05-5678. Oil and Gas and Sulphur Operations in the Outer Continental Shelf (OCS); Data Release and Definitions

AGENCY:

Minerals Management Service (MMS), Interior.

ACTION:

Proposed rule.

SUMMARY:

This proposed rulemaking would revise certain existing definitions, add a first production notice requirement, and make some administrative changes. MMS recently redesigned and renamed some of its forms to aid submission and streamline data. MMS also discovered inconsistent practices in first production reporting, which is a prime parameter in determining inspection and testing schedules for safety system devices. This proposed rulemaking would correspond to recently revised forms, provide clarity and explanation of definitions and forms, and correct form submittal with first production notices. It would also clarify the basis upon which the Regional Director invokes the requirement for an archaeological survey on a lease area.

DATES:

We will consider all comments received by June 21, 2005. We will begin reviewing comments then and may not fully consider comments we receive after June 21, 2005.

ADDRESSES:

You may submit comments on the rulemaking by any of the following methods listed below. Please use 1010-AC99 as an identifier in your message. See also Public Comment Procedures under Procedural Matters.

MMS's Public Connect on-line commenting system, https://ocsconnect.mms.gov. Follow the instructions on the Web site for submitting comments.

Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions on the Web site for submitting comments.

E-mail MMS at [e-mail]. Identify the Regulation Identifier Number (RIN) in the subject line.

Fax: [phone]. Identify the RIN.

Mail or hand-carry comments to the Department of the Interior; Minerals Management Service; Mail Stop 4024; 381 Elden Street; Herndon, Virginia 20170-4817; Attention: Rules Processing Team (RPT). Please reference “Oil and Gas and Sulphur Operations in the Outer Continental Shelf (OCS), 30 CFR 250 Subpart A, General-Data Release and Definitions.” in your comments.

You may also send comments on the information collection aspects of this rule directly to the Office of Management and Budget (OMB), Office of Information and Regulatory Affairs, OMB Attention: Desk Officer for the Department of the Interior via OMB e-mail ([e-mail]) or by fax [phone]; identify with 1010-AC99. Please also send a copy to MMS.

FOR FURTHER INFORMATION CONTACT:

Kumkum Ray, Rules Processing Team, Regulations and Standards Branch, [phone].

SUPPLEMENTARY INFORMATION:

MMS proposes to make the following amendments to its regulations in Title 30 CFR Part 250:

1. Amend the definition of the term “Person” in § 250.105 to include joint ventures as an example of an association.

2. Amend the definition of the term “You” at § 250.105 to include the words “designated operator.” Under § 250.143, a designated operator is authorized to act on behalf of, and to fulfill the obligations of, a lessee under the Outer Continental Shelf Lands Act, the lease, and the regulations in Part 250. Therefore, a designated operator is an entity that must comply with applicable requirements, and hence is a part of the regulated community covered by the word “You.”

3. Clarify in § 250.194(a) the basis upon which the Regional Director invokes the requirement for an archaeological survey on a lease area. Because it cannot be determined whether it is “likely” that an archaeological resource exists on a specific lease area until the archaeological survey has first been conducted, the wording would be changed to state, “if the Regional Director has reason to believe that an archaeological resource may exist.” The “reason to believe” is established by a technical analysis of existing archaeological, geological, and other pertinent environmental data. To more closely reflect the wording of the new Subpart B regulations, and to clarify that the archaeological report accompanies, but is not part of, the Exploration Plan (EP) or Development and Production Plan (DPP), we propose to modify the second part of this sentence to state that “* * * the Regional Director will request in writing that your EP or DPP be accompanied by an archaeological report.”

4. Redesignate §§ 250.195 and 250.196 as §§ 250.196 and 250.197, respectively, and add a new § 250.195 requiring the lessee or operator to notify MMS when a well has actually begun producing. When the lessee or operator files a form MMS-125 (OMB Approval No. 1010-0046), End of Operations Report (formerly Well Summary Report), the well status is often shown as “shut in” since production facilities are not ready. Therefore, a “first production notice” often will be the only indication MMS receives that a well has actually begun producing. Such a notice is not currently required by our regulations, but has become standard practice. MMS is proposing to add this requirement because this information has become one of the prime parameters in determining inspection and testing schedules for safety system devices.

5. Reorganize the forms data release table in the proposed redesignated § 250.197(a), and add entries for the new forms MMS-123S, Supplemental APD Information Sheet; MMS-137, OCS Plan Information; MMS-133, Well Activity Report; and MMS-140, Bottomhole Pressure Survey Report. The Office of Management and Budget (OMB) has approved the use of these new forms, all of which contain proprietary data. MMS also proposes deleting the entry for form MMS-128, Semiannual Well Test Report, because no proprietary information is reported on this form. The reorganization of the table does not change the current data release timeframe for any of the other forms included in the table.

