Oil, Gas, and Sulphur Operations and Leasing in the Outer Continental Shelf (OCS)-Recovery of Costs Related to the Regulation of Oil and Gas Activities on the OCS, 69118-69128 [05-22504]

Download as PDF 69118 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules The condom is used for contraceptive and for prophylactic purposes (preventing transmission of sexually transmitted diseases). The device may also be used to collect semen to aid in the diagnosis of infertility. (b) Classification. (1) Class II (special controls) for condoms made of materials other than natural rubber latex, including natural membrane (skin) or synthetic. (2) Class II (special controls) for natural rubber latex condoms. The guidance document entitled ‘‘Class II Special Controls Guidance Document: Labeling for Male Condoms Made of Natural Rubber Latex’’ will serve as the special control. See § 884.1(e) for the availability of this guidance document. 3. Section 884.5310 is revised to read as follows: § 884.5310 lubricant. Condom with spermicidal (a) Identification. A condom with spermicidal lubricant is a sheath which completely covers the penis with a closely fitting membrane with a lubricant that contains a spermicidal agent, nonoxynol–9. This condom is used for contraceptive and for prophylactic purposes (preventing transmission of sexually transmitted diseases). (b) Classification. (1) Class II (special controls) for condoms made of materials other than natural rubber latex, including natural membrane (skin) or synthetic. (2) Class II (special controls) for natural rubber latex condoms. The guidance document entitled ‘‘Class II Special Controls Guidance Document: Labeling for Male Condoms Made of Natural Rubber Latex’’ will serve as the special control. See § 884.1(e) for the availability of this guidance document. Dated: June 21, 2005. Jeffrey Shuren, Assistant Commissioner for Policy. [FR Doc. 05–22611 Filed 11–10–05; 8:45 am] BILLING CODE 4160–01–S VerDate Aug<31>2005 16:03 Nov 10, 2005 Jkt 208001 DEPARTMENT OF THE INTERIOR Minerals Management Service 30 CFR Parts 250, 251, and 280 RIN 1010–AD23 Oil, Gas, and Sulphur Operations and Leasing in the Outer Continental Shelf (OCS)—Recovery of Costs Related to the Regulation of Oil and Gas Activities on the OCS Minerals Management Service (MMS), Interior. ACTION: Proposed rule. AGENCY: SUMMARY: MMS is proposing regulations which impose new fees to process certain plans, applications, and permits. The proposed service fees would offset MMS’s costs of processing these plans, applications, and permits. DATES: MMS will consider all comments received by January 13, 2006. MMS will begin reviewing comments and may not fully consider comments received after January 13, 2006. ADDRESSES: You may submit comments on the proposed rule by any of the following methods listed below. Please use the regulatory identifier number (RIN) 1010-AD23 as an identifier in your message. See also Public Comment Procedures under Procedural Matters. • Federal e-Rulemaking Portal: http://www.regulations.gov. Follow the instructions on the website for submitting comments. • E-mail MMS at rules.comments@mms.gov. Use the RIN in the subject line. • Fax: 703–787–1546. Identify with the RIN. • Mail or hand-carry comments to the Department of the Interior; Minerals Management Service; Attention: Rules Processing Team (RPT); 381 Elden Street, MS–4024; Herndon, Virginia 20170–4817. Please reference ‘‘Recovery of Costs Related to the Regulation of Oil and Gas Activities on the OCS–AD23’’ in your comments. You may also send comments on the information collection aspects of this rule directly to the Office of Management and Budget (OMB) via: OMB e-mail: (OIRA_DOCKET@omb.eop.gov); mail or hand carry to the Office of Information and Regulatory Affairs, OMB Attention: Desk Officer for the Department of the Interior (1010–AD23) or by fax (202) 395–6566. Please also send a copy to MMS. FOR FURTHER INFORMATION CONTACT: Martin Heinze, Program Analyst, Office of Planning, Budget and International Affairs at (703) 787–1010. PO 00000 Frm 00017 Fmt 4702 Sfmt 4702 SUPPLEMENTARY INFORMATION: Background Federal agencies are generally authorized to recover the costs of providing services to non-federal entities through the provisions of the Independent Offices Appropriation Act of 1952 (IOAA), 31 U.S.C. 9701. The Act requires implementation through rulemaking. There are several policy documents that provide MMS guidance on the process of charging applicants for service costs. The governing language concerning cost recovery can be found in OMB Circular No. A–25 which states in part, ‘‘The provisions of this Circular cover all federal activities that convey benefits to recipients beyond those accruing to the general public. * * * When a service (or privilege) provides special benefits to an identifiable recipient, beyond those that accrue to the general public, a charge would be imposed (to recover the full costs to the Federal Government for providing this specific benefit, or the market price). * * * The general policy is that user charges will be instituted through the promulgation of regulations.’’ The Department of the Interior (DOI) Manual mirrors this policy (330 DM 1.3 A.). In this rulemaking, ‘‘cost recovery’’ means reimbursement to MMS for its costs of performing a service by charging a fee to the identifiable applicant/beneficiary of the service. Further guidance is provided by Solicitor’s Opinion M–36987, ‘‘BLM’s Authority to Recover Costs of Minerals Document Processing’’ (December 5, 1996). As explained in that Solicitor’s Opinion, some costs, such as the costs of programmatic environmental studies and programmatic environmental assessments in support of a general agency program are not recoverable because they create an ‘‘independent public benefit’’ rather than a specific benefit to an identifiable recipient. Id. at 9–10. On March 25, 2005, MMS published an Advance Notice of Proposed Rulemaking (ANPR) in the Federal Register titled, ‘‘Recovery of Costs Related to the Regulation of Oil and Gas Activities on the Outer Continental Shelf,’’ (70 FR 15246). (The cost recovery fees MMS is addressing in this proposed rule are for different activities than those addressed in the recently promulgated final rule issued on August 25, 2005 (70 FR 49871)). Through the ANPR, MMS alerted the public that we seek to recover the costs of processing certain permits and applications through the rulemaking process. MMS believes that cost recovery for the MMSprovided service of reviewing and E:\FR\FM\14NOP1.SGM 14NOP1 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules approving applications and permits is warranted because such service provides an identifiable recipient—the applicant—with direct benefits beyond those received by the general public. The ANPR invited comments, recommendations, and specific remarks on a program of collecting fees for reviewing certain plans and permit applications such as: • Exploration Plans (§ 250.203). • Development and Production Plans (§ 250.204). • Deep Water Operations Plans (Notice To Lessees No. 2000–N06). • Application for Permit to Drill (APD; form MMS–123). • Application for Permit to Modify (APM; form MMS–124). • Application to Remove a Platform (required by § 250.1727). • Facility Permits (required by § 250.901 for the installation, modification, or repair of a platform). • Conservation Information Documents (Notice to Lessees No. 2000N05). • Geological and Geophysical (G&G) Permits: Permit for Geophysical Exploration for Mineral Resources or Scientific Research on the Outer Continental Shelf (form MMS–328); Permit for Geological Exploration for Mineral Resources or Scientific Research on the OCS (form MMS–329). • Sand and Gravel Permits: Permit for Geophysical Prospecting for Mineral Resources or Scientific Research on the Outer Continental Shelf Related to Minerals Other than Oil, Gas, and Sulphur (form MMS–135); Permit for Geological Prospecting for Mineral Resources or Scientific Research on the Outer Continental Shelf Related to Minerals Other than Oil, Gas, and Sulphur (form MMS–136). The ANPR also solicited specific comments on the following: 1. Are there other actions for which MMS should require fees to recover costs from operators? 2. MMS plans to calculate the fees in a manner similar to that used in the recently published Cost Recovery Rule (RIN 1010–AD16, August 25, 2005, 70 FR 49871). Are there alternative ways to determine fair and equitable fees? 3. MMS may have large cost differences associated with issuing permits and reviewing plans in the different Regions (Gulf of Mexico, Pacific, Alaska); should the fee be uniform nationwide or vary by Region? Comments on the ANPR MMS received nine comment letters from industry and the general public. Four of the comment letters complained that there was insufficient time (30 VerDate Aug<31>2005 16:03 Nov 10, 2005 Jkt 208001 days) provided for comment in the ANPR. The commenters asked for an extension of the comment period that ranged from 30–45 days. One commenter provided examples of recent comment time frames on MMS rulemakings that ranged from 30–90 days, and suggested that future rules have a standard comment period of either 60 or 90 days. An ANPR simply informs the public that an agency expects to publish a proposed rule. Because the public is given another opportunity to comment in connection with the proposed rule, MMS believes that 30 days is a sufficient comment period for an ANPR. This proposed rule now being published has a 60-day comment period. Three comment letters presented more extensive views of the offshore oil and gas industry. Two letters were from individual companies, and one letter was from a consortium of eight trade organizations that represented thousands of companies involved in the United States (U.S.) oil and gas industry. In general, industry respondents stated that the total of lease bonuses, rentals and royalty fees paid by industry adequately compensate MMS and the Federal Government for any service provided in the issuance of permits. Several commenters pointed to the MMS statistics for monies collected as proof that the Federal Government had been adequately compensated for the process of issuing offshore leases as well as ‘‘for processing the necessary paperwork required by regulations to facilitate lessees bringing their leases to production.’’ The relevant mineral leasing law (the Outer Continental Shelf Lands Act (OCSLA)), which granted the Secretary the authority to issue leases offshore on the OCS, was not enacted as a cost recovery mechanism. The monies collected as bonuses, rentals, and royalties under those leases are not intended to compensate the government for administrative costs. They instead reflect the value of the public’s interest in the resource and property. When a lease is issued, the working interest is conveyed to the lessee(s) to whom it is issued. The government reserves a royalty interest, which is a cost-free share of the production or the value of the production. Under the bidding system that is characteristic of most of the leases, the lessee pays a bonus to obtain the lease that is the result of competitive bidding. During the primary term of a lease and before the lease goes into production (in other words, during the time the lessor is not receiving any benefit from its retained royalty interest), the lessee must pay annual PO 00000 Frm 00018 Fmt 4702 Sfmt 4702 69119 rentals. All of these obligations (royalties, bonus payments and rentals) reflect the value of the lessor’s (i.e., the public’s) property interest in the leased minerals. None of these obligations was ever intended to compensate the government for administrative costs. In a related remark, one industry commenter asserted that a document cited by MMS, OMB Circular No. A–25, provides that new user charges should not be imposed in cases where other revenues from individuals already finance the government services provided to them. The commenter appears to be citing paragraph 7.c. of OMB Circular No. A–25, which addresses excise taxes. The paragraph states that ‘‘[n]ew user charges should not be proposed in cases where an excise tax currently finances the government services that benefit specific individuals’’ (giving the example of a gasoline tax to finance highway construction). Royalties, bonus payments, and rentals are not taxes, but payments that reflect the value of the resources. Reference to this paragraph of the OMB Circular is thus inappropriate. Several commenters asserted that because neither existing lease terms nor regulations in effect at the time of lease issuance contain provisions allowing the new cost recovery fees, regulations imposing such fees that are promulgated after lease issuance ‘‘are not within the scope of the contract’’. They cite Mobil Exploration and Producing Southeast, Inc. v. United States, 530 U.S. 604 (2000), as standing for the proposition that offshore leases are subject only to regulations in existence at the time of lease issuance and those promulgated thereafter that concern prevention of waste and conservation of resources. These comments fail to acknowledge that the Independent Officers Appropriation Act (IOAA), the statute under whose authority MMS is promulgating this rule, was enacted in 1952, and predates the OCSLA and the leases issued under the authority of that Act. The comments also misinterpret the Mobil decision. In Mobil, the Supreme Court addressed a statute enacted by Congress years after lease issuance (the Outer Banks Protection Act) whose substantive effect was to prohibit exploration of a certain class of existing leases. The Supreme Court held the statute to be a breach of contract on the part of the U.S. The Supreme Court in Mobil did not address regulations promulgated under authority already granted to the Secretary under a statute that predated the leases involved. Only two commenters responded to the MMS list of specific questions. These commenters: (1) Did not agree E:\FR\FM\14NOP1.SGM 14NOP1 69120 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules that MMS should charge the proposed fees and, therefore, had no suggestions for additional cost recovery; (2) did not propose alternative methods for determining fees (they did, however, recommend that MMS continue efforts to improve cost effectiveness and provide specific details on how any fees are to be determined); and (3) suggested that fees be assigned to the different regions based on the actual costs in those regions. Regarding this last suggestion, MMS found, first, that the number of plans and permits processed in the Pacific and Alaska OCS Regions is very small. More than 98 percent of the MMS plan and permit applications processed are in the Gulf of Mexico (GOM) OCS Region. Second, MMS found that, due to the smaller number of plans in the Pacific and Alaska OCS Regions, and the controversy often involved with them, the processing costs per plan or permit in those regions are considerably higher than in the Gulf of Mexico OCS Region. MMS has determined that because of the higher expense and the small number of plans, applications and permits MMS processed in the Pacific and Alaska Regions, it is reasonable to set as the standard fee for all such activities the average cost for the GOM OCS Region. This fee structure will avoid creating disparity among leases in different parts of the country, due to unusual conditions in some regions, for receiving a similar final determination from MMS. Regarding the comment that MMS should improve its cost and effectiveness, MMS will continue in its efforts to reduce costs through initiatives such as OCS Connect, a multi-year initiative to automate major business transactions and plan/ application/permit reviews, resulting in more timely decisions. One citizen commented that fees should also be recovered on applications for lease term pipelines; seismic data acquisition; surface comingling of OCS production; and applications for departures from operational requirements. All but the applications for departures have been included in the proposed rule. Departures were not included because departure requests are almost always part of another permit application. Finally, several commenters believed that the fees proposed by the ANPR seem contrary to the administration’s national energy policy. They maintained that every dollar collected by MMS for the processing of applications and permits is a dollar that would not be spent producing energy on the OCS. MMS works closely with industry to ensure that energy production on the OCS will continue to contribute significantly to the nation’s energy supply. For example, MMS provides incentives for industry production of offshore oil and gas, such as royalty relief for deep-water and deep-gas development. The proposed service fees would not affect existing incentives and would only marginally add to the cost of operating offshore. Proposed Regulation What Type of Fees Does This Proposed Rule Propose? MMS is proposing fixed fees for certain services based on cost recovery principles. A fixed fee would remain the same for each request of a similar type. The fixed fee approach would provide objectivity and certainty because each applicant’s fees are based on the same predetermined fee structure. Which MMS Services Would Be Subject To a Cost Recovery Fee? The following table lists the plan/ application/permit requests for which we are proposing a cost recovery fee under this proposed rule. The table includes some additional requests that were not included in the ANPR. Service: processing of the following . . . Proposed fee Exploration Plan (EP) ......................................... Development and Production Plan (DPP)/Development Operations Coordination Document (DOCD). Deepwater Operations Plan ............................... Conservation Information Document .................. Application for Permit to Drill (APD; form MMS– 123). $3,250 for each surface location ..................... $3,750 for each well proposed ........................ § 250.211(d). § 250.241. $3,150 .............................................................. $24,200 ............................................................ $1,850 Initial applications only, no fee for revisions. Application for Permit to Modify (APM; form MMS–124). $110 ................................................................. New Facility Production Safety System Application. $4,750 (> 125 components). (Additional fee of $12,500 will be charged if MMS deems it necessary to visit a facility offshore; and $6,500 to visit a facility in a shipyard). $1,150 (25–125 components). (Additional fee of $7,850 will be charged if MMS deems it necessary to visit a facility offshore; and $4,500 to visit a facility in a shipyard). $570 (< 25 components). $530 (> 125 components). $190 (25–125 components). $80 (< 25 components). $19,900 ............................................................ § 250.292. § 250.296. § 250.410(d); § 250.411; § 250.460; § 250.513; § 250.515; § 250.1605; § 250.1617; § 250.1622. § 250.460; § 250.465; § 250.513; § 250.515; § 250.613; § 250.615; § 250.1618; § 250.1622; § 250.1704. § 250.802(e) Production Safety System Application—Modification. Platform Application— Installation—under the Platform Verification Program. Platform Application—Installation—Fixed Structure Under the Platform Approval Program. Platform Application—Installation—Caisson/ Well Protector. Platform Application—Modification ..................... New Pipeline Application—Lease Term ............. Pipeline Application—Modification (Lease Term) Pipeline Application—Modification (ROW) ......... Pipeline Repair Notification ................................ VerDate Aug<31>2005 16:03 Nov 10, 2005 Jkt 208001 30 CFR citation § 250.802(e). § 250.905(k). $2,850 .............................................................. § 250.905(k). $1,450 .............................................................. § 250.905(k). $3,400 .............................................................. $3,100 .............................................................. $1,800 .............................................................. $3,650 .............................................................. $340 ................................................................. § 250.905(k). § 250.1000(b). § 250.1000(b). § 250.1000(b). § 250.1008(e). PO 00000 Frm 00019 Fmt 4702 Sfmt 4702 E:\FR\FM\14NOP1.SGM 14NOP1 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules Service: processing of the following . . . Proposed fee Complex Surface Commingling and Measurement Application. Simple Surface Commingling and Measurement Application. Application to Remove a Platform ...................... Application to Decommission a Pipeline (Lease Term). Application to Decommission a Pipeline (ROW) Permit for Geological or Geophysical Exploration for Mineral Resources or Scientific Research on the OCS related to oil, gas and Sulphur. Permit for Geological or Geophysical Prospecting for Mineral Resources or Scientific Research on the OCS Related to Minerals Other than Oil, Gas, and Sulphur. $3,550 (see proposed rule text) ...................... § 250.1204(a). $1,200 (see proposed rule text) ...................... § 250.1204(a). $4,100 .............................................................. $1,000 .............................................................. § 250.1727. § 250.1751 and § 250.1752. $1,900 .............................................................. $1,900 .............................................................. § 250.1751 and § 250.1752. § 251.5 (form MMS–327). $1,900 .............................................................. 69121 § 280.12 (form MMS–134). How Did MMS Determine the Costs To Be Covered By the Proposed Fees and What Are the Fee Amounts Based On? The cost methodology used in developing the fee schedule for the proposed rule includes the sum of direct costs and indirect costs. Direct costs are comprised of the salaries, benefits, materials and contracts/equipment (including information technology) and direct support costs attributed to processing each step of a request. Steps include receiving, validating and entering data, technical and administrative review of the plan/ application/permit for compliance with safety and other regulatory requirements, assessing the nature of the impact, National Environmental Policy Act (NEPA) analysis or Categorical Exclusion Reviews (CERs), and site visits, if required. Indirect costs include centrally paid items such as telecommunications, space, utilities, security, property management, workman’s compensation and unemployment compensation, as well as bureau support functions such as personnel services, finance, procurement, and management. The indirect rate applied to MMS direct costs is 21.5 percent. MMS is using a cost estimation methodology based on its Activity Based Costing (ABC) System. ABC provides reasonable managerial accounting for costs and provides a sound basis for establishing the costs in this rule. Fiscal Year 2004 was the baseline year used for the cost analysis of usersubmitted plans/applications/permits. MMS used FY 2004 activity-based costing data collected through its timekeeping and financial systems. Non-labor and labor costs are coded to MMS work activities. Each MMS employee codes his or her order time to work activities as part of payroll VerDate Aug<31>2005 16:03 Nov 10, 2005 Jkt 208001 30 CFR citation timekeeping. Examples of MMS work activities include: Process Exploration Plans, Process Well Permits, and Perform NEPA Compliance for Development Plans and Permit Applications. MMS has adjusted the FY 2004 baseline plan/permit costs by the FY 2005 New Orleans general schedule increase and locality adjustment of 3.26 percent (salary adjustment for federal employees). We incorporated this adjustment into the fee schedule. Only direct and indirect costs incurred in the direct support of processing plans/applications/permits were included in the cost analysis. Costs were determined as follows: 1. The FY 2004 work activity labor costs recorded by each employee supporting the plans/applications/ permits processes were analyzed along with organizational non-labor costs. These individual employee and nonlabor cost breakdowns were reviewed by the managers responsible for each group of employees. The managers verified the accuracy of the labor costs and nonlabor costs and made adjustments if necessary. Non-labor costs include travel, printing, transportation, contracts, equipment purchases, data backup and operation and maintenance (O&M) costs for MMS’ TIMS (Technical Information Management System). For TIMS costs, MMS determined the number of modules or objects in TIMS that assist in the review and approval of plans/applications/permits and compared that number to the total number of modules or objects in TIMS. We then used this ratio to calculate the proportion of TIMS O&M costs included in the cost analysis for these fees. IT infrastructure (desktop & network), O&M and management/administrative support costs were determined using the ratio of the plan/permit approval processes costs to the program’s total costs. PO 00000 Frm 00020 Fmt 4702 Sfmt 4702 2. Each GOM Region District is approximately the same size and has a similar workload. District permit work activity costs were assigned to different types of permits using a weighted percentage distribution from the activity-based costing system. 3. MMS indirect costs have been allocated to individual plans/ applications/permits based on a flat bureau-wide indirect cost rate of 21.5 percent applied to the program’s total plan/permit cost. The indirect rate was calculated bureau-wide for all MMS cost purposes using FY 2004 costs and is consistent with the rate charged for MMS administrative reimbursable agreements. This full cost analysis differs slightly from the methodology used in the final MMS cost recovery rulemaking published on August 25, 2005 (70 FR 49871). MMS completed its second year of bureau-wide activity-based-costing at the end of FY 2004. MMS evaluated the reliability of its FY 2004 data and determined that it was reliable (with minor adjustments) for cost recovery analysis. Since this data was not fully available when the recent final rule was developed, that rule used employee surveys to identify processing costs rather than using costs coded to work activities. MMS is confident that both methodologies produce reliable cost data, but since data is now available, this proposed rule uses actual work activity (ABC) data coded into the MMS financial system as the basis for its cost analysis. MMS is not proposing to recover the following costs in this proposed rule: 1. Operational and Safety Research— Information derived from this program is directly integrated into MMS’s offshore operations and is used to make decisions pertaining to plans, safety and pollution inspections, enforcement actions, and training requirements. MMS cannot approve plans proposing E:\FR\FM\14NOP1.SGM 14NOP1 69122 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules the use of new technology without this type of evaluation. MMS is examining these costs and is not proposing to recover these costs at this time. 2. Regulation Development—MMS spends more than $1 million yearly developing regulations and guidance for the planning and permitting process. MMS is examining these costs and is not proposing to recover these costs at this time. 3. Work activities funded by the Oil Pollution Act of 1990—This includes research conducted to prevent or cleanup oil spills. It also includes the work of Regional and District engineers whose salaries are paid by funds provided to MMS under this Act. These costs have already been paid by industry through their contributions to the Oil Spill Liability Trust Fund through a five-cent per barrel fee on imported and domestic oil that was collected until December 31, 1994. How Did MMS Round Fees? MMS rounded fees in the following manner. Fees calculated to be less than $1,000 have been rounded down or up to the nearest $10. Fees $1,000–$10,000 have been rounded down or up to the nearest $50. Fees above $10,000 have been rounded down or up to the nearest $100. Would the Proposed Fees Be Adjusted for Inflation? Yes. Since MMS used current salary and expense levels, the cost figures we generated reflect current dollars. To keep the service fees in line with inflation, we propose to adjust the fees periodically according to the Implicit Price Deflator for the Gross Domestic Product (GDP), starting in 2005 dollars. This inflation index, as published by the U.S. Department of Commerce, is generally accepted by economists as the most reliable general price index and is used by MMS for other inflation adjustments. MMS would amend the fees by publication in the Federal Register. Because we are proposing to establish the process for changing fees in this rule and the application of that process is simply a mathematical calculation, new rulemaking would not be necessary when adjustments are made. MMS would also review our costs for administering each type of request every 2 years. If MMS decides to amend fees based on this analysis, we would do so through notice and comment rulemaking. VerDate Aug<31>2005 16:47 Nov 10, 2005 Jkt 208001 How would MMS handle the payment of fees for denied requests or verbal approvals? Would there be any refunds? Fees proposed in this rule would be non-refundable. However, if a request is deemed not complete, an additional fee would not be charged for its resubmission. Any verbal approvals that MMS provides would need to be preceded by payment of the applicable fee. MMS is currently considering the different payment options available, and would notify lessees of the available payment options via a Notice to Lessees or notice in a final rule. Are Fixed Fees Appealable? No. The amount of a fixed fee would not be appealable to the Interior Board of Land Appeals because it is set by regulation. There is no discretion to change it. Procedural Matters Public Comment Procedures: All submissions received must include the agency name and Regulatory Identifier Number (RIN) for this rulemaking. MMS’s practice is to make comments, including names and addresses of respondents, available for public review. Individual respondents may request that we withhold their address from the record, which we will honor to the extent allowable by law. There may be circumstances in which we would withhold from the record a respondent’s identity, as allowable by the law. If you wish us to withhold your name and/or address, you must state this prominently at the beginning of your comment. However, we will not consider anonymous comments. Except for proprietary information, we will make all submissions from organizations or businesses, and from individuals identifying themselves as representatives or officials of organizations or businesses, available for public inspection in their entirety. Regulatory Planning and Review (Executive Order (E.O.) 12866) This proposed 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) The proposed rule would not have an annual effect of $100 million or more on the economy. It would 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. This proposed rule would establish fees based on cost recovery principles. Based on historical filings, we project the fees would raise revenue PO 00000 Frm 00021 Fmt 4702 Sfmt 4702 by approximately $16.5 million annually. (2) The proposed rule would not create a serious inconsistency or otherwise interfere with action taken or planned by another agency because the costs incurred are for specific MMS services and other agencies are not involved in these aspects of the OCS Program. (3) This proposed rule would not alter the budgetary effects of entitlements, grants, user fees or loan programs, or the rights or obligations of their recipients. This change would have no effect on the rights of the recipients of entitlements, grants, user fees, or loan programs. The fees proposed in this rule are service fees based on cost recovery, and not user fees. (4) This proposed rule would not raise novel legal or policy issues. Regulatory Flexibility Act (RFA) The Department certifies that this proposed rule would not have a significant economic effect on a substantial number of small entities under the RFA (5 U.S.C. 601 et seq.). The changes proposed in the rule would affect lessees and operators of leases and pipeline right-of-way holders on the OCS. This includes about 130 active federal oil and gas lessees and 115 pipeline rights-of-way holders. Small lessees that operate under this rule fall under the Small Business Administration’s (SBA) North American Industry Classification System (NAICS) codes 211111, Crude Petroleum and Natural Gas Extraction, and 213111, Drilling Oil and Gas Wells. For these NAICS code classifications, a small company is one with fewer than 500 employees. Based on these criteria, an estimated 70 percent of these companies are considered small. This proposed rule, therefore would affect a substantial number of small entities. The fees proposed in the rule would not have a significant economic effect on a substantial number of small entities because the fees are small compared to normal costs of doing business on the OCS. For example, depending on water depth and well depth, cost estimates for drilling a well range from $5 million to $23 million. Thus, the proposed fees, ranging from $80 to $24,200, are dwarfed by the millions of dollars that industry already commits to exploration, development, production, and transportation. MMS conducted an additional analysis to study the potential impacts of these fees on small entities. MMS charted the 2004 production of all companies operating on the OCS. Using corresponding rolling annual average E:\FR\FM\14NOP1.SGM 14NOP1 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules prices, MMS calculated each company’s federal OCS gross revenues. Using TIMS (and other databases) 2004 company data, plan/application/permit fees were calculated and compared with each company’s calculated gross revenue. The analysis indicates that no company would have its offshore revenues affected by 0.5 percent or more. MMS does not have revenue data for most of the 115 pipeline right-of-way holders. However, MMS does not expect the companies to be significantly impacted. Additionally, the service fees established in the rule would apply in a non-discriminating way to both large and small firms. Also, applying for MMS services provides a benefit to both a large and small applicant if the applicant decides to operate on the OCS. 