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Extension of the “Category 5” Royalty Rate Reduction Qualification for Oklahoma Federal Coal within a Designated Area of Nine (9) Oklahoma Counties

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Bureau of Land Management, Interior.




The notice announces that the Federal coal lands within the nine (9) Oklahoma Counties of Atoka, Coal, Haskell, Latimer, LeFlore, McIntosh, Muskogee, Pittsburgh, and Sequoyah continue to qualify as a Category 5 royalty rate reduction “Area” as set forth in the Bureau of Land Management (BLM) Royalty Rate Reduction Guidelines (55 FR 6841 and 55 FR 18401) and BLM Manual 3485, Reports, Royalties, and Records. Analysis by the Bureau of Land Management, New Mexico State Office indicates that there have been no significant changes in the coal market for the Area during the last 5 years. Therefore, the State Director of the New Mexico State Office of the BLM has determined to extend the qualification of the Area for Category 5 Royalty Rate Reductions for five (5) additional years.


The Qualification of the Designated Area for “Category 5” Royalty Rate Reductions is extended for five (5) years from December 17, 2005 to, and inclusive of, December 17, 2010.


New Mexico State Office, Bureau of Land Management, P.O. Box 27115, Santa Fe, NM 87502-0115.

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Vincent N. Vogt, at (505) 438-7455, or Darwyn F. Pogue, at (505) 438-7466.

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The New Mexico State Office first designated these same nine counties in Oklahoma as a Category 5 “Area” effective December 17, 1990 (56 FR 27771-27773). A Category 5 Area may be established only if all of the following criteria are affirmed to exist within the Area.

1. The Federal coal resources are not the dominate coal resources available for mining in the Area.

2. The royalty rate for Federal coal leases (43 CFR 3473.3-2(a)) is greater than the royalty rate for comparable non-Federal coal in the Area.

3. The Federal coal resources in the Area would be bypassed or remain undeveloped in favor of development of non-Federal coal resources due to the difference in royalty rate.

4. The above conditions exist throughout the Area.

5. A royalty rate reduction under this Category is not likely to result in undue competitive advantages over neighboring coal producing areas.

The BLM has concluded that the nine county Oklahoma Area continues to meet all of these criteria. The royalty rates for Federal coal in the Area shall continue to be: 2% for Federal coal mined by underground mining methods, and 4% for Federal coal mined by surface mining methods. These royalty rates are only granted if the Federal coal lessee applies to BLM in writing for a Category 5 royalty rate reduction and the application is approved by BLM.

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Dated: May 17, 2006.

Gary Johnson

Deputy State Director, Minerals & Lands.

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[FR Doc. E6-9553 Filed 6-16-06; 8:45 am]