Federal Register / Vol. 73, No. 178 / Friday, September 12, 2008 / Rules and Regulations 52917 

DEPARTMENT OF THE INTERIOR 

Minerals Management Service 

30 CFR Part 256 

[Docket ID: MMS–2007–OMM–0064] 

RIN 1010–AD44 

Bonus or Royalty Credits for 

Relinquishing Certain Leases Offshore 

Florida 

AGENCY: Minerals Management Service 

(MMS), Interior. 

ACTION: Final rule. 

SUMMARY: This final rule amends 

regulations for oil and gas leases on the 

Outer Continental Shelf to implement a 

mandate in the Gulf of Mexico Energy 

Security Act of 2006. These 

amendments (1) provide a credit to 

lessees who relinquish certain eligible 

leases in the Gulf of Mexico; (2) define 

eligible leases as those within 125 miles 

of the Florida coast in the Eastern 

Planning Area, and certain leases within 

100 miles of the Florida coast in the 

Central Planning Area; and (3) allow 

lessees to use the credits in lieu of 

monetary payment for either a lease 

bonus bid or royalty due on oil and gas 

production from most other leases in the 

Gulf of Mexico, or to transfer the credits 

to other Gulf of Mexico lessees for their 

use. 

DATES: Effective Date: This final rule 

becomes effective on October 14, 2008. 

FOR FURTHER INFORMATION CONTACT: 

Marshall Rose, Chief, Economics 

Division, at (703) 787–1536. 

SUPPLEMENTARY INFORMATION: 

Background and Summary of the Rule 

On February 1, 2008, MMS published 

a proposed rule in the Federal Register 

(73 FR 6073) to implement section 

104(c) of the Gulf of Mexico Energy 

Security Act of 2006 (GOMESA), Public 

Law 109–432. Section 104(c) of that 

statute authorizes the Secretary of the 

Interior (Secretary) to issue a bonus or 

royalty credit for the exchange of certain 

leases located offshore of the State of 

Florida. The statute defines leases 

eligible for the credit as those in 

existence on the enactment date of the 

GOMESA and located both within 

specified Outer Continental Shelf (OCS) 

planning areas and distances from the 

Florida coastline. The statute sets the 

size of the credit as equal to the bonus 

and rental paid for the relinquished 

eligible lease, and limits its use to 

payments by lessees of bonuses and 

royalties for leases in the Gulf of Mexico 

(GOM) not subject to revenue sharing 

under section 8(g) of the Outer 

Continental Shelf Lands Act (OCSLA) 

(43 U.S.C. 1337(g)). Finally, the statute 

mandates creation of a regulatory 

process for notifying the Secretary of a 

lessee’s decision to exchange a lease for 

a credit, issuing the credit, allocating 

the credit among multiple lease owners, 

and transferring the credit to other 

parties. 

The MMS received 2 responses during 

the 60-day comment period on this rule, 

2 comments from ExxonMobil on March 

20, 2008, and 2 comments from Chevron 

on March 31, 2008. Our reply to these 

four comments results in one change in 

§ 256.92(a) from the proposed rule. In 

addition, we changed the wording in the 

title to this subpart and in §§ 256.94(c) 

and 256.95(b) and (c)(5) for clarity, but 

the title and these sections retain the 

same meaning as they had in the 

proposed rule. 

Exxon asked for the following two 

changes in the rule: 

1. On a lease where MMS elects to 

take royalty-in-kind (RIK), the lessee 

should be allowed to notify MMS of its 

intent to use credits for royalty, in 

which case the RIK election is 

postponed until credits are completed. 

Otherwise the credits could be lost 

because the company may choose not to 

bid on new leases and MMS decides to 

accept only RIK from the company’s 

leases. 

We decline to make this change to the 

rule. It would create an unnecessary 

interference with the RIK program just 

to save a claimant from having to engage 

in the sale of the credit to another party. 

Section 256.95 explicitly authorizes 

transfer of the credits to other parties. 

