Source: https://www.federalregister.gov/documents/2011/05/04/2011-10906/agency-information-collection-activities-proposed-collection-comment-request
Timestamp: 2017-10-19 20:48:17
Document Index: 16725847

Matched Legal Cases: ['art 1218', 'art 218', '§\u20091218', '§\u20091218', '§\u20091218', '§\u20091218', '§\u20091218', '§\u20091218']

76 FR 25370
25370-25373 (4 pages)
2011-10906
https://www.federalregister.gov/d/2011-10906 https://www.federalregister.gov/d/2011-10906
To comply with the Paperwork Reduction Act of 1995 (PRA), the Office of Natural Resources Revenue (ONRR) is 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 1010-0107. Start Printed Page 25371However, OMB approved a new series number and renumbered our ICRs after the Secretary of the Interior established ONRR (the former Minerals Revenue Management, a program under the Minerals Management Service) by Secretarial Order 3299, which was effective October 1, 2010. Also ONRR published a rule, effective October 1, 2010, transferring our regulations from chapter II to chapter XII in title 30 of the Code of Federal Regulations (CFR. This ICR covers the paperwork requirements in the regulations under 30 CFR part 1218 (previously 30 CFR part 218).
You may submit comments on this ICR by any of the following methods. Please use “ICR 1012-0008” as an identifier in your comment.
Electronically go to http://www.regulations.gov. In the entry titled “Enter Keyword or ID,” enter ONRR-2011-0009, and then click search. Follow the instructions to submit public comments. The ONRR will post all comments.
Mail comments to Hyla Hurst, Regulatory Specialist, Office of Natural Resources Revenue, P.O. Box 25165, MS 61013B, Denver, Colorado 80225. Please reference ICR 1012-0008 in your comments.
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 1012-0008 in your comments.
This form is still listed as Form MMS-4425 in the regulations. As ONRR completes the transition to the new organization, we will publish a rule updating our form numbers in the CFR.
Abstract: The Secretary of the Interior is responsible for mineral resource development on Federal and Indian lands and the Outer Continental Shelf (OCS). The Secretary is required by various laws to manage mineral resource production from Federal and Indian lands and the OCS, collect the royalties and other mineral revenues due, and distribute the funds collected in accordance with applicable laws. The Secretary also has a trust responsibility to manage Indian lands and seek advice and information from Indian beneficiaries. The ONRR performs the mineral revenue management functions for the Secretary and assists the Secretary in carrying out the Department's trust responsibility for Indian lands. Public laws pertaining to mineral revenues are on our Web site at http://www.onrr.gov/​Laws_​R_​D/​PublicLawsAMR.htm.
Minerals produced from Federal and Indian leases vary greatly in the nature of occurrence, production, and processing methods. When a company or an individual enters into a lease to explore, develop, produce, and dispose of minerals from Federal or Indian lands, that company or individual agrees to pay the lessor a share in an amount or value of production from the leased lands. The lessee is required to report various kinds of information to the lessor relative to the disposition of the leased minerals. Such information is generally available within the records of the lessee or others involved in developing, transporting, processing, purchasing, or selling such minerals. The information collected includes data necessary to ensure that production is accurately valued and royalties are appropriately paid.
This ICR covers unique reporting circumstances including (1) cross-lease netting in calculation of late-payment interest; (2) designation of designee; and (3) and Tribal permission for recoupment on Indian oil and gas leases.
