30 C.F.R. PART 218—COLLECTION OF ROYALTIES, RENTALS, BONUSES AND OTHER MONIES DUE THE FEDERAL GOVERNMENT
Title 30 - Mineral Resources
Authority: 25 U.S.C. 396 et seq., 396a et seq., 2101 et seq.; 30 U.S.C. 181 et seq., 351 et seq., 1001 et seq., 1701 et seq.; 31 U.S.C. 3335; 43 U.S.C. 1301 et seq., 1331 et seq., and 1801 et seq.
Source: 48 FR 35641, Aug. 5, 1983, unless otherwise noted.
The information collection requirements contained in this part have been approved by OMB under 44 U.S.C. 3501 et seq. The forms, filing date, and approved OMB clearance numbers are identified in 30 CFR 210.10. [57 FR 41867, Sept. 14, 1992] (a) An assessment of an amount not to exceed $10 per day may be charged for each report not received by MMS by the designated due date. (b) An assessment of an amount not to exceed $10 may be charged for each incorrectly completed report. (c) For purposes of assessments discussed in this section, a report is defined as follows: (1) For coal and other solid mineral leases, a report is each line on the Solid Minerals Production and Royalty Report, Form MMS–4430. (2) For oil and gas and geothermal leases, a report is each line on the Report of Sales and Royalty Remittance, Form MMS–2014. (d) An assessment under this section shall not be shared with a State, Indian tribe, or Indian allottee. (e) The amount of the assessment to be imposed pursuant to paragraphs (a) and (b) of this section shall be established periodically by MMS. The assessment amount for each violation will be based on MMS's experience with costs and improper reporting. The MMS will publish a Notice of the assessment amount to be applied in the [49 FR 37346, Sept. 21, 1984. Redesignated and amended at 51 FR 15767, Apr. 28, 1986; 52 FR 27546, July 22, 1987; 52 FR 37452, Oct. 7, 1987; 57 FR 52720, Nov. 5, 1992; 59 FR 38906, Aug. 1, 1994; 66 FR 45773, Aug. 30, 2001] (a) An assessment of an amount not to exceed $250 may be charged when the amount of a payment submitted by a payor is not equivalent in amount to the total of individual line items on the associated Form MMS 2014 or bill document, unless the difference in amount has been authorized by MMS. (b) An assessment of an amount not to exceed $250 may be charged for each payment submitted by a payor that cannot be automatically applied by AFS to the associated Form MMS–2014 or bill document because of inadequate or erroneous information submitted by the payor. For purposes of this section, inadequate or erroneous information is defined as: (1) Absent or incorrect payor assigned document number, required to be identified by the payor in Block 3a on a Form MMS–2014, or the reuse of the same payor assigned document (“3a”) number in a subsequent reporting period. (2) Absent or incorrect bill document invoice number (to include the four character alpha prefix and the eight digit number) or the payor-assigned 3a number required to be identified by the payor on the associated payment document, or the reuse of the same payor assigned 3a number in a subsequent reporting period. (3) Absent or incorrect name of the administering Bureau of Indian Affairs Agency/Area office and the word “allotted” or the tribe name on payment documents remitted to MMS for an Indian tribe or allottee. If the payment is made by EFT, the payor must identify the tribe/allottee on the EFT message by a pre-established five digit code. (4) Absent or incorrect MMS assigned payor code on a payment document. (c) For purposes of this section, the term “Form MMS–2014” includes submission of reports of royalty information by magnetic media. Magnetic media submissions include submissions by magnetic tape, magnetic cartridge, or floppy diskette. (d) For purposes of this section, a bill document is defined as any Bill of Collection (Form DI–1040b) that has been issued by MMS for assessments, late-payment interest charges, or other amounts owed. (e) For purposes of this section, a payment document is defined as one of the payment methods identified in §218.51(a)(3). (f) The amount of the assessment to be imposed pursuant to paragraphs (a) and (b) of this section shall be established periodically by MMS. The assessment amount will be based on MMS' experience with costs and improper reporting and/or payment as specified in this section. The MMS will publish a Notice in the [58 FR 45438, Aug. 30, 1993] (a) Interest due from a payor on any underpayment for any Federal mineral lease or leases (onshore or offshore) and on any Indian tribal mineral lease or leases for any production month shall not be reduced by offsetting against that underpayment any overpayment made by the payor on any other lease or leases, except as provided in paragraph (b) of this section. Interest