[Federal Register Volume 63, Number 30 (Friday, February 13, 1998)]
[Proposed Rules]
[Pages 7335-7356]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-3533]
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DEPARTMENT OF THE INTERIOR
Minerals Management Service
30 CFR Parts 218, 250, and 256
RIN 1010-AC32
Postlease Operations Safety
AGENCY: Minerals Management Service (MMS), Interior.
ACTION: Proposed rule.
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SUMMARY: These proposed revisions update and clarify MMS regulations
concerning postlease operations. The revised rule provides authority to
MMS to grant an easement and a right-of-use for an outer Continental
Shelf (OCS) tract to a State lessee. It also clarifies the distinction
between granting and directing a suspension, and the different
consequences of each; sets out criteria to disqualify an operator with
repeated poor operating performance from acquiring any new
leaseholdings; and requires written accident reports.
DATES: MMS will consider all comments we receive by May 14, 1998. We
will begin reviewing comments then and may not fully consider comments
we receive after May 14, 1998.
ADDRESSES: Mail or hand-carry written comments (3 copies) to the
Department of the Interior; Minerals Management Service; Mail Stop
4024; 381 Elden Street; Herndon, Virginia 20170-4817; Attention: Rules
Processing Team (Comments).
FOR FURTHER INFORMATION CONTACT: Kumkum Ray, Engineering and Operations
Division, at (703) 787-1600.
SUPPLEMENTARY INFORMATION: The proposed revision of 30 CFR part 250,
subpart A, is an effort to streamline and organize the various topics
that apply in a general sense to all the other subparts under 30 CFR
part 250. These postlease operations regulations would contain
requirements as well as useful information and reference materials,
with an emphasis on operations performance. We would include a newer
edition of a document incorporated by reference (API RP 2A).
Definition of Lessee
We would include an owner of operating rights in the definition of
lessee. We would emphasize in Sec. 250.15(d) that, in addition to the
lessee and operator, all persons who conduct lease activities on behalf
of the lessee or operator must also comply with our regulations. The
operator is responsible for the performance of its contractors. MMS
will hold the operator accountable for the contractors' performance.
Performance standards
We would revise the regulation addressing crane operations to
include certain specifications that apply to platforms in the Pacific
OCS Region. Also, we would include two new sections under Performance
standards: One on welding procedures and another on electrical
equipment requirements. These requirements are repeated under Drilling
(subpart D), Well-Completion (subpart E), and Well-Workover (Subpart
F). Since the requirements apply to all exploration, development, and
production operations, they would be listed in subpart A and would be
removed from the various other subparts.
Disqualifying an operator
Safety is MMS's top priority for offshore operations. A new
regulation has been proposed to provide criteria that MMS will
consider, individually or collectively, in evaluating whether to
disqualify operators with repeated poor safety performance from
acquiring additional leases. In some particularly serious cases, this
could also result in MMS disapproving or revoking a company's status as
a designated operator. MMS will hold a meeting in Houston, Texas within
the comment period of the rulemaking, to consult with industry before
setting up criteria to implement this provision in our rules. We will
publish the meeting notice in the Federal Register. We recognize that
the vast majority of operators are conscientious in their operations.
The intention of this provision is to safeguard you from the few that
may be in dire non-compliance.
Civil Penalty
The reference related to civil penalty appeals has been deleted
from subpart A. On August 8, 1997, MMS published a revision to subpart
N which provides information related to civil penalty appeals.
Granting a right-of-use and easement
In our effort to establish and maintain a cooperative relationship
with coastal States, and lessees of State submerged land oil and gas
leases adjacent to the OCS, we are proposing to amend our regulations
currently in Sec. 250.7. (See proposed Sec. 250.18). The proposed rule
further implements the Secretary of the Interior's authority to
regulate offshore operations under the OCS Lands Act. The rule would
provide specific regulatory authority for Regional Directors to grant
an easement and right-of-use on an OCS tract to the State lessee when
the lease is near or adjacent to the Federal and State jurisdictional
boundary. MMS would require an application processing fee, annual
rental payments, and surety bonds from State lessees.
Suspensions
We are proposing to reorganize the section on suspensions to flow
better and to distinguish clearly between granting or directing a
suspension. A new provision at Sec. 250.19 (l)(5) would authorize
suspensions as necessary for the diligent development of marginal
reserves that would otherwise not be developed. The proposed revisions
to ``effect of suspensions on lease terms'' appear in Sec. 250.19 and
Sec. 256.73.
Accident reports
Recent rapid growth in offshore exploration and production
activities in the Gulf of Mexico has led to an attendant increase in
accidents and injuries on the OCS related to these activities. Since
safety is our top priority, MMS sees a strong need to upgrade our
accident investigation functions to ensure the continued safety of OCS
operations. The proposed rule adds a new requirement (proposed
Sec. 250.20(a)) that OCS operators, lessees, or permit holders provide
the MMS District Supervisor with written reports concerning accidents
on the OCS. We have provided a table to specify the reports required
for different types of accidents. MMS will provide more guidance on
thresholds for fires, and factors that impair safety, through Notices
to Lessees. Safety concerns also prompted the new requirement in
proposed paragraph (b) in this section to require evacuation statistics
during natural occurrences such as earthquakes and hurricanes.
[[Page 7336]]
Lease term extensions
We are proposing to expand the reporting requirements under
Sec. 250.23 to require the lessee/operator to report to MMS when lease
production is initiated, resumes before the end of the 180-day period
after production ceased, and when leaseholding operations occur during
the referenced 180-day interval. MMS needs this information in a timely
manner to efficiently maintain the lessee/operator's lease status.
Format of the proposed rule
We have written this proposed rule in a plain English format. We
have tried to set out these requirements in a straightforward and
uncomplicated manner. The plain English format uses the term ``you''
which means the lessee, right-of-way holder, or person acting on behalf
of a lessee or a right-of-way holder. We emphasize that ``you'' are
responsible for ensuring that all requirements are met. We encourage
your comments on our use of the plain English format in this proposed
rule as well as future rulemaking.
Executive Order (E.O.) 12866
This rule is not a significant rule under E. O. 12866 and does not
require a review by the Office of Management and Budget (OMB). The new
or expanded requirements in the rule are designed to safeguard lives,
property and the environment. They do not impose extensive burdens.
Lessees of a State lease located adjacent to the OCS will have to pay a
non-refundable filing fee if they apply for a right-of-use and
easement. The economic effects of the rule will be minimal. If there is
one application from State lessees per year, MMS will receive a total
of approximately $2,350 in fees and $5,000 in rental.
There are some additional new or expanded reporting requirements in
this rule. They do not impose extensive burdens, yet provide necessary
data that MMS will use to safeguard offshore operations. The estimated
additional burden for submitting copies of written accident reports is
1 hour. There are an estimated 142 responses and at the rate of $35 per
hour it would cost reporters a total of $4, 970 per year. The estimated
burden for evacuation statistics reports is 1 hour. There are an
estimated 620 responses and at the rate of $35 per hour it would cost
reporters a total of $21,700 per year. Since such events are extremely
unpredictable, we are estimating that these events could occur once
every three years. The estimated burden on lease production status is
one-half hour per report on lease production status. There are an
estimated 1,000 responses and at a rate of $35 per hour it would cost
reporters $17,500 per year.
Regulatory Flexibility Act
The proposed changes to 30 CFR part 250, subpart A will not have a
significant economic effect. In general, a company needs large
technical and financial resources and experience to safely conduct
offshore activities. However, many of the leases and operators have
less than 500 employees and are small businesses. It is likely that a
State lessee applying for a right-of-use and easement on the OCS may be
a small business. The costs associated with obtaining the benefit
(right-of-use and easement) would be minimal. The application fee is
estimated to be $2,350 per application and the rental is estimated to
be $5,000. A company is not expected to apply for more than one such
application per year. There are some additional new or expanded
reporting requirements in this rule but they do not impose extensive
burdens. 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
enforcement actions of MMS, call toll-free (888) 734-3247.
Paperwork Reduction Act
We have examined the proposed changes to 30 CFR part 218; 30 CFR
part 250; subparts E and F; and 30 CFR part 256 under the Paperwork
Reduction Act of 1995 (PRA). We have determined that no new reporting
and information collection requirements are included and the currently
approved collections of information for these sections remain
unchanged.
With respect to 30 CFR part 250, subpart D, the proposed changes
remove sections of the regulations that contain approved collections of
information subject to the PRA (OMB control number 1010-0053) and
relocate them to 30 CFR 250, subpart A. MMS will submit an inventory
correction change to OMB for approval when this rule is published in
final.
The proposed changes to 30 CFR 250, subpart A, do contain
collections of information subject to the PRA, and MMS has submitted
them to OMB for review and approval under section 3507(d) of the PRA.
As part of our continuing effort to reduce paperwork and respondent
burdens, MMS invites the public and other Federal agencies to comment
on any aspect of the reporting and recordkeeping burden. Submit your
comments to the Office of Information and Regulatory Affairs; OMB;
Attention: Desk Officer for the Department of the Interior (OMB control
number 1010-NEW); 725 17th Street, N.W., Washington, D.C. 20503. Send a
copy of your comments to the Rules Processing Team, Attn: Comments;
Mail Stop 4020; Minerals Management Service; 381 Elden Street; Herndon,
Virginia 20170-4817. You may obtain a copy of the supporting statement
for the new collection of information by contacting the Bureau's
Information Collection Clearance Officer at (202) 208-7744.
The PRA provides that an agency may not conduct or sponsor, and a
person is not required to respond to, a collection of information
unless it displays a currently valid OMB control number. OMB is
required to make a decision concerning the collection of information
contained in these proposed regulations between 30 to 60 days after
publication of this document in the Federal Register. Therefore, a
comment to OMB is best assured of having its full effect if OMB
receives it by March 16, 1998. This does not affect the deadline for
the public to comment to MMS on the proposed regulations.
The title of the collection of information for the main portion of
this proposed rule is ``Proposed Rulemaking--30 CFR 250, Subpart A,
General'' (OMB control number 1010-NEW). The current subpart A
regulations contain approved collections of information (OMB control
number 1010-0030) which consist of reporting and recordkeeping
requirements on designations of operator; performance capabilities and
standards; lease cancellations; suspensions of production or other
operations; determinations of well producibility; reinjection and
subsurface storage of gas; reimbursements of postlease geological and
geophysical data and information reproduction costs; accident
reporting; access to facilities; and crane inspection, testing,
maintenance and operator qualifications. MMS uses the information to
ensure that operations on the OCS are carried out in a manner that is
safe, pollution free, and do not interfere with the rights of other
users on the OCS.
The proposed rule, rewritten in plain English, restructures the
citations containing the information collection requirements approved
for the current
[[Page 7337]]
30 CFR 250, subpart A, regulations, but they remain unchanged. It also
relocates two requirements from other subparts of 30 CFR 250 that also
remain unchanged.
The proposed rule contains the following new or expanded
information collection requirements:
1. Sections 250.18(c) explains how lessees of a State lease located
adjacent to the OCS may apply for a right-of-use and easement on the
OCS, and includes a non-refundable filing fee for such applications.
MMS will use the information to determine if the right-of-use and
easement: serves the purpose specified in the grant when conducting
exploration, development, and production activities or other operations
on or off the lease; is maintained for such purposes specified; and
does not unreasonably interfere with the operations of any other
lessee. We estimate that the average burden for this new application
process will be 5 hours and a filing fee of approximately $2,350 per
application.
2. Section 250.20(a) expands accident reporting to include the
requirement to submit copies of written follow-up reports in addition
to oral notifications. MMS will use the information to upgrade the
accident investigation functions. We estimate that the average burden
for this new reporting requirement will be an additional 1 hour per
report.
3. Section 250.20(b) requires reports on evacuation statistics for
a natural occurrence (i.e., hurricanes, earthquakes, etc.). MMS will
use the information to be informed when there could be a major
disruption in the availability and supply of natural gas and oil due to
natural occurrences, to advise the Coast Guard of rescue needs, and to
alert the news media and interested public entities when production is
shut in and when resumed. We estimate that the average burden for this
reporting requirement will be 1 hour per report.
4. Sections 250.23(e), (f), and (g) expand the reporting
requirements for lease term dependency and operations for respondents
to report when lease production is initiated, resumes before the end of
the 180-day period after production ceased, and when leaseholding
operations occur during the referenced 180-day interval. MMS will use
this information to efficiently maintain the lessee/operator's lease
status. We estimate that the average burden for this expanded reporting
requirement will be one-half hour per report.
Respondents are approximately 130 Federal OCS oil and gas or
sulphur lessees and an estimate of one State lessee each year who will
apply for OCS right-of-use and easement. The frequency of response is
on occasion or annual. Responses to this collection of information are
mandatory or are required to obtain or retain a benefit. MMS will
protect proprietary information in accordance with the Freedom of
Information Act and 30 CFR 250.18 (renumbered to 30 CFR 250.27 in this
proposed rule), Data and information to be made available to the
public.
MMS estimates the total annual reporting and recordkeeping ``hour''
burden for the requirements in this proposed rule to be 10,578 hours.
This will reflect an increase of 2,150 hours for the new or expanded
requirements described above when this new collection replaces the
collection of information approved for the current requirements in 30
CFR 250, subpart A (1010-0030). MMS estimates the total annual
reporting and recordkeeping ``cost'' burden of this proposed rule to be
$2,350 for approximately one application filing fee per year under
Sec. 250.18(c).
In calculating the burden, MMS assumed that respondents perform
some of the requirements and maintain some of the records in the normal
course of their activities. MMS considers these to be usual and
customary and did not include them in the burden estimates. You are
invited to provide information if you disagree with this assumption.
MMS will summarize written responses to this notice and address
them in the final rule. All comments will become a matter of public
record.
1. MMS specifically solicits comments on the following questions:
(a) Is the proposed collection of information necessary for MMS to
properly perform its functions, and will it be useful?
(b) Are the estimates of the burden hours of the proposed
collection reasonable?
(c) Do you have any suggestions that would enhance the quality,
clarity, or usefulness of the information to be collected?
(d) Is there a way to minimize the information collection burden on
those who are to respond, including the use of appropriate automated
electronic, mechanical, or other forms of information technology?
2. In addition, the PRA requires agencies to estimate the total
annual cost burden to respondents or recordkeepers resulting from the
collection of information. MMS needs your comments on this item. Your
response should split the cost estimate into two components: (a) Total
capital and startup cost component, and (b) annual operation,
maintenance, and purchase of services component. Your estimates should
consider the costs to generate, maintain, and disclose or provide the
information. You should describe the methods you use to estimate major
cost factors, including system and technology acquisition, expected
useful life of capital equipment, discount rate(s), and the period over
which you incur costs. Capital and startup costs include, among other
items, computers and software you purchase to prepare for collecting
information; monitoring, sampling, drilling, and testing equipment; and
record storage facilities. Generally, your estimates should not include
equipment or services purchased: before October 1, 1995; to comply with
requirements not associated with the information collection; for
reasons other than to provide information or keep records for the
Government; or as part of customary and usual business or private
practices.