Unless the potential uses of the credit 

are inadequate to absorb all the value 

represented by the credit, this limitation 

will not inhibit realization of full value 

from a transfer of the credit. Potential 

uses of the credit are clearly not 

inadequate. For example, in FY 2006, 

the non-8(g), non-RIK royalty revenue 

from the GOM was over $2 billion while 

bonus revenue was $0.8 billion. Thus, 

ample opportunity exists for use of 

credits by recipients themselves or 

others to whom recipients may transfer 

the credits, which are only $60 million 

in total. 

2. Do not give MMS discretion to 

apply lessee’s unused credits 5 years 

after MMS issues them however MMS 

chooses. Lessees holding credits for a 

longer period is to the financial 

advantage of the government and 

computerized recordkeeping obviates 

any burden this continued holding 

would create. 

Again, we decline to make this change 

to the rule. Although it is undeniably 

true that it is to the financial advantage 

of the government for the lessee to hold 

on to the credits, there remains concern 

about recordkeeping issues and 

administrative costs. Computerization of 

records facilitates keeping track of 

unused credits, but does not completely 

eliminate the monitoring burden and 

cost of that activity. Also, a company 

would not likely relinquish its lease to 

obtain the credit, and then not timely 

use the credit. Regardless, we will not 

void the credit after 5 years, but simply 

apply it to outstanding obligations of the 

lessee. 

Chevron raised the following two 

objections to the rule: 

3. The proposed credit amounts, equal 

to bonuses and rentals, do not make the 

parties whole; they should also include 

a reasonable interest rate for the time 

value of those payments and 

compensation for any investments made 

in exploration activities on the leases. 

We decline to make this change to the 

rule because the GOMESA would not 

permit us to do so. The statute explicitly 

values an existing lease for exchange 

purposes at the amount of bonus and 

rentals paid until exchange. While we 

acknowledge that some lessees have 

spent large sums beyond the original 

bonus and subsequent rentals and 

discovered at least one prospect, 

GOMESA does not authorize 

reimbursement of either interest or 

exploration costs through the credits. 

Lessees retain the option not to 

relinquish their lease if they feel the 

compensation is inadequate. 

4. The 1-year period to claim the 

credit is not enforceable. Chevron 

interprets the absence of a specific time 

period in the law to claim the credit as 

meaning that MMS does not have the 

authority to use a rule implementing a 

statute to set an expiration date that 

Congress did not include in the statute. 

In response to this comment, the final 

rule extends the claim period of 1 year 

in the proposed rule to 2 years. But, we 

believe a firm deadline is both within 

our authority and appropriate as an 

efficient way to design this rulemaking. 

We have the authority to set a deadline 

because the statute (section 104(c)(4)) 

directs the Secretary to ‘‘promulgate 

regulations that shall provide a process 

for * * * issuance of bonus or royalty 

credits in exchange for relinquishment 

of the existing lease * * *’’. A time 

component is often an integral part of 

any such process, in this case one 

designed to resolve the issue of preexisting leases in an area now 

designated as off-limits to new oil and 

gas leasing. Further, the statute does not 

preclude use of an expiration date and 

general rulemaking authority permits 

setting a reasonable expiration date 


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52918 Federal Register / Vol. 73, No. 178 / Friday, September 12, 2008 / Rules and Regulations 

when it contributes to the purpose of 

the regulation. A 2-year deadline for 

acting on the exchange offer is 

reasonable and appropriate in this 

process because it provides ample time 

for lessees to consider and reach a 

decision about relinquishing their leases 

in return for the credits, while at the 

same time not prolonging revelation of 

that decision and its potential effects in 

this sensitive area. The deadline serves 

the statutory policy of assuring a timely 

approach for addressing outstanding 

concerns on the part of Florida residents 

relating to development of the affected 

leases by encouraging accelerated 

relinquishment of the leases. In return, 

lessees qualify for a reimbursement that 

would not be forthcoming normally for 

leases that will eventually expire on 

their own with no reimbursement. Also, 

the timing constraint serves to terminate 

rental payments after a reasonable time, 

thereby mitigating the amount of 

accrued rentals that would otherwise 

become part of the credits due if the 

lease is relinquished. 

Both Exxon and Chevron object to the 

moratoria provisions in the statute. 