due from a payor or any underpayment on any Indian allotted lease shall not be reduced by offsetting against any overpayment on any other Indian allotted lease under any circumstances. (b) Royalties attributed to production from a lease or leases which should have been attributed to production from a different lease or leases may be offset to determine whether and to what extent an underpayment exists on which interest is due if the following conditions are met: (1) The error results from attributing and reporting an equal volume of production, produced from a lease or leases during a particular production month, to a different lease or leases from which it was not produced for the same or another production month; (2) The payor is the same for the lease or leases to which production was attributed and the lease or leases to which it should have been attributed; (3) The payor submits production reports, pipeline allocation reports, or other similar documentary evidence pertaining to the specific production involved which verifies the correct production information; (4) The lessor is the same for the leases involved (in the case of Indian tribal leases, the same tribe is the lessor); and (5) The ultimate recipients of any royalty or other lease revenues under any applicable permanent indefinite appropriations are the same for, and receive the same percentage of revenue from, the leases. (c) If MMS assesses late-payment interest and the payor asserts that some or all of the interest assessed is not owed pursuant to the exception set forth in paragraph (b) of this section, the burden is on the payor to demonstrate that the exception applies in the specific circumstances of the case. (d) The exception set forth in paragraph (b) of this section shall not operate to relieve any payor of liability imposed by statute or regulation for erroneous reporting. [57 FR 62206, Dec. 30, 1992] Source: 49 FR 37346, Sept. 21, 1984, unless otherwise noted.
(a) Royalty payments are due at the end of the month following the month during which the oil and gas is produced and sold except when the last day of the month falls on a weekend or holiday. In such cases, payments are due on the first business day of the succeeding month. Rental payments are due as specified by the lease terms. (b) Payments made on a Bill for Collection (Form DI–1040b) are due as specified by the Bill. Bills for Collection will be issued and payable as final collection actions. (c) All payments to MMS are due as specified and are not deferred or suspended by reason of an appeal having been filed unless such deferral or suspension is approved in writing by an authorized MMS official. (d)(1) Notwithstanding the provisions of paragraph (a) of this section and corresponding lease terms and 30 CFR 210.52, the due date for submittal of royalty payments and Reports of Sales and Royalty Remittance (Form MMS–2014) for the production months of July, August, September, and October 2005 for Federal offshore and onshore oil and gas leases by oil and gas lessees or royalty payors who make the certification required under paragraph (d)(2) of this section is extended until January 3, 2006. (2) The extended due dates in paragraph (d)(1) of this section will apply to royalty payments and Reports of Sales and Royalty Remittance (Form MMS–2014) by any lessee or royalty payor who certifies that a hurricane that struck the Gulf of Mexico coast of the United States in August or September 2005 disrupted the lessee's or payor's operations to the extent that it prevented the lessee or royalty payor from making an accurate royalty payment or submitting an accurate Form MMS–2014. (3) A lessee's or royalty payor's certification under paragraph (d)(2) of this section that it is unable to generate and submit either an accurate royalty report or an accurate royalty payment will extend the due date for both royalty reporting and royalty payment. (4) Paragraphs (d)(1) through (d)(3) of this section do not apply to Indian leases or to Federal leases for minerals other than oil and gas. (5) Certifications under paragraph (d)(2) of this section should be submitted either: (i) By mail to: Robert Prael, Financial Manager, Minerals Management Service, Minerals Revenue Management, P.O. Box 25165, MS 350B1, Denver, CO 80225–0165, or (ii) By e-mail to [email protected]. (e)(1) A lessee or royalty payor who submits a certification required under paragraph (d)(2) of this section may rely on the extended due dates prescribed in paragraph (d)(1) of this section unless and until MMS notifies the lessee or royalty payor or operator that MMS does not accept the certification. (2) If MMS notifies the lessee or royalty payor that MMS does