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Proposed Rule

Workshops To Discuss Specific Issues Regarding the Existing Rule-Establishing Oil Value for Royalty Due on Federal Leases

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Minerals Management Service, Interior.


Notice of public workshops.


The Minerals Management Service (MMS) is giving notice of four public workshops to discuss specific issues regarding the existing Federal oil royalty valuation regulations at 30 CFR Part 206 for crude oil produced from Federal leases.


The public workshop dates are:

Workshop 1—Denver, Colorado, on March 4, 2003, beginning at 8:30 a.m. and ending at 2 p.m., Mountain time.

Workshop 2—Houston, Texas, on March 5, 2003, beginning at 8:30 a.m. and ending at 2 p.m., Central time.

Workshop 3—Washington, DC, on March 6, 2003, beginning at 8:30 a.m. and ending at 2 p.m., Eastern time.

Workshop 4—Albuquerque, New Mexico, on March 6, 2003, beginning at 8:30 a.m. and ending at 2 p.m., Mountain time.


The workshop locations are:

Workshop 1 will be held at the Minerals Management Service, Denver Federal Center, 6th Avenue and Kipling Street, Building 85, Auditoriums A-D, Denver, Colorado, 80226-0165, telephone number (303) 231-3302.

Workshop 2 will be held at Minerals Management Service, 4141 North Sam Houston Parkway East, Houston, Texas 77032, telephone number (281) 987-6800.

Workshop 3 will be held at the Main Interior Building, 1849 C Street, NW., Washington, DC 20240 (South Penthouse Room), telephone number, (202) 208-3512.

Workshop 4 will be held at the Wyndham Albuquerque, 2910 Yale Boulevard SE., Albuquerque, New Mexico 87106, telephone number (505) 843-7000.

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Paul Knueven, Minerals Management Service, Minerals Revenue Management Program, P.O. Box 25165, MS 320B2, Denver, Colorado 80225-0165, telephone (303) 231-3316, fax number (303) 231-3781, e-mail

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MMS continues to evaluate the effectiveness and efficiency of its regulations. We believe that the Federal oil valuation rule is working well and accomplishes its objective of ensuring a fair return on federal resources. However, with our 3 years of experience with the current rule and our 5-year experience with the royalty-in-kind program, we have identified certain technical issues needing a more thorough review.

Accordingly, MMS is seeking public comment and recommendations on the following specific issues: (1) The timing and application of published indices, (2) the calculation of location and quality differentials where lessees do not have that information, (3) allowable transportation costs, (4) the rate of return allowed for calculating actual costs under non-arm's-length transportation agreements, and (5) how lessees value and report crude oil disposed of under joint operating agreements.

Because we believe the current rule is working well and is not in need of extensive revision, we request that workshop participants focus their comments on the specific issues identified above. However, if there are other significant issues, participants may address those in their comments, if time permits.

The workshops will be open to the public without advance registration. Public attendance may be limited to the space available. We encourage a workshop atmosphere; members of the public are encouraged to participate.

For building security measures, each person may be required to present a picture identification to gain entry to the meetings.

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Dated: February 5, 2003.

Lucy Querques Denett,

Associate Director for Minerals Revenue Management.

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[FR Doc. 03-3467 Filed 2-11-03; 8:45 am]