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 (SBREFA) The proposed rule is not a major rule under the SBREFA (5 U.S.C. 804(2)). This proposed rule: (a) Would not have an annual effect on the economy of $100 million or more. (b) Would not cause a major increase in costs or prices for consumers, individual industries, Federal, state, or local government agencies, or geographic regions. (c) Would 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. Leasing on the U.S. OCS is limited to residents of the U.S. or companies incorporated in the U.S. This proposed rule would not change that requirement. Unfunded Mandates Reform Act (UMRA) of 1995 This proposed rule would not impose an unfunded mandate on state, local, or tribal governments or the private sector VerDate Aug<31>2005 16:03 Nov 10, 2005 Jkt 208001 of more than $100 million per year. The proposed rule would 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 UMRA (2 U.S.C. 1531 et seq.) is not required. This is because the proposal would not affect state, local, or tribal governments, and the effect on the private sector is small. Takings Implication Assessment (TIA) (Executive Order 12630) The proposed rule is not a governmental action capable of interference with constitutionally protected property rights. Thus, MMS did not need to prepare a TIA according to E.O. 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights. Federalism (Executive Order 13132) With respect to E.O. 13132, this proposed rule would not have federalism implications. This proposed rule would 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 proposed rule would not affect that role. Civil Justice Reform (Executive Order 12988) With respect to E.O. 12988, MMS finds that this proposed rule would not unduly burden the judicial system and does meet the requirements of sections 3(a) and 3(b)(2) of the E.O. MMS consulted with the Department of the Interior Office of the Solicitor throughout this drafting process. Paperwork Reduction Act (PRA) of 1995 The proposed rulemaking relates to 30 CFR part 250, subparts B, D, E, H, I, J, L, P, and Q; 30 CFR part 251; and 30 CFR part 280. The rulemaking affects the information collections for these regulations but would not change the approved burden hours; it would just add the associated fees. Therefore, OMB has ruled that there is no change in the information collection and that MMS does not need to make a formal submission by Form OMB 83–I for this rulemaking. If the rule is finalized, we will submit Form OMB 83–C to add the fees in each collection. OMB has approved the information collections for the affected regulations at 30 CFR part 250, subpart B, 1010–0151; subpart D, 1010–0141; subpart E, 1010– 0067, subpart H, 1010–0059; subpart I, 1010–0149; subpart J, 1010–0050; PO 00000 Frm 00022 Fmt 4702 Sfmt 4702 69123 subpart L 1010–0051; subpart P, 1010– 0086, subpart Q, 1010–0142; 30 CFR part 251, 1010–0048; and 30 part CFR 280, 1010–0072. National Environmental Policy Act (NEPA) of 1969 The MMS has determined that this rule is administrative and involves only procedural changes addressing fee requirements. Therefore, it is categorically excluded from environmental review under section 102(2)(C) of the NEPA, pursuant to 516 DM 2.3A and 516 DM 2, Appendix 1, Item 1.10. In addition, the proposed rule does not meet any of the 10 criteria for exceptions to categorical exclusions listed in 516 DM 2, Appendix 2. Pursuant to Council on Environmental Quality regulations (40 CFR 1508.4) and the environmental policies and procedures of the Department of the Interior, the term ‘categorical exclusions’ means categories of action which do not individually or cumulatively have a significant effect on the human environment and which have no such effect in procedures adopted by a federal agency and therefore require neither an environmental assessment nor an environmental impact statement. Effects on the Nation’s Energy Supply (Executive Order 13211) E.O. 13211 requires the agency to prepare a Statement of Energy Effects when it takes a regulatory action that is identified as a significant energy action. This proposed rule is not a significant energy action, and therefore would not require a Statement of Energy Effects because it: (1) Is not a significant regulatory action under E.O. 12866, (2) Is not likely to have a significant adverse effect on the supply, distribution, or use of energy, and (3) Has not been designated by the Administrator of the Office of Information and Regulatory Affairs, OMB, as a significant energy action. Consultation and Coordination With Indian Tribal Governments (E.O. 13175) In accordance with E.O. 13175, this proposed rule would not have tribal implications that impose substantial direct compliance costs on Indian tribal governments. Clarity of This Regulation E.O. 12866 requires each agency to write regulations that are easy to understand. MMS invites your comments on how to make this E:\FR\FM\14NOP1.SGM 14NOP1 69124 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules proposed rule easier to understand, including answers to questions such as the following: (1) Are the requirements in the rule clearly stated? (2) Does the rule contain technical language or jargon that interferes with its clarity? (3) Does the format of the rule (grouping and order of sections, use of headings, paragraphing, etc.) aid or reduce its clarity? (4) Is the description of the rule in the ‘‘Supplementary Information’’ section of this preamble helpful in understanding the rule? What else can MMS do to make the rule easier to understand? Send a copy of any comments that concern how MMS could make this rule easier to understand to: Office of Regulatory Affairs, Department of the Interior, Room 7229, 1849 C Street, NW., Washington, DC 20240. You may also e-mail the comments to this address: Exsec@ios.doi.gov. List of Subjects 30 CFR Part 250 Administrative practice and procedure, Continental shelf, Environmental impact statements, Environmental protection, Government contracts, Investigations, Oil and gas exploration, Penalties, Pipelines, Public lands-mineral resources, Public landsrights-of-way, Reporting and recordkeeping requirements, Sulphur. 30 CFR Part 251 Continental shelf, Freedom of information, Oil and gas exploration, Public lands—mineral resources, Reporting and recordkeeping requirements, Research. 30 CFR Part 280 Continental shelf, Public lands— mineral resources, Reporting and recordkeeping requirements, Research. Dated: October 24, 2005. Chad Calvert, Acting Assistant Secretary—Land and Minerals Management. For the reasons stated in the preamble, the Minerals Management Service (MMS) proposes to amend 30 CFR parts 250, 251, and 280 as follows: PART 250—OIL AND GAS AND SULPHUR OPERATIONS IN THE OUTER CONTINENTAL SHELF 1. The authority citation for part 250 is revised to read as follows: Authority: 43 U.S.C. 1331 et seq.; 31 U.S.C. 9701. 2. In § 250.125, revise the table in paragraph (a) and paragraph (b) to read as follows: § 250.125 Service Fees (a) * * * SERVICE FEE TABLE Service—processing of the following: Fee amount Change in Designation of Operator ................... Suspension of Operators/Suspension of Production (SOO/SOP) Request. Exploration Plan (EP) ......................................... Development and Production Plan (DPP) or Development Operations Coordination Document (DOCD). Deepwater Operations Plan ............................... Conservation Information Document .................. Application for Permit to Drill (APD; form MMS– 123). $150 ................................................................. $1,800 .............................................................. § 250.143. § 250.171. $3,250 for each surface location ..................... $3,750 for each well proposed ........................ § 250.211(d). § 250.241(e). $3,150 .............................................................. $24,200 ............................................................ $1,850. Initial applications only, no fee for revisions. Application for Permit to Modify (APM; form MMS–124). $110 ................................................................. New Facility Production Safety System Application for facility with more than 125 components. $4,750 (Additional fee of $12,500 will be charged if MMS deems it necessary to visit a facility offshore; and $6,500 to visit a facility in a shipyard). $1,150 (Additional fee of $7,850 will be charged if MMS deems it necessary to visit a facility offshore; and $4,500 to visit a facility in a shipyard). $570 ................................................................. § 50.292(p). §250.296(a). § 250.296(a). § 250.410(d); § 250.411; § 250.460; § 250.513(b); § 250.515; § 250.1605; § 250.1617(a); § 250.1622. § 250.460; § 250.465(b); § 250.513(b); § 250.515; § 250.613(b); § 250.615; § 250.1618(a); § 250.1622; § 250.1704(g). § 250.802(e). New Facility Production Safety System Application for facility 25–125 components. New Facility Production Safety System Application for facility with fewer than 25 components. Production Safety System Application—Modification with more than 125 components reviewed. Production Safety System Application—Modification with 25–125 components reviewed. Production Safety System Application—Modification with fewer than 25 components reviewed. Platform Application—Installation—under the Platform Verification Program. Platform Application—Installation—Fixed Structure Under the Platform Approval Program. Platform Application—Installation—Caisson/ Well Protector. Platform Application—Modification ..................... New Pipeline Application (Lease Term) ............. Pipeline Application—Modification (Lease Term) Pipeline Application—Modification (ROW) ......... VerDate Aug<31>2005 16:03 Nov 10, 2005 Jkt 208001 30 CFR citation § 250.802(e). § 250.802(e). $530 ................................................................. § 250.802(e). $190 ................................................................. § 250.802(e). $80 ................................................................... § 250.802(e). $19,900 ............................................................ § 250.905(k). $2,850 .............................................................. § 250.905(k). $1,450 .............................................................. § 250.905(k). $3,400 $3,100 $1,800 $3,650 § 250.905(k). § 250.1000(b). § 250.1000(b). § 250.1000(b). PO 00000 .............................................................. .............................................................. .............................................................. .............................................................. Frm 00023 Fmt 4702 Sfmt 4702 E:\FR\FM\14NOP1.SGM 14NOP1 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules 69125 SERVICE FEE TABLE—Continued Service—processing of the following: Fee amount Pipeline Repair Notification ................................ Pipeline Right-of-Way (ROW) Grant Application Pipeline Conversion of Lease Term to ROW ..... Pipeline ROW Assignment ................................. 500 Feet From Lease/Unit Line Production Request. Gas Cap Production Request ............................ Downhole Commingling Request ....................... Complex Surface Commingling and Measurement Application. Simple Surface Commingling and Measurement Application. Voluntary Unitization Proposal or Unit Expansion. Unitization Revision ............................................ Application to Remove a Platform or Other Facility. Application to Decommission a Pipeline (Lease Term). Application to Decommission a Pipeline (ROW) $340 ................................................................. $1,800 .............................................................. $200 ................................................................. $170 ................................................................. $3,300 .............................................................. § 250.1008(e). § 250.1015. § 250.1015. § 250.1018. § 250.1101. $4,200 .............................................................. $4,900 .............................................................. $3,550 .............................................................. § 250.1101. § 250.1106. § 250.1204(a). $1,200 .............................................................. § 250.1204(a). $10,700 ............................................................ § 250.1303. $760 ................................................................. $4,100 .............................................................. § 250.1303. § 250.1727. $1,000 .............................................................. § 250.1751(a) or § 250.1752(a). $1,900 .............................................................. § 250.1751(a) or § 250.1752(a). (b) Payment of the fees listed in paragraph (a) must accompany the submission of the document for approval. Once a fee is paid, it is nonrefundable, even if an application or other request is withdrawn. If your application is returned to you as incomplete, you are not required to submit a new fee with the amended application. 3. In § 250.211, add a new paragraph (d) to read as follows: § 250.211 What must the EP include? * * * * * (d) Service fee. You must include payment of the service fee listed in § 250.125. 4. In § 250.241, add a new paragraph (e) to read as follows: § 250.241 include? What must the DPP or DOCD * * * * * (e) Service fee. You must include payment of the service fee listed in § 250.125. 5. In § 250.292, revise paragraphs (n) and (o); and add a new paragraph (p) to read as follows: § 250.292 What must the DWOP contain? (n) A discussion of any new technology that affects hydrocarbon recovery systems; (o) A list of any alternate compliance procedures or departures for which you anticipate requesting approval; and (p) Payment of the service fee listed in § 250.125. 6. In § 250.296, add the following sentence at the end of paragraph (a): VerDate Aug<31>2005 16:03 Nov 10, 2005 Jkt 208001 30 CFR citation § 250.296 When and how must I submit a CID or a revision to a CID? (a) * * * The submission of your CID must be accompanied by payment of the service fee listed in § 250.125. * * * * * 7. In § 250.410, revise the introductory paragraph and paragraph (d) to read as follows: accompanied by payment of the service fee listed in § 250.125: * * * * * 9. In § 250.513, revise the last sentence in paragraph (a); and revise the introductory language of paragraph (b) and paragraphs (b)(3) and (4) and adding paragraph (b)(5) to read as follows: § 250.410 a well? § 250.513 Approval and reporting of wellcompletion operations. How do I obtain approval to drill You must obtain written approval from the District Manager before you begin drilling any well or before you sidetrack, bypass, or deepen a well. To obtain approval, you must: * * * * * (d) Submit the following to the District Manager: (1) An original and two complete copies of form MMS–123, Application for a Permit to Drill (APD), and form MMS–123S, Supplemental APD Information Sheet; (2) A separate public information copy of forms MMS–123 and MMS– 123S that meets the requirements of § 250.127; and (3) Payment of the service fee listed in § 250.125. 