not accept the lessee's or royalty payor's certification under paragraph (d)(2) of this section, the due date for royalty payments and Reports of Sales and Royalty Remittance will be the date specified in the notice. [49 FR 37346, Sept. 21, 1984, as amended at 70 FR 56853, Sept. 29, 2005] (a) Definitions. ACH—Automated Clearing House. A type of EFT using the ACH network. Courtesy Notice—An MMS-issued notice of rental or bonus due. Deferred Bonus Payment—Lease bonus paid in equal annual installments over a specified number of years. EFT—Electronic Funds Transfer. Any paperless transfer of funds a bank initiates through an electronic terminal. For MMS purposes, EFT is limited to FEDWIRE and ACH transfers. FEDWIRE—A type of EFT using the Federal Reserve Wire network. Invoice Document Identification—The MMS-assigned invoice document identification (four alpha and eight numeric characters). Payment—Any monies for royalty, bonus, rental, late payment charge, assessment, penalty, or other money sent to MMS. Person—Any individual, firm, corporation, association, partnership, consortium, or joint venture (when established as a separate entity). The term does not include Federal agencies. Report—Form MMS–2014, Report of Sales and Royalty Remittance. RIK—Royalty in kind. (b) General Instructions. You must make all payments to MMS electronically to the extent it is cost effective and practical. If you pay money to MMS or to an Indian tribe or allottee, you must follow these procedures: (1) If MMS instructs you to use EFT, you must use EFT for all payments to MMS and/or a tribe. (2) Contact MMS before using EFT. MMS will provide you with EFT payment instructions. (3) Separate any payments on a Federal lease from any payments on an Indian lease. (4) If you are not required to use EFT, use one of the following types of payment documents. MMS prefers that you use these payment documents in the order presented: (i) Commercial check drawn on a solvent bank; (ii) Certified check; (iii) Cashier's check; (iv) Money order; (v) Bank draft drawn on a solvent bank; or (vi) Federal Reserve check. (5) You must include your payor code on all payments. (6) You must pay in U.S. dollars. (c) How to complete a non-EFT payment. (1) Make any payment on a Federal lease payable to: “Department of the Interior-Minerals Management Service” or “DOI-MMS.” (2) For an Indian allottee payment, send a separate payment for each Bureau of Indian Affairs (BIA) agency or area office represented by the leases on your report or invoice document. You must include the name of the applicable BIA agency or area office on your payment. Make your payment document payable to: “Department of the Interior-Minerals Management Service for BIA [Name] Agency (allotted)” or “DOI-MMS for BIA [Name] Agency (allotted).” (3) For an Indian tribal payment other than a lockbox payment, send a separate payment for each tribe represented by the leases on your report or invoice document. You must include the name of the Indian tribe on your payment. Make it payable to: “Department of the Interior-Minerals Management Service for BIA [Name of Tribe]” or “DOI-MMS for BIA [Name of Tribe].” (4) For an Indian tribal lockbox payment, follow the instructions MMS provides you on how to report and make the lockbox payment. These instructions are specific to each tribe's lockbox written agreement with the bank authorized to receive payments on the tribe's mineral leases. You will receive these instructions from MMS when you are required to use a tribal lockbox for reports and payments. (d) Where to send a non-EFT payment when you use the U.S. Postal Service. (1) For a payment to an Indian tribal lockbox, send your payment to the appropriate tribal lockbox address. (2) For a Federal nonproducing lease rental or deferred bonus payment, send it to:
Minerals Management Service, Minerals Revenue Management, P.O. Box 5640, Denver, CO 80217–5640. (3) For all other Federal and Indian lease payments other than those going to an Indian tribal lockbox, send them to:
Minerals Management Service, Minerals Revenue Management, P.O. Box 5810, Denver, CO 80217–5810. (e) Where to send a non-EFT payment when you use a courier or overnight delivery service. You should send this type of payment to:
Minerals Management Service, Minerals Revenue Management, Building 85, Denver Federal Center, Room A–614, Denver, CO 80225–0165. (f) How to prepare and what to include on your payment document. (1) For Form MMS–2014 payments, you must include both your payor code (block 2) and your payor-assigned document number (block 3a). (2) For invoice payments, including RIK invoice payments, you must include both your payor code and invoice document identification (four-letter prefix and eight-digit number). (3) For bonus payments: (i) For one-fifth bonus payments for offshore oil, gas, and sulphur leases, follow the instructions in the Notice of Lease Offering. (ii) For payment of the four-fifths bonus for an offshore lease, use EFT and follow the instructions in §218.155(c). (iii) For the successful bidder's bonus in the competitive sale of a coal, geothermal, or offshore mineral (other than oil, gas or sulfur) lease, follow the instructions and terms of the Notice of Competitive Lease Sale. (iv) For installment payments of deferred bonuses, you must use EFT. (4) If you are paying a lease rental you must: (i) See 30 CFR 218.155(c) for instructions on how to pay first-year rentals of an offshore oil, gas, or sulfur lease; (ii) See the Notice of Lease Offering for instructions on how to pay first-year rentals other than those covered in paragraph (f)(4)(i) of this section. (iii) Include the MMS Courtesy Notice, when provided, or write your payor code and government-assigned lease number on the payment document when paying a rental that is not reported on Form MMS–2014 and not paid by EFT. (g) When is a payment to MMS due? (1) All payments are due to MMS at the time law, regulation, or lease terms require unless MMS approves a change according to part 243 of this chapter. If you file an appeal, and the requirement to submit payment is suspended, the original payment due date for purposes such as calculating late payment interest is not changed. (2) If you use the U.S. Postal Service, courier, or overnight mail to send your payment, it is due at the MMS addresses in paragraphs (d) and (e) of this section before 4 p.m. Mountain Time on the due date, regardless of when you sent it. (3) If you use EFT to send your payment, it is due in the MMS account by the payment due date. You are responsible for your actions or your bank's actions that cause a late or incorrect payment. You will not be held responsible for mechanical or system failures of EFT payments. (h) What happens if payments are late or overdue? (1) If MMS receives your payment late, MMS will impose a late-payment interest charge under 30 CFR 218.54. (2) If you do not pay an amount you owe, MMS may assess civil penalties under part 241 of this chapter or other applicable regulations. [62 FR 19498, Apr. 22, 1997, as amended at 66 FR 45773, Aug. 30, 2001; 67 FR 19112, Apr. 18, 2002] (a) If you are a lessee under 30 U.S.C. 1701(7), and you want to designate a person to make all or part of the payments due under a lease on your behalf under 30 U.S.C. 1712(a), you must notify MMS or the applicable delegated State in writing of such designation. Your notification for each lease must include the following: (1) The AID number for the lease; (2) The type of products you make payments for e.g., oil, gas. (3) The type of payments you are responsible for e.g., royalty, minimum royalty, rental. (4) Whether you are: (i) A lessee of record (record title owner) in the lease, and the percentage of your record title ownership in the lease; or (ii) An operating rights owner (working interest owner) in the lease, and the percentage of your operating rights ownership in the lease; (5) The name, address, Taxpayer Identification Number (TIN), and phone number of your Designee; (6) The name, address, and phone number of the individual to contact for the person you named in paragraph (a)(5) of this section; (7) Your TIN; (8) The date the designation is effective; (9) The date the designation terminates, if applicable, and (10) A copy of the written designation; (b) The person you designate under paragraph (a) of this section is your Designee under 30 U.S.C. 1701(24) and 30 U.S.C. 1712(a). (c) If you want to terminate a designation you made under paragraph (a) of this section, you must provide to MMS in writing before the termination: (1) The date the designation is due to terminate; and (2) If you are not reporting and paying royalties and making other payments to MMS, a new designation under paragraph (a) of this section. (d) MMS may require you to provide notice when there is a change in the percentage of your record title or operating rights ownership. [62 FR 42066, Aug. 5, 1997] (a) Whenever an overpayment is made under an Indian oil and gas lease, a payor may recoup the overpayment through a recoupment on Form MMS–2014 against the current month's royalties or other revenues owed on the same lease. However, for any month a payor may not recoup more than 50 percent of the royalties or other revenues owed in that month under an individual allotted lease or more than 100 percent of the royalties or other revenues owed in that month under a tribal lease. (b) With written