Takings Implication Assessment
The Department of the Interior (DOI) certifies that this proposed
rule does not represent a governmental action capable of interference
with constitutionally protected property rights. Thus, MMS did not need
to prepare a Takings Implication Assessment pursuant to Executive Order
(E.O.) 12630, Governmental Actions and Interference with
Constitutionally Protected Property Rights.
Unfunded Mandates Reform Act of 1995
DOI has determined and certifies according to the Unfunded Mandates
Reform Act, 2 U.S.C. 1502 et seq., that this rule will not impose a
cost of $100 million or more in any given year on State, local, and
tribal governments, or the private sector.
E.O. 12988
DOI has certified to OMB that the rule meets the applicable reform
standards provided in sections 3(a) and 3(b)(2) of E.O. 12988, Civil
Justice Reform.
National Environmental Policy Act
DOI has also determined that this action does not constitute a
major Federal action affecting the quality of the human environment;
therefore, an Environmental Impact Statement is not required.
List of Subjects
30 CFR Part 218
Continental shelf, Electronic funds transfers, Geothermal energy,
[[Page 7338]]
Government contracts, Indians--lands, Mineral royalties, Oil and gas
exploration, Public lands--mineral resources, Reporting and
recordkeeping requirements.
30 CFR Part 250
Continental shelf, Environmental impact statements, Environmental
protection, Government contracts, Incorporation by reference,
Investigations, Mineral royalties, Oil and gas development and
production, Oil and gas exploration, Oil and gas reserves, Penalties,
Pipelines, Public lands--mineral resources, Public lands--rights-of-
way, Reporting and recordkeeping requirements, Sulphur development and
production, Sulphur exploration, Surety bonds.
30 CFR Part 256
Administrative practice and procedures, Continental shelf,
Environmental Protection, Government contracts, Mineral royalties, Oil
and gas exploration, Pipelines, Public lands--mineral resources, Public
lands--rights-of-way, Reporting and recordkeeping requirements, Surety
bonds.
Dated: February 6, 1998.
Bob Armstrong,
Assistant Secretary, Land and Minerals Management.
For the reasons stated in the preamble, Minerals Management Service
(MMS) proposes to amend 30 CFR parts 218, 250, and 256 as follows:
PART 218--COLLECTION OF ROYALTIES, RENTALS, BONUSES AND OTHER
MONIES DUE THE FEDERAL GOVERNMENT
1. The authority citation continues to read as follows:
Authority: 25 U.S.C. 396 et seq.; 396a et seq.; 2101 et seq.; 30
U.S.C. 181 et seq.; 351 et seq.; 1001 et seq.; 1701 et seq.; 31
U.S.C.A. 3335; 43 U.S.C. 1301 et seq.; 1331 et seq.; 1801 et seq.
2. In Sec. 218.154 paragraphs (a) and (b) are revised to read as
follows:
Sec. 218.154 Effect of suspensions on royalty and rental.
(a) MMS will not require a lessee to pay rental or minimum royalty
for or during a period of suspension if the Regional Supervisor:
(1) Directs the suspension of both operations and production; or
(2) Directs the suspension of operations on a lease on which there
is no producible well under the provisions of 30 CFR 250.19 (j)(1),
(j)(2), (j)(4) or (k)(2).
(b) MMS will not relieve the lessee of the obligation to pay
rental, minimum royalty, or royalty for or during the period of
suspension if the Regional Supervisor approves a suspension of
operations or production, or both, requested by a lessee under the
provisions of 30 CFR 250.19 (j)(3), (j)(5), (k), (l) or (m)(1).
* * * * *
PART 250--OIL AND GAS AND SULPHUR OPERATIONS IN THE OUTER
CONTINENTAL SHELF
3. The authority citation for part 250 continues to read as
follows:
Authority: 43 U.S.C. 1334 et seq.
4. 30 CFR Part 250 subpart A is revised to read as follows:
Subpart A--General
Authority and Definition of Terms
Sec.
250.1 Authority and applicability of this part.
250.2 Definitions.
Performance Standards
250.3 Under what standards will the Director regulate lease
operations?
250.4 What measures must I take to protect health, safety,
property, and the environment?
250.5 What standards must crane operations meet?
250.6 What must a welding, burning, and hot tapping practices and
procedures plan contain?
250.7 What requirements apply to electrical equipment?
250.8 When must I use best available and safest technologies
(BAST)?
250.9 How do I determine well producibility?
250.10 Under what conditions will MMS approve reinjection and
subsurface gas storage?
Inspection of Operations
250.11 How often does MMS conduct inspections?
Disqualification and Appeals
250.12 Under what conditions will MMS disqualify an operator or
lessee?
250.13 How can I appeal a decision made under MMS regulations?
Special Types of Approvals
250.14 Under what conditions will MMS give me an oral approval or
an approval for alternate procedures and/or departures?
250.15 How do I designate an operator and local agent?
Naming and Identifying Platforms and Wells
250.16 How do I name platforms and wells?
250.17 What identification signs must I display?
Right-Of-Use and Easement
250.18 When will MMS grant a right-of-use and easement?
Suspensions
250.19 Under what conditions can operations or production be
suspended?
Reporting Requirements
250.20 What accident reports and evacuation statistics must I
submit?
250.21 Reports and investigations of apparent violations.
250.22 What archaeological reports and surveys must I submit?
Lease Term Extensions
250.23 What effect do production, drilling, or well-reworking have
on the lease term?
250.24 Under what circumstance may MMS cancel my lease, with or
without compensation?
Information: Submission, Reimbursement For, Availability To Public
250.25 What reporting information and report forms must I submit?
250.26 When will MMS reimburse me for reproduction costs?
250.27 Data and information to be made available to the public.
References
250.28 Documents incorporated by reference.
250.29 Paperwork Reduction Act requirements--information
collection.
Subpart A--General
Authority and Definition of Terms
Sec. 250.1 Authority and applicability of this part.
(a) The Secretary of the Interior (Secretary) authorized MMS to
regulate oil, gas and sulphur exploration, development, and production
operations on the Outer Continental Shelf (OCS). Under this authority,
the Director requires that all operations:
(1) Are conducted in accordance with the Act, the regulations in
this part, MMS orders, the lease or right-of-way, and other applicable
laws, regulations, and amendments; and
(2) Conform to sound conservation practice to preserve, protect,
and develop mineral resources of the OCS to:
(i) Make resources available to meet the Nation's energy needs;
(ii) Balance orderly energy resource development with protection of
the human, marine, and coastal environments;
(iii) Ensure the public receives a fair and equitable return on the
resources of the OCS;
(iv) Preserve and maintain free enterprise competition; and
(v) Minimize or eliminate conflicts between the exploration,
development, and production of oil and natural gas and the recovery of
other resources.
[[Page 7339]]
(b) When you conduct operations on the OCS you will be required to
submit requests, applications, and notices, or provide supplemental
information, for MMS approval. The table that follows contains general
references and the corresponding regulatory section for these
processes. MMS will respond with either written or oral approvals.
Refer to Sec. 250.14(a) of this part for information on oral approvals.
Table--Where to Find Information for Conducting Operations
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To get information about Refer to
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Exploration Plans (EP)..................... Sec. 250.33.
Development and Production Plans (DPP)..... Sec. 250.34.
Applications for Permit to Drill........... Sec. 250.64.
Oil and gas well-completion operations..... Sec. 250.83.
Oil and gas well-workover operations....... Sec. 250.103.
Abandonment of wells....................... Sec. 250.111.
Oil and gas production safety systems...... Sec. 250.122.
Platforms and structures................... Sec. 250.131.
Pipelines.................................. Sec. 250.157.
Pipeline right-of-way...................... Sec. 250.160.
Flaring.................................... Sec. 250.175.
Downhole commingling....................... Sec. 250.176.
Measurement of gas......................... Sec. 250.181.
Unitization................................ Sec. 250.190.
Training................................... Sec. 250.211.
Sulphur operations......................... Sec. 250.253.
Off-lease Geological and Geophysical Part 251.
permits.
Oil Spill Response Plans................... Part 254.
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Sec. 250.2 Definitions.
Terms used in this part will have the meanings given in the Act and
as defined below:
Act means the OCS Lands Act, as amended (43 U.S.C. 1331 et seq.).
Affected State means with respect to any program, plan, lease sale,
or other activity proposed, conducted, or approved pursuant to the
provisions of the Act, any State:
(1) The laws of which are declared, pursuant to section 4(a)(2) of
the Act, to be the law of the United States for the portion of the OCS
on which such activity is, or is proposed to be, conducted;
(2) Which is, or is proposed to be, directly connected by
transportation facilities to any artificial island or installation or
other device permanently or temporarily attached to the seabed;
(3) Which is receiving, or in accordance with the proposed activity
will receive, oil for processing, refining, or transshipment which was
extracted from the OCS and transported directly to such State by means
of vessels or by a combination of means including vessels;
(4) Which is designated by the Secretary of the Interior
(Secretary) as a State in which there is a substantial probability of
significant impact on or damage to the coastal, marine, or human
environment, or a State in which there will be significant changes in
the social, governmental, or economic infrastructure, resulting from
the exploration, development, and production of oil and gas anywhere on
the OCS; or
(5) In which the Secretary finds that because of such activity
there is, or will be, a significant risk of serious damage, due to
factors such as prevailing winds and currents to the marine or coastal
environment in the event of any oil spill, blowout, or release of oil
or gas from vessels, pipelines, or other transshipment facilities.
Air pollutant means any airborne agent or combination of agents for
which the Environmental Protection Agency (EPA) has established,
pursuant to section 109 of the Clean Air Act, national primary or
secondary ambient air quality standards.
Analyzed geological information means data collected under a permit
or a lease which have been analyzed. Analysis may include, but is not
limited to, identification of lithologic and fossil content, core
analysis, laboratory analysis of physical and chemical properties, well
logs or charts, results from formation fluid tests, and descriptions of
hydrocarbon occurrences or hazardous conditions.
Archaeological resource means any material remains of human life or
activities that are at least 50 years of age and that are of
archaeological interest.
Attainment area means, for any air pollutant, an area which is
shown by monitored data or which is calculated by air quality modeling
(or other methods determined by the Administrator of EPA to be
reliable) not to exceed any primary or secondary ambient air quality
standards established by EPA.
Best available control technology (BACT) means an emission
limitation based on the maximum degree of reduction for each air
pollutant subject to regulation, taking into account energy,
environmental and economic impacts, and other costs. The Regional
Director will verify the BACT on a case-by-case basis and it may
include reductions achieved through the application of processes,
systems, and techniques for the control of each air pollutant.
Best available and safest technology (BAST) means the best
available and safest technologies which the Secretary determines to be
economically feasible wherever failure of equipment would have a
significant effect on safety, health, or the environment.
Coastal environment means the physical, atmospheric, and biological
components, conditions, and factors which interactively determine the
productivity, state, condition, and quality of the terrestrial
ecosystem from the shoreline inward to the boundaries of the coastal
zone.
Coastal zone means the coastal waters (including the lands therein
and thereunder) and the adjacent shorelands (including the waters
therein and thereunder) strongly influenced by each other and in
proximity to the shorelands of the several coastal States. The coastal
zone includes islands, transition and intertidal areas, salt marshes,
wetlands, and beaches. The coastal zone extends seaward to the outer
limit of the U.S. territorial sea and extends inland from the
shorelines to the extent necessary to control shorelands, the uses of
which have a direct and significant impact on the coastal waters, and
the inward boundaries of which may be identified by the several coastal
States, pursuant to the authority in section 305(b)(1) of the Coastal
Zone Management Act (CZMA) of 1972.
Competitive reservoir means a reservoir in which there are one or
more well completions on each of two or more leases or portions of
leases, with different lease operating interests, from which the
lessees plan future production.
Conservation means preservation, economy, and avoidance of waste.
It is especially important in the petroleum industry, since oil and gas
are irreplaceable.
Correlative rights when used with respect to lessees of adjacent
tracts, means the right of each lessee to be afforded an equal
opportunity to explore for, develop, and produce, without waste,
minerals from a common source.
Data means facts and statistics, measurements, or samples which
have not been analyzed or processed.
Departures means approvals granted by the appropriate MMS
representative for operating requirements/procedures other than those
specified in the regulations found in this part. These requirements/
procedures may be necessary to control a well; properly develop a
lease; conserve natural resources, or protect life, property, or the
marine, coastal, or human environment.
Development means those activities which take place following
discovery of minerals in paying quantities, including geophysical
activity, drilling, platform construction, and operation of all
[[Page 7340]]
onshore support facilities, and which are for the purpose of ultimately
producing the minerals discovered.
Director means the Director of the MMS of the U.S. Department of
the Interior.
District Supervisor means the MMS officer with authority and
responsibility for a district within an MMS Region.
Easement means an authorization for a non-possessory, non-exclusive
interest in a portion of an OCS tract, whether leased or unleased,
which specifies the rights of the holder to use the area embraced in
the easement in a manner consistent with the terms and conditions of
the granting authority.
Emission offsets means emission reductions obtained from
facilities, either onshore or offshore, other than the facility or
facilities covered by the proposed Exploration Plan or Development and
Production Plan.
Enhanced recovery operations means pressure maintenance operations,
secondary and tertiary recovery, cycling, and similar recovery
operations which alter the natural forces in a reservoir to increase
the ultimate recovery of oil or gas.
Existing facility, as used in Sec. 250.45, means an OCS facility
described in an Exploration Plan or a Development and Production Plan
approved before June 2, 1980.
Exploration means the commercial search for oil, gas, and sulphur.
Activities classified as exploration include but are not limited to:
(1) Geophysical and geological (G&G) surveys where magnetic,
gravity, seismic reflection, seismic refraction, gas sniffers, coring,
or other systems are used to detect or imply the presence of oil, gas,
or sulphur; and
(2) Any drilling, including the drilling in which a discovery of
oil or natural gas in paying quantities or sulphur is made. This
includes drilling of any additional well needed to delineate any
reservoir and any drilling to enable the lessee to determine whether to
proceed with development and production.
Facility, as used in Sec. 250.11 concerning inspections, means any
installation permanently or temporarily attached to the seabed (that
includes manmade islands, and bottom-sitting structures) and any
onshore installation used for oil, gas, or sulphur drilling,
production, or related activities. Any group of installations that is
interconnected with walkways, or any group of installations that
includes a central or primary installation with processing equipment
and one or more satellite or secondary installations, is a single
facility unless the Regional Supervisor determines that the complexity
of the individual installations justifies their classification as
separate facilities.
Facility, as used in Sec. 250.45 concerning air quality, means any
installation or device permanently or temporarily attached to the
seabed which is used for exploration, development, and production
activities for oil, gas, or sulphur and which emits or has the
potential to emit any air pollutant from one or more sources. All
equipment directly associated with the installation or device is part
of a single facility if the equipment is dependent on, or affects the
processes of, the installation or device. During production, multiple
installations or devices are a single facility if the installations or
devices are directly related to the production of oil or gas at a
single site. Any vessel used to transfer production from an offshore
facility is part of the facility while physically attached to it.