8. In § 250.465, revise paragraph (b)(1) to read as follows: § 250.465 When must I submit an Application for Permit to Modify (APM) or an End of Operations Report to MMS? * * * * * (b) * * * (1) Your APM (form MMS–124) must contain a detailed statement of the proposed work that would materially change from the approved APD and the submission of your APM must be PO 00000 Frm 00024 Fmt 4702 Sfmt 4702 (a) * * * If the completion has not been approved or if the completion objective or plans have significantly changed, approval for such operations must be requested on Form MMS–124, Application for Permit to Modify (APM). (b) You must submit the following with Form MMS–124 (or with Form MMS–123; Form MMS–123S): * * * * * (3) For multiple completions, a partial electric log showing the zones proposed for completion, if logs have not been previously submitted; (4) When the well-completion is in a zone known to contain H2S or a zone where the presence of H2S is unknown, information pursuant to § 250.490 of this part; and (5) Payment of the service fee listed in § 250.125. * * * * * 10. In § 250.613, revise the last sentence in paragraph (a) and revise the introductory language of paragraph (b) and paragraphs (b)(2) and (3) and adding (b)(4) to read as follows: § 250.613 Approval and reporting for wellworkover operations. (a) * * * Approval for such operations must be requested on Form E:\FR\FM\14NOP1.SGM 14NOP1 69126 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules MMS–124, Application for Permit to Modify. (b) You must submit the following with Form MMS–124: * * * * * (2) When changes in existing subsurface equipment are proposed, a schematic drawing of the well showing the zone proposed for workover and the workover equipment to be used; (3) Where the well-workover is in a zone known to contain H2S or a zone where the presence of H2S is unknown, information pursuant to § 250.490 of this part; and (4) Payment of the service fee listed in § 250.125. * * * * * 11. In § 250.802, add a new paragraph (e)(7) to read as follows: § 250.802 Design, installation, and operation of surface production safety systems. * * * * * (e) * * * (7) The service fee listed in § 250.125 of this part. The fee you must pay will be determined by the number of Required submittal components involved in the review and approval process. 12. In § 250.905, revise the introductory language and table headings add paragraph (k) to the table to read as follows: § 250.905 How do I get approval for the installation, modification, or repair of my platform? The Platform Approval Program requires that you submit the information, documents and fees listed in the following table for your proposed project. Required contents * * (k) Payment of the service fee listed in § 250l.125. * * Other requirements j * 13. In § 250.1000, revise paragraph (b) to read as follows: 14. In § 250.1008, revise paragraph (e) to read as follows: § 250.1000 § 250.1008 General Requirements. * * * * * (b) An application must be accompanied by payment of the service fee listed in § 250.125 and submitted to the Regional Supervisor and approval obtained before: (1) Installation, modification or abandonment of a lease term pipeline (2) Installation or modification of a right-of-way (other than lease term) pipeline; or (3) Modification or relinquishment of a pipeline right-of way. * * * * * Reports. * * * * * (e) The lessee or right-of-way holder must notify the Regional Supervisor before the repair of any pipeline or as soon as practicable. Your notification must be accompanied by payment of the service fee listed in § 250.125. You must submit a detailed report of the repair of a pipeline or pipeline component to the Regional Supervisor within 30 days after the completion of the repairs. In the report you must include the following: (1) Description of repairs, (2) Results of pressure test, and * * (3) Date returned to service. * * * * 15. In § 250.1204, revise paragraph (a)(1) to read as follows: * § 250.1204 Surface commingling. (a) * * * (1) Submit a written application to, and obtain approval from, the Regional Supervisor before commencing the commingling of production or making changes to previously approved commingling applications. Your application must be accompanied by payment of the service fee listed in § 250.125. The service fees are divided into two levels for simple applications and complex applications. Application type Actions (i) Simple applications consist of those that update or correct previously approved measurement and commingling records such as: Lease terminations. Well status changes. Well name changes. Platform removals. Application cancellations FMP status changes. Meter updates. Operator changes. Meter proving and well test waivers. Applications to temporarily reroute production. Production tests prior to pipeline construction. (ii) Complex applications include applications not categorized as simple and entail: Creation of a new facility measurement points (FMPs). Association of leases or units to existing FMPs. Inclusion of production from additional structures. Meter updates which add buy-back gas meters or pigging meters. Other applications which are deviations from the approved allocation procedures. * * * * * 16. In § 250.1617, revise paragraph (a) to read as follows: VerDate Aug<31>2005 16:03 Nov 10, 2005 Jkt 208001 § 250.1617 Application for permit to drill. (a) Before drilling a well under an approved Exploration Plan, Development and Production Plan, or Development Operations Coordination PO 00000 Frm 00025 Fmt 4702 Sfmt 4702 Document, you must file Form MMS– 123, APD, with the District Manager for approval. The submission of your APD must be accompanied by payment of the service fee listed in § 250.125. Before E:\FR\FM\14NOP1.SGM 14NOP1 69127 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules starting operations, you must receive written approval from the District Manager unless you received oral approval under § 250.140. * * * * * 17. In § 250.1618, revise the section heading and paragraph (a) to read as follows: § 250.1618 Modify. drilling equipment, proposals to deepen, sidetrack, complete, workover, or plug back a well, or engage in similar activities to the District Manager on Form MMS–124, Application for Permit to Modify (APM). The submission of your APM must be accompanied by payment of the service fee listed in § 250.125. Before starting operations associated with the change, you must receive written approval from the Application for Permit to (a) You must submit requests for changes in plans, changes in major District Manager unless you received oral approval under § 250.140. * * * * * 18. In § 250.1704, revise the Decommissioning Applications and Reports Table to read as follows: § 250.1704 When must I submit decommissioning applications and reports? * * * * * DECOMMISSIONING APPLICATIONS AND REPORTS TABLE Decommissioning applications and reports When to submit (a) Initial platform removal application [not required in the Gulf of Mexico OCS Region]. In the Pacific OCS Region or Alaska OCS Region, submit the application to the Regional Supervisor at least 2 years before production is projected to cease. Before removing a platform or other facility in the Gulf of Mexico OCS Region, or not more than 2 years after the submittal of an initial platform removal application to the Pacific OCS Region and the Alaska OCS Region. Within 30 days after you remove a platform or other facility * * *. Before you decommission a pipeline * * * ........ (b) Final removal application for a platform or other facility. (c) Post-removal report for a platform or other facility. (d) Pipeline decommissioning application .......... (e) Post-pipeline decommissioning report .......... (f) Site clearance report for a platform or other facility. (g) Form MMS–124, Application for Permit to Modify (APM). The submission of your APM must be accompanied by payment of the service fee listed in § 250.125. Instructions Within 30 days after your decommission a pipeline * * *. Within 30 days after you complete site clearance verification activities. (1) Before you temporarily abandon or permanently plug a well or zone. (2) Within 30 days after you plug a well .......... (3) Before you install a subsea protective device. (4) Within 30 days after your complete a protective device trawl test. (5) Before you remove any casing stub or mud line suspension equipment and any subsea protective device. (6) Within 30 days after you complete site clearance verfication activities. 19. In § 250.1727, revise the introductory paragraph to read as follows: § 250.1727 What information must I include in my final application to remove a platform or other facility? You must submit to the Regional Supervisor, a final application for approval to remove a platform or other facility. Your application must be accompanied by payment of the service fee listed in § 250.125. If you are proposing to use explosives, provide three copies of the application. If you are not proposing to use explosives, provide two copies of the application. VerDate Aug<31>2005 16:03 Nov 10, 2005 Jkt 208001 Include the following information in the final removal application, as applicable: * * * * * 20. In § 250.1751, revise paragraph (a) introductory text to read as follows: § 250.1751 How do I decommission a pipeline in place? * * * * * (a) Submit a pipeline decommissioning application in triplicate to the Regional Supervisor for approval. Your application must be accompanied by payment of the service fee listed in § 250.125. Your application must include the following information: * * * * * PO 00000 Frm 00026 Fmt 4702 Sfmt 4702 Include information § 250.1726. required under Include information § 250.1727. required under Include information required under § 250.1729. Include information required under § 250.1751(a) § 250.1752(a), as applicable. Include information required under § 250.1753. Include information required under § 250.1743(b) Include information required under §§ 250.1712 and 250.1721. Include information § 250.1717. Refer to § 250.1722(a). required under Include information 250.1722(d). Refer to § 250.1723. required under Include information § 250.1743(a). required under 21. In § 250.1752, revise the introductory text of paragraph (a) to read as follows: § 250.1752 How do I remove a pipeline? * * * * * (a) Submit a pipeline removal application in triplicate to the Regional Supervisor for approval. Your application must be accompanied by payment of the service fee listed in § 250.125. Your application must include the following information: * * * * * E:\FR\FM\14NOP1.SGM 14NOP1 69128 Federal Register / Vol. 70, No. 218 / Monday, November 14, 2005 / Proposed Rules PART 251—GEOLOGICAL AND GEOPHYSICAL (G&G) EXPLORATIONS OF THE OUTER CONTINENTAL SHELF 22. The authority citation for part 251 is revised to read as follows: Authority: 43 U.S.C. 1331 et seq.; 31 U.S.C. 9701. 23. In § 251.5, revise paragraph (a) to read as follows: § 251.5 Applying for permits or filing Notices. PART 280—PROSPECTING FOR MINERALS OTHER THAN OIL, GAS, AND SULPHUR ON THE OUTER CONTINENTAL SHELF 24. The authority citation for part 280 is revised to read as follows: Authority: 43 U.S.C. 1331 et seq.; 42 U.S.C. 4332 et seq.; 31 U.S.C. 9701. 25. In § 280.12, revise paragraph (a) to read as follows: § 280.12 What must I include in my application or notification? (a) Permits. You must submit to the RD a signed original and three copies of the permit application form (form MMS–134) at least 30 days before the startup date for activities in the permit area. If unusual circumstances prevent you from meeting this deadline, you must immediately contact the RD to arrange an acceptable deadline. The form includes names of persons, type, location, purpose, and dates of activity, as well as environmental and other information. A nonrefundable service fee of $ 1,900 must accompany your application. The time period for extensions is defined on the permit form (Form MMS–135 (Geophysical Exploration) or MMS–136 (Geological Exploration)). * * * * * [FR Doc. 05–22504 Filed 11–10–05; 8:45 am] VerDate Aug<31>2005 16:03 Nov 10, 2005 Jkt 208001 Coast Guard 33 CFR Part 165 [CGD09–05–131] RIN 1625–AA11 Regulated Navigation Area, Chicago Sanitary and Ship Canal, Romeoville, IL Coast Guard, DHS. Notice of proposed rulemaking. AGENCY: (a) Permits. You must submit a signed original and three copies of the MMS permit application form (Form MMS– 327). The form includes names of persons, type, location, purpose, and dates of activity, and environmental and other information. A nonrefundable service fee of $ 1,900 must accompany your application. The time period for extensions is defined on the permit form (Form MMS–328 (Geophysical Prospecting) or MMS–329 (Geological Prospecting)). * * * * * BILLING CODE 4310–MR–P DEPARTMENT OF HOMELAND SECURITY ACTION: The Coast Guard is proposing to establish a permanent regulated navigation area on the Chicago Sanitary and Ship Canal on the Illinois Waterway near Romeoville, IL. This permanent regulated navigation area will place navigational and operational restrictions on all vessels transiting through the demonstration electrical dispersal barrier located on the Chicago Sanitary and Ship Canal. This regulated navigation area is necessary to protect vessels and their crews from harm as a result of electrical discharges emitting from the electrical dispersal barrier as vessels transit over it. DATES: Comments and related materials must reach the Coast Guard on or before December 14, 2005. ADDRESSES: You may mail comments and related material to Commander (dpw–1) Ninth Coast Guard District, 1240 E.9th Street, Room 2069, Cleveland, OH 44199. The Ninth Coast Guard District Planning and Development Section (dpw–1) maintains the public docket for this rulemaking. Comments and material received from the public, as well as documents indicated in this preamble as being available in the docket, will become part of this docket and will be available for inspection or copying between 8 a.m. and 4 p.m., Monday through Friday, except Federal holidays. FOR FURTHER INFORMATION CONTACT: If you have further questions on this rule, contact CDR K. Phillips, Planning and Development Section, Ninth Coast Guard District, Cleveland, OH at (216) 902–6045. SUPPLEMENTARY INFORMATION: SUMMARY: Request for Comments We encourage you to submit comments and related materials. If you submit a comment, please include your name and address, identify the docket number for this rulemaking [CGD09–05– 131], indicate the specific section of this document to which each comment applies, and give the reason for each PO 00000 Frm 00027 Fmt 4702 Sfmt 4702 comment. You may submit your comments and material by mail (see ADDRESSES). If you submit them by mail or delivery, submit them in an unbound format, no larger than 81⁄2 by 11 inches, suitable for copying and electronic filing. If you submit them by mail and would like to know that they reached the facility, please enclose a stamped, self-addressed postcard or envelope. We will consider all comments and material received during the comment period, which may result in a modification to the rule. Public Meeting We do not now plan to hold a public meeting. But you may submit a request for a public meeting (see ADDRESSES) explaining why one would be beneficial. If we determine that one would aid this rulemaking, we will hold one at a time and place announced by a later notice in the Federal Register. Background and Purpose On January 7, 2005, the U.S. Army Corps of Engineers, in close coordination with the U. S. Coast Guard, conducted preliminary safety tests on the electrical dispersal barrier located at Mile Marker 296.5 of the Chicago Sanitary and Ship Canal near Romeoville, IL. This barrier was constructed to prevent Asian Carp from entering Lake Michigan through the Illinois River system by generating a low-voltage electric field across the canal. The Coast Guard and Army Corps of Engineers conducted field tests to ensure the continued safe navigation of commercial and recreational traffic across the barrier; however, results indicated a significant arcing risk and hazardous electrical discharges as vessels transited the barrier posing a significant risk to navigation through the barrier. To mitigate these risks, the proposed rule would place navigational and operational restrictions on all vessels transiting through the vicinity. On January 26, 2005 a regulated navigational area (RNA) was published in the Federal Register (70 FR 3625) as a temporary final rule. The temporary final rule was extended on August 10, 2005 (70 FR 46407). Testing has continued since the regulation was first proposed in January 2005, but has not yet been completed. Preliminary results indicate that further tests and analysis are warranted and that this process may continue for an undetermined period of time. Therefore, the Coast Guard is proposing to establish a permanent RNA. E:\FR\FM\14NOP1.SGM 14NOP1