permission authorized by tribal statute or resolution, a payor may recoup an overpayment against royalties or other revenues owed in that month under other leases for which that tribe is the lessor. A copy of the tribe's written permission must be furnished to MMS pursuant to instructions for reporting recoupments in the MMS revenue reporter handbook. See part 210 of this chapter. Recouping overpayments on one allotted lease from royalties paid to another allotted lease is specifically prohibited. (c) Overpayments subject to recoupment under this section include all payments made in excess of the required payment for royalty, rental, bonus, or other amounts owed as specified by statute, regulation, order, or terms of an Indian mineral lease. (d) The MMS Director or his/her designee may order any payor to not recoup any amount for such reasonable period of time as may be necessary for MMS to review the nature and amount of any claimed overpayment. [60 FR 3087, Jan. 13, 1995, as amended at 67 FR 19112, Apr. 18, 2002] (a) An interest charge shall be assessed on unpaid and underpaid amounts from the date the amounts are due. (b) The interest charge on late payments shall be at the underpayment rate established by the Internal Revenue Code, 26 U.S.C. 6621(a)(2) (Supp. 1987). (c) Interest will be charged only on the amount of the payment not received. Interest will be charged only for the number of days the payment is late. (d) A portion of the interest collected will be paid to a State where the State shares in mineral revenues from Federal leases. (e) An overpayment on a lease or leases may be offset against an underpayment on a different lease or leases to determine a net underpayment on which interest is due pursuant to conditions specified in §218.42. [49 FR 37346, Sept. 21, 1984, as amended at 55 FR 37230, Sept. 10, 1990; 57 FR 62206, Dec. 30, 1992] (a) All interest collected from unpaid or underpayments on Indian tribal or allotted leases will be paid to the tribe or allottee. (b) Any disbursement of Indian mineral revenues not made by the due date as required in §219.103 of this chapter shall accrue interest. (c) Interest shall be computed at the underpayment rate established by the Internal Revenue Code, 26 U.S.C. 6621(a)(2) (Supp. 1987). (d) The interest shall be payable only for the number of days the disbursement is late. [49 FR 37346, Sept. 21, 1984, as amended at 55 FR 37230, Sept. 10, 1990] Terms used in this subpart shall have the same meaning as in 30 U.S.C. 1702. [49 FR 37346, Sept. 21, 1984. Redesignated at 51 FR 15767, Apr. 28, 1986] (a) General. (1) If a person has any information that could lead to the recovery of royalty or other payments owed to the United States with respect to any oil and gas lease on Federal lands or the Outer Continental Shelf, such information may be provided to the Minerals Management Service (MMS) in accordance with this paragraph. The MMS is authorized, under the Federal Oil and Gas Royalty Management Act of 1982 (FOGRMA), 30 U.S.C. 1723, to pay a reward for information with respect to Federal oil and gas leases. Funds must be appropriated before payment of any reward. Criteria and procedures covering claims for and payment of rewards are provided in paragraphs (b), (c), and (d) of this section. (2) If a person has any information he or she believes would be valuable to MMS, that person (“informant”) should submit the information in writing, in the form of a letter, mailed or delivered in person to the Director, Minerals Management Service, Department of the Interior, 18th and C Street, NW., Washington, DC 20240, or to the Director's designated representative. Although written communications are preferred, oral information will be accepted. (3) The informant should provide all data he or she has with respect to royalty or other payments owed. The information provided should include: identification of the alleged debtor; the source of the informant's knowledge of royalties or other payments owed; the date, if known, of the indebtedness; and any other information that could be used to establish indebtedness. All information received by MMS from persons providing information will be considered “highly confidential” and will not be disclosed to any individual except on a “need to know” basis in the performance of official duties. (b) Claim for reward. (1) Any informant who provides information that could lead to the recovery of royalty or other payments may file a claim for reward unless the person is an officer or employee of the United States, an officer or employee of a State or Indian tribe acting pursuant to a cooperative agreement or delegation under the FOGRMA, or any person acting pursuant to a