[Federal Register Volume 77, Number 204 (Monday, October 22, 2012)]
[Pages 64535-64538]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-25971]



Bureau of Safety and Environmental Enforcement (BSEE)

[Docket ID BSEE-2012-0009; OMB Number 1014-0005]

Information Collection Activities: Relief or Reduction in Royalty 
Rates; Submitted for Office of Management and Budget (OMB) Review; 
Comment Request

ACTION: 30-day Notice.


SUMMARY: To comply with the Paperwork Reduction Act of 1995 (PRA), we 
are notifying the public that we have submitted to OMB an information 
collection request (ICR) to renew approval of the paperwork 
requirements in the regulations under 30 CFR part 203, Relief or 
Reduction in Royalty Rates. This notice also provides the public a 
second opportunity to comment on the paperwork burden of these 
regulatory requirements.

DATES: You must submit comments by November 21, 2012.

ADDRESSES: Submit comments by either fax (202) 395-5806 or email 
([email protected]) directly to the Office of Information and 
Regulatory Affairs, OMB, Attention: Desk Officer for the Department of 
the Interior (1014-0005). Please provide a copy of your comments to 
BSEE by any of the means below.
     Electronically: Go to http://www.regulations.gov. In the 
entry titled, ``Enter Keyword or ID,'' enter BSEE-2012-0009, then click 
search. Follow the instructions to submit public comments and view all 
related materials. We will post all comments.
     Email: [email protected], fax (703) 787-1546, or mail 
or hand-carry comments to: Department of the Interior; Bureau of Safety 
and Environmental Enforcement; Regulations and Standards Branch; 
Attention: Nicole Mason; 381 Elden Street, HE3313; Herndon, Virginia 
20170-4817. Please reference 1014-0005 in your comment and include your 
name and return address.

FOR FURTHER INFORMATION CONTACT: Nicole Mason, Regulation and Standards 
Branch, (703) 787-1605, to request additional information about this 
ICR. To see a copy of the entire ICR submitted to OMB, go to http://www.reginfo.gov (select Information Collection Review, Currently Under 

    Title: 30 CFR 203, Relief or Reduction in Royalty Rates.
    OMB Control Number: 1014-0005.
    Abstract: The Outer Continental Shelf (OCS) Lands Act, as amended 
by Public Law 104-58, Deep Water Royalty Relief Act (DWRRA), gives the 
Secretary of the Interior (Secretary) the authority to reduce or 
eliminate royalty or any net profit share specified in OCS oil and gas 
leases to promote increased production. The DWRRA also authorized the 
Secretary to suspend royalties when necessary to promote development or 
recovery of marginal resources on producing or non-producing leases in 
the Gulf of Mexico (GOM) west of 87 degrees, 30 minutes West longitude.
    Section 302 of the DWRRA provides that new production from a lease 
in existence on November 28, 1995, in a water depth of at least 200 
meters, and in the GOM west of 87 degrees, 30 minutes West longitude 
qualifies for royalty suspension in certain situations. To grant a 
royalty suspension, the Secretary must determine that the new 
production or development would not be economic in the absence of 
royalty relief. The Secretary must then determine the volume of 
production on which no royalty would be due in order to make the new 
production from the lease economically viable. This determination is 
done on a case-by-case basis. Production from leases in the same water 
depth and area issued after November 28, 2000, also can qualify for 
royalty suspension in addition to any that may be included in their 
lease terms.
    In addition, the Independent Offices Appropriations Act (31 U.S.C. 
9701), the Omnibus Appropriations Bill (Pub. L. 104-134, 110 Stat. 
1321, April 26, 1996), and OMB Circular A-25, authorize Federal 
agencies to recover the full cost of services that confer special 
benefits. Under the Department of the Interior's (DOI) implementing 
policy, BSEE is required to charge fees for services that provide 
special benefits or privileges to an identifiable non-Federal recipient 
above and beyond those which accrue to the public at large.
    Regulations at 30 CFR part 203 implement these statutes and policy 
and require respondents to pay a fee to request royalty relief. Section 
30 CFR 203.3 states that, ``We will specify the necessary fees for each 
of the types of royalty-relief applications and possible BSEE audits in 
a Notice to Lessees. We will periodically update the fees to reflect 
changes in costs as well as provide other information necessary to 
administer royalty relief.''
    The BSEE uses the information to make decisions on the economic 
viability of leases requesting a suspension or elimination of royalty 
or net profit share. These decisions have enormous monetary impacts to 
both the lessee and the Federal Government. Royalty relief can lead to 
increased production of natural gas and oil, creating profits for 
lessees and royalty and tax revenues for the government that they might 
not otherwise receive. We could not make an informed decision without 
the collection of information required by 30 CFR part 203.
    We will protect information from respondents considered proprietary 
under the Freedom of Information Act (5 U.S.C. 552) and its 
implementing regulations (43 CFR part 2) and under regulations at 30 
CFR 203.63, Does my application have to include all leases in the 
field, and 30 CFR 250.197, Data and information to be made available to 
the public or for limited inspection. No items of a sensitive nature 
are collected. Responses are mandatory or are required to obtain or 
retain a benefit.
    Frequency: On occasion.
    Description of Respondents: Potential respondents comprise Federal 
oil, gas, or sulphur lessees and/or operators.
    Estimated Reporting and Recordkeeping Hour Burden: The estimated 
annual hour burden for this information collection is a total of 2,329 
hours. The following chart details the individual components and 
estimated hour burdens. In calculating the burdens, we assumed that 
respondents perform certain requirements in the normal course of their 
activities. We consider these to be usual and