Exxon laments increasing barriers to oil 

and gas development that could 

diversify our Nation’s sources of supply 

and notes that energy development and 

environmental protection can and 

should continue to co-exist. Chevron 

notes that the extension of moratoria is 

contrary to the GOMESA title. The 

company says that this provision will 

actually harm energy security by 

perpetuating the status quo (off-limits to 

exploration and production activities) in 

areas of the GOM that are known to 

contain significant oil and gas resources. 

Regardless of the accuracy of these 

assertions, they are not germane to the 

rule. Rather, they are more about the 

concept behind the moratoria language 

and the requirement for MMS to 

promulgate a rule encouraging the 

relinquishment of certain leases offshore 

Florida as contained in GOMESA. In 

this case, we are simply drafting the 

implementation language for a policy 

decreed by Congress. Moreover, the rule 

does not force relinquishment of the 

eligible leases—it just provides an 

incentive for lessees to do so. Finally, 

we note that the moratoria period is 

finite and known resources in the area 

could be developed fairly quickly if 

policy should change in the future. 

The proposed rule listed all the leases 

MMS records show as being in the area 

eligible for exchange for a credit, along 

with the bonus and rental amounts 

received from each of those leases and 

asked whether lessees had any 

information not consistent with this list. 

No comments were received on this 

published list and no one registered a 

claim that eligible leases were omitted 

or that the bonus and rental amounts 

which determine the value of the credits 

were incorrect. 

Procedural Matters 

Regulatory Planning and Review 

(Executive Order (E.O.) 12866) 

This final rule is not a significant rule 

as determined by the Office of 

Management and Budget (OMB) and is 

not subject to review under E.O. 12866. 

(1) This final rule will not have an 

annual effect of $100 million or more on 

the economy. It will not adversely affect 

in a material way the economy, 

productivity, competition, jobs, the 

environment, public health or safety, or 

State, local, or tribal governments or 

communities. The total value of the 

credit is defined by statute as bonuses 

and rental paid on the leases in the 

eligible area. The MMS records show 79 

leases are eligible. Total bonuses and 

rentals paid in connection with these 

leases is about $60 million. 

(2) This final rule will not create a 

serious inconsistency or otherwise 

interfere with an action taken or 

planned by another agency. In fact, it 

endeavors to end leases whose 

operations are restricted to 

accommodate activity carried out by 

another Federal agency and whose 

potential activities are opposed by State 

and local officials in the area. 

(3) This final rule will not alter the 

budgetary effects of entitlements, grants, 

user fees or loan programs, or the rights 

or obligations of their recipients. 

(4) This final rule will not raise novel 

legal or policy issues. The final rule will 

implement a statutory program that 

exchanges a credit against future 

obligations for the return of old, largely 

inactive leases in an area deemed 

sensitive by statute. 

Regulatory Flexibility Act 

The Department of the Interior 

certifies that this final rule will not have 

a significant economic effect on a 

substantial number of small entities 

under the Regulatory Flexibility Act (5 

U.S.C. 601 et seq.). 

This final rule applies to the lessees 

holding record title interests in the 79 

offshore leases located near the 

coastline of the State of Florida. These 

lessees fall under the Small Business 

Administration’s North American 

Industry Classification System (NAICS) 

code 211111, Crude Petroleum and 

Natural Gas Extraction. Under this 

NAICS code, companies with less than 

500 employees are considered small 

businesses. Only 1 of the current record 

title owners of these 79 leases has less 

than 500 employees. Moreover, this rule 

provides a clear benefit to the lessees. It 

specifies a valuable credit and a simple 

process for claiming a benefit for 

relinquishing a lease which the owners 

have had trouble operating due to access 

limitations. 

This final rule will create a relatively 

small amount of total credits in 

exchange for certain leases through a 

longstanding relinquishment process. 

The credits could be used to fulfill any 

of a relatively large pool of routine 

bonus or royalty in-value OCS 

obligations under leases located in the 

GOM. The credits also will be freely 

transferable or assignable. Thus, should 

a small entity obtain a credit through a 

transfer, it will be able to use the credit 

for routine obligations or it could 

exchange the credit for approximately 

equivalent value in a potentially large 

market of other users. The provisions of 

this final rule will not have a significant 

adverse economic effect on offshore 

lessees and operators, including those 

that are classified as small businesses. 

