Federal Register / Vol. 62, No. 153 / Friday, August 8, 1997 / Rules and Regulations 42667

FR 9033), or 6–96 (62 FR 111), as applicable;

and 29 CFR Part 1911.

* * * * *

4. Paragraph (n)(2)(i)(C) of

§ 1910.1052 is revised to read as

follows:

§ 1910.1052 Methylene chloride.

* * * * *

(n) * * *

(2) * * *

(i) * * *

(C) For all other employers, within

150 days after the effective date of this

section.

* * * * *

[FR Doc. 97–20890 Filed 8–7–97; 8:45 am]

BILLING CODE 4510–26–M

DEPARTMENT OF THE INTERIOR

Minerals Management Service

30 CFR Part 250

RIN 1010–AC11

Outer Continental Shelf Civil Penalties

AGENCY: Minerals Management Service

(MMS), Interior.

ACTION: Final rule.

SUMMARY: This rule revises MMS

regulations governing the Outer

Continental Shelf (OCS) Civil Penalty

Program. MMS is revising these

regulations to clarify and simplify

assessing and collecting OCS civil

penalties. In addition, MMS is adjusting

the maximum civil penalty per day per

violation from $20,000 to $25,000 due to

inflation.

EFFECTIVE DATE: October 7, 1997.

FOR FURTHER INFORMATION CONTACT:

Greg Gould, Program Coordinator, at

(703) 787–1591 or fax (703) 787–1575.

SUPPLEMENTARY INFORMATION:

Background

MMS proposed revising the

regulations for civil penalties in a notice

of proposed rulemaking published in

the Federal Register (61 FR 66967) on

December 19, 1996. We received one

comment during the 90-day comment

period, which closed on March 19,

1997. This final rule revises the

regulations at 30 CFR 250.200.

The Oil Pollution Act of 1990 (OPA

90), (Pub. L. 101–380) expanded and

strengthened MMS’s authority to

impose penalties for violating

regulations promulgated under the OCS

Lands Act.

Section 8201 of OPA 90 authorizes

the Secretary of the Interior (Secretary)

to assess a civil penalty without

providing notice and time for corrective

action where a failure to comply with

applicable regulations results in a threat

of serious, irreparable, or immediate

harm or damage to human life or the

environment.

The goal of the MMS OCS Civil

Penalty Program is to ensure safe and

clean operations on the OCS. By

pursuing, assessing, and collecting civil

penalties, the program is designed to

encourage compliance with OCS

statutes and regulations.

Not all regulatory violations warrant a

review to initiate civil penalty

proceedings. However, violations that

cause injury, death, or environmental

damage, or pose a threat to human life

or the environment, will trigger such

review.

Intent of Proposed Rule

The goal of the proposed rule was to

rewrite the regulations at 30 CFR part

250, subpart N to simplify the language

into ‘‘plain English.’’ The new questionand-answer format provides a better

understanding of the OCS civil penalty

process.

Besides simplifying the regulations,

MMS proposed to increase the

maximum civil penalty to $25,000 per

day per violation. The provisions of

OPA 90 require the Secretary to adjust

at least every 3 years the maximum civil

penalty to reflect any increases in the

Consumer Price Index for all-urban

consumers (CPI–U) as prepared by the

Department of Labor.

Comments on the Rule

One major oil company commented

on the rule. The company strongly

opposed the amount of the increase to

the maximum civil penalty. In

particular, the company believed that

rounding to the nearest $5,000 was

inappropriate, and recommended

rounding to the nearest $500.

Response to the Comments

In computing the new civil penalty

maximum amount, MMS divided the

August 1995 CPI–U by the August 1990

CPI–U and multiplied the resulting

value by the current maximum civil

penalty (152.5/131.6=1.159;

1.159×20,000=23,180)

Section 5(a) of Pub. L. 101–410

provides that ‘‘Any increase determined

under this subsection shall be rounded

to the nearest multiple of $5,000 in the

case of penalties greater than $10,000

but less than or equal to $100,000.’’

Therefore, MMS rounded the maximum

civil penalty from $23,180 to $25,000

based on the formula provided in the

law. The final rule also includes a few

other changes from the proposed rule

that are not substantive.

Executive Order (E.O.) 12866

This final rule is significant under

E.O. 12866 and has been reviewed by

the Office of Management and Budget

(OMB).

Regulatory Flexibility Act

The Department of the Interior (DOI)

has determined that this final rule will

not have a significant effect on a

substantial number of small entities. In

general, the entities that engage in

offshore activities are not considered

small because of the technical and

financial resources and experience

necessary to safely conduct such

activities. DOI also determined that the

indirect effects of this final rule on

small entities that provide support for

offshore activities are small.

