[Federal Register Volume 76, Number 58 (Friday, March 25, 2011)]
[Notices]
[Pages 16816-16818]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-7140]


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DEPARTMENT OF THE INTERIOR

Office of Natural Resources Revenue

[Docket No. ONRR-2011-0006]


Agency Information Collection Activities: Proposed Collection, 
Comment Request

AGENCY: Office of Natural Resources Revenue (ONRR), Interior.

ACTION: Notice of a revision of a currently approved information 
collection (OMB Control Number 1012-0009, formerly 1010-0073).

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SUMMARY: To comply with the Paperwork Reduction Act of 1995 (PRA), we 
are inviting comments on a collection of information that we will 
submit to the Office of Management and Budget (OMB) for review and 
approval. This information collection request (ICR) was formerly 
approved under OMB Control Number 1010-0073. After the Secretary of the 
Interior established ONRR (the former Minerals Revenue Management, a 
program under the Minerals Management Service) on October 1, 2010, OMB 
approved a new series number for ONRR and renumbered our ICRs. Also, 
effective October 1, 2010, ONRR reorganized and transferred their 
regulations from chapter II to chapter XII in title 30 of the Code of 
Federal Regulations (CFR), resulting in a change in our citations. This 
ICR covers the paperwork requirements in the regulations under 30 CFR 
part 1220 (previously 30 CFR part 220). The revised title of this 
information collection request (ICR) is ``30 CFR Part 1220, OCS Net 
Profit Share Payment Reporting.'' There are no forms associated with 
this information collection.

DATES: Submit written comments on or before May 24, 2011.

ADDRESSES: You may submit comments on this ICR to ONRR by any of the 
following methods. Please use ``ICR 1012-0009'' as an identifier in 
your comment.
    <bullet> Electronically go to http://www.regulations.gov. In the 
entry titled ``Enter Keyword or ID,'' enter ONRR-2011-0006, and then 
click search. Follow the instructions to submit public comments. The 
ONRR will post all comments.
    <bullet> Mail comments to Armand Southall, Regulatory Specialist, 
Office of Natural Resources Revenue, P.O. Box 25165, MS 61013B, Denver, 
Colorado 80225. Please reference ICR 1012-0009 in your comments.
    <bullet> Hand-carry comments or use an overnight courier service. 
Our courier address is Building 85, Room A-614, Denver Federal Center, 
West 6th Ave. and Kipling St., Denver, Colorado 80225. Please reference 
ICR 1012-0009 in your comments.

FOR FURTHER INFORMATION CONTACT: For questions on technical issues, 
contact Mary Ann Guilinger, Audit and Compliance Management (ACM), 
Office of Natural Resources Revenue (ONRR), telephone (303) 231-3408, 
or e-mail <a href="/cdn-cgi/l/email-protection#90fdf1e2e9f1fefebef7e5f9fcf9fef7f5e2d0fffee2e2bef7ffe6"><span class="__cf_email__" data-cfemail="1875796a61797676367f6d717471767f7d6a5877766a6a367f776e">[email protected]</span></a>. For other comments or questions, 
contact Armand Southall, Project Management Office--Regulations, ONRR, 
telephone (303) 231-3221, or e-mail <a href="/cdn-cgi/l/email-protection#d9b8abb4b8b7bdf7aab6acadb1b8b5b599b6b7ababf7beb6af"><span class="__cf_email__" data-cfemail="25445748444b410b564a50514d444949654a4b57570b424a53">[email protected]</span></a>. You may 
contact Mr. Southall to obtain copies, at no cost, of (1) the ICR and 
(2) the regulations that require the subject information collection.