Your comments are important. The 

Small Business and Agriculture 

Regulatory Enforcement Ombudsman 

and 10 Regional Fairness Boards were 

established to receive comments from 

small businesses about Federal agency 

enforcement actions. The Ombudsman 

will annually evaluate the enforcement 

activities and rate each agency’s 

responsiveness to small business. If you 

wish to comment on the actions of 

MMS, call 1–888–734–3247. You may 

comment to the Small Business 

Administration without fear of 

retaliation. Disciplinary action for 

retaliation by an MMS employee may 

include suspension or termination from 

employment with the DOI. 

Small Business Regulatory Enforcement 

Fairness Act 

This final rule is not a major rule 

under 5 U.S.C. 804(2) of the Small 

Business Regulatory Enforcement 

Fairness Act. This final rule: 

a. Will not have an annual effect on 

the economy of $100 million or more. 

This final rule will offer credits worth 

approximately $60 million for the 

exchange of 79 leases in a sensitive area. 

Not all companies may choose to 

relinquish their leases for the credit 

offered. Even if all the credits were 

redeemed in 1 year, it will not have an 

annual effect on the economy of $100 

million. 

b. Will not cause a major increase in 

costs or prices for consumers, 

individual industries, Federal, State, 

local government agencies, or 

geographic regions. The credit 


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represents only a transfer of previous 

payments back to lessees. The relatively 

small amount returned by these credits 

will have little effect on markets, 

agencies, or regions. 

c. Will not have significant adverse 

effects on competition, employment, 

investment, productivity, innovation, or 

the ability of U.S.-based enterprises to 

compete with foreign-based enterprises. 

Productive activities have been 

restricted on the leases that will be 

returned, and the monetary credit 

received in exchange will be too small 

to have a perceptible effect. 

Unfunded Mandates Reform Act 

This final rule will not impose an 

unfunded mandate on State, local, or 

tribal governments or the private sector 

of more than $100 million per year. The 

final rule will not have a significant or 

unique effect on State, local, or tribal 

governments or the private sector. A 

statement containing the information 

required by the Unfunded Mandates 

Reform Act (2 U.S.C. 1531 et seq.) is not 

required. 

Takings Implication Assessment (E.O. 

12630) 

Under the criteria in E.O. 12630, this 

final rule does not have significant 

takings implications as participation is 

voluntary. The final rule is not a 

governmental action capable of 

interference with constitutionally 

protected property rights. A Takings 

Implication Assessment is not required. 

Federalism (E.O. 13132) 

Under the criteria in E.O. 13132, this 

final rule does not have sufficient 

federalism implications to warrant the 

preparation of a Federalism Assessment. 

As noted in the proposed rule, the 

potential revenue sharing effects are 

excluded either explicitly or implicitly 

by virtue of the treatment of the 

expected credit redemptions. This final 

rule will not substantially and directly 

affect the relationship between the 

Federal and State governments. To the 

extent that State and local governments 

have a role in OCS activities, this final 

rule will not affect that role. A 

Federalism Assessment is not required. 

Civil Justice Reform (E.O. 12988) 

This final rule complies with the 

requirements of E.O. 12988. 

Specifically, this rule: 

(a) Meets the criteria of section 3(a) 

requiring that all regulations be 

reviewed to eliminate errors and 

ambiguity and be written to minimize 

litigation; and 

(b) Meets the criteria of section 3(b)(2) 

requiring that all regulations be written 

in clear language and contain clear legal 

standards. 

Consultation With Indian Tribes (E.O. 

13175) 

Under the criteria in E.O. 13175, we 

have evaluated this final rule and 

determined that it has no potential 

effects on federally recognized Indian 

tribes. There are no Indian or tribal 

lands on the OCS. 

