the tribes to ensure that

Indian mineral lessors receive the maximum revenues from mineral

resources on their land consistent with the Secretary's trust

responsibility and lease terms. In the safety net calculation, the

lessee will only include sales under those arm's-length contracts that

establish a delivery point beyond the first index pricing point to

which the gas flows. Moreover, those contracts must include any gas

produced from or allocable to one or more of the lessee's Indian leases

in the index zone. The MMS or tribal auditors, Indian representatives,

MMS's Royalty Valuation Division, and the Office of Indian Royalty

Assistance, may use the information provided on the form.

The current OMB inventory of 37,400 hours is decreased to 10,500

hours. This adjusted decrease of 26,900 burden hours is the result of

our originally overestimating the number of companies submitting Form

MMS-4411 and overstating the number of index zones for which each

company would have to submit this form.

Respondents/Affected Entities: Companies that pay royalties on gas

produced from tribal and allotted Indian leases.

Frequency of Response: Annually.

Estimated Number of Respondents: 140 companies.

Estimated Total Annual Reporting and Recordkeeping Burden: 10,500

hours.

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 January 3, 2000.

MMS Information Collection Clearance Officer: Jo Ann Lauterbach,

(202) 208-7744.

Dated: November 23, 1999.

Lucy Querques Denett,

Associate Director for Royalty Management.

[FR Doc. 99-31113 Filed 11-30-99; 8:45 am]

BILLING CODE 4310-MR-P