It should be noted that MMS very recently redesigned and renamed some of its forms. This is part of a separate process to provide a future option for electronic submission and streamlining of the data collected on MMS forms. In addition to any actual data element changes we made to the forms, we completely renumbered all of the data elements on most of the forms. The form and item numbers shown in the table at proposed

§ 250.197(a) correspond to the revised forms. You may obtain copies of the forms listed in the table from any of the OCS regional offices or at the Web site: http://www.gomr.mms.gov/​homepg/​mmsforms/​frmindx.html

6. Revise § 250.197(b)(8) to clarify existing requirements by including release times for certain data and information submitted on well operations, and adding special provisions for the release of directional surveys.

7. Insert a new form MMS-144, Rig Movement in the table at existing § 250.199.

8. Remove the definitions of “I, me, or you” and “Person” at § 250.1402, because the definitions for these terms are found at § 250.105.

Procedural Matters

Public Comment Procedure

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

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

This document is not a significant rule and is not subject to review by the Office of Management and Budget (OMB) under Executive Order 12866. This proposed rule:

1. Would not have an annual economic effect of $100 million or more on the economy. It would not adversely affect in a material way the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities. A cost-benefit and economic analysis is not required because:

a. The proposed changes to the definitions and data release tables would have no financial impact on the oil and gas industry.

b. The proposed requirements would minimally increase the paperwork burden for submitting first production notices under newly proposed § 250.195. At an average cost of $50 per hour, the increase of approximately 250 hours each year would result in an hour burden impact of $12,500. (Refer to the Paperwork Reduction Act section later in the preamble.)

2. Would not create a serious inconsistency or otherwise interfere with an action taken or planned by another agency. It would not affect how lessees or operators interact with other agencies.

3. Would not alter the budgetary effects or entitlements, grants, user fees, or loan programs or the rights or obligations of their recipients. It would have no effect on the rights of the recipients of entitlements, grants, user fees, or loan programs.

4. Does not raise novel legal or policy issues.

Regulatory Flexibility (RF) Act

The Department of Interior (DOI) certifies that this proposed rule would not have a significant economic effect on a substantial number of small entities under the RF Act (5 U.S.C. 601 et seq.). It would apply to all lessees operating on the OCS. Small lessees would fall under the Small Business Administration's (SBA) North American Industry Classification System Codes 211111, which includes companies that extract crude petroleum and natural gas. Under this code, a small company is one with fewer than 500 employees. Based on these criteria, MMS estimates that about 70 percent of these companies are considered small. The proposed requirements would minimally increase the paperwork burden for submitting first production notices under newly proposed § 250.195. At an average cost of $50 per hour, the increase of approximately 250 hours each year would result in an hour burden impact of $12,500. (Refer to the Paperwork Reduction Act section later in the preamble.) Thus, based on 130 lessees/operators, the average increase would be $100, for both large and small entities. Since 70 percent of the companies are small businesses, the total paperwork burden for small companies would be approximately 175 man hours, representing an annual hour cost burden of $8,750.

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 at [phone]. You may comment to the SBA without fear of retaliation. Disciplinary action for retaliation by an MMS employee may include suspension or termination from employment with the DOI.

Small Business Regulatory Enforcement Fairness Act (SBREFA)

This proposed rule is not a major rule under the SBREFA (5 U.S.C. 804(2)). This proposed rule:

1. Would not have an annual effect on the economy of $100 million or more. As described above, we estimate an annual increase of $100 per respondent. These costs will not cause an annual effect on the economy of $100 million.

2. Would not cause a major increase in costs or prices for consumers; individual industries; Federal, State, or local government agencies; or geographic regions. The minor increase in cost would not change the way the oil and gas industry conducts business, nor would it affect regional oil and gas prices. Therefore, it would not cause major cost increases for consumers, the oil and gas industry, or any government agencies.

3. Would not have significant adverse effects on competition, employment, investment, productivity, innovation, or ability of United States (U.S.)-based enterprises to compete with foreign-based enterprises. All lessees and drilling contractors, regardless of nationality, would have to comply with the requirements of this proposed rule, so it would not affect competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises.

Paperwork Reduction Act (PRA) of 1995

The proposed rule would require a new information collection (IC), and an IC request (form OMB 83-I) has been submitted to OMB for review and approval under section 3507(d) of the PRA. The title of the collection of information is “30 CFR 250, Subpart A, General, Data Release and Definitions.” The PRA provides that an agency may not conduct or sponsor a collection of information unless it displays a currently valid OMB control number. Until OMB approves the collection of information and assigns a control number, you are not required to respond.