Paperwork Reduction Act

The final rule does not contain

collections of information that require

approval by OMB under 44 U.S.C. 3501,

et seq. The requirements in subpart N

are exempted as defined in 5 CFR

1320.4(a)(2) and 1320.4(c).

Taking Implication Assessment

DOI certifies that this final rule does

not represent a governmental action

capable of interference with

constitutionally protected property

rights. Thus, DOI does not need to

prepare a Takings Implication

Assessment pursuant to E.O. 12630,

Governmental Actions and Interference

with Constitutionally Protected Property

Rights.

Unfunded Mandates Reform Act of

1995

DOI has determined and certifies

according to the Unfunded Mandates

Reform Act, 2 U.S.C. 1502 et seq., that

this final rule will not impose a cost of

$100 million or more in any given year

on State, local, and tribal governments,

or the private sector.

E.O. 12988

DOI has certified to OMB that the

final rule meets the applicable reform

standards provided in sections 3(a) and

3(b)(2) of E.O. 12988.

National Environmental Policy Act

DOI determined that this action does

not constitute a major Federal action

significantly affecting the quality of the

human environment; therefore, an

Environmental Impact Statement is not

required.
42668 Federal Register / Vol. 62, No. 153 / Friday, August 8, 1997 / Rules and Regulations

List of Subjects in 30 CFR Part 250

Continental shelf, Environmental

impact statements, Environmental

protection, Government contracts,

Investigations, Mineral royalties, Oil

and gas development and production,

Oil and gas exploration, Oil and gas

reserves, Penalties, Pipelines, Public

lands—mineral resources, Public

lands—rights-of-way, Reporting and

recordkeeping requirements, Sulphur

development and production, Sulphur

exploration, Surety bonds.

Dated: June 19, 1997.

Sylvia V. Baca,

Acting Assistant Secretary, Land and

Minerals Management.

For the reasons stated in the

preamble, Minerals Management

Service (MMS) amends 30 CFR part 250

as follows:

PART 250—OIL AND GAS AND

SULPHUR OPERATIONS IN THE

OUTER CONTINENTAL SHELF

1. Authority citation for part 250

continues to read as follows:

Authority: 43 U.S.C. 1334.

2. Subpart N is revised to read as

follows:

Subpart N—Outer Continental Shelf (OCS)

Civil Penalties

Sec.

250.200 How does MMS begin the civil

penalty process?

250.201 Index table.

250.202 Definitions.

250.203 What is the maximum civil

penalty?

250.204 Which violations will MMS review

for potential civil penalties?

250.205 When is a case file developed?

250.206 When will MMS notify me and

provide penalty information?

250.207 How do I respond to the letter of

notification?

250.208 When will I be notified of the

Reviewing Officer’s decision?

250.209 What are my appeal rights?

Subpart N—Outer Continental Shelf

(OCS) Civil Penalties

§ 250.200 How does MMS begin the civil

penalty process?

This subpart explains MMS’s civil

penalty procedures whenever a lessee,

operator or other person engaged in oil,

gas, sulphur or other minerals

operations in the OCS has a violation.

Whenever MMS determines, on the

basis of available evidence, that a

violation occurred and a civil penalty

review is appropriate, it will prepare a

case file. MMS will appoint a Reviewing

Officer.

§ 250.201 Index Table.

The following table is an index of the

sections in this subpart:

§ 250.201 Table.

Section

Definitions ..................................... 250.202

What is the maximum civil penalty? ........................................... 250.203

Which violations will MMS review

for potential civil penalties? ....... 250.204

When is a case file developed? ... 250.205

When will MMS notify me and

provide penalty information? ..... 250.206

How do I respond to the letter of

notification? ............................... 250.207

When will I be notified of the Reviewing Officer’s decision? ........ 250.208

What are my appeal rights? ......... 250.209

§ 250.202 Definitions.

Terms used in this subpart have the

following meaning:

Case file means an MMS document

file containing information and the

record of evidence related to the alleged

violation.

Civil penalty means a fine. It is an

MMS regulatory enforcement tool used

in addition to Notices of Incidents of

Noncompliance and directed

suspensions of production or other

operations.

I, me in a question or you in a

response means the person, or agent of

a person engaged in oil, gas, sulphur, or

other minerals operations in the Outer

Continental Shelf (OCS).

