63186 Federal Register / Vol. 62, No. 228 / Wednesday, November 26, 1997 / Notices

The Secretary of the Interior

(Secretary) is responsible for the

collection of royalties from lessees who

produce minerals from leased Indian

lands. The Secretary is required by

various laws to manage the production

of mineral resources on Indian lands, to

collect the royalties due, and to

distribute the funds in accordance with

those laws. The product valuation and

allowance determination process is

essential to assure that the public and/

or the Indians receive payment on the

proper value of the minerals being

removed.

MMS performs the royalty

management functions for the Secretary.

When a company or an individual

enters into a contract (a lease) to

explore, develop, produce, and dispose

of oil from Indian lands, that company

or individual agrees to pay the United

States or Indian tribe or allottee a share

(royalty) of the value received from

production from the leased lands.

Royalty rates are specified in the lease

agreement. In order to determine

whether the amount of royalty tendered

represents the proper royalty due, it is

first necessary to establish the proper

value of the oil that is being sold or

otherwise disposed of in some other

manner, as well as the proper costs

associated with allowable deductions.

In some circumstances, lessees are

authorized to deduct from royalty

payments the reasonable actual cost of

transporting the royalty portion of the

oil from the lease to a delivery point

remote from the lease. Transportation

allowances are a part of the product

valuation process which MMS uses to

determine if the lessee is reporting and

paying the proper royalty amount.

Before any deduction may be taken,

the lessee must submit page one of the

Oil Transportation Allowance Report,

Form MMS–4110, declaring the amount

of reasonable actual transportation costs

to be deducted from royalty. We

estimate that 3 respondents will each

submit an average of 7 allowance data

lines for a total of 21 data lines

annually. We estimate that each data

line will require 1⁄4 hour to prepare, a

total of 5.25 burden hours.

Authorization to deduct a transportation

allowance continues for 12 months, or

until the contract is changed or

terminated. At that time, the lessee must

resubmit page one of Form MMS–4110.

We estimate that recordkeeping for

these transportation allowances will

require 1/2 hour per respondent

annually.

Dated: November 20, 1997.

Joan Killgore,

Acting Associate Director for Royalty

Management.

[FR Doc. 97–31081 Filed 11–25–97; 8:45 am]

BILLING CODE 4310–MR–P

DEPARTMENT OF THE INTERIOR

Minerals Management Service, Interior

Agency Information Collection

Activities: Proposed Collection;

Comment Request

AGENCY: Minerals Management Service,

DOI.

ACTION: Notice of information collection

solicitation.

SUMMARY: Under the Paperwork

Reduction Act of 1995, the Minerals

Management Service (MMS) is soliciting

comments on an information collection,

Coal Transportation and Washing

Allowance (OMB Control Number

1010–0074); this information collection

pertains to Indian leases only.

FORMS: MMS–4292, Coal Washing

Allowance Report and MMS–4293, Coal

Transportation Allowance Report.

DATES: Written comments should be

received on or before January 26, 1998.

ADDRESSES: Comments sent via the U.S.

Postal Service should be sent to

Minerals Management Service, Royalty

Management Program, Rules and

Publications Staff, P.O. Box 25165, MS

3021, Denver, Colorado 80225–0165;

courier address is Building 85, Room

A613, Denver Federal Center, Denver,

Colorado 80225; e:Mail address is

DavidlGuzy@mms.gov.

FOR FURTHER INFORMATION CONTACT:

Dennis C. Jones, Rules and Publications

Staff, phone (303) 231–3046, FAX (303)

231–3385, e-Mail

DennislClJones@mms.gov.

SUPPLEMENTARY INFORMATION: In

compliance with the Paperwork

Reduction Act of 1995, Section

3506(c)(2)(A), we are notifying you,

members of the public and affected

agencies, of this collection of

information and are inviting your

comments. In this information

collection necessary for us to properly

do our job? Have we accurately

estimated the industry burden for

responding to this collection? Can we

enhance the quality, utility, and clarity

of the information we collect? Can we

lessen the burden of this information

collection on the respondents by using

automated collection techniques or

other forms of information technology?

The Secretary of the Interior is

responsible for the collection of

royalties from lessees who produce

minerals from leased Indian lands. The

Secretary is required by various laws to

manage the production of mineral

resources on Indian lands, to collect the

royalties due, and to distribute the

funds in accordance with those laws.