Respondents include approximately 130 Federal OCS oil and gas lessees. The frequency of reporting and recordkeeping is generally on occasion. Responses are mandatory. The IC does not include questions of a sensitive nature. MMS will protect information considered proprietary according to 30 CFR § 250.196, “Data and information to be made available to the public,” 30 CFR Part 252, “OCS Oil and Gas Information Program,” and the Freedom of Information Act (5 U.S.C. 552) and its implementing regulations (43 CFR Part 2).

The proposed rule addresses several reports and forms required by current regulations. All the burdens for the individual reports and forms have been approved by OMB and assigned OMB control numbers according to their associated subparts.

Proposed § 250.195 would require the lessee or operator to notify MMS when a well has actually begun producing. When the lessee or operator files a form MMS-125, End of Operations Report (formerly the Well Summary Report), the well status is often shown as “shut in” since production facilities are not ready. Currently there is no regulatory requirement for lessees or operators to formally notify MMS of “first production,” although most companies already notify MMS when a well begins to produce. This practice serves to alert both MMS and the operator of the requirements pertaining to the inspection, installation, and maintenance of safety systems. We estimate 250 annual notifications would be submitted, requiring about 1 hour each to prepare and submit.

The proposed rule would increase the total paperwork hour burden of the 30 CFR Part 250, Subpart A, regulations by 250 hours. Based on a cost factor of $50 per hour, the hour burden of the new paperwork requirements would be $12,500. When this rulemaking becomes effective, MMS will consolidate the 250 burden hours with the primary information collection for 30 CFR 250, Subpart A (OMB control number 1010-0114, expiration date October 31, 2007).

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 burden in the proposed rule.

1. We specifically solicit 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 reporting and recordkeeping “non-hour” cost burden resulting from the collection of information. We have not identified any non-hour cost burden and solicit your comments on this item. For reporting and recordkeeping only, your response should split the cost estimate into two components: (a) the total capital and startup cost component and (b) the 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. 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 practice.

If you wish to comment on the hour burdens in response to this notice, you may send your comments to OMB, with a copy to MMS (see the ADDRESSES section of this notice). OMB is required to make its decision on the information collection aspects of this proposed rule between 30 to 60 days after publication in the Federal Register. Therefore, a comment to OMB is best assured of having its full effect if OMB receives it by April 22, 2005. This does not affect the deadline for the public to comment to MMS on the proposed regulations.

Federalism (E.O. 13132)

According to E.O. 13132, this proposed rule does not have Federalism implications. This proposed rule would not substantially and directly affect the relationship between Federal and State Governments. This proposed rule would clarify and require information from lessees/operators on the OCS, which is outside State jurisdiction. States have no role in this activity with or without this proposed rule, and this proposed rule would not impose costs on States or localities.

Takings Implication Assessment (E.O. 12630)

According to E.O. 12630, the proposed rule does not have significant Takings Implications. A Takings Implication Assessment is not required. The rulemaking is not a governmental action capable of interfering with constitutionally protected property rights.

Civil Justice Reform (E.O. 12988)

According to E.O. 12988, the Office of the Solicitor has determined that this proposed rule would not unduly burden the judicial system and does meet the requirements of sections 3(a) and 3(b)(2) of the Order.

National Environmental Policy Act

The rule does not constitute a major Federal action significantly affecting the quality of the human environment. An environmental impact statement is not required.

Unfunded Mandates Reform Act (UMRA) of 1995 (E.O. 12866)

This proposed rule would not impose an unfunded mandate on State, local, or tribal governments or the private sector of more than $100 million per year. It does not have any Federal mandates, nor a significant or unique effect on State, local, or tribal governments or the private sector. A statement containing the information required by the UMRA (2 U.S.C. 1531 et seq.) is not required.

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

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

List of Subjects in 30 CFR Part 250

• Environmental impact statements
• Environmental protection
• Government contracts
• Investigations
• Mineral royalties
• Oil and gas development and production
• Oil and gas exploration
• Oil and gas reserves
• Outer continental shelf
• Penalties
• Pipelines
• Public lands-mineral resources
• Public lands-rights-of-way
• Reporting and recordkeeping requirements
• Sulphur development and production
• Sulphur exploration
• Surety bonds

Dated: February 16, 2005.

Chad Calvert,

Acting Assistant Secretary, Land and Minerals Management.

For the reasons stated in the preamble, the Minerals Management Service proposes to amend 30 CFR Part 250 as follows:

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

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

Authority: 43 U.S.C. 1331 et seq.

2. In § 250.105, revise the definitions of the terms, “Person” and “You,” to read as follows:

§ 250.105

Definitions.

* * * * *

Person includes, in addition to a natural person, an association (including partnerships, joint ventures, and trusts), a State, a political subdivision of a State, or a private, public, or municipal corporation.