SUPPLEMENTARY INFORMATION: 
    Title: 30 CFR Part 1220, OCS Net Profit Share Payment Reporting.
    OMB Control Number: 1012-0009.
    Bureau Form Number: None.
    Abstract: The Secretary of the Department of the Interior is 
responsible for collecting royalties from lessees who produce minerals 
from leased Federal and Indian lands and the Outer Continental Shelf 
(OCS). The Secretary is required by various laws to manage mineral 
resources production on Federal and Indian lands and the OCS, collect 
the royalties due, and distribute the funds collected in accordance 
with those laws. The ONRR performs the royalty management functions for 
the Secretary.
    Public laws pertaining to mineral leases on Federal and Indian 
lands and the OCS are posted at http://www.onrr.gov/Laws_R_D/PublicLawsAMR.htm.

I. General Information

    The ONRR collects and uses this information to determine all 
allowable direct and allocable joint costs and credits under Sec.  
1220.011 incurred during the lease term, appropriate overhead allowance 
permitted on these costs under Sec.  1220.012, and allowances for 
capital recovery calculated under Sec.  1220.020. The ONRR also 
collects this information to ensure royalties or net profit share 
payments are accurately valued and appropriately paid. This ICR affects 
only oil and gas leases on submerged Federal lands on the OCS.

II. Information Collections

    Title 30 CFR part 1220 covers the net profit share lease (NPSL) 
program and establishes reporting requirements for determining the net 
profit share base and calculating net profit share payments due the 
Federal Government for the production of oil and gas from leases.

A. NPSL Bidding System

    To encourage exploration and development of oil and gas leases on 
submerged Federal lands on the OCS, the Bureau of Ocean Energy 
Management, Regulation, and Enforcement (BOEMRE, the former Offshore 
Energy and Minerals Management [OEMM] of Minerals Management Service 
[MMS]) promulgated regulations at 30 CFR 260--Outer Continental Shelf 
Oil and Gas Leasing. Also, BOEMRE promulgated specific implementing 
regulations for the NPSL bidding system at Sec.  260.110(d). The 
BOEMRE, formerly OEMM/MMS, established the NPSL bidding system to 
balance a fair market return to the Federal Government for the lease of 
its public lands with a fair profit to companies risking their 
investment capital. The system provides an incentive for early and 
expeditious exploration and development and provides for sharing the 
risks by the lessee and the Federal Government. The NPSL bidding system 
incorporates a fixed capital recovery system as a means through which 
the lessee recovers costs of exploration and development from 
production revenues, along with a reasonable return on investment.

B. NPSL Capital Account

    The Federal Government does not receive a profit share payment from 
an NPSL until the lessee shows a credit balance in its capital account, 
that is, when cumulative revenues and other credits exceed cumulative 
costs. Lessees multiply the credit balance by the net profit share rate 
(30 to 50 percent), resulting in the amount of net profit

[[Page 16817]]

share payment due the Federal Government.
    The ONRR requires lessees to maintain an NPSL capital account for 
each lease under Sec.  1220.010, which transfers to a new owner when 
sold. Following the cessation of production, lessees are also required 
to provide either an annual or a monthly report to the Federal 
Government, using data from the capital account.

C. NPSL Inventories

    The NPSL lessees must notify ONRR of their intent to perform an 
inventory and file a report after each inventory of controllable 
materiel under Sec.  1220.032.

D. NPSL Audits

    When non-operators of an NPSL call for an audit, they must notify 
ONRR. When ONRR calls for an audit, the lessee must notify all non-
operators on the lease. These requirements are located at Sec.  
1220.033.

III. OMB Approval

    The information we collect under this ICR is essential in order to 
determine when net profit share payments are due and to ensure lessees 
properly value and pay royalties or net profit share payments.
    The ONRR will request OMB's approval to continue to collect this 
information. Not collecting this information would limit the 
Secretary's ability to discharge fiduciary duties and may also result 
in the inability to confirm the accurate royalty value. Proprietary 
information submitted to ONRR under this collection is protected, and 
no items of a sensitive nature are collected.
    Frequency: Annually, monthly, and on occasion.
    Estimated Number and Description of Respondents: 6 lessees.
    Estimated Annual Reporting and Recordkeeping ``Hour'' Burden: 1,046 
hours.
    All six lessees report monthly because all current NPSLs are in 
producing status. Because the requirements for establishment of capital 
accounts at Sec.  1220.010(a) and reporting of annual capital account 
at Sec.  1220.031(a) are necessary only during non-producing status of 
a lease, we included only one response annually for these requirements, 
in case a new NPSL is established. We have not included in our 
estimates certain requirements performed in the normal course of 
business, which are considered usual and customary. The following chart 
shows the estimated annual burden hours by CFR section and paragraph.