Paperwork Reduction Act (PRA) of 1995 

This rule contains new information 

collection requirements, and therefore 

MMS has submitted an information 

collection request to OMB for review 

and approval, as required under the 

PRA. The OMB has approved the new 

requirements and assigned OMB Control 

Number 1010–0174 (expiration 09–30– 

2011, 45 hours). This rule also refers to, 

but does not change, information 

collection burdens already covered and 

approved under OMB Control Number 

1010–0006 (expiration 5/31/10). There 

were no changes in the information 

collection requirements from the 

proposed rule to the final rule. The 

rulemaking imposes no new non-hour 

cost burdens. 

The title of the collection of 

information for the rule is ‘‘30 CFR Part 

256, Bonus or Royalty Credits for 

Relinquishing Certain Leases Offshore 

Florida.’’ It should be noted that this 

rulemaking concerns only 79 current 

leases and will not affect future leases. 

Therefore, the associated information 

collection would be a one-time only 

hour burden should respondents 

holding eligible leases elect to take 

advantage of the bonus or royalty credits 

for relinquishing these leases. 

Responses to this collection are required 

to obtain or retain a benefit and are 

mandatory. The MMS will protect 

proprietary information according to 

section 26 of the OCS Lands Act, the 

Freedom of Information Act (5 U.S.C. 

552) and its implementing regulations 

(43 CFR part 2), and § 256.10(d). The 

information collection does not include 

questions of a sensitive nature. 

The OMB approved the collection of 

information required by the current 30 

CFR part 256 regulations under OMB 

Control Number 1010–0006 (17,058 

burden hours, $603,125 non-hour cost 

burdens, expiration 5/31/2010). 

The final regulation will allow lessees 

to request a bonus or royalty credit, and 

to transfer this same bonus or credit to 

another party. We estimate a total of 45 

burden hours, including the time for 

gathering the information and 

submitting the request to MMS for 

review. Refer to the chart for the burden. 

Citation 

30 CFR part 256 

subpart N 

Reporting & recordkeeping requirement Hour burden 

Average number of annual 

responses 

Annual burden 

hours 

92(a) .................... Request a bonus or royalty credit and submit supporting documentation 1 30 30 

92(a)(5) ............... Submit a request to relinquish lease according to § 256.76 ..................... Burden currently approved under 1010–0006.* 

95 ........................ Request approval to transfer bonus or credit to another party with supporting information.1 15 15 

Total Burden ..................................................................................................................................................... 45 45 

* 240 hours for this requirement are already approved under 1010–0006. 

A Federal 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. The public may 

comment, at any time, on the accuracy 

of the information collection burden of 

our regulations and may submit 

comments to the Department of the 

Interior; Minerals Management Service; 

Attention: Regulations and Standards 

Branch; MS–4024; 381 Elden Street; 

Herndon, Virginia 20170–4817. 

National Environmental Policy Act 

(NEPA) of 1969 

We determined this final rule is 

categorically excluded from 

requirements for analysis under the 

National Environmental Policy Act and 

the Department Manual at 516 DM. This 


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52920 Federal Register / Vol. 73, No. 178 / Friday, September 12, 2008 / Rules and Regulations 

rule deals with financial matters and 

has no direct effect on MMS decisions 

on oil and gas operations with the 

potential to affect the environment; 

hence, an Environmental Impact 

Statement is not required. Pursuant to 

Department Manual 516 DM 2.3A (2), 

section 1.10 of 516 DM 2, Appendix 1 

excludes from documentation in an 

environmental assessment or impact 

statement ‘‘policies, directives, 

regulations and guidelines of an 

administrative, financial, legal, 

technical or procedural nature; or the 

environmental effects of which are too 

broad, speculative or conjectural to lend 

themselves to meaningful analysis and 

will be subject later to the NEPA 

process, either collectively or case-bycase.’’ Section 1.3 of the same appendix 

clarifies that royalties and audits are 

considered routine financial 

transactions that are subject to 

categorical exclusion from the NEPA 

process. None of the exceptional 

circumstances set forth in 516 DM 2 

Appendix 2 apply. 

Data Quality Act 

In developing this final rule we did 

not conduct or use a study, experiment, 

or survey requiring peer review under 

the Data Quality Act (Pub. L. 106–554, 

app. C section 515, 114 Stat. 2763, 

2763A–153–154). 