Facility, as used in Sec. 250.67(b) concerning hydrogen sulfide
(H2S), means a vessel, a structure, or an artificial island
used for drilling, well-completion, well-workover, and/or production
operations.
Gas reservoir means a reservoir that contains hydrocarbons
predominantly in a gaseous (single-phase) state.
Gas-well completion means a well completed in a gas reservoir or in
the gas-cap of an oil reservoir with an associated gas-cap.
Governor means the Governor of a State, or the person or entity
designated by, or pursuant to, State law to exercise the powers granted
to such Governor pursuant to the Act.
H2S absent means:
(1) Drilling, logging, coring, testing, or producing operations
have confirmed the absence of H2S in concentrations that
could potentially result in atmospheric concentrations of 20 ppm or
more of H2S; or
(2) Drilling in the surrounding areas and correlation of geological
and seismic data with equivalent stratigraphic units have confirmed an
absence of H2S throughout the area to be drilled.
H2S present means drilling, logging, coring, testing, or
producing operations have confirmed the presence of H2S in
concentrations and volumes that could potentially result in atmospheric
concentrations of 20 ppm or more of H2S.
H2S unknown means the designation of a zone or geologic
formation where neither the presence nor absence of H2S has
been confirmed.
Human environment means the physical, social, and economic
components, conditions, and factors which interactively determine the
state, condition, and quality of living conditions, employment, and
health of those affected, directly or indirectly, by activities
occurring on the OCS.
Information when used without an adjective means G&G data that have
been analyzed, processed, or interpreted.
Interpreted geological information means geological information,
often in the form of schematic cross sections, 3-dimensional
representations, and maps, developed by determining the geological
significance of data and analyzed geological information.
Interpreted geophysical information means geophysical information,
often in the form of seismic cross sections, 3-dimensional
representations, and maps, developed by determining the geological
significance of geophysical data and processed geophysical information.
Lease means an agreement which is issued under section 8 or
maintained under section 6 of the Act and which authorizes exploration
for, and development and production of, minerals. The term also means
the area covered by that authorization, whichever is required by the
context.
Lease term pipelines means those pipelines owned and operated by a
lessee or operator that are completely contained within the boundaries
of a single lease, unitized leases, or contiguous (not cornering)
leases of that lessee or operator.
Lessee means a person who has entered into, or who is the MMS-
approved assignee of, a lease with the United States to explore for,
develop, and produce the leased minerals. The term lessee also includes
an owner of operating rights for that lease.
Major Federal action means any action or proposal by the Secretary
which is subject to the provisions of section 102(2)(C) of the National
Environmental Policy Act of 1969, 42 U.S.C. (2)(C) (i.e., an action
which will have a significant impact on the quality of the human
environment requiring preparation of an Environmental Impact Statement
pursuant to section 102(2)(C) of the National Environmental Policy
Act).
Marine environment means the physical, atmospheric, and biological
components, conditions, and factors which interactively determine the
productivity, state, condition, and quality of the marine ecosystem,
including the waters of the high seas, the contiguous zone,
transitional and intertidal areas, salt marshes, and wetlands within
the coastal zone and on the OCS.
[[Page 7341]]
Marine remains means physical evidence of human habitation,
occupation, use, or activity, including the site, location, or context
in which such evidence is situated.
Maximum production rate (MPR) means the approved maximum daily rate
at which oil or gas may be produced from a specified oil-well or gas-
well completion.
Minerals includes oil, gas, sulphur, geopressured-geothermal and
associated resources, and all other minerals which are authorized by an
Act of Congress to be produced from ``public lands'' as defined in
section 103 of the Federal Land Policy and Management Act of 1976, 43
U.S.C. 1331.
Nonattainment area means, for any air pollutant, an area which is
shown by monitored data or which is calculated by air quality modeling
(or other methods determined by the Administrator of EPA to be
reliable) to exceed any primary or secondary ambient air quality
standard established by EPA.
Nonsensitive reservoir means a reservoir in which ultimate recovery
is not decreased by high reservoir production rates.
Of archaeological interest means capable of providing scientific or
humanistic understanding of past human behavior, cultural adaptation,
and related topics through the application of scientific or scholarly
techniques, such as controlled observation, contextual measurement,
controlled collection, analysis, interpretation, and explanation.
Oil reservoir means a reservoir that contains hydrocarbons
predominantly in a liquid (single-phase) state.
Oil reservoir with an associated gas cap means a reservoir that
contains hydrocarbons in both a liquid and gaseous (two-phase) state.
Oil-well completion means a well completed in an oil reservoir or
in the oil accumulation of an oil reservoir with an associated gas cap.
Operating rights means any interest held in a lease with right to
explore for, develop, and produce leased substances. Any assignment or
transfer of operating rights may specify the depth of the borehole down
to which the operating rights extend.
Operator means the person the lessee(s) designates as having
control or management of operations on the leased area or a portion
thereof.
Outer Continental Shelf (OCS) means all submerged lands lying
seaward and outside of the area of lands beneath navigable waters as
defined in section 2 of the Submerged Lands Act (43 U.S.C. 1301) and of
which the subsoil and seabed appertain to the United States and are
subject to its jurisdiction and control.
Person includes, in addition to a natural person, an association, a
State, a political subdivision of a State, or a private, public, or
municipal corporation.
Pipelines are the piping, risers, and appurtenances installed for
the purpose of transporting oil, gas, sulphur, and produced waters.
Processed geological information means data collected under a
permit or a lease which have been processed. Processing involves
changing the form of data to facilitate interpretation. Processing
operations may include, but are not limited to, applying corrections
for known perturbing causes, rearranging or filtering data, and
combining or transforming data elements. Reprocessing operations may
include varying identified parameters for the detailed study of a
specific problem area.
Producing in paying quantities means that a well is able to produce
oil, gas, or both in a cost-effective manner. This means that the
production quantities must yield a greater return than the total costs,
including well-completion costs, of producing the hydrocarbons at the
wellhead.
Production means those activities which take place after the
successful completion of any means for the removal of minerals,
including such removal, field operations, transfer of minerals to
shore, operation monitoring, maintenance, and work-over operations.
Projected emissions means emissions, either controlled or
uncontrolled, from a source or sources.
Regional Director means the MMS officer with responsibility and
authority for a Region within MMS.
Regional Supervisor means the MMS officer with responsibility and
authority for operations or other designated program functions within
an MMS Region.
Right-of-use means any authorization to use OCS lands issued under
this part.
Right-of-way pipelines are those pipelines which: (1) Are contained
within the boundaries of a single lease or unitized leases but are not
owned and operated by a lessee or operator of that lease or unit, (2)
are contained within the boundaries of contiguous (not cornering)
leases which do not have a common lessee or operator, (3) are contained
within the boundaries of contiguous (not cornering) leases which have a
common lessee or operator but are not owned and operated by that common
lessee or operator, or (4) are contained within a block(s) which is
unleased.
Routine operations, for the purposes of subpart F, means any of the
following operations conducted on a well with the tree installed:
(1) Cutting paraffin;
(2) Removing and setting pump-through-type tubing plugs, gas-lift
valves, and subsurface safety valves which can be removed by wireline
operations;
(3) Bailing sand;
(4) Pressure surveys;
(5) Swabbing;
(6) Scale or corrosion treatment;
(7) Caliper and gauge surveys;
(8) Corrosion inhibitor treatment;
(9) Removing or replacing subsurface pumps;
(10) Through-tubing logging (diagnostics);
(11) Wireline fishing;
(12) Setting and retrieving other subsurface flow-control devices;
and
(13) Acid treatments.
Sensitive reservoir means a reservoir in which high reservoir
production rates will decrease ultimate recovery. Initially, all oil
reservoirs with an associated gas cap are classified as sensitive.
Significant archaeological resource means those archaeological
resources that meet the criteria of significance for eligibility to the
National Register of Historic Places as defined in 36 CFR 60.4.
Suspension means a granted or directed deferral of the requirement
to produce (Suspension of Production (SOP)) or to conduct leaseholding
operations (Suspension of Operations (SOO)).
Waste of oil, gas, or sulphur means:
(1) The physical waste of oil, gas, or sulphur;
(2) The inefficient, excessive, or improper use, or the unnecessary
dissipation, of reservoir energy;
(3) The locating, spacing, drilling, equipping, operating, or
producing of any oil, gas, or sulphur well(s) in a manner which causes
or tends to cause a reduction in the quantity of oil, gas, or sulphur
ultimately recoverable under prudent and proper operations or which
causes or tends to cause unnecessary or excessive surface loss or
destruction of oil or gas; or
(4) The inefficient storage of oil.
Well-completion operations means the work conducted to establish
production from a well after the production-casing string has been set,
cemented, and pressure-tested.
Well-control fluid means drilling mud, completion fluid, or
workover fluid as appropriate to the particular operation being
conducted.
[[Page 7342]]
Workover operations means the work conducted on wells after the
initial well-completion operation for the purpose of maintaining or
restoring the productivity of a well.
You means the Lessee, right-of-way holder, or person acting on
behalf of a lessee or a right-of-way holder.
Performance Standards
Sec. 250.3 Under what standards will the Director regulate lease
operations?
The Director will regulate all operations under a lease, right-of-
use and easement, or right-of-way to:
(a) Promote orderly exploration, development, and production of
mineral resources;
(b) Prevent damage to or waste of any natural resource, life,
property, or the environment; and
(c) Cooperate and consult with affected States, local governments,
other interested parties, and relevant Federal agencies.
Sec. 250.4 What measures must I take to protect health, safety,
property, and the environment?
(a) You must protect health, safety, property, and the environment
by:
(1) Performing all operations in a safe and workmanlike manner; and
(2) Maintaining all equipment in a safe condition.
(b) You must immediately take all necessary precautions to control,
remove, or otherwise correct any hazardous oil and gas accumulation or
other health, safety, or fire hazard.
Sec. 250.5 What standards must crane operations meet?
To ensure the safety of facility operations, you must meet the
requirements of paragraph (a) of this section. If your facility is
located in the Pacific OCS Region, you must also meet the requirements
of paragraph (b) of this section.
(a) In all cases, you must:
(1) Operate and maintain cranes installed on fixed platforms
according to the American Petroleum Institute (API) Recommended
Practice (RP) for Operation and Maintenance of Offshore Cranes (API RP
2D), and
(2) Keep records of inspection, testing and maintenance, and crane
operator qualifications according to the provisions of API RP 2D at
your field office nearest the OCS facility for a period of 2 years.
(b) This paragraph applies if your facility is located in the
Pacific OCS region. You may use other power-operated load-handling
equipment (such as air hoists or jib cranes) that has lower capacities
and is generally used for smaller loads than pedestal-mounted revolving
cranes. In this case, you must use such equipment according to specific
sections of API RP 2D as follows:
(1) Subsection 3.2 for Handling the Load;
(2) Section 4 for Inspection, Testing and Maintenance (with the
exception of 4.2.3, Load Test and 4.5, Crane Rerating); and
(3) Section 5 for Wire Rope and Sling Inspection, Requirement and
Maintenance.
Sec. 250.6 What must a welding, burning, and hot tapping practices and
procedures plan contain?
In this section, welding and burning include arc or fuel-gas
welding and arc or fuel-gas (acetylene or other gas) cutting. The term
welding includes welding, burning, and hot tapping activities.
(a) You must submit a Welding, Burning, and Hot Tapping Safe
Practices and Procedures Plan to the District Supervisor before you
begin drilling or production activities on a lease. You may not begin
welding activities until the District Supervisor has approved your
plan. A copy of the plan and its approval letter must be available at
the facility for the life of the facility (platform or drilling rig).
(b) Your plan must include the following:
(1) Standards or requirements for qualifying personnel who conduct
welding activities;
(2) Methods to ensure that only qualified personnel will conduct
welding activities;
(3) Practices and procedures for safe welding. Practices and
procedures must address:
(i) Welding in designated safe areas;
(ii) Welding in undesignated areas, including well bays;
(iii) Fire watches; and
(iv) Maintenance of welding equipment.
(4) Drawings showing any designated safe-welding areas; and
(5) Methods, practices and procedures to preclude spark producing
activities (i.e., grinding, abrasive blasting/cutting and arc-welding)
from becoming a source of ignition in hazardous locations.
(c) A welding supervisor or a designated person in charge must be
thoroughly familiar with your welding plan. This person must ensure
that each welder is properly qualified according to the welding plan.
This person also must inspect all welding equipment before welding.
(d) Your welding equipment must meet the following requirements:
(1) All engine-driven welding equipment must be equipped with spark
arrestors and drip pans;
(2) Welding leads must be completely insulated and in good
condition;
(3) Hoses must be leak free and equipped with proper fittings,
gauges, and regulators; and
(4) Oxygen and fuel gas bottles must be secured in a safe place.
(e) Before you weld, you must move any equipment containing
hydrocarbons or other flammable substances at least 35 feet
horizontally from the work site. You must move similar equipment
located on lower decks at least 35 feet from the point of impact where
slag, sparks, or other burning materials could fall. If moving this
equipment is impractical, you must protect that equipment with flame-
proofed covers, shield it with metal or fire-resistant guards or
curtains, or render the flammable substances inert.
(f) While you weld, you must monitor all water-discharge-point
sources from hydrocarbon-handling vessels. If a discharge of flammable
fluids occurs, you must stop welding.
(g) If you cannot weld in an approved safe-welding area, you must
meet the following requirements:
(1) You may not begin welding until the designated person-in-charge
has authorized in writing that it is safe to proceed with the welding
activity. Before beginning welding, the designated person-in-charge and
the welder(s) must inspect the work area and areas below the work area
for potential fire and explosion hazards.
(2) During welding, the person-in-charge must designate one or more
persons as a fire watch. These persons must have no other duties while
actual welding is in progress. The fire watch must have usable
firefighting equipment. The fire watch must remain on duty for 30
minutes after welding activities end. If welding occurs in an area not
equipped with a gas detector, the fire watch also must maintain a
continuous surveillance during the welding and burning operation, with
a portable gas detector.
(3) You may not weld piping, containers, tanks, or other vessels
that have contained a flammable substance unless you have rendered the
contents inert and the designated person-in-charge has determined it is
safe to weld. This does not apply to approved hot taps.
(4) You may not weld in, or within 10 feet of, a well-bay or
production area unless you have shut in all producing wells in that
area.
(5) You may not weld while you drill, complete, workover, or
conduct
[[Page 7343]]
wireline operations unless the fluids in the well are noncombustible
and you have precluded the entry of formation hydrocarbons into the
wellbore. This does not apply to welding in an approved safe-welding
area.
Sec. 250.7 What requirements apply to electrical equipment?
The requirements in this section apply to all electrical equipment
on all platforms, artificial islands, fixed structures, and their
facilities.
(a) You must classify all areas in accordance with API RP 500,
Recommended Practice for Classification of Locations for Electrical
Installations at Petroleum Facilities.
(b) You must use trained and experienced personnel to maintain your
electrical systems. They must have expertise in area classification,
distribution system, performance characteristics and operation of
electrical equipment, and associated hazards.