Agencies

[Federal Register Volume 70, Number 218 (Monday, November 14, 2005)]
[Proposed Rules]
[Pages 69118-69128]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-22504]


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DEPARTMENT OF THE INTERIOR

Minerals Management Service

30 CFR Parts 250, 251, and 280

RIN 1010-AD23


Oil, Gas, and Sulphur Operations and Leasing in the Outer 
Continental Shelf (OCS)--Recovery of Costs Related to the Regulation of 
Oil and Gas Activities on the OCS

AGENCY: Minerals Management Service (MMS), Interior.

ACTION: Proposed rule.

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SUMMARY: MMS is proposing regulations which impose new fees to process 
certain plans, applications, and permits. The proposed service fees 
would offset MMS's costs of processing these plans, applications, and 
permits.

DATES: MMS will consider all comments received by January 13, 2006. MMS 
will begin reviewing comments and may not fully consider comments 
received after January 13, 2006.

ADDRESSES: You may submit comments on the proposed rule by any of the 
following methods listed below. Please use the regulatory identifier 
number (RIN) 1010-AD23 as an identifier in your message. See also 
Public Comment Procedures under Procedural Matters.
     Federal e-Rulemaking Portal: http://www.regulations.gov. 
Follow the instructions on the website for submitting comments.
     E-mail MMS at rules.comments@mms.gov. Use the RIN in the 
subject line.
     Fax: 703-787-1546. Identify with the RIN.
     Mail or hand-carry comments to the Department of the 
Interior; Minerals Management Service; Attention: Rules Processing Team 
(RPT); 381 Elden Street, MS-4024; Herndon, Virginia 20170-4817. Please 
reference ``Recovery of Costs Related to the Regulation of Oil and Gas 
Activities on the OCS-AD23'' in your comments.
    You may also send comments on the information collection aspects of 
this rule directly to the Office of Management and Budget (OMB) via: 
OMB e-mail: (OIRA_DOCKET@omb.eop.gov); mail or hand carry to the 
Office of Information and Regulatory Affairs, OMB Attention: Desk 
Officer for the Department of the Interior (1010-AD23) or by fax (202) 
395-6566. Please also send a copy to MMS.

FOR FURTHER INFORMATION CONTACT: Martin Heinze, Program Analyst, Office 
of Planning, Budget and International Affairs at (703) 787-1010.

SUPPLEMENTARY INFORMATION:

Background

    Federal agencies are generally authorized to recover the costs of 
providing services to non-federal entities through the provisions of 
the Independent Offices Appropriation Act of 1952 (IOAA), 31 U.S.C. 
9701. The Act requires implementation through rulemaking. There are 
several policy documents that provide MMS guidance on the process of 
charging applicants for service costs. The governing language 
concerning cost recovery can be found in OMB Circular No. A-25 which 
states in part, ``The provisions of this Circular cover all federal 
activities that convey benefits to recipients beyond those accruing to 
the general public. * * * When a service (or privilege) provides 
special benefits to an identifiable recipient, beyond those that accrue 
to the general public, a charge would be imposed (to recover the full 
costs to the Federal Government for providing this specific benefit, or 
the market price). * * * The general policy is that user charges will 
be instituted through the promulgation of regulations.'' The Department 
of the Interior (DOI) Manual mirrors this policy (330 DM 1.3 A.).
    In this rulemaking, ``cost recovery'' means reimbursement to MMS 
for its costs of performing a service by charging a fee to the 
identifiable applicant/beneficiary of the service. Further guidance is 
provided by Solicitor's Opinion M-36987, ``BLM's Authority to Recover 
Costs of Minerals Document Processing'' (December 5, 1996). As 
explained in that Solicitor's Opinion, some costs, such as the costs of 
programmatic environmental studies and programmatic environmental 
assessments in support of a general agency program are not recoverable 
because they create an ``independent public benefit'' rather than a 
specific benefit to an identifiable recipient. Id. at 9-10.
    On March 25, 2005, MMS published an Advance Notice of Proposed 
Rulemaking (ANPR) in the Federal Register titled, ``Recovery of Costs 
Related to the Regulation of Oil and Gas Activities on the Outer 
Continental Shelf,'' (70 FR 15246). (The cost recovery fees MMS is 
addressing in this proposed rule are for different activities than 
those addressed in the recently promulgated final rule issued on August 
25, 2005 (70 FR 49871)). Through the ANPR, MMS alerted the public that 
we seek to recover the costs of processing certain permits and 
applications through the rulemaking process. MMS believes that cost 
recovery for the MMS-provided service of reviewing and

[[Page 69119]]

approving applications and permits is warranted because such service 
provides an identifiable recipient--the applicant--with direct benefits 
beyond those received by the general public.
    The ANPR invited comments, recommendations, and specific remarks on 
a program of collecting fees for reviewing certain plans and permit 
applications such as:
     Exploration Plans (Sec.  250.203).
     Development and Production Plans (Sec.  250.204).
     Deep Water Operations Plans (Notice To Lessees No. 2000-
N06).
     Application for Permit to Drill (APD; form MMS-123).
     Application for Permit to Modify (APM; form MMS-124).
     Application to Remove a Platform (required by Sec.  
250.1727).
     Facility Permits (required by Sec.  250.901 for the 
installation, modification, or repair of a platform).
     Conservation Information Documents (Notice to Lessees No. 
2000-N05).
     Geological and Geophysical (G&G) Permits: Permit for 
Geophysical Exploration for Mineral Resources or Scientific Research on 
the Outer Continental Shelf (form MMS-328); Permit for Geological 
Exploration for Mineral Resources or Scientific Research on the OCS 
(form MMS-329).
     Sand and Gravel Permits: Permit for Geophysical 
Prospecting for Mineral Resources or Scientific Research on the Outer 
Continental Shelf Related to Minerals Other than Oil, Gas, and Sulphur 
(form MMS-135); Permit for Geological Prospecting for Mineral Resources 
or Scientific Research on the Outer Continental Shelf Related to 
Minerals Other than Oil, Gas, and Sulphur (form MMS-136). The ANPR also 
solicited specific comments on the following:
    1. Are there other actions for which MMS should require fees to 
recover costs from operators?
    2. MMS plans to calculate the fees in a manner similar to that used 
in the recently published Cost Recovery Rule (RIN 1010-AD16, August 25, 
2005, 70 FR 49871). Are there alternative ways to determine fair and 
equitable fees?
    3. MMS may have large cost differences associated with issuing 
permits and reviewing plans in the different Regions (Gulf of Mexico, 
Pacific, Alaska); should the fee be uniform nationwide or vary by 
Region?

Comments on the ANPR

    MMS received nine comment letters from industry and the general 
public. Four of the comment letters complained that there was 
insufficient time (30 days) provided for comment in the ANPR. The 
commenters asked for an extension of the comment period that ranged 
from 30-45 days. One commenter provided examples of recent comment time 
frames on MMS rulemakings that ranged from 30-90 days, and suggested 
that future rules have a standard comment period of either 60 or 90 
days.
    An ANPR simply informs the public that an agency expects to publish 
a proposed rule. Because the public is given another opportunity to 
comment in connection with the proposed rule, MMS believes that 30 days 
is a sufficient comment period for an ANPR. This proposed rule now 
being published has a 60-day comment period.
    Three comment letters presented more extensive views of the 
offshore oil and gas industry. Two letters were from individual 
companies, and one letter was from a consortium of eight trade 
organizations that represented thousands of companies involved in the 
United States (U.S.) oil and gas industry. In general, industry 
respondents stated that the total of lease bonuses, rentals and royalty 
fees paid by industry adequately compensate MMS and the Federal 
Government for any service provided in the issuance of permits. Several 
commenters pointed to the MMS statistics for monies collected as proof 
that the Federal Government had been adequately compensated for the 
process of issuing offshore leases as well as ``for processing the 
necessary paperwork required by regulations to facilitate lessees 
bringing their leases to production.''
    The relevant mineral leasing law (the Outer Continental Shelf Lands 
Act (OCSLA)), which granted the Secretary the authority to issue leases 
offshore on the OCS, was not enacted as a cost recovery mechanism. The 
monies collected as bonuses, rentals, and royalties under those leases 
are not intended to compensate the government for administrative costs. 
They instead reflect the value of the public's interest in the resource 
and property. When a lease is issued, the working interest is conveyed 
to the lessee(s) to whom it is issued. The government reserves a 
royalty interest, which is a cost-free share of the production or the 
value of the production. Under the bidding system that is 
characteristic of most of the leases, the lessee pays a bonus to obtain 
the lease that is the result of competitive bidding. During the primary 
term of a lease and before the lease goes into production (in other 
words, during the time the lessor is not receiving any benefit from its 
retained royalty interest), the lessee must pay annual rentals. All of 
these obligations (royalties, bonus payments and rentals) reflect the 
value of the lessor's (i.e., the public's) property interest in the 
leased minerals. None of these obligations was ever intended to 
compensate the government for administrative costs.
    In a related remark, one industry commenter asserted that a 
document cited by MMS, OMB Circular No. A-25, provides that new user 
charges should not be imposed in cases where other revenues from 
individuals already finance the government services provided to them. 
The commenter appears to be citing paragraph 7.c. of OMB Circular No. 
A-25, which addresses excise taxes. The paragraph states that ``[n]ew 
user charges should not be proposed in cases where an excise tax 
currently finances the government services that benefit specific 
individuals'' (giving the example of a gasoline tax to finance highway 
construction). Royalties, bonus payments, and rentals are not taxes, 
but payments that reflect the value of the resources. Reference to this 
paragraph of the OMB Circular is thus inappropriate.
    Several commenters asserted that because neither existing lease 
terms nor regulations in effect at the time of lease issuance contain 
provisions allowing the new cost recovery fees, regulations imposing 
such fees that are promulgated after lease issuance ``are not within 
the scope of the contract''. They cite Mobil Exploration and Producing 
Southeast, Inc. v. United States, 530 U.S. 604 (2000), as standing for 
the proposition that offshore leases are subject only to regulations in 
existence at the time of lease issuance and those promulgated 
thereafter that concern prevention of waste and conservation of 
resources.
    These comments fail to acknowledge that the Independent Officers 
Appropriation Act (IOAA), the statute under whose authority MMS is 
promulgating this rule, was enacted in 1952, and predates the OCSLA and 
the leases issued under the authority of that Act. The comments also 
misinterpret the Mobil decision. In Mobil, the Supreme Court addressed 
a statute enacted by Congress years after lease issuance (the Outer 
Banks Protection Act) whose substantive effect was to prohibit 
exploration of a certain class of existing leases. The Supreme Court 
held the statute to be a breach of contract on the part of the U.S. The 
Supreme Court in Mobil did not address regulations promulgated under 
authority already granted to the Secretary under a statute that 
predated the leases involved.
    Only two commenters responded to the MMS list of specific 
questions. These commenters: (1) Did not agree

[[Page 69120]]

that MMS should charge the proposed fees and, therefore, had no 
suggestions for additional cost recovery; (2) did not propose 
alternative methods for determining fees (they did, however, recommend 
that MMS continue efforts to improve cost effectiveness and provide 
specific details on how any fees are to be determined); and (3) 
suggested that fees be assigned to the different regions based on the 
actual costs in those regions.
    Regarding this last suggestion, MMS found, first, that the number 
of plans and permits processed in the Pacific and Alaska OCS Regions is 
very small. More than 98 percent of the MMS plan and permit 
applications processed are in the Gulf of Mexico (GOM) OCS Region. 
Second, MMS found that, due to the smaller number of plans in the 
Pacific and Alaska OCS Regions, and the controversy often involved with 
them, the processing costs per plan or permit in those regions are 
considerably higher than in the Gulf of Mexico OCS Region. MMS has 
determined that because of the higher expense and the small number of 
plans, applications and permits MMS processed in the Pacific and Alaska 
Regions, it is reasonable to set as the standard fee for all such 
activities the average cost for the GOM OCS Region. This fee structure 
will avoid creating disparity among leases in different parts of the 
country, due to unusual conditions in some regions, for receiving a 
similar final determination from MMS.
    Regarding the comment that MMS should improve its cost and 
effectiveness, MMS will continue in its efforts to reduce costs through 
initiatives such as OCS Connect, a multi-year initiative to automate 
major business transactions and plan/application/permit reviews, 
resulting in more timely decisions.
    One citizen commented that fees should also be recovered on 
applications for lease term pipelines; seismic data acquisition; 
surface co-mingling of OCS production; and applications for departures 
from operational requirements. All but the applications for departures 
have been included in the proposed rule. Departures were not included 
because departure requests are almost always part of another permit 
application.
    Finally, several commenters believed that the fees proposed by the 
ANPR seem contrary to the administration's national energy policy. They 
maintained that every dollar collected by MMS for the processing of 
applications and permits is a dollar that would not be spent producing 
energy on the OCS.
    MMS works closely with industry to ensure that energy production on 
the OCS will continue to contribute significantly to the nation's 
energy supply. For example, MMS provides incentives for industry 
production of offshore oil and gas, such as royalty relief for deep-
water and deep-gas development. The proposed service fees would not 
affect existing incentives and would only marginally add to the cost of 
operating offshore.