Effects on the Energy Supply (E.O. 

13211) 

This final rule is not a significant 

energy action under the definition in 

E.O. 13211. A Statement of Energy 

Effects is not required. 

List of Subjects in 30 CFR Part 256 

Administrative practice and 

procedure, Continental shelf, 

Government contracts, Mineral 

royalties, Oil and gas exploration, 

Public lands—mineral resources, 

Reporting and recordkeeping 

requirements. 

Dated: August 8, 2008. 

C. Stephen Allred, 

Assistant Secretary—Land and Minerals 

Management. 

■ For the reasons stated in the preamble, 

the Minerals Management Service 

(MMS) proposes to amend 30 CFR part 

256 as follows: 

PART 256—LEASING OF SULPHUR OR 

OIL AND GAS IN THE OUTER 

CONTINENTIAL SHELF 

■ 1. The authority citation for part 256 

is revised to read as follows: 

Authority: 31 U.S.C. 9701, 42 U.S.C. 6213, 

43 U.S.C. 1334, Pub. L. 109–432. 

■ 2. Section 256.5 is amended by adding 

paragraphs (m) through (s) to read as 

follows: 

§ 256.5 Definitions. 

* * * * * 

(m) Bonus or royalty credit means a 

legal instrument or other written 

documentation, or an entry in an 

account managed by the Secretary that 

a bidder or lessee may use in lieu of any 

other monetary payment for— 

(1) A bonus due for a lease on the 

Outer Continental Shelf; or 

(2) A royalty due on oil or gas 

production from any lease located on 

the Outer Continental Shelf. 

(n) Central planning area means the 

Central Gulf of Mexico Planning Area of 

the Outer Continental Shelf, as 

designated in the document entitled 

‘‘Draft Proposed Program Outer 

Continental Shelf Oil and Gas Leasing 

Program 2007–2012,’’ dated February 

2006. 

(o) Coastline means the line of 

ordinary low water along that portion of 

the coast in direct contact with the open 

sea and the line marking the seaward 

limit of inland waters. 

(p) Desoto Canyon OPD means the 

official protraction diagram designated 

as Desoto Canyon which has a western 

edge located at the universal transverse 

mercator (UTM) X coordinate 1,346,400 

in the North American Datum of 1927 

(NAD 27). 

(q) Destin Dome OPD means the 

official protraction diagram designated 

as Destin Dome which has a western 

edge located at the universal transverse 

mercator (UTM) X coordinate 1,393,920 

in the NAD 27. 

(r) Eastern planning area means the 

Eastern Gulf of Mexico Planning Area of 

the Outer Continental Shelf, as 

designated in the document entitled 

‘‘Draft Proposed Program Outer 

Continental Shelf Oil and Gas Leasing 

Program 2007–2012,’’ dated February 

2006. 

(s) Pensacola OPD means the official 

protraction diagram designated as 

Pensacola which has a western edge 

located at the universal transverse 

mercator (UTM) X coordinate 1,393,920 

in the NAD 27. 

■ 3. Add a new subpart N consisting of 

§§ 256.90 through 256.95 to read as 

follows: 

Subpart N—Bonus or Royalty Credits 

for Exchange of Certain Leases 

Offshore Florida 

Sec. 

256.90 Which leases may I exchange for a 

bonus or royalty credit? 

256.91 How much bonus or royalty credit 

will MMS grant in exchange for a lease? 

256.92 What must I do to obtain a bonus or 

royalty credit? 

256.93 How is the bonus or royalty credit 

allocated among multiple lease owners? 

256.94 How may I use the bonus or royalty 

credit? 

256.95 How do I transfer a bonus or royalty 

credit to another person? 

§ 256.90 Which leases may I exchange for 

a bonus or royalty credit? 

You may exchange a lease for a bonus 

or royalty credit if it: 

(a) Was in effect on December 20, 

2006, and 

(b) Is located in: 

(1) The Eastern planning area and 

within 125 miles of the coastline of the 

State of Florida, or 

(2) The Central planning area and 

within the Desoto Canyon OPD, the 

Destin Dome OPD, or the Pensacola 

OPD, and within 100 miles of the 

coastline of the State of Florida. 