[[Page 64536]]

customary and took that into account in estimating the burden.

[[Page 64537]]


[[Page 64538]]


    * CPA certification expense burden also imposed on applicant.
    ** These applications currently do not have a set fee since they 
are done on a case-by-case basis.

    Note: Applications include numerous items such as: transmittal 
letters, letters of request, modifications to applications, 
reapplications, etc.

    Estimated Reporting and Recordkeeping Non-Hour Cost Burden: We have 
identified two non-hour costs associated with this information 
collection. The estimated non-hour cost burden is $117,441. This 
estimate is based on:
    Under Sec.  203.3, we charge lessees (respondents) applying for 
royalty relief an amount that covers the cost of processing their 
applications and auditing financial data when necessary to determine 
the proposed development's economic situation. The total annual 
estimated cost burden for these fees is $72,441.
    Cost of a report prepared by independent certified public 
accountant. Under Sec.  203.81, a report prepared by an independent 
certified public accountant must accompany the application and post-
production report (expansion project, short form, and preview 
assessment applications are excluded). The OCS Lands Act applications 
will require this report only once; the DWRRA applications will require 
this report at two stages--with the application and post-production 
development report for successful applicants. The BSEE estimates 
approximately one submission each year at an average cost of $45,000 
per report.
    Public Disclosure Statement: The PRA (44 U.S.C. 3501, et seq.,) 
provides that an agency may not conduct or sponsor a collection of 
information unless it displays a currently valid OMB control number. 
Until OMB approves a collection of information, you are not obligated 
to respond.
    Comments: Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3501, et 
seq.,) requires each agency ``* * * to provide notice * * * 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 
collection is necessary or useful; (b) evaluate the accuracy 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 
    To comply with the public consultation process, on May 22, 2012, we 
published a Federal Register notice (77 FR 30310) announcing that we 
would submit this ICR to OMB for approval. The notice provided the 
required 60-day comment period. In addition, Sec.  203.82 provides the 
OMB control number for the information collection requirements imposed 
by the 30 CFR part 203 regulations. The regulation also informs the 
public that they may comment at any time on the collections of 
information and provides the address to which they should send 
comments. We have received one comment in response to these efforts; 
however, the comment did not pertain to the paperwork burden associated 
with this IC. The comment was a personal opinion of the bureau location 
of where this program resides.
    Public Availability of Comments: Before including your address, 
phone number, email address, or other personal identifying information 
in your comment, you should be aware 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 
your personal identifying information from public review, we cannot 
guarantee that we will be able to do so.
    Acting BSSE Information Collection Clearance Officer: Cheryl 
Blundon (703) 787-1607.

    Dated: October 9, 2012.
Robert W. Middleton,
Deputy Chief, Office of Offshore Regulatory Programs.
[FR Doc. 2012-25971 Filed 10-19-12; 8:45 am]