(c) You must install all electrical systems in accordance with API
RP 14F, Recommended Practice for Design and Installation of Electrical
Systems for Offshore Production Platforms. You do not have to comply
with Sections 7.4, Emergency Lighting, and 9.4, Aids to Navigation
Equipment.
(d) You must use a low-tension ignition system on each engine that
has electric ignition. You must design and maintain the ignition system
to minimize the release of electrical energy.
Sec. 250.8 When must I use best available and safest technologies
(BAST)?
(a) You must use BAST on all new exploration, development, and
production operations.
(b) You must use BAST on existing operations to avoid failure of
equipment that would have a significant effect on safety, health, or
the environment if the Director determines that:
(1) Using BAST is economically feasible; and
(2) The benefits of using BAST outweigh the costs.
(c) If you comply with the requirements of this part, MMS will
consider you to be using BAST.
(d) MMS will analyze specific equipment and procedures or systems
not covered by standards, codes, or practices to determine if their
failure would have a significant effect on safety, health, or the
environment. If MMS identifies significant effects on safety, health,
and the environment, the Regional Supervisor may direct you to submit
on a case-by-case basis the following analysis:
(1) Information necessary to indicate the use of BAST;
(2) Alternatives you are considering to the specific equipment or
procedures;
(3) The rationale as to why you chose one safe alternative
technology instead of another; and
(4) A discussion of the costs involved in the use of alternate
technologies and the incremental benefits to be gained.
Sec. 250.9 How do I determine well producibility?
To determine whether a well is capable of producing in paying
quantities, submit a written request to the District Supervisor. You
must then meet the criteria in paragraphs (a) and (b) of this section.
Once a lease has a well that MMS determines is capable of producing in
paying quantities, no further determination of well producibility will
be made on the lease. A determination of well producibility invokes
minimum royalty status on the lease as provided in 30 CFR 202.53. If
your well is located in the Gulf of Mexico (GOM), you must also meet
the requirements of paragraph (c) of this section.
(a) You must give the District Supervisor a reasonable opportunity
to witness each test that you conduct under paragraph (b) of this
section. In lieu of witnessing a test, MMS will accept test data with
your affidavit, or third-party test data, but you must receive the
District Supervisor's approval for this arrangement before the test.
(b) You must conduct:
(1) A production test for oil wells that lasts at least 2 hours
after flow stabilizes; and
(2) Either:
(i) A deliverability test for gas wells that lasts at least 2 hours
after flow stabilizes, or
(ii) A four-point back pressure test.
(c) As evidence that a well in the GOM is capable of producing oil
or gas in paying quantities, the GOM OCS Region will also consider the
collective results of the following log, core analyses, and test
criteria:
(1) Resistivity or induction electric log of the well showing a
minimum of 15 feet of producible sand in one section. The producible
section must not include any interval which appears to be water
saturated. All of the sections you count as producible must exhibit:
(i) Electrical spontaneous potential exceeding 20-negative
millivolts beyond the shale base line; or
(ii) Gamma ray log deflection of at least 70 percent of the maximum
gamma ray deflection in the nearest clean water-bearing sand--if mud
conditions prevent a 20-negative millivolt reading beyond the shale
base line; and
(iii) A minimum true resistivity ratio of the producible section to
the nearest clean water-bearing sand of at least 5:1.
(2) A log indicating sufficient porosity in the producible section.
(3) Sidewall cores and core analyses which indicate that the
section is capable of producing oil or gas or evidence that an attempt
was made to obtain such cores.
(4) A wireline formation test and/or mud-logging analysis which
indicates that the section is capable of producing oil or gas.
Sec. 250.10 Under what conditions will MMS approve reinjection and
subsurface gas storage?
(a) The Regional Supervisor may authorize you to reinject gas on
the OCS to promote conservation of natural resources and to prevent
waste. To receive MMS approval for reinjection, you must:
(1) Show that the reinjection will not result in undue interference
with operations under existing leases; and
(2) Submit a written application to the Regional Supervisor for
reinjection of gas.
(b) The Regional Supervisor will approve gas reinjection
applications that:
(1) Enhance recovery projects;
(2) Prevent flaring of casinghead gas; or
(3) Implement other conservation measures approved by the Regional
Supervisor.
(c) The Regional Supervisor may authorize subsurface storage of gas
on the OCS for later commercial benefit. To receive MMS approval you
must:
(1) Show that the subsurface storage of gas will not result in
undue interference with operations under existing leases; and
(2) Sign a storage agreement which includes the required payment
amount of a storage fee or rental.
(d) MMS may approve reinjection or storage of gas for locations on-
or off-lease.
(1) If you produce gas from an OCS lease and store it in a
reservoir on the lease or unit, you are not required to pay royalty
until you remove or sell the gas from the storage reservoir.
(2) If you produce gas from an OCS lease and treat it at an off-
lease or off-unit location, you must pay royalties when the gas is
first produced.
(3) A reservoir on- or off-lease may contain both reinjected or
stored gas and gas original to the reservoir. In this case, when you
produce gas from the reservoir you must use an MMS-
[[Page 7344]]
approved formula to determine the amounts of injected or stored gas
and gas original to the reservoir.
(e) Using a lease area for subsurface storage of gas, does not
affect the continuance or expiration of the lease.
(f) You may not store gas on unleased lands unless the Regional
Supervisor has approved a right-of-use and easement for that purpose,
under Sec. 250.18.
(g) To receive the Regional Supervisor's approval of your request
to reinject gas into the cap rock of a salt dome containing a sulphur
deposit, you must show that the injection:
(1) Is necessary to recover oil and gas contained in the cap rock;
and
(2) Will not significantly increase potential hazards to present or
future sulphur mining operations.
Inspection of Operations
Sec. 250.11 How often does MMS conduct inspections?
(a) To ensure that you are conducting operations in accordance with
the Act, the regulations in this part, the lease or right-of-way, and
other applicable laws and regulations, MMS will inspect your OCS
facilities, including those facilities under jurisdiction of other
Federal agencies that MMS inspects by agreement.
(1) MMS conducts a scheduled onsite inspection of each offshore
facility that is subject to environmental or safety regulations under
the Act at least once a year. The inspection determines whether
environmental protection and safety equipment designed to prevent or
ameliorate blowouts, fires, spillages, or other major accidents has
been installed and is operating properly.
(2) MMS may also conduct periodic onsite inspection of any of your
facilities without advance notice.
(b) When MMS conducts an inspection, you must provide:
(1) Access to all platforms, artificial islands, and other
installations located on your leases or associated with your lease,
right of easement, or right of way; and
(2) The use of helicopter landing sites and refueling facilities
for helicopters used by MMS for regulating offshore operations.
(c) You must make available at all reasonable times for MMS
inspection:
(1) The area covered under a lease, easement, right-of-way, or
permit;
(2) All improvements, structures, and fixtures on these areas; and
(3) All records of design, construction, operation, maintenance,
repairs, or investigations on or related to the area.
(d) Upon request, MMS will reimburse you for food, quarters, and
transportation that you provide for MMS representatives while they
inspect lease facilities and operations. You must send MMS your
reimbursement request within 90 days of the inspection.
Disqualification and Appeals
Sec. 250.12 Under what conditions will MMS disqualify an operator or
lessee?
MMS may disqualify an operator or lessee from acquiring any new
leaseholdings or lease assignments, or disapprove or revoke your
designation as operator, if your operating performance is unacceptable.
In making this determination, MMS will consider, individually or
collectively:
(a) Accidents and their nature;
(b) Pollution events, environmental damages and their nature;
(c) Incidents of non-compliance;
(d) Civil penalties;
(e) Failure to adhere to OCS lease obligations; or
(f) Any other relevant factors.
Sec. 250.13 How can I appeal a decision made under MMS regulations?
You may appeal orders or decisions issued under MMS regulations in
subchapter B (parts 250 to 282) in accordance with part 290 of this
title. When you appeal to the Director, you must continue to follow all
requirements for compliance with the order or decision you appealed,
unless the Secretary of the Interior (Secretary) or the Secretary's
designee grants a stay of the request.
Special Types of Approvals
Sec. 250.14 Under what conditions will MMS give me an oral approval or
an approval for alternate procedures and/or a departure?
(a) Oral approvals. When you apply for MMS approval of any
activity, MMS normally gives you a written approval. However, you may
receive oral approval from MMS under certain circumstances:
(1) MMS may give you oral approval to an oral request. You must
confirm the oral request by submitting a written request to MMS within
72 hours of the oral approval. Oral approvals for gas flaring do not
require a written follow-up request.
(2) MMS may give you oral approval to a written application when
quick action is necessary. MMS will follow up its oral approval to your
written application by forwarding a written approval to you and will
include any conditions placed on the oral approval.
(3) Requests to, and approvals from, MMS for gas flaring are always
oral. You are not required to submit a written request to follow-up
your oral request. However, when you stop the approved flaring, you
must promptly submit a written letter summarizing the location, dates
and hours, and volumes of liquid hydrocarbons produced and gas flared
associated with the approved flaring in accordance with 30 CFR part
250, subpart K.
(b) Approval for alternate procedures. You may use alternate
procedures or equipment as follows:
(1) You may use new or alternate procedures or equipment, not
covered in this part, if they provide a level of protection to the
environment and ensure a measure of safety that is equal to or
surpasses the current MMS requirements.
(2) Before using the new or alternate technique or equipment, you
must have written approval from the District or Regional Supervisor, as
appropriate.
(3) To receive MMS approval, you must either submit information or
give an oral presentation to the District or Regional Supervisor, as
appropriate, describing the site-specific application(s), performance
characteristics, and safety features of the proposed procedure. The
District or Regional Supervisor will respond to each proposal in
writing.
(c) Approval for departures. If certain aspects of your proposed
procedure or equipment deviate from or are not covered by MMS
regulations, MMS may prescribe or approve exceptions from the operating
requirements of this part.
Sec. 250.15 How do I designate an operator and local agent?
(a) You must provide the Regional Supervisor an executed
Designation of Operator form unless you are the only lessee and are the
only person conducting lease operations. When there is more than one
lessee then the Regional Supervisor must receive and approve the
Designation of Operator form from each lessee before the designated
operator may commence operations on the leasehold.
(1) This designation is authority for the designated operator to
act on your behalf and to fulfill your obligations under the Act, the
lease, and the regulations in this part.
(2) When you are no longer the designated operator, you must
immediately provide in writing the termination of your Designation of
Operator to the Regional Supervisor. If you are also a designated
royalty payor and will not continue to be in the future, you must also
notify the Royalty Management Program of the termination of your
Designation of Operator.
(3) When a Designation of Operator terminates, the Regional
Supervisor must approve a new designated operator
[[Page 7345]]
under this paragraph before operator may continue.
(4) If your Designation of Operator is terminated, or a controversy
develops between you and your designated operator, you and your
designated operator must protect the lessor's interests.
(5) You, or your designated operator, must immediately provide the
Regional Supervisor a written notification of any change of address.
(b) When you are not the sole lessee, you and your co-lessee(s) are
jointly and severally responsible for fulfilling your obligations under
the provisions of this subchapter, unless otherwise provided in the
regulations in this subchapter. Should your designated operator fail to
fulfill any of your obligations under this subchapter, the Regional
Supervisor may require you or any or all of your co-lessee(s) to
fulfill those obligations or other operational obligations under the
Act, the lease, or the regulations in this subchapter.
(c) You or your designated operator may designate for the Regional
Supervisor's approval, or the Regional Director may require you to
designate, a local agent empowered to: receive notices, submit
requests, applications, notices, or supplemental information; or
fulfill your obligations under the Act, the lease, or the regulations
in this part.
(d) Whenever the regulations in 30 CFR parts 250 to 282 require the
lessee to meet a requirement or perform an action, the lessee, operator
(if one has been designated), and the person actually performing the
activity to which the requirement applies are jointly and severally
responsible for compliance with the regulation.
Naming and Identifying Platforms and Wells
Sec. 250.16 How do I name platforms and wells?
(a) In the Gulf of Mexico Region: (1) Assign each platform a letter
designation. For example, A, B, CA, or CB.
(i) After a platform is installed, rename each well that was
drilled through a template and was assigned a number. Use a letter and
number designation. For example, rename Well No. 1: A-1, B-1, or C-1;
and
(ii) When you have more than one platform in a field (excluding
complexes), include the designations for the field and use a different
letter designation for each platform. For example, EC 221-A, EC 222-B,
EC 223-C.
(2) In naming multiple well caissons, you must assign a letter
designation.
(3) In naming single well caissons, you must use certain criteria
as follows:
(i) For single well caissons that are not attached to a platform
with a walkway, use the well designation. For example, Well No. 1;
(ii) For single well caissons that are attached to a platform with
a walkway, use the same designation as the platform. For example,
rename Well No.10 as A-10; and
(iii) For single well caissons with production equipment, use a
letter designation. For example, Well No. 1 as A-1.
(b) In the Pacific Region, platforms are assigned a name
designation.
(c) In the Alaska Region, platforms will be named and identified in
accordance with the Regional Director's directions.
Sec. 250.17 What identification signs must I display?
(a) You must identify all platforms, structures, artificial
islands, and mobile drilling units with a sign.
(1) You must display an identification sign that can be viewed from
the waterline on at least one side of the platform. The sign must use
at least 3-inch letters and figures.
(2) When helicopter landing facilities are present, you must
display an additional identification sign that is visible from the air.
The sign must use at least 12-inch letters and figures, and must also
display the weight capacity of the helipad. If this sign is visible to
both helicopter and boat traffic, then the sign in paragraph (a)(1) of
this section is not required.
(3) Your identification sign must:
(i) List the name of the lessee or designated operator;
(ii) In the GOM OCS Region, list the area designation or
abbreviation and the block number of the platform location as depicted
on OCS Official Protraction Diagrams or leasing maps;
(iii) In the Pacific OCS Region, list the lease number on which the
facility is located; and
(iv) List the name of the platform, structure, artificial island,
or mobile drilling unit.
(b) You must identify singly completed wells and multiple
completions as follows:
(1) For each singly completed well, list the lease number and well
number on the wellhead or on a sign affixed to the wellhead;
(2) For wells with multiple completions, identify each completion
individually at the wellhead; and
(3) For subsea wellheads, affix the required sign on the flowline
that connects to the pipeline that connects to the subsea well at a
convenient location on the receiving platform.
(c) Each identifying sign must be visible to approaching traffic
and maintained in a legible condition.
Right-of-Use and Easement
Sec. 250.18 When will MMS grant a right-of-use and easement?
(a) Granting a right-of-use and easement. In addition to the rights
and privileges granted to you under a lease issued or maintained under
the Act, MMS may grant you a right-of-use and easement on the OCS if
you meet these requirements:
(1) You must need the right-of-use and easement to construct and
maintain off the lease platforms, artificial islands, and installations
and other devices that are:
(i) Permanently or temporarily attached to the seabed; and
(ii) Used for conducting exploration, development, and production
activities or other operations on your lease;
(2) You must exercise the right-of-use and easement in accordance
with the provisions of this part;
(3) If you apply for a right-of-use and easement on a leased area,
you must notify the lessee and give her/him an opportunity to comment
on your application; and
(4) You must receive MMS approval for all platforms, artificial
islands, and installations and other devices permanently or temporarily
attached to the seabed.