§ 256.91 How much bonus or royalty credit 

will MMS grant in exchange for a lease? 

The amount of the bonus or royalty 

credit for an exchanged lease equals the 

sum of: 

(a) The amount of the bonus payment; 

and 

(b) All rent paid for the lease as of the 

date the lessee submits the request to 

exchange the lease under § 256.92 to 

MMS. 

§ 256.92 What must I do to obtain a bonus 

or royalty credit? 

(a) To obtain the bonus or royalty 

credit, all of the record title interest 

owners in the lease must submit the 

following to the MMS Regional 

Supervisor for Leasing and Environment 

for the Gulf of Mexico on or before 

October 14, 2010. 

(1) A written request to exchange the 

lease for the bonus or royalty credit, 

signed by all record title interest owners 

in the lease. 

(2) The name and contact information 

for a person who will act as a contact 

for each record title interest owner. 

(3) Documentation of each record title 

interest owner’s percentage share in the 

lease. 

(4) A list of all bonus and rental 

payments for that lease made by, or on 

behalf of, each of the current record title 

owners. 

(5) A written relinquishment of the 

lease as described in § 256.76. 

Notwithstanding § 256.76, the 

relinquishment will become effective 

when the credit becomes effective under 

paragraph (b) of this section. 

(b) The credit becomes effective when 

MMS issues a certification to the record 

title interest owners that the lease has 

qualified for the credit. 


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§ 256.93 How is the bonus or royalty credit 

allocated among multiple lease owners? 

The MMS will allocate the bonus or 

royalty credit for an exchanged lease to 

the current record title interest owners 

in the same percentage share as each 

owner has in the lease as of the date of 

the request to exchange the lease. 

§ 256.94 How may I use the bonus or 

royalty credit? 

(a) You may use a credit issued under 

this part in lieu of a monetary payment 

due under any lease in the Gulf of 

Mexico not subject to the revenue 

distribution provisions of section 8(g)(2) 

of the OCSLA (43 U.S.C. 1337(g)(2)) for 

either: 

(1) A bonus for acquisition of an 

interest in a new lease; or 

(2) Royalty due on oil and gas 

production after October 14, 2008. 

(b) You may not use a bonus or 

royalty credit in lieu of delivering oil or 

gas taken as royalty-in-kind. 

(c) If you have any credit that remains 

unused after 5 years from the date MMS 

issued the credit, MMS reserves the 

right to apply the remaining credit to 

any of your obligations. 

§ 256.95 How do I transfer a bonus or 

royalty credit to another person? 

(a) You may transfer your bonus or 

royalty credit to any other person by 

submitting to the MMS Adjudication 

Unit for the Gulf of Mexico two 

originally executed transfer letters of 

agreement. 

(b) Authorized officers indicated on 

the qualification card filed with MMS of 

all companies involved in transferring 

and receiving the credit must sign the 

transfer letters of agreement. 

(c) A transfer letter of agreement must 

include: 

(1) The effective date of the transfer, 

(2) The OCS–G number for the lease 

that originally qualified for the credit, 

(3) The amount of the credit being 

transferred, 

(4) Company names punctuated 

exactly as filed on the qualification card 

at MMS, and 

(5) A corporate seal, if you used a 

corporate seal in your initial 

qualification to hold OCS leases. 

(d) The transferee of a credit 

transferred under this section may use 

it in accordance with § 256.94 as soon 

as MMS sends a confirmation of the 

transfer to the transferee. 

[FR Doc. E8–21135 Filed 9–11–08; 8:45 am] 

BILLING CODE 4310–MR–P 

DEPARTMENT OF THE INTERIOR 

Office of Surface Mining Reclamation 

and Enforcement 

30 CFR Part 934 

[SATS No: ND–050–FOR; Docket ID No. 

OSM–2008–0004] 

North Dakota Regulatory Program 

AGENCY: Office of Surface Mining 

Reclamation and Enforcement, Interior. 

ACTION: Final rule; approval of 

amendment. 