The product valuation process is

essential to assure that the public and/

or the Indians receive payment on the

full value of the minerals being

removed.

MMS performs these royalty

management functions for the Secretary.

When a company or an individual

enters into a contract (a lease) to

develop, mine, and dispose of coal

deposits from Indian lands, that

company or individual (the lessee)

agrees to pay the United States, Indian

tribe, or allottee (the lessor) a share

(royalty) of the gross proceeds received

from the sale of production from leased

lands. Royalty rates are specified in the

lease agreement. In order to determine

whether the amount of royalty tendered

represents the proper royalty due, it is

necessary to establish the value of the

coal being sold or otherwise disposed of

in some other manner, as well as the

proper costs associated with allowable

deductions.

In some circumstances, lessees are

authorized to deduct certain costs in the

calculation of royalties due. An

allowance may be granted from royalties

to compensate lessees for the reasonable

actual cost of washing the royalty

portion of coal. Also, when the sales

point is not in the immediate vicinity of

a lease or mine area, an allowance may

be granted to compensate lessees for the

reasonable actual cost of transporting

the royalty portion of coal to a sales

point not on the lease or mine area.

Before any deductions are taken, the

lessee with an arm’s-length contract

must submit page one of the Coal

Washing Allowance Report, Form

MMS–4292, or the Coal Transportation

Allowance Report, Form MMS–4293.

The allowances will be based on

reasonable actual costs reported by the

lessees and are subject to later audit. We

estimate that one lessee will submit two

reports annually and that each

submission will require 1⁄2 hour to

prepare, a total of 1 burden hour.

Lessees with a non-arm’s-length

contract must also submit Form MMS–

4292 or Form MMS–4293. All

applicable pages of the allowance

application forms should be submitted.

The allowances will be based on

reasonable actual costs reported by the

lessees and are subject to later audit. We

do not anticipate any lessee with a nonarm’s-length contract submitting

allowance reports.
Federal Register / Vol. 62, No. 228 / Wednesday, November 26, 1997 / Notices 63187

In those instances when Indian

royalty coal is washed, transported, or

sold under non-arm’s-length conditions,

it is necessary for MMS to obtain other

data, and in some cases, appropriate

sales contracts, to accurately determine

if the value of coal and the gross

proceeds for royalty calculation

purposes have been correctly computed

by the lessee. Coal sales contracts for

Indian lands are required to be

submitted only upon request by MMS.

We estimate that four lessees may be

requested to submit sales contracts and

that each submission will take 3 hours

to prepare, a total of 12 burden hours.

Authorization to deduct coal

transportation and washing allowances

continues for 12 months, or until the

contract is changed or terminated. We

estimate that recordkeeping for these

allowances will require 1 hour per

respondent annually (5 respondents × 1

hour = 5 burden hours). Therefore, the

total annual burden hour estimate for

this information collection is 18 burden

hours (1+12+5=18).

Dated: November 20, 1997.

Joan Killgore,

Acting Associate Director for Royalty

Management.

[FR Doc. 97–31082 Filed 11–25–97; 8:45 am]

BILLING CODE 4310–MR–P

DEPARTMENT OF THE INTERIOR

Office of Surface Mining Reclamation

and Enforcement

Request for Determination of Valid

Existing Rights Within the Wayne

National Forest

AGENCY: Office of Surface Mining

Reclamation and Enforcement, Interior.

ACTION: Notice of decision.

SUMMARY: This notice announces the

decision of the Office of Surface Mining

Reclamation and Enforcement (OSM) on

a request by Edward and Madeiline

Blaire and Buckingham Coal Company,

Inc. (Buckingham) for a determination

of valid existing rights (VER) under

section 522(e) of the Surface Mining

Control and Reclamation Act of 1977

(SMCRA). OSM has determined that the

requesters do possess VER to mine coal

by surface methods on 25.2 acres of

federal lands within the Wayne National

Forest in Perry County, Ohio. This

decision is based on the ‘‘takings

standard,’’ which requires OSM to

evaluate whether a determination that

the requester does not have VER would

result in a compensable taking of a

property interest under the Fifth

Amendment to the U.S. Constitution.

FOR FURTHER INFORMATION CONTACT:

Peter Michael, Office of Surface Mining

Reclamation and Enforcement,

Appalachian Regional Coordinating

Center, Room 218, Three Parkway

Center, Pittsburgh, PA 15220.

