E6-2690. Major Portion Prices and Due Date for Additional Royalty Payments on Indian Gas Production in Designated Areas Not Associated With an Index Zone

AGENCY:

Minerals Management Service (MMS), Interior.

ACTION:

Notice of major portion prices for calendar year 2004.

SUMMARY:

Final regulations for valuing gas produced from Indian leases, published on August 10, 1999, require MMS to determine major portion values and notify industry by publishing the values in the Federal Register. The regulations also require MMS to publish a due date for industry to pay additional royalty based on the major portion value. This notice provides the major portion values for the 12 months of 2004. The due date to pay is April 30, 2006, after which late interest will accrue.

FOR FURTHER INFORMATION CONTACT:

John Barder, Indian Oil and Gas Compliance and Asset Management, MMS; telephone [phone]; FAX [phone]; e-mail to [e-mail]; or Larry Gratz, Indian Oil and Gas Compliance and Asset Management, MMS; telephone [phone]; FAX [phone]; e-mail to [e-mail]. Mailing address: Minerals Management Service, Minerals Revenue Management, Compliance and Asset Management, Indian Oil and Gas Compliance and Asset Management, P.O. Box 25165, MS 396B2, Denver, Colorado 80225-0165.

SUPPLEMENTARY INFORMATION:

On August 10, 1999, MMS published a final rule titled “Amendments to Gas Valuation Regulations for Indian Leases,” (64 FR 43506) with an effective date of January 1, 2000. The gas regulations apply to all gas production from Indian (tribal or allotted) oil and gas leases, except leases on the Osage Indian Reservation.

The rule requires that MMS publish major portion prices for each designated area not associated with an index zone for each production month beginning January 2000, along with a due date for additional royalty payments. See 30 CFR 206.174(a)(4)(ii) (2005). If additional royalties are due based on a published major portion price, the lessee must submit an amended Form MMS-2014, Report of Sales and Royalty Remittance, to MMS by the due date. If additional royalties are not paid by the due date, late payment interest, under 30 CFR 218.54 (2005), will accrue using the Internal Revenue Service underpayment rate (26 CFR 6621(a)(2)) from the due date until payment is made and an amended Form MMS-2014 is received. The table below lists the major portion prices for all designated areas not associated with an index zone. The due date is April 30, 2006.

Gas Major Portion Prices for Designated Areas Not Associated With an Index Zone

MMS-Designated Areas	Jan 2004 (MMBtu)	Feb 2004 (MMBtu)	Mar 2004 (MMBtu)	Apr 2004 (MMBtu)
Blackfeet Reservation	7.37	7.07	6.35	6.61
Fort Belknap	5.42	5.32	5.25	5.25
Fort Berthold	5.32	4.70	4.56	5.12
Fort Peck Reservation	5.83	5.43	4.75	4.87
Navajo Allotted Leases in the Navajo Reservation	5.04	4.80	4.27	4.38
Rocky Boys Reservation	4.19	3.93	4.08	4.24
Ute Allotted Leases in the Uintah and Ouray Reservation	4.39	4.65	4.19	4.15
Ute Tribal Leases in the Uintah and Ouray Reservation	5.06	4.74	4.28	4.11

	May 2004 (MMBtu)	Jun 2004 (MMBtu)	Jul 2004 (MMBtu)	Aug 2004 (MMBtu)
Blackfeet Reservation	6.78	7.58	7.32	7.27
Fort Belknap	5.35	5.55	5.56	5.42
Fort Berthold	5.83	5.80	5.22	6.35
Fort Peck Reservation	5.02	5.67	5.59	5.91
Navajo Allotted Leases in the Navajo Reservation	4.92	5.41	5.22	5.18
Rocky Boys Reservation	4.55	4.55	4.41	4.18
Ute Allotted Leases in the Uintah and Ouray Reservation	4.82	5.13	5.09	4.87
Ute Tribal Leases in the Uintah and Ouray Reservation	4.91	5.24	4.97	4.89

	Sep 2004 (MMBtu)	Oct 2004 (MMBtu)	Nov 2004 (MMBtu)	Dec 2004 (MMBtu)
Blackfeet Reservation	6.48	6.22	9.20	8.95
Fort Belknap	5.37	5.56	5.67	5.74
Fort Berthold	4.14	4.94	8.00	5.67
Fort Peck Reservation	5.35	6.91	7.61	7.09
Navajo Allotted Leases in the Navajo Reservation	4.47	4.54	6.47	5.73
Rocky Boys Reservation	3.66	4.54	4.62	4.86
Ute Allotted Leases in the Uintah and Ouray Reservation	4.25	4.40	6.32	5.81
Ute Tribal Leases in the Uintah and Ouray Reservation	4.37	4.46	6.57	6.03

For information on how to report additional royalties due to major portion prices, please refer to our Dear Payor letter dated December 1, 1999, on the MMS Web site address at http://www.mrm.mms.gov/​ReportingServices/​PDFDocs/​991201.pdf.

Dated: January 17, 2006.

Shirley M. Conway,

Acting Associate Director for Minerals Revenue Management.