                                   Respondents' Estimated Annual Burden Hours
----------------------------------------------------------------------------------------------------------------
                                              Reporting and                          Number of
          Citation 30 CFR 1220                recordkeeping         Hour burden       annual       Annual burden
                                               requirement                           responses         hours
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  PART 1220--Accounting Procedures for Determining Net Profit Share Payment for Outer Continental Shelf Oil and
                                                   Gas Leases
----------------------------------------------------------------------------------------------------------------
                                      Sec.   1220.010 NPSL capital account.
----------------------------------------------------------------------------------------------------------------
1220.010(a)............................  (a) For each NPSL                     1               1               1
                                          tract, an NPSL capital
                                          account shall be
                                          established and
                                          maintained by the
                                          lessee for NPSL
                                          operations..
----------------------------------------------------------------------------------------------------------------
                                     Sec.   1220.030 Maintenance of records
----------------------------------------------------------------------------------------------------------------
1220.030(a) and (b)....................  (a) Each lessee . . .                 1               6               6
                                          shall establish and
                                          maintain such records
                                          as are necessary..
----------------------------------------------------------------------------------------------------------------
                               Sec.   1220.031 Reporting and payment requirements
----------------------------------------------------------------------------------------------------------------
1220.031(a)............................  (a) Each lessee subject               1               1               1
                                          to this part shall
                                          file an annual report
                                          during the period from
                                          issuance of the NPSL
                                          until the first month
                                          in which production
                                          revenues are credited
                                          to the NPSL capital
                                          account..
----------------------------------------------------------------------------------------------------------------
1220.031(b)............................  (b) Beginning with the               13              72             936
                                          first month in which
                                          production revenues
                                          are credited to the
                                          NPSL capital account,
                                          each lessee. shall
                                          file a report for each
                                          NPSL, not later than
                                          60 days following the
                                          end of each month..
----------------------------------------------------------------------------------------------------------------
1220.031(c)............................  (c) Each lessee subject  Burden hours covered under Sec.   1220.031(b).
                                          to this Part 1220
                                          shall submit, together
                                          with the report
                                          required . . . any net
                                          profit share payment
                                          due..
----------------------------------------------------------------------------------------------------------------
1220.031(d)............................  (d) Each lessee . . .                 8               6              48
                                          shall file a report
                                          not later than 90 days
                                          after each inventory
                                          is taken..
----------------------------------------------------------------------------------------------------------------
1220.031(e)............................  (e) Each lessee . . .                 4               6              24
                                          shall file a final
                                          report, not later than
                                          60 days following the
                                          cessation of
                                          production..
----------------------------------------------------------------------------------------------------------------
                                           Sec.   1220.032 Inventories
----------------------------------------------------------------------------------------------------------------
1220.032(b)............................  (b) At reasonable                     1               6               6
                                          intervals, but at
                                          least once every three
                                          years, inventories of
                                          controllable materiel
                                          shall be taken by the
                                          lessee. Written notice
                                          of intention to take
                                          inventory shall be
                                          given by the lessee at
                                          least 30 days before
                                          any inventory is to be
                                          taken so that the
                                          Director may be
                                          represented at the
                                          taking of inventory..
----------------------------------------------------------------------------------------------------------------

[[Page 16818]]