Proposed Regulation

What Type of Fees Does This Proposed Rule Propose?

    MMS is proposing fixed fees for certain services based on cost 
recovery principles. A fixed fee would remain the same for each request 
of a similar type. The fixed fee approach would provide objectivity and 
certainty because each applicant's fees are based on the same 
predetermined fee structure.

Which MMS Services Would Be Subject To a Cost Recovery Fee?

    The following table lists the plan/application/permit requests for 
which we are proposing a cost recovery fee under this proposed rule. 
The table includes some additional requests that were not included in 
the ANPR.

------------------------------------------------------------------------
 Service: processing of the
       following . . .            Proposed fee         30 CFR citation
------------------------------------------------------------------------
Exploration Plan (EP).......  $3,250 for each       Sec.   250.211(d).
                               surface location.
Development and Production    $3,750 for each well  Sec.   250.241.
 Plan (DPP)/Development        proposed.
 Operations Coordination
 Document (DOCD).
Deepwater Operations Plan...  $3,150..............  Sec.   250.292.
Conservation Information      $24,200.............  Sec.   250.296.
 Document.
Application for Permit to     $1,850 Initial        Sec.   250.410(d);
 Drill (APD; form MMS-123).    applications only,    Sec.   250.411;
                               no fee for            Sec.   250.460;
                               revisions.            Sec.   250.513;
                                                     Sec.   250.515;
                                                     Sec.   250.1605;
                                                     Sec.   250.1617;
                                                     Sec.   250.1622.
Application for Permit to     $110................  Sec.   250.460; Sec.
 Modify (APM; form MMS-124).                           250.465; Sec.
                                                     250.513; Sec.
                                                     250.515; Sec.
                                                     250.613; Sec.
                                                     250.615; Sec.
                                                     250.1618; Sec.
                                                     250.1622; Sec.
                                                     250.1704.
New Facility Production       $4,750 (> 125         Sec.   250.802(e)
 Safety System Application.    components).
                               (Additional fee of
                               $12,500 will be
                               charged if MMS
                               deems it necessary
                               to visit a facility
                               offshore; and
                               $6,500 to visit a
                               facility in a
                               shipyard). $1,150
                               (25-125
                               components).
                               (Additional fee of
                               $7,850 will be
                               charged if MMS
                               deems it necessary
                               to visit a facility
                               offshore; and
                               $4,500 to visit a
                               facility in a
                               shipyard). $570 (<
                               25 components).
Production Safety System      $530 (> 125           Sec.   250.802(e).
 Application--Modification.    components). $190
                               (25-125
                               components). $80 (<
                               25 components).
Platform Application--        $19,900.............  Sec.   250.905(k).
 Installation--under the
 Platform Verification
 Program.
Platform Application--        $2,850..............  Sec.   250.905(k).
 Installation--Fixed
 Structure Under the
 Platform Approval Program.
Platform Application--        $1,450..............  Sec.   250.905(k).
 Installation--Caisson/Well
 Protector.
Platform Application--        $3,400..............  Sec.   250.905(k).
 Modification.
New Pipeline Application--    $3,100..............  Sec.   250.1000(b).
 Lease Term.
Pipeline Application--        $1,800..............  Sec.   250.1000(b).
 Modification (Lease Term).
Pipeline Application--        $3,650..............  Sec.   250.1000(b).
 Modification (ROW).
Pipeline Repair Notification  $340................  Sec.   250.1008(e).

[[Page 69121]]

 
Complex Surface Commingling   $3,550 (see proposed  Sec.   250.1204(a).
 and Measurement Application.  rule text).
Simple Surface Commingling    $1,200 (see proposed  Sec.   250.1204(a).
 and Measurement Application.  rule text).
Application to Remove a       $4,100..............  Sec.   250.1727.
 Platform.
Application to Decommission   $1,000..............  Sec.   250.1751 and
 a Pipeline (Lease Term).                            Sec.   250.1752.
Application to Decommission   $1,900..............  Sec.   250.1751 and
 a Pipeline (ROW).                                   Sec.   250.1752.
Permit for Geological or      $1,900..............  Sec.   251.5 (form
 Geophysical Exploration for                         MMS-327).
 Mineral Resources or
 Scientific Research on the
 OCS related to oil, gas and
 Sulphur.
Permit for Geological or      $1,900..............  Sec.   280.12 (form
 Geophysical Prospecting for                         MMS-134).
 Mineral Resources or
 Scientific Research on the
 OCS Related to Minerals
 Other than Oil, Gas, and
 Sulphur.
------------------------------------------------------------------------

How Did MMS Determine the Costs To Be Covered By the Proposed Fees and 
What Are the Fee Amounts Based On?

    The cost methodology used in developing the fee schedule for the 
proposed rule includes the sum of direct costs and indirect costs. 
Direct costs are comprised of the salaries, benefits, materials and 
contracts/equipment (including information technology) and direct 
support costs attributed to processing each step of a request.
    Steps include receiving, validating and entering data, technical 
and administrative review of the plan/application/permit for compliance 
with safety and other regulatory requirements, assessing the nature of 
the impact, National Environmental Policy Act (NEPA) analysis or 
Categorical Exclusion Reviews (CERs), and site visits, if required.
    Indirect costs include centrally paid items such as 
telecommunications, space, utilities, security, property management, 
workman's compensation and unemployment compensation, as well as bureau 
support functions such as personnel services, finance, procurement, and 
management. The indirect rate applied to MMS direct costs is 21.5 
percent.
    MMS is using a cost estimation methodology based on its Activity 
Based Costing (ABC) System. ABC provides reasonable managerial 
accounting for costs and provides a sound basis for establishing the 
costs in this rule.
    Fiscal Year 2004 was the baseline year used for the cost analysis 
of user-submitted plans/applications/permits. MMS used FY 2004 
activity-based costing data collected through its timekeeping and 
financial systems. Non-labor and labor costs are coded to MMS work 
activities. Each MMS employee codes his or her order time to work 
activities as part of payroll timekeeping. Examples of MMS work 
activities include: Process Exploration Plans, Process Well Permits, 
and Perform NEPA Compliance for Development Plans and Permit 
Applications.
    MMS has adjusted the FY 2004 baseline plan/permit costs by the FY 
2005 New Orleans general schedule increase and locality adjustment of 
3.26 percent (salary adjustment for federal employees). We incorporated 
this adjustment into the fee schedule.
    Only direct and indirect costs incurred in the direct support of 
processing plans/applications/permits were included in the cost 
analysis. Costs were determined as follows:
    1. The FY 2004 work activity labor costs recorded by each employee 
supporting the plans/applications/permits processes were analyzed along 
with organizational non-labor costs. These individual employee and non-
labor cost breakdowns were reviewed by the managers responsible for 
each group of employees. The managers verified the accuracy of the 
labor costs and non-labor costs and made adjustments if necessary. Non-
labor costs include travel, printing, transportation, contracts, 
equipment purchases, data backup and operation and maintenance (O&M) 
costs for MMS' TIMS (Technical Information Management System). For TIMS 
costs, MMS determined the number of modules or objects in TIMS that 
assist in the review and approval of plans/applications/permits and 
compared that number to the total number of modules or objects in TIMS. 
We then used this ratio to calculate the proportion of TIMS O&M costs 
included in the cost analysis for these fees. IT infrastructure 
(desktop & network), O&M and management/administrative support costs 
were determined using the ratio of the plan/permit approval processes 
costs to the program's total costs.
    2. Each GOM Region District is approximately the same size and has 
a similar workload. District permit work activity costs were assigned 
to different types of permits using a weighted percentage distribution 
from the activity-based costing system.
    3. MMS indirect costs have been allocated to individual plans/
applications/permits based on a flat bureau-wide indirect cost rate of 
21.5 percent applied to the program's total plan/permit cost. The 
indirect rate was calculated bureau-wide for all MMS cost purposes 
using FY 2004 costs and is consistent with the rate charged for MMS 
administrative reimbursable agreements.
    This full cost analysis differs slightly from the methodology used 
in the final MMS cost recovery rulemaking published on August 25, 2005 
(70 FR 49871). MMS completed its second year of bureau-wide activity-
based-costing at the end of FY 2004. MMS evaluated the reliability of 
its FY 2004 data and determined that it was reliable (with minor 
adjustments) for cost recovery analysis. Since this data was not fully 
available when the recent final rule was developed, that rule used 
employee surveys to identify processing costs rather than using costs 
coded to work activities. MMS is confident that both methodologies 
produce reliable cost data, but since data is now available, this 
proposed rule uses actual work activity (ABC) data coded into the MMS 
financial system as the basis for its cost analysis.
    MMS is not proposing to recover the following costs in this 
proposed rule:
    1. Operational and Safety Research--Information derived from this 
program is directly integrated into MMS's offshore operations and is 
used to make decisions pertaining to plans, safety and pollution 
inspections, enforcement actions, and training requirements. MMS cannot 
approve plans proposing

[[Page 69122]]

the use of new technology without this type of evaluation. MMS is 
examining these costs and is not proposing to recover these costs at 
this time.
    2. Regulation Development--MMS spends more than $1 million yearly 
developing regulations and guidance for the planning and permitting 
process. MMS is examining these costs and is not proposing to recover 
these costs at this time.
    3. Work activities funded by the Oil Pollution Act of 1990--This 
includes research conducted to prevent or cleanup oil spills. It also 
includes the work of Regional and District engineers whose salaries are 
paid by funds provided to MMS under this Act. These costs have already 
been paid by industry through their contributions to the Oil Spill 
Liability Trust Fund through a five-cent per barrel fee on imported and 
domestic oil that was collected until December 31, 1994.

How Did MMS Round Fees?

    MMS rounded fees in the following manner. Fees calculated to be 
less than $1,000 have been rounded down or up to the nearest $10. Fees 
$1,000-$10,000 have been rounded down or up to the nearest $50. Fees 
above $10,000 have been rounded down or up to the nearest $100.

Would the Proposed Fees Be Adjusted for Inflation?

    Yes. Since MMS used current salary and expense levels, the cost 
figures we generated reflect current dollars. To keep the service fees 
in line with inflation, we propose to adjust the fees periodically 
according to the Implicit Price Deflator for the Gross Domestic Product 
(GDP), starting in 2005 dollars. This inflation index, as published by 
the U.S. Department of Commerce, is generally accepted by economists as 
the most reliable general price index and is used by MMS for other 
inflation adjustments. MMS would amend the fees by publication in the 
Federal Register. Because we are proposing to establish the process for 
changing fees in this rule and the application of that process is 
simply a mathematical calculation, new rulemaking would not be 
necessary when adjustments are made. MMS would also review our costs 
for administering each type of request every 2 years. If MMS decides to 
amend fees based on this analysis, we would do so through notice and 
comment rulemaking.

How would MMS handle the payment of fees for denied requests or verbal 
approvals? Would there be any refunds?

    Fees proposed in this rule would be non-refundable. However, if a 
request is deemed not complete, an additional fee would not be charged 
for its resubmission. Any verbal approvals that MMS provides would need 
to be preceded by payment of the applicable fee. MMS is currently 
considering the different payment options available, and would notify 
lessees of the available payment options via a Notice to Lessees or 
notice in a final rule.

Are Fixed Fees Appealable?

    No. The amount of a fixed fee would not be appealable to the 
Interior Board of Land Appeals because it is set by regulation. There 
is no discretion to change it.

Procedural Matters

    Public Comment Procedures: All submissions received must include 
the agency name and Regulatory Identifier Number (RIN) for this 
rulemaking. MMS's practice is to make comments, including names and 
addresses of respondents, available for public review. Individual 
respondents may request that we withhold their address from the record, 
which we will honor to the extent allowable by law. There may be 
circumstances in which we would withhold from the record a respondent's 
identity, as allowable by the law. If you wish us to withhold your name 
and/or address, you must state this prominently at the beginning of 
your comment. However, we will not consider anonymous comments. Except 
for proprietary information, we will make all submissions from 
organizations or businesses, and from individuals identifying 
themselves as representatives or officials of organizations or 
businesses, available for public inspection in their entirety.