(b) Continuation of the right beyond lease termination.
If your right-of-use and easement is on a lease, you may continue
to exercise the right-of-use after the lease on which it is situated
terminates. You must only use the right-of-use and easement for the
purpose that the grant specifies. All future lessees of that portion of
the OCS on which your right-of-use and easement is situated must
continue to provide you the right-of-use and easement for the purpose
that the grant specifies.
(c) Granting a right-of-use and easement to adjacent State lessee.
MMS may grant a lessee of a State lease located adjacent to the OCS a
right-of-use and easement on the OCS. MMS will require you to pay an
application fee (see (c)(4)(i)) to reimburse us for our costs of
processing your application. The Independent Offices Appropriations Act
(31 U.S.C. 9701), Office of Management and Budget (OMB) Circular A-25,
and the Omnibus Appropriations Bill (Pub. L. 104-133, 110 Stat. 1321,
April 26, 1996) require us to collect these fees. MMS will
[[Page 7346]]
specify the fee and rental payment amounts (under paragraph (c)(3)) of
this section in notices to State lessees.
(1) MMS will only grant a right-of-use and easement under this
paragraph to enable a State lessee to conduct and maintain a device
that is permanently or temporarily attached to the seabed (i.e., a
platform, artificial island, or installation). The lessee must use the
device to explore for, develop, and produce oil and gas from the
adjacent State lease and for other operations that are related to these
activities.
(2) A right-of-use and easement granted under this section is
subject to the regulations of this part and any terms and conditions
that the Regional Director prescribes.
(3) For the whole or fraction of the first calendar year, and
annually after that, you must pay to MMS, in advance, an annual rental
payment in an amount MMS will establish in accordance with the statutes
and OMB Circular A-25, referenced in paragraph (c) of this section.
(4) When you apply for a right-of-use and easement, you must pay:
(i) A non-refundable filing fee; and
(ii) The first year's rental according to paragraph (c)(3) of this
section.
(5) With your application, you must describe the proposed use
giving:
(i) Details of the proposed uses and activities including access
needs and special rights-of-use that you may need;
(ii) A description of all facilities for which you are seeking
authorization;
(iii) A map or plat describing primary and alternate project
locations; and
(iv) A schedule for constructing any new facilities, drilling or
completing any wells, anticipated production rates, and productive life
of existing production facilities.
(6) Before MMS issues you a right-of-use and easement on the OCS,
you must furnish the Regional Director a surety bond in the amount of
$500,000. The Regional Director may require additional security from
you (i.e., security over and above the prescribed $500,000) to cover
additional costs and liabilities for regulatory compliance. This
additional surety:
(i) Must be in the form of a supplemental bond or bonds meeting the
requirements of Sec. 256.54 or an increase in the amount of coverage of
an existing surety bond; and
(ii) Covers additional costs and liabilities for regulatory
compliance, including well abandonment, platform and structure removal,
and site clearance from the seafloor of the right-of-use and easement.
Suspensions
Sec. 250.19 Under what conditions can operations or production be
suspended?
(a) You may request approval of a suspension, or the Regional
Supervisor may direct a suspension (Directed Suspension), for all or
any part of a lease. Depending on the nature of the suspended activity,
suspensions are labeled either Suspensions of Operations (SOO) or
Suspensions of Production (SOP).
(b) A suspension may extend the term of a lease (see 30 CFR
250.23). The extension is equal to the length of time the suspension is
in effect, except as provided in paragraph (c).
(c) A Directed Suspension does not extend the term of a lease when
the Regional Supervisor direct a suspension because of:
(1) Gross negligence; or
(2) A willful violation of a provision of the lease or governing
statutes and regulations.
(d) MMS may issue suspensions for a period of up to 5 years. The
Regional Supervisor will set the length of the suspension based on the
conditions of the individual case involved. MMS may grant consecutive
suspensions.
(e) SOO's end automatically when the suspended operation commences.
(f) SOP's end automatically when production begins.
(g) A Directed Suspension normally terminates as specified in the
letter directing the suspension.
(h) MMS may terminate any suspension when the Regional Supervisor
determines the circumstances that justified the suspension no longer
exist or that other lease conditions warrant termination. The Regional
Supervisor will notify you of the reasons for termination and the
effective date.
(i) You must submit your request for a suspension to the Regional
Supervisor before the 180th day after you stop operations (see 30 CFR
250.23). MMS must receive the request before the lease term ends. The
request must include:
(1) The justification for the suspension including the length of
suspended period requested; and
(2) A schedule of work leading to the commencement or restoration
of the suspended activity.
(j) The Regional Supervisor may grant or direct a suspension under
any of the following circumstances:
(1) When necessary to comply with judicial or Congressional decrees
prohibiting any activity or the permitting of those activities. The
effective date of the suspension will be the effective date required by
the action of the court or Congress;
(2) When activities pose a threat of serious, irreparable, or
immediate harm. This would include damage to life (including fish and
other aquatic life), property, any mineral deposit, or the marine,
coastal, or human environment. MMS may require you to do a site-
specific study (see Sec. 250.19 (o)(1));
(3) When necessary for the installation of safety or environmental
protection equipment;
(4) When necessary to carry out the requirements of the National
Environmental Policy Act or to conduct an environmental analysis; or
(5) When necessary to allow for inordinate delays encountered in
obtaining required permits or consents, including administrative or
judicial challenges or appeals.
(k) The Regional Supervisor may direct a suspension when:
(1) You failed to comply with an applicable law, regulation, order,
or provision of a lease or permit; or
(2) The suspension is in the interest of national security or
defense.
(l) The Regional Supervisor may grant or direct an SOP when: the
suspension is in the national interest; you have exercised diligence in
pursuing production; the lease was drilled and a well was determined to
be producible in accordance with 30 CFR 250.9 or 250.253; and it is
necessary because the suspension will meet one of the following
criteria:
(1) It will facilitate the proper development of a lease, including
allowing you reasonable time to construct and install production
facilities;
(2) It will allow you time to obtain adequate transportation
facilities;
(3) It will allow you a reasonable amount of time to enter a sales
contract for oil, gas, or sulphur. You must show that you are making a
good faith effort to enter into the contract(s);
(4) It will avoid premature abandonment of a producing well(s);
(5) It will allow you to develop marginal reserves that would
otherwise not be developed. You must provide a schedule of work
commitments, with specific measurable milestones, which would lead to
development; or
(6) It will allow you reasonable time to acquire, properly process/
reprocess, and evaluate geophysical data or information. You must
demonstrate a commitment to developing the lease, and the evaluation
program must be designed to efficiently select a location for
additional development wells, assist in siting development facilities,
or locate an additional well needed to properly size production
facilities.
[[Page 7347]]
(m) The Regional Supervisor may grant an SOO when necessary to
allow you reasonable time to commence drilling or other operations when
your good-faith efforts are prevented by reasons beyond your control,
such as unexpected weather, unavoidable accidents, or drilling rig
delays.
(n) A directed suspension may affect the payment of rental or
royalties for the lease as provided in Sec. 218.154.
(o) If MMS grants or directs a suspension under paragraph (j)(2) of
this section, the Regional Supervisor may require you to:
(1) Conduct a site-specific study(s);
(2) Submit a revised EP (including any required mitigating
measures);
(3) Submit a revised DPP (including any required mitigating
measures); or
(4) Submit a revised Development Operations Coordination Document
according to Sec. 250.34.
(p) The Regional Supervisor must approve or prescribe the scope for
any site-specific study that you perform under Sec. 250.19 (o)(1).
(1) The study must evaluate the cause of the hazard, the potential
damage, and the available mitigation measures.
(2) You must pay for the study unless you request, and the Regional
Supervisor agrees to arrange, payment by another party.
(3) You must furnish copies and results of the study to the
Regional Supervisor.
(4) MMS will make the results available to other interested parties
and to the public.
(5) The Regional Supervisor will use the results of the study and
any other information that becomes available:
(i) To decide if the suspension can be lifted.
(ii) To determine any actions that you must take to mitigate or
avoid any damage to the environment, life, or property.
Reporting Requirements
Sec. 250.20 What accident reports and evacuation statistics must I
submit?
(a) Accident reports. You must report accidents in accordance with
the accident reporting table in this section. Copies of written company
reports may be submitted to fulfill these requirements.
Table--Accident Reporting
------------------------------------------------------------------------
Type of accident Reporting requirement
------------------------------------------------------------------------
Major accidents, including fires, are 1. In the case of death or
those which cause (1) any death or fire, orally notify the
serious injury resulting in District Supervisor
substantial impairment of any bodily immediately. Otherwise, orally
unit or function, or (2) property or notify the District Supervisor
equipment damage costing more than within 24 hours.
$25,000..
2. Follow up with a preliminary
written report within 10 days.
3. Submit a final written
report in 45 days.
4. In all written reports,
differentiate, to the extent
practicable, between factual
and conjectural or
interpretive information.
Reportable accidents include (1) all 1. Notify the District
other fires, (2) injuries requiring Supervisor within 72 hours.
more than first aid treatment and
which prevent the performance of
normal work duties, or (3) property or
equipment damage costing less than
$25,000 and which impairs safety
systems.
2. Follow up with a written
report within 10 days. To the
extent practicable,
differentiate between factual
and conjectural or
interpretive information.
All explosions and blowouts connected 1. Orally notify the District
with any activities or operations on a Supervisor immediately.
lease.
2. Follow up with a written
report within 10 days. To the
extent practicable,
differentiate between factual
and conjectural or
interpretive information.
Oil spills............................. Report all spills of oil in
accordance with 30 CFR part
254.
------------------------------------------------------------------------
(1) If you hold an easement, right-of-way, or other permit, you
must comply with paragraph (a) of this section by notifying and
reporting to the Regional Supervisor any accidents occurring on the
area covered by the easement, right-of-way, or other permit.
(2) Investigations that MMS conducts under the authority of
sections 22(d) (1) and (2) of the Act 43 U.S.C. 1348 d(1) and (2), are
fact-finding proceedings with no adverse parties. The purpose of the
investigation is to prepare a public report that determines the cause
or causes of the accident. The investigations may involve panel
meetings conducted by a chairperson appointed by MMS. The following
requirements must be met for any panel meetings involving persons
giving testimony:
(i) A person giving testimony may have legal and/or other
representative(s) present to provide advice or counsel while the person
is giving testimony. The chairperson may require a verbatim transcript
to be made of all oral testimony. The chairperson also may accept a
sworn written statement in lieu of oral testimony.
(ii) Only panel members, panel legal advisors, and panel experts
may address questions to any person giving testimony.
(iii) The chairperson may issue subpoenas to persons to appear and
provide testimony at a panel meeting. A subpoena may not require a
person to attend a panel meeting held at a location more than 100 miles
from where a subpoena is served.
(iv) Any person giving testimony is entitled to request
compensation for mileage and fees for service within 90 days after the
panel meeting. The compensated expenses must be similar to mileage and
fees for service that are permitted to be compensated by U. S. District
Courts.
(b) Evacuation statistics for natural occurrences. You must submit
evacuation statistics to the Regional Supervisor for a natural
occurrence such as an earthquake or hurricane. MMS will notify local
and national authorities and the public, as appropriate. You must:
(1) Submit the statistics by telefax or E-mail as soon as possible
when evacuation occurs;
(2) Submit statistics on a daily basis no later than 11 a.m. during
the period of shut-in and evacuation;
(3) Inform MMS when you resume production; and
(4) Submit statistics either by MMS district or the total figures
for your operations in the Region.
[[Page 7348]]
Sec. 250.21 Reports and investigations of apparent violations.
Any person may report to MMS an apparent violation or failure to
comply with any provision of the Act, any provision of a lease,
license, or permit issued under the Act, or any provision of any
regulation or order issued under the Act. When MMS receives a report of
an apparent violation, or when an MMS employee detects an apparent
violation, MMS will investigate in accordance with its procedures.
Sec. 250.22 What archaeological reports and surveys must I submit?
(a) If it is likely that an archaeological resource exists in the
lease area, the Regional Director will notify you in writing. You must
include an archaeological report in the EP or DPP.
(1) If the archaeological report suggests that an archaeological
resource may be present, you must either:
(i) Locate the site of any operation so as not to adversely affect
the area where the archaeological resource may be; or
(ii) Establish to the satisfaction of the Regional Director that an
archaeological resource does not exist or will not be adversely
affected by operations. This requires further archaeological
investigation, conducted by an archaeologist and a geophysicist, using
survey equipment and techniques the Regional Director considers
appropriate. You must submit the investigation report to the Regional
Director for review.
(2) If the Regional Director determines that an archaeological
resource is likely to be present in the lease area and may be adversely
affected by operations, the Regional Director will notify you
immediately. You must not take any action that may adversely affect the
archaeological resource until the Regional Director has told you how to
protect the resource.
(b) If you discover any archaeological resource while conducting
operations in the lease area, you must immediately halt operations
within the area of the discovery and report the discovery to the
Regional Director. If investigations determine that the resource is
significant, the Regional Director will tell you how to protect it.
Lease Term Extensions
Sec. 250.23 What effect do production, drilling, or well-reworking
have on the lease term?
(a) Your lease expires at the end of its primary term unless you
are producing in paying quantities or conducting drilling or well-
reworking operations on your lease (see 30 CFR part 256). The objective
of the drilling or well-reworking operations must be to establish
continuous production on the lease. For purposes of this section, the
term operations means continuous production, drilling, or well-
reworking.
(b)(1) If you stop conducting operations during the last 180 days
of your primary lease term, your lease will expire at the end of the
primary lease term unless by the 180th day after you stop operations
you either resume operations, or MMS receives your request for an SOO
or an SOP that the Regional Supervisor later grants under Sec. 250.19.
If the Regional Supervisor denies your request for an SOO or an SOP and
you do not resume operations within 180 days after you stop operations,
your lease expires at the end of the primary lease term.
(2) If you extend your lease term under paragraph (b)(1), you must
pay rental for each year or part of the year during which your lease
continues in force beyond the end of the primary lease term.
(c) If you stop conducting operations on a lease that has continued
beyond its primary term, then your lease will expire unless you resume
operations or receive an SOO or an SOP from the Regional Supervisor
under Sec. 250.19 before the end of the 180th day after you stop
operations
(d) You may ask the Regional Supervisor to allow you more than 180
days to resume operations on a lease continued beyond its primary term
when operating conditions warrant. The request must be in writing and
explain the operating conditions that warrant a longer period. In
allowing additional time, the Regional Supervisor must determine that
the longer period is in the national interest and that it conserves
resources, prevents waste, or protects correlative rights.
(e) You must immediately notify MMS either orally or by fax or E-
mail when you begin operations and follow up with a written report
under paragraph (f) of this section.
(f) You must submit a report to the District Supervisor when lease
production is initiated, lease production ceases, when production
resumes before the end of the 180-day period after production ceased,
and when any operations occur during the referenced 180-day interval.