Regulations at § 1218.54 require ONRR to assess interest on unpaid or underpaid amounts. The ONRR distributes these interest revenues to states, Indian Tribes, and the U.S. Treasury, based on financial lease distribution information. Current regulations at § 1218.42 provide that an overpayment on a lease or leases may be offset against an underpayment on a different lease or leases to determine the net payment subject to interest, when certain conditions are met. This is called cross-lease netting. However, sections 6(a), (b), and (c) of the Royalty Simplification and Fairness Act (RSFA) require ONRR to pay interest on lessees' Federal oil and gas overpayments made on or after February 13, 1997 (6 months after the August 13, 1996, enactment of RSFA). The ONRR implemented this RSFA provision in 1997 and began calculating interest on both underpayments and overpayments for Federal oil and gas leases, making the cross-lease netting provisions at § 1218.42 no longer applicable for these leases. The ONRR estimates that, in about seven cases per year, lessees must comply with the provisions of § 1218.42(b) and (c) for Indian Tribal leases or Federal leases other than oil and gas, demonstrating that cross-lease netting is correct by submitting production reports, pipeline allocation reports, or other similar documentary evidence. This information is necessary for ONRR to determine the correct amount of interest owed by the lessee and to ensure that proper value is collected.
The RSFA established that lessees (owners, primarily, of operating rights, or secondarily, lease record title) are responsible for making royalty and related payments on Federal oil and gas leases. These RSFA requirements are codified at § 1218.52. It is common, however, for a payor rather than a lessee to make these payments. When a payor makes payments on behalf of a lessee, RSFA section 6(g) requires that the lessee designate the payor as its designee and notify ONRR of this arrangement in writing. Form ONRR-4425, Designation Form for Royalty Payment Responsibility (formerly Form MMS-4425), was designed to request all the information necessary for lessees to comply with these RSFA requirements when they choose to designate an agent to pay for them.
Regulations at § 1218.53(b) allow lessees with written permission from the Tribe to recoup overpayments on one lease against a different lease for which the Tribe is the lessor. The payor must provide ONRR with a copy of the Tribe's written permission. Generally, a payor may recoup an overpayment against the current month's royalties or other revenues owed on the same Tribal lease. For any month, a payor may not recoup more than 50 percent of the royalties or other revenues owed in that month, under an individual allotted lease, or more than 100 percent of the royalties or other revenues owed in that month, under a Tribal lease. Lessees report oil and gas lease recoupments on Form MMS-2014, Report of Sales and Royalty Remittance (which will be renumbered as Form ONRR-2014, as we complete the process of updating our forms and the regulations). The burden Start Printed Page 25372hours are covered under ICR 1012-0004, formerly ICR 1010-0139.
We are requesting OMB's approval to continue to collect this information. Not collecting this information would limit the Secretary's ability to discharge the duties of the office and may also result in loss of royalty payments. Proprietary information submitted is protected, and there are no questions of a sensitive nature included in this information collection.
Subpart A—General Provisions— Cross-lease netting in calculation of late-payment interest
1218.42(b) and (c) Cross-lease netting in calculation of late-payment interest. (b) Royalties attributed to production from a lease or leases which should have been attributed to production from a different lease or leases may be offset * * * if * * * the payor submits production reports, pipeline allocation reports, or other similar documentary evidence pertaining to the specific production involved which verifies the correct production information * * * 2 25 50
(c) If ONRR assesses late-payment interest and the payor asserts that some or all of the interest is not owed * * * the burden is on the payor to demonstrate that the exception applies * * *
1218.52 (a), (c), and (d) How does a lessee designate a Designee? (a) If you are a lessee under 30 U.S.C. 1701(7), and you want to designate a person to make all or part of the payments due under a lease on your behalf * * * you must notify ONRR * * * in writing of such designation * * * 0.72 1,600 1,200
(c) If you want to terminate a designation * * * you must provide [the following] to ONRR in writing * * *
(d) ONRR may require you to provide notice when there is a change in the percentage of your record title or operating rights ownership
Subpart B—Oil and Gas, General— Recoupment of overpayments on Indian mineral leases
1218.53(b) Recoupment of overpayments on Indian mineral leases. (b) With written permission authorized by Tribal statute or resolution, a payor may recoup an overpayment against royalties or other revenues owed . . . under other leases * * *. A copy of the Tribe's written permission must be furnished to ONRR * * * 1 5 5
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 Start Printed Page 25373comments 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.
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 on our Web site at http://www.onrr.gov/​Laws_​R_​D/​FRNotices/​ICR0107.htm.
[FR Doc. 2011-10906 Filed 5-3-11; 8:45 am]