Regulatory Planning and Review (Executive Order (E.O.) 12866)

    This proposed 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) The proposed rule would not have an annual effect of $100 
million or more on the economy. It would 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. This proposed rule would establish fees 
based on cost recovery principles. Based on historical filings, we 
project the fees would raise revenue by approximately $16.5 million 
annually.
    (2) The proposed rule would not create a serious inconsistency or 
otherwise interfere with action taken or planned by another agency 
because the costs incurred are for specific MMS services and other 
agencies are not involved in these aspects of the OCS Program.
    (3) This proposed rule would not alter the budgetary effects of 
entitlements, grants, user fees or loan programs, or the rights or 
obligations of their recipients. This change would have no effect on 
the rights of the recipients of entitlements, grants, user fees, or 
loan programs. The fees proposed in this rule are service fees based on 
cost recovery, and not user fees.
    (4) This proposed rule would not raise novel legal or policy 
issues.

Regulatory Flexibility Act (RFA)

    The Department certifies that this proposed rule would not have a 
significant economic effect on a substantial number of small entities 
under the RFA (5 U.S.C. 601 et seq.).
    The changes proposed in the rule would affect lessees and operators 
of leases and pipeline right-of-way holders on the OCS. This includes 
about 130 active federal oil and gas lessees and 115 pipeline rights-
of-way holders. Small lessees that operate under this rule fall under 
the Small Business Administration's (SBA) North American Industry 
Classification System (NAICS) codes 211111, Crude Petroleum and Natural 
Gas Extraction, and 213111, Drilling Oil and Gas Wells. For these NAICS 
code classifications, a small company is one with fewer than 500 
employees. Based on these criteria, an estimated 70 percent of these 
companies are considered small. This proposed rule, therefore would 
affect a substantial number of small entities.
    The fees proposed in the rule would not have a significant economic 
effect on a substantial number of small entities because the fees are 
small compared to normal costs of doing business on the OCS. For 
example, depending on water depth and well depth, cost estimates for 
drilling a well range from $5 million to $23 million. Thus, the 
proposed fees, ranging from $80 to $24,200, are dwarfed by the millions 
of dollars that industry already commits to exploration, development, 
production, and transportation.
    MMS conducted an additional analysis to study the potential impacts 
of these fees on small entities. MMS charted the 2004 production of all 
companies operating on the OCS. Using corresponding rolling annual 
average

[[Page 69123]]

prices, MMS calculated each company's federal OCS gross revenues. Using 
TIMS (and other databases) 2004 company data, plan/application/permit 
fees were calculated and compared with each company's calculated gross 
revenue. The analysis indicates that no company would have its offshore 
revenues affected by 0.5 percent or more.
    MMS does not have revenue data for most of the 115 pipeline right-
of-way holders. However, MMS does not expect the companies to be 
significantly impacted.
    Additionally, the service fees established in the rule would apply 
in a non-discriminating way to both large and small firms. Also, 
applying for MMS services provides a benefit to both a large and small 
applicant if the applicant decides to operate on the OCS.
    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 (SBREFA)

    The proposed rule is not a major rule under the SBREFA (5 U.S.C. 
804(2)). This proposed rule:
    (a) Would not have an annual effect on the economy of $100 million 
or more.
    (b) Would not cause a major increase in costs or prices for 
consumers, individual industries, Federal, state, or local government 
agencies, or geographic regions.
    (c) Would 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. 
Leasing on the U.S. OCS is limited to residents of the U.S. or 
companies incorporated in the U.S. This proposed rule would not change 
that requirement.

Unfunded Mandates Reform Act (UMRA) of 1995

    This proposed rule would not impose an unfunded mandate on state, 
local, or tribal governments or the private sector of more than $100 
million per year. The proposed rule would 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 UMRA (2 
U.S.C. 1531 et seq.) is not required. This is because the proposal 
would not affect state, local, or tribal governments, and the effect on 
the private sector is small.

Takings Implication Assessment (TIA) (Executive Order 12630)

    The proposed rule is not a governmental action capable of 
interference with constitutionally protected property rights. Thus, MMS 
did not need to prepare a TIA according to E.O. 12630, Governmental 
Actions and Interference with Constitutionally Protected Property 
Rights.

Federalism (Executive Order 13132)

    With respect to E.O. 13132, this proposed rule would not have 
federalism implications. This proposed rule would 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 proposed rule would not affect that role.

Civil Justice Reform (Executive Order 12988)

    With respect to E.O. 12988, MMS finds that this proposed rule would 
not unduly burden the judicial system and does meet the requirements of 
sections 3(a) and 3(b)(2) of the E.O. MMS consulted with the Department 
of the Interior Office of the Solicitor throughout this drafting 
process.

Paperwork Reduction Act (PRA) of 1995

    The proposed rulemaking relates to 30 CFR part 250, subparts B, D, 
E, H, I, J, L, P, and Q; 30 CFR part 251; and 30 CFR part 280. The 
rulemaking affects the information collections for these regulations 
but would not change the approved burden hours; it would just add the 
associated fees. Therefore, OMB has ruled that there is no change in 
the information collection and that MMS does not need to make a formal 
submission by Form OMB 83-I for this rulemaking. If the rule is 
finalized, we will submit Form OMB 83-C to add the fees in each 
collection.
    OMB has approved the information collections for the affected 
regulations at 30 CFR part 250, subpart B, 1010-0151; subpart D, 1010-
0141; subpart E, 1010-0067, subpart H, 1010-0059; subpart I, 1010-0149; 
subpart J, 1010-0050; subpart L 1010-0051; subpart P, 1010-0086, 
subpart Q, 1010-0142; 30 CFR part 251, 1010-0048; and 30 part CFR 280, 
1010-0072.

National Environmental Policy Act (NEPA) of 1969

    The MMS has determined that this rule is administrative and 
involves only procedural changes addressing fee requirements. 
Therefore, it is categorically excluded from environmental review under 
section 102(2)(C) of the NEPA, pursuant to 516 DM 2.3A and 516 DM 2, 
Appendix 1, Item 1.10.
    In addition, the proposed rule does not meet any of the 10 criteria 
for exceptions to categorical exclusions listed in 516 DM 2, Appendix 
2. Pursuant to Council on Environmental Quality regulations (40 CFR 
1508.4) and the environmental policies and procedures of the Department 
of the Interior, the term `categorical exclusions' means categories of 
action which do not individually or cumulatively have a significant 
effect on the human environment and which have no such effect in 
procedures adopted by a federal agency and therefore require neither an 
environmental assessment nor an environmental impact statement.

Effects on the Nation's Energy Supply (Executive Order 13211)

    E.O. 13211 requires the agency to prepare a Statement of Energy 
Effects when it takes a regulatory action that is identified as a 
significant energy action. This proposed rule is not a significant 
energy action, and therefore would not require a Statement of Energy 
Effects because it:
    (1) Is not a significant regulatory action under E.O. 12866,
    (2) Is not likely to have a significant adverse effect on the 
supply, distribution, or use of energy, and
    (3) Has not been designated by the Administrator of the Office of 
Information and Regulatory Affairs, OMB, as a significant energy 
action.

Consultation and Coordination With Indian Tribal Governments (E.O. 
13175)

    In accordance with E.O. 13175, this proposed rule would not have 
tribal implications that impose substantial direct compliance costs on 
Indian tribal governments.

Clarity of This Regulation

    E.O. 12866 requires each agency to write regulations that are easy 
to understand. MMS invites your comments on how to make this

[[Page 69124]]

proposed rule easier to understand, including answers to questions such 
as the following:
    (1) Are the requirements in the rule clearly stated?
    (2) Does the rule contain technical language or jargon that 
interferes with its clarity?
    (3) Does the format of the rule (grouping and order of sections, 
use of headings, paragraphing, etc.) aid or reduce its clarity?
    (4) Is the description of the rule in the ``Supplementary 
Information'' section of this preamble helpful in understanding the 
rule? What else can MMS do to make the rule easier to understand?
    Send a copy of any comments that concern how MMS could make this 
rule easier to understand to: Office of Regulatory Affairs, Department 
of the Interior, Room 7229, 1849 C Street, NW., Washington, DC 20240. 
You may also e-mail the comments to this address: Exsec@ios.doi.gov.

List of Subjects

30 CFR Part 250

    Administrative practice and procedure, Continental shelf, 
Environmental impact statements, Environmental protection, Government 
contracts, Investigations, Oil and gas exploration, Penalties, 
Pipelines, Public lands-mineral resources, Public lands-rights-of-way, 
Reporting and recordkeeping requirements, Sulphur.

30 CFR Part 251

    Continental shelf, Freedom of information, Oil and gas exploration, 
Public lands--mineral resources, Reporting and recordkeeping 
requirements, Research.

30 CFR Part 280

    Continental shelf, Public lands--mineral resources, Reporting and 
recordkeeping requirements, Research.

    Dated: October 24, 2005.
Chad Calvert,
Acting Assistant Secretary--Land and Minerals Management.
    For the reasons stated in the preamble, the Minerals Management 
Service (MMS) proposes to amend 30 CFR parts 250, 251, and 280 as 
follows:

PART 250--OIL AND GAS AND SULPHUR OPERATIONS IN THE OUTER 
CONTINENTAL SHELF

    1. The authority citation for part 250 is revised to read as 
follows:

    Authority: 43 U.S.C. 1331 et seq.; 31 U.S.C. 9701.

    2. In Sec.  250.125, revise the table in paragraph (a) and 
paragraph (b) to read as follows:


Sec.  250.125  Service Fees

    (a) * * *

                            Service Fee Table
------------------------------------------------------------------------
 Service--processing of the
         following:                Fee amount          30 CFR citation
------------------------------------------------------------------------
Change in Designation of      $150................  Sec.   250.143.
 Operator.
Suspension of Operators/      $1,800..............  Sec.   250.171.
 Suspension of Production
 (SOO/SOP) Request.
Exploration Plan (EP).......  $3,250 for each       Sec.   250.211(d).
                               surface location.
Development and Production    $3,750 for each well  Sec.   250.241(e).
 Plan (DPP) or Development     proposed.
 Operations Coordination
 Document (DOCD).
Deepwater Operations Plan...  $3,150..............  Sec.   50.292(p).
                                                     Sec.  250.296(a).
Conservation Information      $24,200.............  Sec.   250.296(a).
 Document.
Application for Permit to     $1,850. Initial       Sec.   250.410(d);
 Drill (APD; form MMS-123).    applications only,    Sec.   250.411;
                               no fee for            Sec.   250.460;
                               revisions.            Sec.   250.513(b);
                                                     Sec.   250.515;
                                                     Sec.   250.1605;
                                                     Sec.   250.1617(a);
                                                     Sec.   250.1622.
Application for Permit to     $110................  Sec.   250.460; Sec.
 Modify (APM; form MMS-124).                           250.465(b); Sec.
                                                      250.513(b); Sec.
                                                     250.515; Sec.
                                                     250.613(b); Sec.
                                                     250.615; Sec.
                                                     250.1618(a); Sec.
                                                     250.1622; Sec.
                                                     250.1704(g).
New Facility Production       $4,750 (Additional    Sec.   250.802(e).
 Safety System Application     fee of $12,500 will
 for facility with more than   be charged if MMS
 125 components.               deems it necessary
                               to visit a facility
                               offshore; and
                               $6,500 to visit a
                               facility in a
                               shipyard).
New Facility Production       $1,150 (Additional    Sec.   250.802(e).
 Safety System Application     fee of $7,850 will
 for facility 25-125           be charged if MMS
 components.                   deems it necessary
                               to visit a facility
                               offshore; and
                               $4,500 to visit a
                               facility in a
                               shipyard).
New Facility Production       $570................  Sec.   250.802(e).
 Safety System Application
 for facility with fewer
 than 25 components.
Production Safety System      $530................  Sec.   250.802(e).
 Application--Modification
 with more than 125
 components reviewed.
Production Safety System      $190................  Sec.   250.802(e).
 Application--Modification
 with 25-125 components
 reviewed.
Production Safety System      $80.................  Sec.   250.802(e).
 Application--Modification
 with fewer than 25
 components reviewed.
Platform Application--        $19,900.............  Sec.   250.905(k).
 Installation--under the
 Platform Verification
 Program.
Platform Application--        $2,850..............  Sec.   250.905(k).
 Installation--Fixed
 Structure Under the
 Platform Approval Program.
Platform Application--        $1,450..............  Sec.   250.905(k).
 Installation--Caisson/Well
 Protector.
Platform Application--        $3,400..............  Sec.   250.905(k).
 Modification.
New Pipeline Application      $3,100..............  Sec.   250.1000(b).
 (Lease Term).
Pipeline Application--        $1,800..............  Sec.   250.1000(b).
 Modification (Lease Term).
Pipeline Application--        $3,650..............  Sec.   250.1000(b).
 Modification (ROW).