* * * * *

You means a lessee, the owner or holder of operating rights, a designated operator or agent of the lessee(s), a pipeline right-of-way holder, or a State lessee granted a right-of-use and easement.

* * * * *

3. In § 250.194 revise the introductory text of paragraph (a) to read as follows:

§ 250.194

What archaeological reports and surveys must I submit?

(a) If the Regional Director has reason to believe that an archaeological resource may exist in the lease area, the Regional Director will request in writing that your EP or DPP be accompanied by an archaeological report. If the archaeological report suggests that an archaeological resource may be present, you must either:

* * * * *

§§ 250.195 and 250.196

[Redisignated]

4. Redesignate § 250.195 and § 250.196 as § 250.196 and § 250.197 respectively.

5. Add new § 250.195 to read as follows:

§ 250.195

What notification does MMS require on the production status of wells?

You must notify the appropriate MMS District Manager when you successfully complete or recomplete a well for production as follows:

(a) Make the notification on the date you place the well in a production status. You may provide the notification orally if confirmed in writing by telefax or by e-mail.

(b) Include the following information in your notification:

(1) Operator name;

(2) Well number, lease number, area, and block;

(3) Date you place the well on production (indicate whether or not this is first production on the lease);

(4) Type of production; and

(5) Depth (measured depth) of production interval.

6. In newly redesignated § 250.197 the following changes are made:

A. Revise the introductory text and paragraph (a) to read as set forth below.

B. Revise paragraph (8) in the table in paragraph (b) to read as set forth below.

§ 250.197

Data and information to be made available to the public.

MMS will protect data and information you submit under this part. MMS will make certain data and information available to the public without the consent of the lessee. The tables in paragraphs (a) and (b) of this section specify when MMS will make data available to the public without the consent of the lessee, and describe the data and information that MMS will make available.

(a) All data and information you submit on MMS forms will be made available to the public upon submission except as specified in the following table:

On form. . .	Data and information not immediately available are . . .	Excepted data will be made available . . .
(1) MMS-123, Application for Permit to Drill	Items 13, 14, 20, 21, and 22	When the well goes on production or according to the table in paragraph (b) of this section, whichever is earlier.
(2) MMS-123S, Supplemental APD Information Sheet	Items 4, 13, 14, 15 and 20	When the well goes on production or according to the table in paragraph (b) of this section, whichever is earlier.
(3) MMS-124, Application for Permit to Modify	Item 22	When the well goes on production or according to the table in paragraph (b) of this section, whichever is earlier.
(4) MMS-125, End of Operations Report	Items 12, 13, 17, 18, 23, 24 through 29, and 33 through 38	When the well goes on production or according to the table in paragraph (b) of this section, whichever is earlier. However, items 33 through 38 will not be released when the well goes on production unless the period of time in the table in paragraph (b) has expired.
(5) MMS-126, Well Potential Test Report	Item 101	2 years after you submit it.
(6) MMS-127, Sensitive Reservoir Information Report	Items 124 through 168	2 years after the effective date of the Sensitive Reservoir Information Report.
(7) MMS-133 Well Activity Report	Item 10 Fields [WELLBORE, START DATE, TD DATE, OP STATUS, END DATE, MD, TVD AND MW PPG] Item 11 Fields [WELLBORE START DATE, TD DATE, PLUGBACK DATE, FINAL MD, AND FINAL TVD]. and Items 12 through 15	When the well goes on production or according to the table in paragraph (b) of this section, whichever is earlier.
(8) MMS-137, OCS Plan Information	Items providing the bottomhole location, true vertical depth, and measured depth of wells	When the well goes on production or according to the table in paragraph (b) of this section, whichever is earlier.
(9) MMS-140, Bottomhole Pressure Survey Report	All items	2 years after the date of the survey.

(b) * * *

If . . .	MMS will release . . .	At this time . . .	Special provisions
	*         *         *         *         *         *         *
(8) Data or information is submitted on well operations	Descriptions of downhole locations, operations, and equipment	When the well goes on production or geological data is released according to §§ 250.197(b)(6) and (b)(7), whichever is earlier	Directional survey data may be released earlier to the owner of an adjacent lease according to Subpart D of this part.
	*         *         *         *         *         *         *

7. Amend the table at § 250.199(e), by adding paragraph (26) to read as follows:

§ 250.199

Paperwork Reduction Act statements—information collection.

* * * * *

(e) * * *

30 CFR 250 subpart/title (OMB control number)	Reasons for collecting information and how used
	*         *         *         *         *         *         *
(26) Form MMS-144, Rig Movement (used in GOM region), Subparts D, E, F (1010-0150)	The rig notification requirement is essential for MMS inspection scheduling and to verify that the equipment being used complies with approved permits.

§ 250.1402

[Amended]

8. In § 250.1402, remove the definitions of “I, me, or you” and “Person.”