SUMMARY: We are approving an 

amendment to the North Dakota 

regulatory program (the ‘‘North Dakota 

program’’) under the Surface Mining 

Control and Reclamation Act of 1977 

(‘‘SMCRA’’ or ‘‘the Act’’). North Dakota 

proposed minor revisions to its rules 

concerning self-bonding requirements, 

and updating terminology used for 

describing native grasslands, and 

correcting a cross reference error. North 

Dakota intended to revise its program to 

clarify ambiguities and improve 

operational efficiency. 

DATES: Effective Date: September 12, 

2008. 

FOR FURTHER INFORMATION CONTACT: 

Jeffrey Fleischman, Casper Field Office 

Director Telephone: 307/261–6550, 

Internet address: 

JFleischman@osmre.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background on the North Dakota Program 

II. Submission of the Proposed Amendment 

III. Office of Surface Mining Reclamation and 

Enforcement’s (OSM) Findings 

IV. Summary and Disposition of Comments 

V. OSM Decision 

VI. Procedural Determinations 

I. Background on the North Dakota 

Program 

Section 503(a) of the Act permits a 

State to assume primacy for the 

regulation of surface coal mining and 

reclamation operations on non-Federal 

and non-Indian lands within its borders 

by demonstrating that its State program 

includes, among other things, ‘‘a State 

law which provides for the regulation of 

surface coal mining and reclamation 

operations in accordance with the 

requirements of this Act * * *; and 

rules and regulations consistent with 

regulations issued by the Secretary 

pursuant to this Act.’’ See 30 U.S.C. 

1253(a)(1) and (7). On the basis of these 

criteria, the Secretary of the Interior 

conditionally approved the North 

Dakota program on December 15, 1980. 

You can find background information 

on the North Dakota program, including 

the Secretary’s findings, the disposition 

of comments, and conditions of 

approval in the December 15, 1980, 

Federal Register (45 FR 82214). You can 

also find later actions concerning North 

Dakota’s program and program 

amendments at 30 CFR 934.15, and 

934.30. 

II. Submission of the Proposed 

Amendment 

By letter dated March 12, 2008, North 

Dakota sent us an amendment to its 

program (North Dakota Amendment 

number XXXVII, SATS No. ND–050– 

FOR, Administrative Record No. ND– 

LL–01) under SMCRA (30 U.S.C. 1201 et 

seq.). North Dakota sent the amendment 

to include changes made at its own 

initiative. 

We announced receipt of the 

proposed amendment in the April 18, 

2008, Federal Register (73 FR 21087). In 

the same document, we opened the 

public comment period and provided an 

opportunity for a public hearing or 

meeting on the amendment’s adequacy. 

We did not hold a public hearing or 

meeting because no one requested one. 

The public comment period ended on 

May 5, 2008. We received a ‘‘no 

inconsistency with this agency’s 

regulations’’ comment from the U.S. 

Department of Labor’s Mine Safety and 

Health Administration (MSHA), ‘‘no 

comments’’ from the State Historical 

Society of North Dakota (SHPO), and a 

‘‘we agree’’ comment from the North 

Dakota State University Extension 

Service (NDSU Extension Service). 

III. OSM’s Findings 

Following are the findings we made 

concerning the amendment under 

SMCRA and the Federal regulations at 

30 CFR 732.15 and 732.17. We are 

approving the amendment. 

A. Minor Revisions to North Dakota’s 

Rules 

1. North Dakota proposed a crossreference change under its previously 

approved permit approval criteria Rule 

NDAC 69–05.2–10–03. The crossreference is being changed from Section 

69–05.2–04–01 to Section 69–05.2–04– 

01.1 and is due to a Rule numbering 

revision that was made several years ago 

when some new rules were adopted by 

North Dakota. 

2. In NDAC 69–05.2–08–08, (pre-mine 

land use and vegetation data 

requirements), North Dakota proposed 

to update the terminology used to 

describe native grasslands to reflect the 

terminology now used by USDA’s 

Natural Resource Conservation Service 

(NRCS). 

Because these changes are minor, we 

find that they will not make North 


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