(1) The report must contain:
(i) The lease number;
(ii) The well number(s) involved; and
(iii) The pertinent dates and a description of the operation.
(2) You must submit the report within 30 days after production
either commences, resumes, or ceases, as appropriate, or 30 days after
the leaseholding operation is completed.
(g) You must immediately report to the District Supervisor if
production does not resume before the end of the 180-day period.
Sec. 250.24 Under what circumstances may MMS cancel my lease with or
without compensation?
If the Secretary cancels your lease under this part or under part
256, you are entitled to compensation under paragraph (d) of this
section. Paragraph (e) of this section gives conditions under which you
will receive no compensation.
(a) Conditions for canceling a lease with compensation. The
Secretary may cancel a lease after notice and opportunity for a hearing
when:
(1) Continued activity on the lease, would probably cause harm or
damage to life (including fish and other aquatic life), property, other
mineral deposits (in areas leased or not leased), or the marine,
coastal, or human environment;
(2) The threat of harm or damage will not disappear or decrease to
an acceptable extent within a reasonable period of time;
(3) The advantages of cancellation outweigh the advantages of
continuing the lease in force; and
(4) A suspension has been in effect for at least 5 years, or you
request termination of the suspension and lease cancellation.
(b) Canceling a lease at the exploration stage. MMS may not approve
an EP under subpart B of this part if the Regional Supervisor
determines that the proposed activities may cause serious harm or
damage to life (including fish and other aquatic life), property, any
mineral deposits, the national security or defense, or to the marine,
coastal, or human environment. When you cannot modify the EP to avoid
such conditions and the EP is subsequently disapproved under the
regulations in subpart B of this part, the Secretary may cancel the
lease if:
(1) The primary lease term has not expired and exploration has been
prohibited for 5 years following the disapproval; or
(2) You request cancellation at an earlier time.
(c) Extending or canceling a lease at development and production
stage. (1) MMS may extend your lease if you submit a DPP and the
Regional Supervisor disapproves the plan in accordance with the
regulations in subpart B of this part. Following the disapproval:
(i) MMS will allow you to hold the lease for 5 years maximum;
[[Page 7349]]
(ii) At any time within 5 years after the disapproval, you may
reapply for approval of the same or a modified plan; and
(iii) The Regional Supervisor will approve, disapprove, or require
modification of the plan under Sec. 250.34(l).
(2) If the Regional Supervisor has not approved a DPP or required
you to submit a DPP for approval or modification, the Secretary will
cancel the lease:
(i) When the 5-year period described in paragraph (c)(1) of this
section expires; or
(ii) If you request cancellation at an earlier time.
(d) Amount of compensation for lease cancellation. When the
Secretary cancels a lease under paragraphs (a), (b), or (c) of this
section, you are entitled to receive compensation under 43 U.S.C. 1334
(a)(2)(c). You must show the Director that the amount of compensation
claimed is the lesser of paragraph (d)(1) or (d)(2) of this section:
(1) The fair value of the cancelled rights as of the date of
cancellation, taking into account both:
(i) Anticipated revenues from the lease; and
(ii) Costs reasonably anticipated on the lease, including:
(A) Costs of compliance with all applicable regulations and
operating orders; and
(B) Liability for cleanup costs or damages, or both, in the case of
an oil spill.
(2) The excess, if any, over your revenues from the lease (plus
interest thereon from the date of receipt to date of reimbursement) of:
(i) All consideration paid for the lease; and
(ii) All your direct expenditures:
(A) After the issue date of the lease; and
(B) For exploration or development, or both, under the lease plus
interest on the consideration under paragraph (d)(2)(i) of this section
and expenditures under paragraph (d)(2)(ii) from date of payment to
date of reimbursement.
(3) Compensation for leases issued before September 18, 1978 will
be equal to the amount specified in paragraph (d)(1).
(e) Canceling a lease without compensation. You will not receive
compensation from MMS for lease cancellation if:
(1) MMS disapproves a DPP because you do not receive concurrence by
the State under section 307(c)(3)(B)(i) or (ii) of the CZMA, and the
Secretary of Commerce does not make the finding authorized by section
307(c)(3)(B)(iii) of the CZMA;
(2) You do not submit a DPP in accordance with Sec. 250.34 or do
not comply with the approved DPP;
(3) As the lessee of a nonproducing lease, you fail to comply with
the Act, the lease, or the regulations issued under the Act, and the
default continues for a period of 30 days after MMS mails you a notice
by overnight mail;
(4) The Regional Supervisor disapproves a DPP because you fail to
demonstrate compliance with the requirements of applicable Federal law;
or
(5) The Secretary forfeits or cancels a producing lease under
section (d) of the Act, 43 U.S.C. 1334(d).
Information: Submission, Reimbursement For, And Availability to Public
Sec. 250.25 What reporting information and report forms must I submit?
(a) You must submit required information as MMS prescribes.
(1) You may obtain copies of forms from, and submit completed forms
to, the Regional or District Supervisor.
(2) Instead of paper copies of forms available from the Regional or
District Supervisor, you may use your own computer generated forms
which are equal in size to MMS's forms. The data on your form must be
arranged in a format identical to the MMS form.
(3) You may submit digital data when the Region/District is
equipped to accept it.
(b) You must include, for public information, one copy of any
reports submitted on forms as MMS prescribes.
(1) You must mark it Public Information.
(2) You must include all required information except information
exempt from public disclosure under Sec. 250.27 or otherwise exempt
from public disclosure under law or regulation.
Sec. 250.26 When will MMS reimburse me for reproduction costs?
(a) MMS will reimburse you for reasonable costs of reproduction
when you submit geological data, geophysical data, analyzed geological
information, processed geological and geophysical information,
reprocessed geological and geophysical information, and interpreted
geological and geophysical information for the Regional Director to
review or select (and whether or not retained) in accordance with this
part if:
(1) MMS receives your request for reimbursement within 90 days from
the date of delivery and the Regional Supervisor determines that the
requested reimbursement is proper; and
(2) The cost is at your lowest rate or at the lowest commercial
rate established in the area, whichever is less.
(b) MMS will reimburse you for the reasonable processing costs of
geological or geophysical information if:
(1) You processed--at the request of the Regional Supervisor--the
geological or geophysical information, in a form or manner other than
normally used in conducting business; or
(2) You collected the information under a permit that MMS issued
you before October 1, 1985, and the Regional Supervisor requests the
information.
(c) When you request reimbursement, you must identify reproduction
and processing costs separately from acquisition costs.
(d) MMS will not reimburse you for data acquisition costs or for
the costs of analyzing or processing geological information or
interpreting geological or geophysical information.
Sec. 250.27 Data and information to be made available to the public.
MMS will protect data and information you submit under this part,
except as described in this section. The tables in paragraphs (a) and
(b) of this section describe what data and information will be made
available to the public without the consent of the lessee and under
what circumstances and in what time period.
(a) MMS will disclose information collected on MMS forms in
accordance with the following table:
----------------------------------------------------------------------------------------------------------------
In the following
Data that you submit on form items Will be released And
----------------------------------------------------------------------------------------------------------------
MMS-123, Application for Permit All entries except At any time........ The data and information in items
to Drill. items 17, 24, and 17, 24, and 25 will be released
25. according to paragraph (b) of
this section or when the well
goes on production, whichever is
earlier.
[[Page 7350]]
MMS-124, Sundry Notices and All entries except At any time........ The data and information in item
Reports on Wells. item 36. 36 will be released according to
paragraph (b) of this section or
when the well goes on production,
whichever is earlier.
MMS-125, Well Summary Report..... All entries except At any time........ The data and information in the
items 17, 24, 34, excepted items will be released
37, and 46 through according to paragraph (b) of
87. this section or when the well
goes on production, whichever is
earlier. However, items 78 and 85
will not be released when the
well goes on production unless
the period of time in paragraph
(b) of this section has expired.
MMS-126, Well Potential Test All entries except When the well goes The data and information in item
Report and Request for Maximum item 101. on production. 101 will be released 2 years
Production Rate (MPR). after you submit it.
MMS-127, Request for Reservoir All entries except At any time........ The data and information in items
Maximum Efficient Rate (MER). items 124 through 124 through 168 will be released
168. according to the time periods in
paragraph (b) of this section.
MMS-128, Semiannual Well Test All entries......... At any time........ ..................................
Report.
----------------------------------------------------------------------------------------------------------------
(b) MMS will disclose information not collected on MMS forms in
accordance with the following table:
----------------------------------------------------------------------------------------------------------------
If MMS will release At this time Additional provisions
----------------------------------------------------------------------------------------------------------------
The Director determines that Geophysical data...... Any time.............. Data and information will be
data and information are Geological data shown only to persons with an
needed to unitize operations Reprocessed G&G interest.
on two or more leases, to information.
ensure proper plans of Interpreted geological
development for competitive & geophysical
reservoirs, or to promote information.
operational safety or protect Processed geophysical
the environment. information.
Analyzed geological
information.
The Director determines that Geophysical data...... Any time.............. MMS will release data and
data and information are Geological data....... information only if release
needed for specific Reprocessed G&G would further the national
scientific or research information. interest without unduly
purposes for the Government. Interpreted geological damaging the competitive
& geophysical position of the lessee.
information.
Processed geophysical
information.
Analyzed geological
information.
Data or information is Geophysical data...... 60 days after you MMS will release the data and
collected with high- Geological data....... submit the data or information earlier than 60
resolution systems (e.g., Processed geological & information, if the days if the Regional Supervisor
bathymetry, side-scan sonar, geophysical Regional Supervisor determines it is needed by
subbottom profiler, and information. deems it necessary. affected States to make
magnetometer) to comply with Interpreted G&G decisions under subpart B of
safety or environmental information. this part. The Regional
protection requirements. Supervisor will reconsider
earlier release if you satisfy
him/her that it would unduly
damage your competitive
position.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
If MMS will release At this time Additional provisions
----------------------------------------------------------------------------------------------------------------
Your lease is no longer in Geophysical data...... When your lease This release time applies only
effect. Processed geophysical terminates or 10 if the provisions in this table
information. years after the date governing high resolution
Reprocessed G&G you submit the data, systems and the provisions in
information. whichever is earlier. Sec. 252.7 do not apply.
Interpreted G&G
information.
Your lease is no longer in Geological data....... When your lease This release time applies only
effect. Analyzed geological terminates. if the provisions in this table
information. governing high resolution
systems and the provisions in
Sec. 252.7 do not apply.
Your lease is still in effect. Geophysical data...... 2 years after you These release times apply only
Processed geophysical submit it or 60 days if the provisions in this table
information. after a lease sale if governing high resolution
Reprocessed G&G any portion of an systems and the provisions in
information. offered block is Sec. 252.7 do not apply. If
Interpreted G&G within 50 miles of a the primary term specified in
information. well, whichever is the lease is extended under
later. Sec. 252.10, the extension
applies to this provision.
[[Page 7351]]
Data is released to the owner Directional survey If the lessee from ................................
of an adjacent lease under data. whose lease the
subpart D of part 250. directional survey
was taken consents..
Data and information are Any data or At any time........... ................................
obtained from beneath information obtained.
unleased land as a result of
a well deviation that has not
been approved by the Regional
or District Supervisor.
----------------------------------------------------------------------------------------------------------------
References
Sec. 250.28 Documents incorporated by reference.
(a) MMS is incorporating by reference the documents listed in the
table in paragraph (e) of this section. The Director of the Federal
Register has approved this incorporation by reference in accordance
with 5 U.S.C. 552(a) and 1 CFR part 51.
(1) MMS will publish any changes to these documents in the Federal
Register.
(2) The rule change will become effective without prior opportunity
to comment when MMS determines that the revisions to a document result
in safety improvements or represent new industry standard technology,
and do not impose undue costs on the affected parties.
(b) MMS incorporated each document or specific portion by reference
in the sections noted. The entire document is incorporated by
reference, unless the text of the corresponding sections in this part
calls for compliance with specific portions of the listed documents. In
each instance, the applicable document is the specific edition or
specific edition and supplement or addendum cited in this section.
(c) In accordance with Sec. 250.14, you may comply with a later
edition of a specific document incorporated by reference, provided:
(1) You demonstrate that compliance with the later edition provides
a degree of protection, safety, or performance equal to or better than
that which would be achieved by compliance with the listed edition; and
(2) You obtain the prior written approval for alternative
compliance from the authorized MMS official.
(d) You may inspect these documents at the Minerals Management
Service, 381 Elden Street, Room 3313, Herndon, Virginia; or at the
Office of the Federal Register, 800 North Capitol Street, N.W., Suite
700, Washington, D.C. You may obtain the documents from the publishing
organizations at the addresses given in the following table:
----------------------------------------------------------------------------------------------------------------
For Write to
----------------------------------------------------------------------------------------------------------------
ACI Standards.......................... American Concrete Institute, P.O. Box 19150, Detroit, MI 48219.
AISC Standards......................... American Institute of Steel Construction, Inc., P.O. Box 4588, Chicago,
IL 60680.
ANSI/ASME Codes........................ American National Standards Institute, Attention Sales Department, 1430
Broadway, New York, NY 10018; and/or American Society of Mechanical
Engineers, United Engineering Center, 345 East 47th Street, New York,
NY 10017.
API Recommended Practices, Specs, American Petroleum Institute, 1220 L Street, N.W., Washington, D.C.
Standards, Manual of Petroleum 20005.
Measurement Standards (MPMS) chapters.
ASTM Standards......................... American Society for Testing and Materials, 1916 Race Street,
Philadelphia, PA 19103.
AWS Codes.............................. American Welding Society, 550 N.W., LeJeune Road, P.O. Box 351040,
Miami, FL 33135.
NACE Standards......................... National Association of Corrosion Engineers, P.O. Box 218340, Houston,
TX 77218.
----------------------------------------------------------------------------------------------------------------
(e) This paragraph lists documents incorporated by reference. In
order to easily reference text of the corresponding sections with the
list of documents incorporated by reference, the list is in
alphanumerical order by organization and document.
------------------------------------------------------------------------
Incorporated by reference
Title of documents at
------------------------------------------------------------------------
ACI Standard 318-95, Building Code Sec. 250.138(b)(4)(i),
Requirements for Reinforced Concrete, plus (b)(6)(i), (b)(7),
Commentary on Building Code Requirements for (b)(8)(i), (b)(9),
Reinforced Concrete (ACI 318R-95). (b)(10), (c)(3),
(d)(1)(v), (d)(5),
(d)(6), (d)(7), (d)(8),
(d)(9), (e)(1)(i),
(e)(2)(i).
ACI Standard 357-R-84, Guide for the Design Sec. 250.130(g); Sec.
and Construction of Fixed Offshore Concrete 250.138(c)(2), (c)(3).
Structures, 1984.
AISC Standard, Specification for Structural Sec. 250.137(b)(1)(ii),
Steel for Buildings, Allowable Stress Design (c)(4)(ii), (c)(4)(vii).
and Plastic Design, June 1, 1989, with
Commentary.
ANSI/ASME Boiler and Pressure Vessel Code, Sec. 250.123(b)(1),
Section I, Power Boilers including (b)(1)(i); Sec.
