Risk Management and Financial Assurance for OCS Lease and Grant Obligations
Revision of a currently approved collection
No
Regular
Comment filed on proposed rule and continue
09/21/2023
06/29/2023
In accordance with 5 CFR 1320.11(c), OMB is filing comment and withholding approval at this time.
This OMB action is not an approval to conduct or sponsor an information collection under the Paperwork Reduction Act of 1995. This action has no effect on any current approvals. If OMB has assigned this ICR a new OMB Control Number, the OMB Control Number will not appear in the active inventory. For future submissions of this information collection, reference the OMB Control Number provided. The agency shall examine public comment in response to the proposed rulemaking and include in the supporting statement of the next ICR--to be submitted to OMB at the final rule stage--a description of how the agency has responded to any public comments on the ICR, including comments on maximizing the practical utility of the collection and minimizing the burden. Given that the cost estimates presented rely largely on non-public data, the agency is requested to work with OMB to increase the amount of quality supporting information underlying the cost estimates before this information collection is submitted for renewal. Lastly, the supporting statement submitted at final rule stage should include any changes that occurred between the proposed and final rule related to this ICR.
table that charts list comparision
Inventory as of this Action
Requested
Previously Approved
03/31/2026
36 Months From Approved
03/31/2026
21,826
0
21,826
21,935
0
21,935
766,053
0
766,053
The Department of the Interior, acting through BOEM, proposes in its Notice of Proposed Rulemaking, entitled, âRisk Management and Financial Assurance for OCS Lease and Grant Obligationsâ (RIN 1010-AE14) to modify its criteria for determining whether oil, gas, and sulfur lessees, right-of-use and easement grant holders, and pipeline right-of-way grant holders may be required to provide bonds or other financial assurance above the regulatorily prescribed base bonds to ensure compliance with their Outer Continental Shelf Lands Act obligations. This proposed rule would also remove existing restrictive provisions for third-party guarantees and decommissioning accounts and would add new criteria under which a bond or third-party guarantee that was provided as supplemental financial assurance may be cancelled. Additionally, this proposed rule would clarify bonding requirements for RUEs serving Federal leases.
Overall, this proposed rule would result in the following adjustments in hour burden, which would lead to an overall increase of 77 annual burden hours:
Base Bonds and Supplemental Financial Assurance
The hours per response for all respondents (i.e., a lessee, grant holder, a co-lessee, and a co-grant holder) who show financial worth/ability to carry out present and future financial obligations as demonstrated by an issuer credit rating, or a proxy credit rating determined by BOEM based on audited financial information, will remain at 3.5 hours as approved by OMB. The number of responses for the provisions related to §§ 550.160, 550.166, 550.1011, and 556.900-902 would decrease to 160 respondents from 166 respondents due to program changes. The related existing and new provisions would result in a decrease of 21 burden hours from 581 to 560 annual burden hours (3.5 hours x -6 hours = -21 annual burden hours)
BOEM proposes to add paragraph (h) to § 556.901 to establish the limited opportunity to provide the required supplemental financial assurance demanded during the first 3 years after the effective date of this regulation in three installments. This provision would establish the timing and amounts of staggered supplemental financial assurance that would be demanded. This would likely increase the number of submissions for the 3 payments required for supplemental financial assurance, but only for the first 3 years after the effective date of this regulation. OMB has approved 135 submissions which take 20 minutes per submission (total existing annual burden hours is 45 hours. BOEM estimates the burden hours to be 135 annual burden hours (405 submissions x 20 minutes), which is an increase of 90 hours over existing OMB approval. (+90 hours).
Third-party Guarantees
Proposed § 556.905(b)(2) would be revised to eliminate the requirement that, when a guarantor becomes unqualified, a lessee must cease production, until supplemental financial assurance coverage requirements are met. The regulatory provision would be replaced with a requirement to immediately submit and maintain a substitute surety bond or other security. Both the existing and proposed provisions require the lessee to provide surety bond coverage; however, BOEMâs current OMB Control Number 1010-0006 does not quantify the burdens associated with either situation. Therefore, BOEM would add approximately 8 annual burden hours to OMB Control Number 1010-0006 for any lessee whose guarantor became unqualified (+8 hours).
On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).
The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control number;
If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.
30 CFR Part 556 - Subpart K