Person means, in addition to a natural

person, an association (including

partnerships and joint ventures), a State,

a political subdivision of a State, or a

private, public, or municipal

corporation.

Reviewing Officer means an MMS

employee assigned to review case files

and assess civil penalties.

Violation means failure to comply

with the Outer Continental Shelf Lands

Act (OCSLA) or any other applicable

laws, with any regulations issued under

the OCSLA, or with the terms or

provisions of leases, licenses, permits,

rights-of-way, or other approvals issued

under the OCSLA.

Violator means a person responsible

for a violation.

§ 250.203 What is the maximum civil

penalty?

The maximum civil penalty is

$25,000 per day violation.

§ 250.204 Which violations will MMS

review for potential civil penalties?

MMS will review each of the

following violations for potential civil

penalties:

(a) Violations that you do not correct

within the period MMS grants;

(b) Violations that MMS determines

may constitute a threat of serious,

irreparable, or immediate harm or

damage to life (including fish and other

aquatic life), property, any mineral

deposit, or the marine, coastal, or

human environment; or

(c) Violations that cause serious,

irreparable, or immediate harm or

damage to life (including fish and other

aquatic life), property, any mineral

deposit, or the marine, coastal, or

human environment.

§ 250.205 When is a case file developed?

MMS will develop a case file during

its investigation of the violation, and

forward it to a Reviewing Officer if any

of the conditions in § 250.204 exist. The

Reviewing Officer will review the case

file and determine if a civil penalty is

appropriate. The Reviewing Officer may

administer oaths and issue subpoenas

requiring witnesses to attend meetings,

submit depositions, or produce

evidence.

§ 250.206 When will MMS notify me and

provide penalty information?

If the Reviewing Officer determines

that a civil penalty should be assessed,

the Reviewing Officer will send the

violator a letter of notification. The

letter of notification will include:

(a) The amount of the proposed civil

penalty;

(b) Information on the alleged

violation(s); and

(c) Instruction on how to obtain a

copy of the case file, schedule a

meeting, submit information, or pay the

penalty.

§ 250.207 How do I respond to the letter of

notification?

You have 30 calendar days after you

receive the Reviewing Officer’s letter to

either:

(a) Request, in writing, a meeting with

the Reviewing Officer;

(b) Submit additional information; or

(c) Pay the proposed civil penalty.

§ 250.208 When will I be notified of the

Reviewing Officer’s decision?

At the end of the 30 calendar days or

after the meeting and submittal of

additional information, the Reviewing

Officer will review the case file,

including all information you

submitted, and send you a decision. The

decision will include the amount of any

final civil penalty, the basis for the civil

penalty, and instructions for paying or

appealing the civil penalty.

§ 250.209 What are my appeal rights?

When you receive the Reviewing

Officer’s decision, you must either pay
Federal Register / Vol. 62, No. 153 / Friday, August 8, 1997 / Rules and Regulations 42669

the penalty or file an appeal with MMS

under part 290 of this chapter. If you do

not either pay the penalty or file a

timely appeal, MMS will take one or

more of the following actions:

(a) MMS will collect the amount you

were assessed, plus interest, late

payment charges, and other fees as

provided by law, from the date of

assessment until the date MMS receives

payment;

(b) MMS may initiate additional

enforcement proceedings including, if

appropriate, cancellation of the lease,

right-of-way, license, permit, or

approval, or the forfeiture of a bond

under this part; or

(c) MMS may bar you from doing

further business with the Federal

Government according to Executive

Orders 12549 and 12689, and section

2455 of the Federal Acquisition

Streamlining Act of 1994, 31 U.S.C.

6101. The Department of the Interior’s

regulations implementing these

authorities are found at 43 CFR part 62,

subpart D.

[FR Doc. 97–21032 Filed 8–7–97; 8:45 am]

BILLING CODE 4310–MR–M

DEPARTMENT OF THE INTERIOR

30 CFR Part 250

RIN 1010–AC12

Safety and Pollution Prevention

Equipment Quality Assurance

Requirements

AGENCY: Minerals Management Service

(MMS), Interior.

ACTION: Final rule.

SUMMARY: This rule amends the

regulations governing the quality

assurance (QA) program for safety and

pollution prevention equipment (SPPE)

used on the Outer Continental Shelf

(OCS). The rule requires lessees to

install only QA certified SPPE after

April 1, 1998. However, the rule allows

the continued use of noncertified SPPE

installed prior to April 1, 1998,

provided the equipment does not

require remanufacturing. Amendments

to the rule reduce the paperwork burden

on both industry and MMS and ensure

that OCS lessees continue to use the

best available and safest equipment.