Appendices, 1995 Edition. 250.292(b)(1),
(b)(1)(i).
ANSI/ASME Boiler and Pressure Vessel Code, Sec. 250.123(b)(1),
Section IV, Heating Boilers including (b)(1)(i); Sec.
Nonmandatory Appendices A, B, C, D, E, F, H, 250.292(b)(1),
I, and J, and the Guide to Manufacturers (b)(1)(i).
Data Report Forms, 1995 Edition.
ANSI/ASME Boiler and Pressure Vessel Code, Sec. 250.123(b)(1),
Section VIII, Pressure Vessels, Divisions 1 (b)(1)(i); Sec.
and 2, including Nonmandatory Appendices, 250.292(b)(1),
1995 Edition. (b)(1)(i).
ANSI/ASME B 16.5-1988 (including Errata) and Sec. 250.152(b)(2).
B 16.5a-1992 Addenda, Pipe Flanges and
Flanged Fittings.
ANSI/ASME B 31.8-1995, Gas Transmission and Sec. 250.152(a).
Distribution Piping Systems.
[[Page 7352]]
ANSI/ASME SPPE-1-1994 and SPPE-1d-1996 Sec. 250.126(a)(2)(i).
ADDENDA, Quality Assurance and Certification
of Safety and Pollution Prevention Equipment
Used in Offshore Oil and Gas Operations.
ANSI Z88.2--1992, American National Standard Sec. 250.67(g)(4)(iv),
for Respiratory Protection. (j)(13)(ii).
API RP 2A, Recommended Practice for Planning, Sec. 250.130(g); Sec.
Designing and Constructing Fixed Offshore 250.142(a).
Platforms Working Stress Design, Nineteenth
Edition, August 1, 1991, API Stock No. 811-
00200.
API RP 2A, Recommended Practice for Planning, Sec. 250.130(g); Sec.
Designing and Constructing Fixed Offshore 250.142(a).
Platforms-Working Stress Design:(RP 2A-WSD)
Twentieth Edition, July 1, 1993, API Stock
No. 811-00200.
API RP 2A, Recommended Practice for Planning, Sec. 250.130(g); Sec.
Designing and Constructing Fixed Offshore 250.142(a).
Platforms-Working Stress Design:(RP 2A-WSD)
Twentieth Edition, July 1, 1993, Supplement
1, December 1996, Effective Date, February
1, 1997, API Stock No. 811-00200.
API RP 2D, Recommended Practice for Operation Sec. 250.20(c); Sec.
and Maintenance of Offshore Cranes, Third 250.260(g).
Edition, June 1, 1995, API Stock No. G02D03.
API RP 14B, Recommended Practice for Design, Sec. 250.121(e)(4); Sec.
Installation, Repair and Operation of 250.124(a)(1)(i); Sec.
Subsurface Safety Valve Systems, Fourth 250.126(d).
Edition, July 1, 1994, with Errata dated
June 1996, API Stock No. Sec. 250.130(g);
Sec. 250.142(a) G14B04.
API RP 14C, Recommended Practice for Sec. 250.122(b), (e)(2);
Analysis, Design, Installation and Testing Sec. 250.123(a),
of Basic Surface Safety Systems for Offshore (b)(2)(i), (b)(4),
Production Platforms, Fourth Edition, (b)(5)(i), (b)(7),
September 1, 1986, API Stock No. 811-07180. (b)(9)(v), (c)(2); Sec.
250.124(a), (a)(5); Sec.
250.152(d); Sec.
250.154(b)(9); Sec.
250.291(c), (d)(2); Sec.
250.292(b)(2),
(b)(4)(v); Sec.
250.293(a).
API RP 14E, Recommended Practice for Design Sec. 250.122(e)(3); Sec.
and Installation of Offshore Production 250.291(b)(2), (d)(3).
Platform Piping Systems, Fifth Edition,
October 1, 1991, API Stock No. G07185.
API RP 14F, Recommended Practice for Design Sec. 250.53(c); Sec.
and Installation of Electrical Systems for 250.123(b)(9)(v); Sec.
Offshore Production Platforms, Third 250.292(b)(4)(v).
Edition, September 1, 1991, API Stock No.
G07190.
API RP 14G, Recommended Practice for Fire Sec. 250.123(b)(8),
Prevention and Control on Open Type Offshore (b)(9)(v); Sec.
Production Platforms, Third Edition, 250.292(b)(3),
December 1, 1993, API Stock No. G07194. (b)(4)(v).
API RP 14H, Recommended Practice for Sec. 250.122(d); Sec.
Installation, Maintenance and Repair of 250.126(d).
Surface Safety Valves and Underwater Safety
Valves Offshore, Fourth Edition, July 1,
1994, API Stock No. G14H04.
API RP 500, Recommended Practice for Sec. 250.53(b); Sec.
Classification of Locations for Electrical 250.122(e)(4)(i); Sec.
Installations at Petroleum Facilities, First 250.123(b)(9)(i); Sec.
Edition, June 1, 1991, API Stock No. G06005. 250.291(b)(3);
(d)(4)(i); Sec.
250.292(b)(4)(i).
API RP 2556, Recommended Practice for Sec. 250.180(f)(2)(i)(C)
Correcting Gauge Tables for Incrustation, .
Second Edition, August 1993, API Stock No.
H25560.
API Spec Q1, Specification for Quality Sec. 250.126(a)(2)(ii).
Programs, Fifth Edition, December 1994, API
Stock No. 811-00001.
API Spec 6A, Specification for Wellhead and Sec. 250.126(a)(3) Sec.
Christmas Tree Equipment, Seventeenth 250.152 (b)(1), (b)(2).
Edition, February 1, 1996, API Stock No.
G06A17.
API Spec 6AV1, Specification for Verification Sec. 250.126(a)(3).
Test of Wellhead Surface Safety Valves and
Underwater Safety Valves for Offshore
Service, First Edition, February 1, 1996,
API Stock No. G06AV1.
API Spec 6D, Specification for Pipeline Sec. 250.152(b)(1).
Valves (Gate, Plug, Ball, and Check Valves),
Twenty-first Edition, March 31, 1994, API
Stock No. G03200.
API Spec 14A, Specification for Subsurface Sec. 250.126(a)(3).
Safety Valve Equipment, Ninth Edition, July
1, 1994, API Stock No. G14A09.
API Spec 14D, Specification for Wellhead Sec. 250.126(a)(3).
Surface Safety Valves and Underwater Safety
Valves for Offshore Service, Ninth Edition,
June 1, 1994, with Errata dated August 1,
1994, API Stock No. G07183.
API Standard 2545, Method of Gaging Petroleum Sec. 250.180
and Petroleum Products, October 1965, (f)(2)(ii)(C).
reaffirmed October 1992; also available as
ANSI/American Society of Testing Materials
(ASTM) D 1085-65, API Stock No. H25450.
API Standard 2551, Standard Method for Sec. 250.180(f)(2)(i)(C)
Measurement and Calibration of Horizontal .
Tanks, First Edition, 1965, reaffirmed
October 1992; also available as ANSI/ASTM D
1410-65, reapproved 1984, API Stock No.
H25510.
API Standard 2552, Measurement and Sec. 250.180(f)(2)(i)(C)
Calibration of Spheres and Spheroids, First .
Edition, 1966, reaffirmed October 1992; also
available as ANSI/ASTM D 1408-65, reapproved
1984, API Stock No. H25520.
API Standard 2555, Method for Liquid Sec. 250.180(f)(2)(i)(C)
Calibration of Tanks, September 1966, .
reaffirmed October 1992; also available as
ANSI/ASTM D 1406-65, reapproved 1984, API
Stock No. H25550.
MPMS, Chapter 2, Tank Calibration, Section Sec. 250.180
2A, Measurement and Calibration of Upright (f)(2)(i)(A).
Cylindrical Tanks by the Manual Strapping
Method, First Edition, February 1995, API
Stock No. H022A1.
MPMS, Chapter 2, Section 2B, Calibration of Sec. 250.180
Upright Cylindrical Tanks Using the Optical (f)(2)(i)(B).
Reference Line Method, First Edition, March
1989; also available as ANSI/ASTM D4738-88,
API Stock No. H30023.
MPMS, Chapter 3, Tank Gauging, Section 1A, Sec. 250.180
Standard Practice for the Manual Gauging of (f)(2)(ii)(A).
Petroleum and Petroleum Products, First
Edition, December 1994, API Stock No. H031A1.
MPMS, Chapter 3, Section 1B, Standard Sec. 250.180
Practice for Level Measurement of Liquid (f)(2)(ii)(B).
Hydrocarbons in Stationary Tanks by
Automatic Tank Gauging, First Edition, April
1992, API Stock No. H30060.
[[Page 7353]]
MPMS, Chapter 4, Proving Systems, Section 1, Sec. 250.180(c)(6)(i),
Introduction, First Edition, July 1988, (d)(3)(iv).
reaffirmed October 1993, API Stock No.
H30081.
MPMS, Chapter 4, Section 2, Conventional Pipe Sec. 250.180(c)(6)(i),
Provers, First Edition, October 1988, (d)(3)(iv).
reaffirmed October 1993, API Stock No.
H30082.
MPMS, Chapter 4, Section 3, Small Volume Sec. 250.180(c)(6)(i),
Provers, First Edition, July 1988, (d)(3)(iv).
reaffirmed October 1993, API Stock No.
H30083.
MPMS, Chapter 4, Section 4, Tank Provers, Sec. 250.180(c)(6)(i),
First Edition, October 1988, reaffirmed (d)(3)(iv).
October 1993, API Stock No. H30084.
MPMS, Chapter 4, Section 5, Master-Meter Sec. 250.180(c)(6)(i),
Provers, First Edition, October 1988, (d)(3)(iv).
reaffirmed October 1993, API Stock No.
H30085.
MPMS, Chapter 4, Section 6, Pulse Sec. 250.180(c)(6)(i)
Interpolation, First Edition, July 1988, and (d)(3)(iv).
reaffirmed October 1993, API Stock No.
H30086.
MPMS, Chapter 4, Section 7, Field-Standard Sec. 250.180(c)(6)(i),
Test Measures, First Edition, October 1988, (d)(3)(iv).
API Stock No. H30087.
MPMS, Chapter 5, Metering, Section 1, General Sec. 250.180(c)(6)(ii).
Considerations for Measurement by Meters,
Third Edition, September 1995, API Stock No.
H05013.
MPMS, Chapter 5, Section 2, Measurement of Sec. 250.180(c)(6)(ii).
Liquid Hydrocarbons by Displacement Meters,
Second Edition, November 1987, reaffirmed
October 1992, API Stock No. H30102.
MPMS, Chapter 5, Section 3, Measurement of Sec. 250.180(c)(6)(ii).
Liquid Hydrocarbons by Turbine Meters, Third
Edition, September 1995, API Stock No.
H05033.
MPMS, Chapter 5, Section 4, Accessory Sec. 250.180(c)(6)(ii).
Equipment for Liquid Meters, Third Edition,
September 1995, with Errata, March 1996, API
Stock No. H05043.
MPMS, Chapter 5, Section 5, Fidelity and Sec. 250.180(c)(6)(ii).
Security of Flow Measurement Pulsed-Data
Transmission Systems, First Edition, June
1982, reaffirmed October 1992, API Stock No.
H30105.
MPMS, Chapter 6, Metering Assemblies, Section Sec. 250.180(c)(6)(iii)(
1, Lease Automatic Custody Transfer (LACT) A).
Systems, Second Edition, May 1991, API Stock
No. H30121.
MPMS, Chapter 6, Section 6, Pipeline Metering Sec. 250.180(c)(6)(iii)(
Systems, Second Edition, May 1991, API Stock B)
No. H30126.
MPMS, Chapter 6, Section 7, Metering Viscous Sec. 250.180(c)(6)(iii)(
Hydrocarbons, Second Edition, May 1991, API C).
Stock No. H30127.
MPMS, Chapter 7, Temperature Determination, Sec. 250.180
Section 2, Dynamic Temperature (c)(6)(iv)(A),
Determination, Second Edition, March 1995, (f)(2)(iii)(A).
API Stock No. H07022.
MPMS, Chapter 7, Section 3, Static Sec. 250.180
Temperature Determination Using Portable (c)(6)(iv)(B),
Electronic Thermometers, First Edition, July (f)(2)(iii)(B)
1985, reaffirmed March 1990, API Stock No.
H30143.
MPMS, Chapter 8, Sampling, Section 1, Sec. 250.180 (c)(6)(v),
Standard Practice for Manual Sampling of (f)(2)(iv).
Petroleum and Petroleum Products, Third
Edition, October 1995; also available as
ANSI/ASTM D 4057-88, API Stock No. H30161.
MPMS, Chapter 8, Section 2, Standard Practice Sec. 250.180 (c)(6)(v),
for Automatic Sampling of Liquid Petroleum (f)(2)(iv).
and Petroleum Products, Second Edition,
October 1995; also available as ANSI/ASTM D
4177, API Stock No. H30162.
MPMS, Chapter 9, Density Determination, Sec. 250.180(c)(6)(vi)(A
Section 1, Hydrometer Test Method for ), (f)(2)(v)(A).
Density, Relative Density (Specific
Gravity), or API Gravity of Crude Petroleum
and Liquid Petroleum Products, First
Edition, June 1981, reaffirmed October 1992;
also available as ANSI/ASTM D 1298, API
Stock No. H30181.
MPMS, Chapter 9, Section 2, Pressure Sec. 250.180(c)(6)(vi)(B
Hydrometer Test Method for Density or ), (f)(2)(v)(B).
Relative Density, First Edition, April 1982,
reaffirmed October 1992, API Stock No.
H30182.
MPMS, Chapter 10, Sediment and Water, Section Sec. 250.180(c)(6)(vii)(
1, Determination of Sediment in Crude Oils A), (f)(2)(vi)(A).
and Fuel Oils by the Extraction Method,
First Edition, April 1981, reaffirmed
December 1993; also available as ANSI/ASTM D
473, API Stock No. H30201.
MPMS, Chapter 10, Section 2, Determination of Sec. 250.180(c)(6)(vii)(
Water in Crude Oil by Distillation Method, B), (f)(2)(vi)(B).
First Edition, April 1981, reaffirmed
December 1993; also available as ANSI/ASTM D
4006, API Stock No. H30202.
MPMS, Chapter 10, Section 3, Determination of Sec. 250.180(c)(6)(vii)(
Water and Sediment in Crude Oil by the C), (f)(2)(vi)(C).
Centrifuge Method (Laboratory Procedure),
First Edition, April 1981, reaffirmed
December 1993; also available as ANSI/ASTM D
4007, API Stock No. H30203.
MPMS, Chapter 10, Section 4, Determination of Sec. 250.180(c)(6)(vii)(
Sediment and Water in Crude Oil by the D), (f)(2)(vi)(D).
Centrifuge Method (Field Procedure), Second
Edition, May 1988; also available as ANSI/
ASTM D 96, API Stock No. H30204.