[[Page 69125]]

 
Pipeline Repair Notification  $340................  Sec.   250.1008(e).
Pipeline Right-of-Way (ROW)   $1,800..............  Sec.   250.1015.
 Grant Application.
Pipeline Conversion of Lease  $200................  Sec.   250.1015.
 Term to ROW.
Pipeline ROW Assignment.....  $170................  Sec.   250.1018.
500 Feet From Lease/Unit      $3,300..............  Sec.   250.1101.
 Line Production Request.
Gas Cap Production Request..  $4,200..............  Sec.   250.1101.
Downhole Commingling Request  $4,900..............  Sec.   250.1106.
Complex Surface Commingling   $3,550..............  Sec.   250.1204(a).
 and Measurement Application.
Simple Surface Commingling    $1,200..............  Sec.   250.1204(a).
 and Measurement Application.
Voluntary Unitization         $10,700.............  Sec.   250.1303.
 Proposal or Unit Expansion.
Unitization Revision........  $760................  Sec.   250.1303.
Application to Remove a       $4,100..............  Sec.   250.1727.
 Platform or Other Facility.
Application to Decommission   $1,000..............  Sec.   250.1751(a)
 a Pipeline (Lease Term).                            or Sec.
                                                     250.1752(a).
Application to Decommission   $1,900..............  Sec.   250.1751(a)
 a Pipeline (ROW).                                   or Sec.
                                                     250.1752(a).
------------------------------------------------------------------------

    (b) Payment of the fees listed in paragraph (a) must accompany the 
submission of the document for approval. Once a fee is paid, it is 
nonrefundable, even if an application or other request is withdrawn. If 
your application is returned to you as incomplete, you are not required 
to submit a new fee with the amended application.
    3. In Sec.  250.211, add a new paragraph (d) to read as follows:


Sec.  250.211  What must the EP include?

* * * * *
    (d) Service fee. You must include payment of the service fee listed 
in Sec.  250.125.
    4. In Sec.  250.241, add a new paragraph (e) to read as follows:


Sec.  250.241  What must the DPP or DOCD include?

* * * * *
    (e) Service fee. You must include payment of the service fee listed 
in Sec.  250.125.
    5. In Sec.  250.292, revise paragraphs (n) and (o); and add a new 
paragraph (p) to read as follows:


Sec.  250.292  What must the DWOP contain?

    (n) A discussion of any new technology that affects hydrocarbon 
recovery systems;
    (o) A list of any alternate compliance procedures or departures for 
which you anticipate requesting approval; and
    (p) Payment of the service fee listed in Sec.  250.125.
    6. In Sec.  250.296, add the following sentence at the end of 
paragraph (a):


Sec.  250.296  When and how must I submit a CID or a revision to a CID?

    (a) * * * The submission of your CID must be accompanied by payment 
of the service fee listed in Sec.  250.125.
* * * * *
    7. In Sec.  250.410, revise the introductory paragraph and 
paragraph (d) to read as follows:


Sec.  250.410  How do I obtain approval to drill a well?

    You must obtain written approval from the District Manager before 
you begin drilling any well or before you sidetrack, bypass, or deepen 
a well. To obtain approval, you must:
* * * * *
    (d) Submit the following to the District Manager:
    (1) An original and two complete copies of form MMS-123, 
Application for a Permit to Drill (APD), and form MMS-123S, 
Supplemental APD Information Sheet;
    (2) A separate public information copy of forms MMS-123 and MMS-
123S that meets the requirements of Sec.  250.127; and
    (3) Payment of the service fee listed in Sec.  250.125.
    8. In Sec.  250.465, revise paragraph (b)(1) to read as follows:


Sec.  250.465  When must I submit an Application for Permit to Modify 
(APM) or an End of Operations Report to MMS?

* * * * *
    (b) * * *
    (1) Your APM (form MMS-124) must contain a detailed statement of 
the proposed work that would materially change from the approved APD 
and the submission of your APM must be accompanied by payment of the 
service fee listed in Sec.  250.125:
* * * * *
    9. In Sec.  250.513, revise the last sentence in paragraph (a); and 
revise the introductory language of paragraph (b) and paragraphs (b)(3) 
and (4) and adding paragraph (b)(5) to read as follows:


Sec.  250.513  Approval and reporting of well-completion operations.

    (a) * * * If the completion has not been approved or if the 
completion objective or plans have significantly changed, approval for 
such operations must be requested on Form MMS-124, Application for 
Permit to Modify (APM).
    (b) You must submit the following with Form MMS-124 (or with Form 
MMS-123; Form MMS-123S):
* * * * *
    (3) For multiple completions, a partial electric log showing the 
zones proposed for completion, if logs have not been previously 
submitted;
    (4) When the well-completion is in a zone known to contain 
H2S or a zone where the presence of H2S is 
unknown, information pursuant to Sec.  250.490 of this part; and
    (5) Payment of the service fee listed in Sec.  250.125.
* * * * *
    10. In Sec.  250.613, revise the last sentence in paragraph (a) and 
revise the introductory language of paragraph (b) and paragraphs (b)(2) 
and (3) and adding (b)(4) to read as follows:


Sec.  250.613  Approval and reporting for well-workover operations.

    (a) * * * Approval for such operations must be requested on Form

[[Page 69126]]

MMS-124, Application for Permit to Modify.
    (b) You must submit the following with Form MMS-124:
* * * * *
    (2) When changes in existing subsurface equipment are proposed, a 
schematic drawing of the well showing the zone proposed for workover 
and the workover equipment to be used;
    (3) Where the well-workover is in a zone known to contain 
H2S or a zone where the presence of H2S is 
unknown, information pursuant to Sec.  250.490 of this part; and
    (4) Payment of the service fee listed in Sec.  250.125.
* * * * *
    11. In Sec.  250.802, add a new paragraph (e)(7) to read as 
follows:


Sec.  250.802  Design, installation, and operation of surface 
production safety systems.

* * * * *
    (e) * * *
    (7) The service fee listed in Sec.  250.125 of this part. The fee 
you must pay will be determined by the number of components involved in 
the review and approval process.
    12. In Sec.  250.905, revise the introductory language and table 
headings add paragraph (k) to the table to read as follows:


Sec.  250.905  How do I get approval for the installation, 
modification, or repair of my platform?

    The Platform Approval Program requires that you submit the 
information, documents and fees listed in the following table for your 
proposed project.

------------------------------------------------------------------------
     Required submittal         Required contents   Other requirements j
------------------------------------------------------------------------
 
                              * * * * * * *
(k) Payment of the service
 fee listed in Sec.
 250l.125.
------------------------------------------------------------------------

    13. In Sec.  250.1000, revise paragraph (b) to read as follows:


Sec.  250.1000  General Requirements.

* * * * *
    (b) An application must be accompanied by payment of the service 
fee listed in Sec.  250.125 and submitted to the Regional Supervisor 
and approval obtained before:
    (1) Installation, modification or abandonment of a lease term 
pipeline
    (2) Installation or modification of a right-of-way (other than 
lease term) pipeline; or
    (3) Modification or relinquishment of a pipeline right-of way.
* * * * *
    14. In Sec.  250.1008, revise paragraph (e) to read as follows:


Sec.  250.1008  Reports.

* * * * *
    (e) The lessee or right-of-way holder must notify the Regional 
Supervisor before the repair of any pipeline or as soon as practicable. 
Your notification must be accompanied by payment of the service fee 
listed in Sec.  250.125. You must submit a detailed report of the 
repair of a pipeline or pipeline component to the Regional Supervisor 
within 30 days after the completion of the repairs. In the report you 
must include the following:
    (1) Description of repairs,
    (2) Results of pressure test, and
    (3) Date returned to service.
* * * * *
    15. In Sec.  250.1204, revise paragraph (a)(1) to read as follows:


Sec.  250.1204  Surface commingling.

    (a) * * *
    (1) Submit a written application to, and obtain approval from, the 
Regional Supervisor before commencing the commingling of production or 
making changes to previously approved commingling applications. Your 
application must be accompanied by payment of the service fee listed in 
Sec.  250.125. The service fees are divided into two levels for simple 
applications and complex applications.

------------------------------------------------------------------------
            Application type                         Actions
------------------------------------------------------------------------
(i) Simple applications consist of       Lease terminations.
 those that update or correct            Well status changes.
 previously approved measurement and     Well name changes.
 commingling records such as:
                                         Platform removals.
                                         Application cancellations
                                         FMP status changes.
                                         Meter updates.
                                         Operator changes.
                                         Meter proving and well test
                                          waivers.
                                         Applications to temporarily
                                          reroute production.
                                         Production tests prior to
                                          pipeline construction.
----------------------------------------
(ii) Complex applications include        Creation of a new facility
 applications not categorized as simple   measurement points (FMPs).
 and entail:                             Association of leases or units
                                          to existing FMPs.
                                         Inclusion of production from
                                          additional structures.
                                         Meter updates which add buy-
                                          back gas meters or pigging
                                          meters.
                                         Other applications which are
                                          deviations from the approved
                                          allocation procedures.
------------------------------------------------------------------------

* * * * *
    16. In Sec.  250.1617, revise paragraph (a) to read as follows:


Sec.  250.1617  Application for permit to drill.

    (a) Before drilling a well under an approved Exploration Plan, 
Development and Production Plan, or Development Operations Coordination 
Document, you must file Form MMS-123, APD, with the District Manager 
for approval. The submission of your APD must be accompanied by payment 
of the service fee listed in Sec.  250.125. Before

[[Page 69127]]

starting operations, you must receive written approval from the 
District Manager unless you received oral approval under Sec.  250.140.
* * * * *
    17. In Sec.  250.1618, revise the section heading and paragraph (a) 
to read as follows:


Sec.  250.1618  Application for Permit to Modify.

    (a) You must submit requests for changes in plans, changes in major 
drilling equipment, proposals to deepen, sidetrack, complete, workover, 
or plug back a well, or engage in similar activities to the District 
Manager on Form MMS-124, Application for Permit to Modify (APM). The 
submission of your APM must be accompanied by payment of the service 
fee listed in Sec.  250.125. Before starting operations associated with 
the change, you must receive written approval from the District Manager 
unless you received oral approval under Sec.  250.140.
* * * * *
    18. In Sec.  250.1704, revise the Decommissioning Applications and 
Reports Table to read as follows:


Sec.  250.1704  When must I submit decommissioning applications and 
reports?

* * * * *

             Decommissioning Applications and Reports Table
------------------------------------------------------------------------
Decommissioning applications
         and reports             When to submit         Instructions
------------------------------------------------------------------------
(a) Initial platform removal  In the Pacific OCS    Include information
 application [not required     Region or Alaska      required under Sec.
 in the Gulf of Mexico OCS     OCS Region, submit      250.1726.
 Region].                      the application to
                               the Regional
                               Supervisor at least
                               2 years before
                               production is
                               projected to cease.
(b) Final removal             Before removing a     Include information
 application for a platform    platform or other     required under Sec.
 or other facility.            facility in the         250.1727.
                               Gulf of Mexico OCS
                               Region, or not more
                               than 2 years after
                               the submittal of an
                               initial platform
                               removal application
                               to the Pacific OCS
                               Region and the
                               Alaska OCS Region.
(c) Post-removal report for   Within 30 days after  Include information
 a platform or other           you remove a          required under Sec.
 facility.                     platform or other       250.1729.
                               facility * * *.
(d) Pipeline decommissioning  Before you            Include information
 application.                  decommission a        required under Sec.
                               pipeline * * *.         250.1751(a) Sec.
                                                      250.1752(a), as
                                                     applicable.
(e) Post-pipeline             Within 30 days after  Include information
 decommissioning report.       your decommission a   required under Sec.
                               pipeline * * *.         250.1753.
(f) Site clearance report     Within 30 days after  Include information
 for a platform or other       you complete site     required under Sec.
 facility.                     clearance               250.1743(b)
                               verification
                               activities.
(g) Form MMS-124,             (1) Before you        Include information
 Application for Permit to     temporarily abandon   required under Sec.
 Modify (APM). The             or permanently plug    Sec.   250.1712
 submission of your APM must   a well or zone.       and 250.1721.
 be accompanied by payment
 of the service fee listed
 in Sec.   250.125.
                              (2) Within 30 days    Include information
                               after you plug a      required under Sec.
                               well.                   250.1717.
                              (3) Before you        Refer to Sec.
                               install a subsea      250.1722(a).
                               protective device.
                              (4) Within 30 days    Include information
                               after your complete   required under
                               a protective device   250.1722(d).
                               trawl test.
                              (5) Before you        Refer to Sec.
                               remove any casing     250.1723.
                               stub or mud line
                               suspension
                               equipment and any
                               subsea protective
                               device.
                              (6) Within 30 days    Include information
                               after you complete    required under Sec.
                               site clearance          250.1743(a).
                               verfication
                               activities.
------------------------------------------------------------------------

    19. In Sec.  250.1727, revise the introductory paragraph to read as 
follows:


Sec.  250.1727  What information must I include in my final application 
to remove a platform or other facility?

    You must submit to the Regional Supervisor, a final application for 
approval to remove a platform or other facility. Your application must 
be accompanied by payment of the service fee listed in Sec.  250.125. 
If you are proposing to use explosives, provide three copies of the 
application. If you are not proposing to use explosives, provide two 
copies of the application. Include the following information in the 
final removal application, as applicable:
* * * * *
    20. In Sec.  250.1751, revise paragraph (a) introductory text to 
read as follows:


Sec.  250.1751  How do I decommission a pipeline in place?

* * * * *
    (a) Submit a pipeline decommissioning application in triplicate to 
the Regional Supervisor for approval. Your application must be 
accompanied by payment of the service fee listed in Sec.  250.125. Your 
applicatio