[Federal Register Volume 61, Number 95 (Wednesday, May 15, 1996)]
[Proposed Rules]
[Pages 24466-24467]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-12167]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 61, No. 95 / Wednesday, May 15, 1996 /
Proposed Rules
[[Page 24466]]
DEPARTMENT OF THE INTERIOR
30 CFR Part 256
RIN 1010-AC18
Leasing of Sulphur or Oil and Gas in the Outer Continental Shelf
AGENCY: Minerals Management Service (MMS), Interior.
ACTION: Notice of proposed rulemaking.
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SUMMARY: MMS proposes to modify regulations to allow the authorized
officer to extend the time period within which we must accept or reject
the high bids received on tracts offered for sale. Currently, the
authorized officer must accept or reject high bids on most tracts
within 90 days after the date on which the bids are opened.
DATES: MMS will consider all comments received by June 14, 1996. We
will begin reviewing comments at that time and may not fully consider
comments we receive after June 14, 1996.
ADDRESSES: Mail or hand-carry comments to the Department of the
Interior; Minerals Management Service; 381 Elden Street; Mail Stop
4700; Herndon, Virginia 22070-4817; Attention: Chief, Engineering and
Standards Branch.
FOR FURTHER INFORMATION CONTACT:
Dr. Marshall Rose, Chief, Economic Evaluation Branch, telephone (703)
787-1536.
SUPPLEMENTARY INFORMATION: We limited the comment period to 30 days to
provide us with timely comments in the event that we need to extend the
bid evaluation period for the lease sale held on April 24, 1996.
The time to accept or reject high bids for tracts offered at an
Outer Continental Shelf (OCS) lease sale is established under the
regulations at 30 CFR 256.47. The authorized officer must accept or
reject the high bids within 90 days after the bid opening, except for
tracts identified by the Secretary of the Interior as subject to:
(1) Another nation's claims of jurisdiction and control which
conflict with the claims of the United States, or,
(2) Defense-related activities that may be incompatible with
mineral exploration and/or development activities.
Any bid not accepted within that period is deemed rejected.
The 90-day period was established in 1982. Since then, we have held
several sales, mainly areawide. The Outer Continental Shelf Deep Water
Royalty Relief Act (Pub. L. 104-58, November 28, 1995) amended the
Outer Continental Shelf Lands Act to define a new bidding system which
provides for royalty suspensions. The deepwater incentive law did not
amend the requirement that we obtain fair market value for tracts that
are leased. Any lease sale held before November 28, 2000, must use the
new bidding system for all tracts located in water depths of 200 meters
or more in the Gulf of Mexico west of 87 degrees, 30 minutes west
longitude. We believe that the increased workload resulting from
compliance with the new statutory requirements and the potential for a
large number of tracts to receive bids may exceed our ability to
complete the bid review process for all tracts bid upon within 90 days
as required by 30 CFR 256.47(e)(2).
We propose to remedy the situation by giving the authorized officer
authority to extend the time period for 30 days or longer when
circumstances warrant. Recent examples include floods and furloughs;
however, other circumstances such as excessive workload may arise which
could warrant a longer time for bid evaluation.
This rule addresses a housekeeping issue and will enable us to
adjust the bid acceptance/rejection time period to meet changing
conditions in the OCS lease market. Continuation of the 90-day review
period would result in the rejection of the high bids which we fail to
evaluate within 90 days. This would result in fewer leases being issued
because of a failure to complete the bid review process within time and
resource constraints. The Government may receive less bonus and rental
monies.
Today, without authority to extend the bid review period, the 1982
90-day rule allows insufficient time and is arbitrarily rigid.
Comments to the 1982 rule objected to the proposal to extend the
bid review process from 60 to 120 days because of economic losses to
the bidders whose high bids were later rejected. (High bidders received
no interest payments on bonus monies returned by the Government.)
Today, regulations provide for the payment of interest on the bonus
monies submitted with the high bids which are ultimately rejected.
Thus, bidders will not suffer economic loss because of an extended time
period to complete the evaluation process.
In Central Gulf of Mexico Sale 157, held April 24, 1996, we
received 1,381 bids on 924 tracts--many in water depths of 200 or more.
It is in the public interest to assure that adequate time is available
to give all high bids a full and appropriate review, to ensure the
receipt of fair market value, and ultimately to increase natural gas
and oil supplies.
Author: This document was prepared by Mary Vavrina, Offshore
Resource Evaluation Division, MMS.
Executive Order (E.O.) 12866
The proposed rule does not meet the criteria for a significant rule
requiring review by the Office of Management and Budget under E.O.
12866.
Regulatory Flexibility Act
The Department of the Interior has determined that the proposed
rule will not have a significant effect on a substantial number of
small entities. In general, the entities that engage in offshore
activities are not, by definition, small due to the technical
complexities and financial resources and experience necessary to safely
conduct such activities. The indirect effect of this rulemaking on
small entities that provide support for offshore activities has also
been determined to be small.
Paperwork Reduction Act
The proposed rule contains no new reporting and information
collection requirements.
Takings Implication Assessment
The DOI certifies that the proposed rule does not represent a
governmental action capable of interference with constitutionally
protected property rights. A Takings Implication Assessment prepared
under E.O. 12630, Government Action and Interference with
Constitutionally Protected Property Rights, is not required.
[[Page 24467]]
E.O. 12988
The DOI has certified to the Office of Management and Budget that
the proposed rule meets the applicable reform standards provided in
Section 3(b)(2) of E.O. 12988.
National Environmental Policy Act
The DOI has determined that the proposed rule does not constitute a
major Federal action significantly affecting the quality of the human
environment; therefore, an environmental impact statement is not
required.
Unfunded Mandate Reform Act of 1995
This rule does not contain any unfunded mandates to State, local,
or tribal governments or the private sector.
List of Subjects in 30 CFR Part 256
Administrative practices and procedures, Continental shelf,
Government contracts, Incorporation by reference, Oil and gas
exploration, Public lands--mineral resources, Reporting and
recordkeeping requirements, Surety bonds.
Dated: May 2, 1996.
Sylvia V. Baca,
Assistant Secretary, Land and Minerals Management.
For the reasons set forth in the preamble, we propose to amend 30
CFR part 256 as follows:
PART 256--LEASING OF SULPHUR OR OIL AND GAS IN THE OUTER
CONTINENTAL SHELF
1. The Authority citation for part 256 continues to read as
follows:
Authority: 43 U.S.C. 1331 et seq.
2. Section 256.47(e)(2) is revised to read as follows:
Sec. 256.47 Award of leases.
* * * * *
(e) * * *
(2) The authorized officer must accept or reject the bid within 90
days. The authorized officer may extend the time period for acceptance
or rejection of a bid for 30 days or longer, if circumstances warrant.
Any bid not accepted within the prescribed time period, including any
extension thereof, shall be deemed rejected.
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[FR Doc. 96-12167 Filed 5-14-96; 8:45 am]
BILLING CODE 4310-MR-M