Telephone: (412) 937–2867. E-mail

address: pmichael@osmre.gov.

SUPPLEMENTARY INFORMATION:

I. Background on VER Requirements

for National Forest Lands

Section 522(e) of SMCRA (30 U.S.C.

1272(e)) prohibits surface coal mining

operations on certain lands unless a

person has VER to conduct such

operations or unless the operation was

in existence on August 3, 1977, the date

of enactment of SMCRA. Section

522(e)(2) in relevant part, applies the

prohibition to federal lands within the

boundaries of any national forest unless

the Secretary of the Interior finds that

(1) there are no significant recreational,

timber, economic, or other values that

may be incompatible with surface coal

mining operations and (2) the surface

operations and impacts are incident to

an underground coal mine.

Under section 523 of the Act and 30

CFR 740.11, the state definition of VER

applies to all federal lands in states with

regulatory programs approved under

section 503 of SMCRA. However, under

30 CFR 745.13, the Secretary has

exclusive authority to determine VER

for surface coal mining and reclamation

operations on federal lands within the

boundaries of the areas specified in

paragraphs (e)(1) and (e)(2) of section

522 of the Act. OSM reaffirmed these

basic principles in the preamble to the

suspension notice concerning VER

published on November 20, 1986 (51 FR

41954). However, to be consistent with

a previous federal court decision

concerning OSM’s March 13, 1979

definition of VER, the preamble

included the caveat that, in states with

an all-permits standard for VER, OSM

would apply the standard as if it

contained a good-faith component. In

other words, if the state program

requires that a person obtain all

necessary permits prior to August 3,

1977, to qualify for VER, OSM will

apply the standard as if it recognizes

that a person also has VER in situations

where that person has made a good faith

effort to obtain all necessary permits by

that date.

The approved Ohio program relies

primarily upon the all-permits standard.

Ohio Revised Code 1501:13–3–

02(A)(1)(a). However, the United States

District Court for the Southern District

of Ohio has prohibited OSM from using

the state program definition or the

policy set forth in the November 20,

1986 suspension notice. Belville Mining

Co. v. Lujan, No. C–1–89–790 (S.D. Ohio

July 22, 1991), modified, Sept. 21, 1992.

In separate litigation, the same court

applied a takings standard to a VER

determination. Sunday Creek Coal Co.

v. Hodel, No. C12–88–0416 (S.D. Ohio

1988).

In the Belville litigation, OSM made a

commitment to the court to apply a

takings standard in determining

whether a person possesses VER to

conduct surface coal mining operations

on federal lands within the court’s

jurisdiction, including the Wayne

National Forest, until a new federal rule

defining VER is in place. Therefore, in

the Southern District of Ohio, under the

takings standard, a person has VER if, as

of the date of the lands come under the

protection of section 522(e) of SMCRA,

application of the prohibitions of

section 522(e) would result in a

compensable taking of property under

the Fifth Amendment to the U.S.

Constitution.

II. Request for VER Determination

On August 14, 1995, James F. Graham

of Buckingham requested that OSM

determine whether the company has

VER to remove the No. 6 coal seam,

using block cut, contour, and area

mining methods, from 25.2 acres of

federal lands within the authorized

boundaries of the Wayne National

Forest in Perry County, Ohio.

Buckingham previously submitted an

application for a permit to conduct

surface mining and reclamation

operations on this parcel and an

adjoining 10.7 acres of land in private

ownership to the Ohio Department of

Natural Resources (ODNR), Division of

Reclamation on March 8, 1995. Of the

35.9 acres in the permit application,

Buckingham proposes to mine a total of

12.6 acres of coal. The federal

government owns the surface overlying

9.8 of these acres.

The lands included in the request lie

along the eastern edge of a 134-acre

parcel for which the United States of

America purchased the surface rights

from Daniel C. Jenkins, Jr. and other

interested parties on April 24, 1967, and

the Blaires on May 1, 1967. The U.S.

Department of Agriculture, Forest

Service (USFS) currently manages the

land as part of the Wayne National

Forest. The Blaires own the mineral

estate and Mr. Graham is the lessee of

all coal within that estate.

The property extends from north to

south along an ephemeral tributary of

Pine Run and is about 1.8 miles

northeast of the city of Shawnee, Ohio.

Its southern limit is adjacent to County