 
                                             Sec.   1220.033 Audits
----------------------------------------------------------------------------------------------------------------
1220.033(b)(1).........................  (b)(1) When                           2               6              12
                                          nonoperators of an
                                          NPSL lease call an
                                          audit in accordance
                                          with the terms of
                                          their operating
                                          agreement, the
                                          Director shall be
                                          notified of the audit
                                          call..
----------------------------------------------------------------------------------------------------------------
1220.033(b)(2).........................  (b)(2) If DOI                         2               6              12
                                          determines to call for
                                          an audit, DOI shall
                                          notify the lessee of
                                          its audit call and set
                                          a time and place for
                                          the audit . . . The
                                          lessee shall send
                                          copies of the notice
                                          to the nonoperators on
                                          the lease..
----------------------------------------------------------------------------------------------------------------
1220.033(e)............................  (e) Records required to  The Office of Regulatory Affairs determined
                                          be kept under Sec.      that the audit process is exempt from the
                                          1220.030(a) shall be    Paperwork Reduction Act of 1995 because MMS
                                          made available for      staff asks non-standard questions to resolve
                                          inspection by any       exceptions.
                                          authorized agent of
                                          DOI..
----------------------------------------------------------------------------------------------------------------
    Total Burden.......................  .......................  ..............             110           1,046
----------------------------------------------------------------------------------------------------------------

    Estimated Annual Reporting and Recordkeeping ``Non-hour'' Cost 
Burden: We have identified no ``non-Hour cost'' burdens.
    Public Disclosure Statement: The PRA (44 U.S.C. 3501 et seq.) 
provides that an agency may not conduct or sponsor, and a person is not 
required to respond to, a collection of information unless it displays 
a currently valid OMB control number.
    Comments: Before submitting an ICR to OMB, PRA Section 
3506(c)(2)(A) requires each agency to ``* * * provide 60-day notice in 
the Federal Register * * * and otherwise consult with members of the 
public and affected agencies concerning each proposed collection of 
information * * *.'' Agencies must specifically solicit comments to: 
(a) Evaluate whether the proposed collection of information is 
necessary for the agency to perform its duties, including whether the 
information is useful; (b) evaluate the accuracy of the agency's 
estimate of the burden of the proposed collection of information; (c) 
enhance the quality, usefulness, and clarity of the information to be 
collected; and (d) minimize the burden on the respondents, including 
the use of automated collection techniques or other forms of 
information technology.
    The PRA also requires agencies to estimate the total annual 
reporting ``non-hour cost'' burden to respondents or recordkeepers 
resulting from the collection of information. If you have costs to 
generate, maintain, and disclose this information, you should comment 
and provide your total capital and startup cost components or annual 
operation, maintenance, and purchase of service components. You should 
describe the methods you use to estimate major cost factors, including 
system and technology acquisition, expected useful life of capital 
equipment, discount rate(s), and the period over which you incur costs. 
Capital and startup costs include, among other items, computers and 
software you purchase to prepare for collecting information; 
monitoring, sampling, and testing equipment; and record storage 
facilities. Generally, your estimates should not include equipment or 
services purchased: (i) Before October 1, 1995; (ii) to comply with 
requirements not associated with the information collection; (iii) for 
reasons other than to provide information or keep records for the 
Government; or (iv) as part of customary and usual business or private 
practices.
    We will summarize written responses to this notice and address them 
in our ICR submission for OMB approval, including appropriate 
adjustments to the estimated burden. We will provide a copy of the ICR 
to you without charge upon request. We also will post the ICR at http://www.onrr.gov/Laws_R_D/FRNotices/FRInfColl.htm.
    Public Comment Policy: We will post all comments, including names 
and addresses of respondents, at http://regulations.gov. Before 
including your address, phone number, e-mail address, or other personal 
identifying information in your comment, be advised that your entire 
comment--including your personal identifying information--may be made 
publicly available at any time. While you can ask us in your comment to 
withhold from public view your personal identifying information, we 
cannot guarantee that we will be able to do so.
    ONRR Information Collection Clearance Officer: Rachel Drucker (202) 
208-3568.

    Dated: March 22, 2011.
Gregory J. Gould,
Director for Office of Natural Resources Revenue.
[FR Doc. 2011-7140 Filed 3-24-11; 8:45 am]
BILLING CODE 4310-MR-P


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