Minerals Management Service, Interior.
Notice of approved publications.
As required by revised Federal oil valuation regulations, the Minerals Management Service (MMS) has approved three spot price publications that royalty payors should use to value oil produced from Federal leases not sold at arm's length.
June 1, 2000.
See FOR FURTHER INFORMATION CONTACT section below.Start Further Info
FOR FURTHER INFORMATION CONTACT:
David Domagala, Royalty Valuation Division, Royalty Management Program, Minerals Management Service, P.O. Box 25165, Mail Stop 3151, Denver, Colorado 80225, telephone number (303) 275-7255 or fax number (303) 275-7227.End Further Info End Preamble Start Supplemental Information
MMS published its revised regulations establishing oil value for royalty due on Federal leases in the Federal Register on March 15, 2000 (65 FR 14022), effective June 1, 2000. The primary changes in the revised regulations affect Federal lessees who value oil not sold at arm's length. The rule provides that the primary means of valuing crude oil not sold at arm's length is an adjusted spot price, except in the Rocky Mountain Region, where use of an adjusted spot price for valuation purposes is the third valuation benchmark (30 CFR 206.103(b)(4))(65 FR 14091). The applicable spot price is the one for the oil most closely representing the lease production in terms of physical proximity and quality parameters. The lessee may select the spot price from any MMS-approved publication; however, once the lessee selects a publication for a geographical area (California/Alaska, the Rocky Mountain Region, or the rest of the country), it must continue to use that same publication for 2 years in that area.
In § 206.104 of the final rule (65 FR 14092) for establishing oil value for royalty due on Federal leases, MMS explained that “approved publications” must be:
(1) Publications buyers and sellers frequently use;
(2) Publications frequently mentioned in purchase or sales contracts;
(3) Publications that use adequate survey techniques, including development of spot price estimates based on daily surveys of buyers and sellers of Alaska North Slope (ANS) and other crude oil; and
(4) Publications independent from MMS, other lessors, and lessees.
Additionally, MMS established that:
(1) Any publication may petition MMS to be added to the published list of acceptable publications.
(2) MMS will reference the tables a lessee must use in the approved publications to determine the associated index prices.
(3) MMS may revoke its approval of a particular publication if it determines that the prices published in the publication do not accurately represent spot market values.
MMS has verified that the publications listed below meet approval criteria based on input from staff of the publication itself, as well as information from marketers, auditors and industry consultants. MMS also examined and compared historical published spot prices from all three of the approved publications to ensure comparability and consistency. The approved publications and applicable tables are as follows:
- Platt's Oilgram Price Report (The same spot prices appear in Platt's Global Alert, Platt's Crude Oil Marketwire, and the soon-to-be-published Platt's U.S. Crudewire.) Use the spot prices found in the “Crude Price Assessments” section.
- Petroleum Argus Americas Crude (The same spot prices appear in Argus Crude, Argus Americas Crude Datafile, Argus Crude Datafile.) Use the spot prices found in the “WTI Cushing,” “US Gulf Coast,” “US Midcontinent,” and “US West Coast” sections.
- Bloomberg Oil Buyers Guide Petroleum Price Supplement (The same spot prices appear on the Bloomberg Energy Web Site, and in Bloomberg Professional.) Use the spot prices found in the “Worldwide Crude Price Snapshot” section.
If any of these entities use identical spot price quotes in other of their publications or distributions (such as electronic bulletin boards, newsletters, etc.), they are also approved. MMS will Start Printed Page 37044monitor these three publications to ensure that they continue to meet the approval criteria.
Representatives of any other publication who wish to obtain MMS approval of their publication may contact MMS at the address shown above in the FOR FURTHER INFORMATION CONTACT section.Start Signature
Dated: June 6, 2000.
Lucy Querques Denett,
Associate Director for Royalty Management.
[FR Doc. 00-14778 Filed 6-12-00; 8:45 am]
BILLING CODE 4310-MR-P