# 30 C.F.R. § 1206.358 (2026): What are byproduct transportation allowances? > Federal · Regulations · In force URL: https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_358 ## Section - **Citation:** 30 C.F.R. § 1206.358 (2026) - **Heading:** What are byproduct transportation allowances? - **Jurisdiction:** Federal - **Kind:** Regulations - **Status:** In force - **Text as of:** August 14, 2026 - **Source:** Compiled text - **Location:** Title 30 CFR: Mineral Resources / Chapter XII / Part 1206 / Subpart H / § 1206.358: § 1206.358 What are byproduct transportation allowances? ## Text (a) When you determine the value of byproducts at a point off the geothermal lease, unit, or participating area, you are allowed a deduction in determining value, for royalty purposes, for your reasonable, actual costs incurred to: (1) Transport the byproducts from a Federal lease, unit, or participating area to a sales point or point of delivery that is off the lease, unit, or participating area; or (2) Transport the byproducts from a Federal lease, unit, or participating area, or from a geothermal use facility to a byproduct recovery facility when that byproduct recovery facility is off the lease, unit, or participating area and, if applicable, from the recovery facility to a sales point or point of delivery off the lease, unit, or participating area. (b) Costs for transporting geothermal fluids from the lease to the geothermal use facility, whether on or off the lease, are not includible in the byproduct transportation allowance. (c)(1) When you transport byproducts from a lease, unit, participating area, or geothermal use facility to a byproduct recovery facility, you are not required to allocate transportation costs between the quantity of marketable byproducts and the rejected waste material. The byproduct transportation allowance is authorized for the total production that is transported. You must express byproduct transportation allowances as a cost per unit of marketable byproducts transported. (2) For byproducts that are extracted on the lease, unit, participating area, or at the geothermal use facility, the byproduct transportation allowance is authorized for the total byproduct that is transported to a point of sale off the lease, unit, or participating area. You must express byproduct transportation allowances as a cost per unit of byproduct transported. (3) You may deduct transportation costs only when you sell, deliver, or otherwise utilize the transported byproduct and report and pay royalties on the byproduct. (d) Reporting requirements rized for the total byproduct that is transported to a point of sale off the lease, unit, or participating area. You must express byproduct transportation allowances as a cost per unit of byproduct transported. (3) You may deduct transportation costs only when you sell, deliver, or otherwise utilize the transported byproduct and report and pay royalties on the byproduct. (d) Reporting requirements. (1) You must use a discrete field on Form ONRR-2014 to notify ONRR of a transportation allowance. (2) In conducting reviews and audits, ONRR may require you to submit arm's-length transportation contracts, production agreements, operating agreements, and related documents. You must comply with any such requirements within the time ONRR specifies. Recordkeeping requirements are found at part 1212 of this chapter. (e) Byproduct transportation allowances are subject to monitoring, review, and audit. If, after a review or audit, ONRR determines that you have improperly determined a byproduct transportation allowance, you must pay any additional royalties due (plus interest computed under § 1218.302 of this chapter). You are entitled to a credit for or refund of any overpaid royalties. (f) If you commingled byproducts produced from Federal and non-Federal leases for transportation, you may not disproportionately allocate transportation costs to Federal lease production. ## Nearby sections - [30 C.F.R. § 1206.350 (2026) § 1206.350 What is the purpose of this subpart?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_350.md) - [30 C.F.R. § 1206.351 (2026) § 1206.351 What definitions apply to this subpart?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_351.md) - [30 C.F.R. § 1206.352 (2026) § 1206.352 How do I calculate the royalty due on geothermal resources used for commercial production or generation of electricity?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_352.md) - [30 C.F.R. § 1206.353 (2026) § 1206.353 How do I determine transmission deductions?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_353.md) - [30 C.F.R. § 1206.354 (2026) § 1206.354 How do I determine generating deductions?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_354.md) - [30 C.F.R. § 1206.355 (2026) § 1206.355 How do I calculate royalty due on geothermal resources I sell at arm's length to a purchaser for direct use?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_355.md) - [30 C.F.R. § 1206.356 (2026) § 1206.356 How do I calculate royalty or fees due on geothermal resources I use for direct use purposes?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_356.md) - [30 C.F.R. § 1206.357 (2026) § 1206.357 How do I calculate royalty due on byproducts?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_357.md) - [30 C.F.R. § 1206.358 (2026) § 1206.358 What are byproduct transportation allowances?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_358.md) - [30 C.F.R. § 1206.359 (2026) § 1206.359 How do I determine byproduct transportation allowances?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_359.md) - [30 C.F.R. § 1206.360 (2026) § 1206.360 What records must I keep to support my calculations of royalty or fees under this subpart?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_360.md) - [30 C.F.R. § 1206.361 (2026) § 1206.361 How will ONRR determine whether my royalty or direct use fee payments are correct?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_361.md) - [30 C.F.R. § 1206.362 (2026) § 1206.362 What are my responsibilities to place production into marketable condition and to market production?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_362.md) - [30 C.F.R. § 1206.363 (2026) § 1206.363 When is an ONRR audit, review, reconciliation, monitoring, or other like process considered final?](https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_363.md) --- Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/CFR_T30_P1206_S1206_358. 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