EFFECTIVE DATE: September 8, 1997. The

incorporation by reference of certain

publications listed in the rule is

approved by the Director of the Federal

Register as of September 8, 1997.

FOR FURTHER INFORMATION CONTACT: Bill

Hauser, Engineering and Research

Branch, at (703) 787–1613.

SUPPLEMENTARY INFORMATION:

Background

MMS proposed revising the

regulations for the SPPE program in a

notice of proposed rulemaking

published in the Federal Register (61

FR 66639) on December 18, 1996. We

received two sets of comments during

the 60-day comment period, which

closed on February 18, 1997. This final

rule amends the regulations found at 30

CFR 250.126.

To fully understand this rule, you

need to know that SPPE consists of the

following equipment: surface safety

valves (SSV) and their actuators;

underwater safety valves and their

actuators; and subsurface safety valves

(SSSV) and associated safety valve locks

and landing nipples. MMS requires

lessees to install SPPE in their wells to

protect the safety of personnel and to

prevent the accidental release of

produced fluids or gases (thus the name

safety and pollution prevention

equipment). Certified SPPE means that

the manufacturer built the equipment

under a QA program recognized by

MMS. Noncertified SPPE is SPPE that

was not manufactured under a

recognized QA program but was in a

lessee’s inventory on April 1, 1988.

MMS required each lessee to submit a

list of this inventory to MMS by August

29, 1988.

Intent of Proposed Rule

The proposed rule had two goals: (1)

to reduce the paperwork associated with

the SPPE QA regulations and (2) to

ensure that lessees continue to use high

quality SPPE on the OCS. To reduce

paperwork, the proposed rule

eliminated the need for companies to

update their list of noncertified SPPE. It

also eliminated the detailed reporting

requirements regarding the installation

and failure of certified equipment.

The proposed rule addressed the

quality of SPPE by limiting the use of

noncertified SPPE. Under the proposed

rule a lessee could not install

noncertified SPPE after April 1, 1998. In

addition, a lessee would have to replace

noncertified SPPE already in service

with certified SPPE when one of the

following conditions occurred:

(1) Noncertified SPPE failed during

normal operations,

(2) Noncertified SPPE failed during

testing, or

(3) Noncertified SPPE was removed

from service for any other reason.

Comments on the Rule

The Offshore Operators Committee

(OOC) and a major oil company were

the only two commenters on the rule.

OOC, an organization that represents 85

companies that operate in the Gulf of

Mexico, commended MMS’ effort to

reduce the paperwork associated with

the program, but strongly objected to

replacing noncertified SPPE with

certified SPPE as proposed by the rule.

They stated that the rules should allow

noncertified SPPE to stay in service as

long as it functions properly.

Replacement of an internal seal or

temporary removal from a well during

routine operations should not prohibit

the use of noncertified SPPE after it has

functioned acceptably for many years.

OOC recommended that MMS should

require replacement only when the

noncertified SPPE has to be

remanufactured.

OOC estimated that approximately

3,000 noncertified SSV’s and 1,000

noncertified SSSV’s remain in service

on the OCS. OOC estimated that the cost

to replace these noncertified SPPE

would be $51,000,000. Their estimate

did not include the cost to replace

noncertified landing nipples for the

SSSV.

The major oil company endorsed

OOC’s comments. It reiterated that the

rule should require replacement of

noncertified SPPE only when it must be

re-manufactured or repaired by hot

work, such as welding.

Response to Comments

After review of the comments, MMS

agrees that the rule should not prohibit

the use of noncertified SPPE if it

requires only minor repairs, such as the

replacement of a seal. Therefore, we

have revised the final rule to require

replacement of noncertified SPPE only

when the noncertified SPPE requires

offsite repair, remanufacturing, or hot

work, such as welding. This will allow

lessees to continue using noncertified

SPPE provided the equipment works

properly, and when necessary, requires

only minor repairs. Once noncertified

SPPE requires offsite repair,

remanufacturing, or hot work, it may

not be used on the OCS. MMS believes

this restriction helps ensure that lessees

continue to use high quality SPPE.

MMS plans to examine the

performance of noncertified and

certified SPPE as part of a research

study that will examine leakage rates

and testing criteria for SPPE. This

research will begin this year. We invite

and encourage industry participation in

this research study. The results will

impact future rulemaking on SPPE

testing requirements.

We also clarified § 250.126(b)(2) of the

rule to state that a lessee may not install

additional noncertified SPPE after April

1, 1998.