MPMS, Chapter 11.1, Volume Correction Sec. 250.180(c)(6)(viii)
Factors, Volume 1, Table 5A--Generalized (A), (d)(3)(v)(B),
Crude Oils and JP-4 Correction of Observed (f)(2)(vii).
API Gravity to API Gravity at 60 deg.F, and
Table 6A--Generalized Crude Oils and JP-4
Correction of Observed API Gravity to API
Gravity at 60 deg.F, First Edition, August
1980, reaffirmed October 1993; also
available as ANSI/ASTM D 1250, API Stock No.
H27000.
MPMS, Chapter 11.2.1, Compressibility Factors Sec. 250.180(c)(6)(viii)
for Hydrocarbons: 0-90 deg. API Gravity (B).
Range, First Edition, August 1984,
reaffirmed May 1996, API Stock No. H27300.
MPMS, Chapter 11.2.2, Compressibility Factors Sec. 250.180(c)(6)(viii)
for Hydrocarbons: 0.350-0.637 Relative (C).
Density (60 deg.F/60 deg.F) and -50 deg.F to
140 deg.F Metering Temperature, Second
Edition, October 1986, reaffirmed October
1992; also available as Gas Processors
Association (GPA) 8286-86, API Stock No.
H27307.
MPMS, Chapter 11, Physical Properties Data, Sec. 250.180(c)(6)(viii)
Addendum to Section 2.2, Compressibility (D).
Factors for Hydrocarbons, Correlation of
Vapor Pressure for Commercial Natural Gas
Liquids, First Edition, December 1994; also
available as GPA TP-15, API Stock No. H27308.
MPMS, Chapter 11.2.3, Water Calibration of Sec. 250.180 (d)(3)(iv).
Volumetric Provers, First Edition, August
1984, reaffirmed, May 1996, API Stock No.
H27310.
[[Page 7354]]
MPMS, Chapter 12, Calculation of Petroleum Sec. 250.180 (c)(6)(ix),
Quantities, Section 2, Calculation of (d)(3)(v)(A),
Petroleum Quantities Using Dynamic (d)(3)(v)(C).
Measurement Methods and Volumetric
Correction Factors, Including Parts 1 and 2,
Second Edition, May 1995; also available as
ANSI/API MPMS 12.2-1981, API Stock No.
H30302.
MPMS, Chapter 14, Natural Gas Fluids Sec. 250.181(c)(1).
Measurement, Section 3, Concentric Square-
Edged Orifice Meters, Part 1, General
Equations and Uncertainty Guidelines, Third
Edition, September 1990; also available as
ANSI/API 2530, Part 1, 1991, API Stock No.
H30350.
MPMS, Chapter 14, Section 3, Part 2, Sec. 250.181(c)(1).
Specification and Installation Requirements,
Third Edition, February 1991; also available
as ANSI/API 2530, Part 2, 1991, API Stock
No. H30351.
MPMS, Chapter 14, Section 3, Part 3, Natural Sec. 250.181(c)(1).
Gas Applications, Third Edition, August
1992; also available as ANSI/API 2530, Part
3, API Stock No. H30353.
MPMS, Chapter 14, Section 5, Calculation of Sec. 250.181(c)(1).
Gross Heating Value, Relative Density, and
Compressibility Factor for Natural Gas
Mixtures From Compositional Analysis,
Revised, 1996; also available as ANSI/API
MPMS 14.5-1981, order from Gas Processors
Association, 6526 East 60th Street, Tulsa,
Oklahoma 74145.
MPMS, Chapter 14, Section 6, Continuous Sec. 250.181(c)(1).
Density Measurement, Second Edition, April
1991, API Stock No. H30346.
MPMS, Chapter 14, Section 8, Liquefied Sec. 250.181(c)(1).
Petroleum Gas Measurement, First Edition,
February 1983, reaffirmed May 1996, API
Stock No. H30348.
ASTM Standard C33-93, Standard Specification Sec. 250.138(b)(4)(i).
for Concrete Aggregates including
Nonmandatory Appendix.
ASTM Standard C94-96, Standard Specification Sec. 250.138(e)(2)(i).
for Ready-Mixed Concrete.
ASTM Standard C150-95a, Standard Sec. 250.138(b)(2)(i).
Specification for Portland Cement.
ASTM Standard C330-89, Standard Specification Sec. 250.138(b)(4)(i).
for Lightweight Aggregates for Structural
Concrete.
ASTM Standard C595-94, Standard Specification Sec. 250.138(b)(2)(i).
for Blended Hydraulic Cements.
D1.1-96, Structural Welding Code--Steel, Sec. 250.137(b)(1)(i).
1996, including Commentary.
DI.4-79, Structural Welding Code--Reinforcing Sec. 250.138(e)(3)(ii).
Steel, 1979.
NACE Standard MR-01-75-96, Sulfide Stress Sec. 250.67(p)(2).
Cracking Resistant Metallic Materials for
Oil Field Equipment, January 1996.
NACE Standard RP 0176-94, Standard Sec. 250.137(d).
Recommended Practice, Corrosion Control of
Steel Fixed Offshore Platforms Associated
with Petroleum Production.
------------------------------------------------------------------------
Sec. 250.29 Paperwork Reduction Act requirements--information
collection.
(a) OMB has approved the information collection requirements in
part 250 under 44 U.S.C. 3501 et seq. The table in paragraph (e) of
this section lists the subpart in the rule requiring the information
and its title, provides the OMB control number, and summarizes the
reasons for collecting the information and how MMS uses the
information. The associated MMS forms required by this part are listed
at the end of this table with the relevant information.
(b) Respondents are OCS oil, gas, and sulphur lessees and
operators. The requirement to respond to the information collections in
this part are mandatory under the OCS Lands Act (43 U.S.C. 1331 et
seq.) and the OCS Lands Act Amendments of 1978 (43 U.S.C. 1801 et
seq.). Some responses are also required to obtain or retain a benefit.
Proprietary information will be protected under Sec. 250.27, Data and
information to be made available to the public; parts 251 and 252 of
this Chapter; and the Freedom of Information Act (5 U.S.C. 552) and its
implementing regulations at 43 CFR part 2.
(c) The Paperwork Reduction Act of 1995 requires us to inform the
public that an agency may not conduct or sponsor, and you are not
required to respond to a collection of information unless it displays a
currently valid OMB control number.
(d) Send comments regarding any aspect of the collections of
information under this part, including suggestions for reducing the
burden, to the Information Collection Clearance Officer, Minerals
Management Service, Mail Stop 4230, 1849 C Street, N.W., Washington,
D.C. 20240; and to the Office of Information and Regulatory Affairs,
Office of Management and Budget, Attention: Desk Officer for the
Department of the Interior (1010-XXXX), Washington, D.C. 20503.
(e) MMS is collecting this information for the reasons given in the
following table:
----------------------------------------------------------------------------------------------------------------
30 CFR 250 subpart/title (OMB control
No.) Reasons for collecting information and how used
----------------------------------------------------------------------------------------------------------------
Subpart A General (1010-0030).......... To inform MMS of actions taken to comply with general operational
requirements on the OCS. To ensure that operations on the OCS meet
statutory and regulatory requirements, are safe and protect the
environment, and result in diligent exploration, development, and
production on OCS leases.
Subpart B Exploration and Development To inform MMS, States, and the public of planned exploration,
and Production Plans (1010-0049). development, and production operations on the OCS. To ensure that
operations on the OCS are planned to comply with statutory and
regulatory requirements, will be safe and protect the human, marine,
and coastal environment, and will result in diligent exploration,
development and production of leases.
Subpart C Pollution Prevention and To inform MMS of measures to be taken to prevent water and air
Control (1010-0057). pollution. To ensure that appropriate measures are taken to prevent
water and air pollution.
Subpart D Oil and Gas Drilling To inform MMS of the equipment and procedures to be used in drilling
Operations (1010-0053). operations on the OCS. To ensure that drilling operations are safe and
protect the human, marine, and coastal environment.
Subpart E Oil and Gas Well-Completion To inform MMS of the equipment and procedures to be used in well-
Operations (1010-0067). completion operations on the OCS. To ensure that well-completion
operations are safe and protect the human, marine, and coastal
environment.
[[Page 7355]]
Subpart F Oil and Gas Well-Workover To inform MMS of the equipment and procedures to be used during well-
Operations (1010-0043). workover operations on the OCS. To ensure that well-workover
operations are safe and protect the human, marine, and coastal
environment.
Subpart G Abandonment of Wells (1010- To inform MMS of procedures to be used during the temporary and
0079). permanent abandonment of wells. To ensure that wells are abandoned in
a manner that is safe and minimizes conflicts with other uses of the
OCS.
Subpart H Oil and Gas Production Safety To inform MMS of the equipment and procedures to be used during
Systems (1010-0059). production operations on the OCS. To ensure that production operations
are safe and protect the human, marine, and coastal environment.
Subpart I Platforms and Structures To inform MMS with information regarding the design, fabrication, and
(1010-0058). installation of platforms on the OCS. To ensure the structural
integrity of platforms installed on the OCS.
Subpart J Pipelines and Pipeline Rights- To provide MMS with information regarding the design, installation, and
of-Way (1010-0050). operation of pipelines on the OCS. To ensure that pipeline operations
are safe and protect the human, marine, and coastal environment.
Subpart K Oil and Gas Production Rates To inform MMS of production rates for hydrocarbons produced on the OCS.
(1010-0041). To ensure that produced hydrocarbons, including those that are
commingled, are measured accurately at secure locations for the
purpose of determining royalty payments.
Subpart L Oil and Gas Production To inform MMS of the measurement of production, commingling of
Measurement, Surface Commingling, and hydrocarbons, and site security plans. To ensure that produced
Security (1010-0051). hydrocarbons are measured and commingled to provide for accurate
royalty payments and security is maintained.
Subpart M Unitization (1010-0068)...... To inform MMS of the unitization of leases. To ensure that unitization
prevents waste, conserves natural resources, and protects correlative
rights.
Subpart N Remedies and Penalties (Not The requirements in Subpart N are exempt from the Paperwork Reduction
applicable). Act of 1995 in accordance with 5 CFR 1320.4.
Subpart O Training (1010-0078)......... To inform MMS of training program curricula, course schedules, and
attendance. To ensure that training programs are technically accurate
and sufficient to meet safety and environmental requirements, and that
workers are properly trained to operate on the OCS.
Subpart P Sulphur Operations (1010- To inform MMS of sulphur exploration and development operations on the
0086). OCS. To ensure that OCS sulphur operations are safe; protect the
human, marine, and coastal environment; and will result in diligent
exploration, development, and production of sulphur leases.
Form MMS-123, Application for Permit to To inform MMS of the procedures and equipment to be used in drilling
Drill Subpart D, E, P (1010-0044). operations. To ensure that drilling and well-completion are safe and
protect the environment, use adequate equipment, conform with
provisions of the lease, and the public is informed.
Form MMS-124, Sundry Notices & Reports To inform MMS of well-completion and well-workover operations, changes
on Wells Subpart D, E, F, G, P (1010- to any ongoing well operations, and well abandonment operations. To
0045). ensure that MMS has up-to-date and accurate informa tion on OCS
drilling and other lease operations; operations are safe and protect
the human, marine, and coastal environment; abandoned sites are
cleared of obstructions; and the public is informed.
Form MMS-125, Well Summary Report To inform MMS of the results of well-completion or well-workover
Subpart D, E, F, P (1010-0046). operations or changes in well status or condition. To ensure that MMS
has up-to-date and accurate information on the status and condition of
wells.
Form MMS-126, Well Potential Test
Report & Request for Maximum
Production Rate (MPR).
Subpart K (1010-0039).................. To inform MMS of the production potential of an oil or gas well and to
verify a requested production rate. To ensure that production results
in ultimate full recovery of hydrocarbons and energy resources are
produced at a prudent rate.
Form MMS-127, Request for Reservoir To inform MMS of data concerning oil and gas well-completion in a rate-
Maximum Efficiency Rate (MER) Subpart sensitive reservoir and to verify requested efficiency rate. To ensure
K (1010-0018). that reservoirs are classified correctly and the requested production
rate will not waste oil or gas.
Form MMS-128, Semi annual Well Test To inform MMS of the status and capacity of gas wells and verify
Report Subpart K (1010-0017). production capacity. To ensure that depletion of reservoirs results in
greatest ultimate recovery of hydrocarbons.
Form MMS-132, Evacuation Statistics To inform MMS in the event of a major disruption in the availability
Subpart A (used in the GOM Region) and supply of natural gas and oil due to natural occurrences/
(1010-0030). hurricanes. To advise the U.S. Coast Guard of rescue needs, and to
alert the news media and interested public entities when production is
shut in and when resumed.
----------------------------------------------------------------------------------------------------------------
5. Sections 250.52, 250.53, 250.77, 250.78, 250.97 and 250.98 are
removed and reserved.
PART 256--LEASING OF SULPHUR OR OIL AND GAS IN THE OUTER
CONTINENTAL SHELF
6. The authority citation for part 256 is revised to read as
follows:
Authority: 43 U.S.C. 1331 et seq., 42 U.S.C. 6213.
7. Section 256.1, is revised to read as follows:
Sec. 256.1 Purpose.
The purpose of the regulations in this part is to establish the
procedures under which the Secretary of the Interior (Secretary) will
exercise the authority to administer a leasing program for oil, gas and
sulphur. The procedures under which the Secretary will exercise the
authority to administer a program to grant rights-of-way, rights-of-
use, and easements are addressed in other parts of this chapter.
8. Section 256.4, Authority, is revised to read as follows:
Sec. 256.4 Authority.
The outer Continental Shelf Lands Act (OCSLA) (43 U.S.C. 1331 et
seq.) authorizes the Secretary of the Interior to issue, on a
competitive basis, leases for oil and gas, and sulphur, in submerged
lands of the outer Continental Shelf (OCS). The Act authorizes the
Secretary to grant rights-of-way, rights-of-use, and easements through
the submerged lands of the OCS. The Energy Policy and Conservation Act
of 1975 (42 U.S.C. 6213), prohibits joint bidding by major oil and gas
producers.
[[Page 7356]]
9. Section 256.35, Qualifications of lessees, is amended by adding
paragraph (c) as follows:
Sec. 256.35 Qualification of lessees.
* * * * *
(c) MMS may disqualify you from acquiring any new leaseholdings or
lease assignments if your operating performance is unacceptable
according to 30 CFR 250.12.
10. Section 256.73 is revised to read as follows:
Sec. 256.73 Effect of suspensions on lease term.
(a) Normally, a suspension extends the term of a lease. The
extension is equal to the length of time the suspension is in effect.
The suspension will not extend the lease term when the Regional
Supervisor directs a suspension because of:
(1) Gross negligence; or
(2) A willful violation of a provision of the lease or governing
regulations.
(b) MMS issues suspensions for a period of up to 5 years. The
Regional Supervisor will set the length of the suspension based on the
conditions of the individual case involved. MMS may grant consecutive
suspensions. For more information on suspension of operations or
production refer to 30 CFR 250.19.
[FR Doc. 98-3533 Filed 2-12-98; 8:45 am]
BILLING CODE 4310-MR-P