contract authorized by the FOGRMA. (2) A claim for reward is not acceptable if filed on behalf of a claimant by his or her agent under power of attorney. However, an agent may provide MMS with information for an unidentified informant, to be evaluated and used by MMS as it deems appropriate. The informant's identity ultimately must be disclosed if the informant intends to file a claim for reward so that MMS can report the reward as taxable income to the Internal Revenue Service. An executor, administrator, or other legal representative of a deceased informant may file a claim on behalf of such deceased informant if, prior to his or her death, the informant was eligible to file a claim under this section. The representative must attach to the claim evidence of authority to file it. (3) To file a claim for reward the informant must: (i) Notify the Director, MMS, or the person to whom the information was reported, that he/she is claiming a reward. (ii) Request an “Application for Reward for Original Information” (Form MMS–4280). This form provides for information to enable MMS to determine and pay rewards, to control reward applications, and to report a claimant's reward as taxable income to the Internal Revenue Service. (iii) File a claim for reward by completing Form MMS–4280, sign it with his or her true name, and mail or deliver it in person to the Director or to the Director's designated representative. If the informant provided the information in person, the claim should include the name and title of the person to whom the information was reported and the date that it was reported. (4) If the informant used an identity other than his or true name when the information was originally reported, the person should attach proof to the claim that he or she is the person who gave the information. The MMS does not disclose the identity of its informants to unauthorized persons. (c) Basis for rejection of claims. No reward will be paid to a claimant: (1) Where the information originally furnished was deemed unworthy of initiating an investigation, but at some later date the records of the lessee are examined without reference to the information furnished. The claim will be rejected on the basis that the information did not cause the investigation nor did it, in itself, result in any recovery. (2) For information that would have been discovered during the normal course of an audit or investigation. (3) Unless the informant's true identity is disclosed. (4) Until after all of the royalties, penalties, or other payments discovered to be owed as a result of information provided are collected and no longer subject to dispute. (5) Unless funds are appropriated for the payment of rewards. (d) Basis for allowance of claims. (1) The value of the information furnished in relation to the facts developed by the investigation will be taken into account in determining whether a reward shall be paid and, if so, the amount thereof. Information must be voluntarily given and upon the informant's own initiative to warrant the allowance of a reward. Information secured by representatives of MMS from witnesses and others in the course of their investigative activities does not constitute a basis for reward. (2) In determining whether a reward will be allowed and, if so, the amount thereof, consideration will be given to any corresponding adjustment(s) which will result in potential savings to the lessee for other leases owned by the lessee or an affiliate of the lessee. An example of such an adjustment is a reduction in royalty payment on a different lease as the result of a revised allocation under a unitization or communitization agreement or from an offshore pipeline system. Rewards otherwise allowable will be reduced or rejected by reason of such offsetting adjustments. (3) If several claims filed by one informant are considered in one recommendation, the reward, if any, may be allowed on one claim and the others may be closed by reference. (4) Where an informant has provided information and filed a claim for reward with respect to royalty reports of one lessee for several leases, no reward will be granted with respect to an individual lease which has been examined until examination of all leases involved has been completed. Because the possibility exists that adjustments made to the reports for the open leases may result in offsetting adjustments, no reward will be allowed until the overall results of the information are evaluated. (e) Amount and payment of reward. (1) The Director, MMS will determine whether a reward will be paid and, if so, the amount thereof. In making this decision, the information provided will be evaluated in relation to the facts developed by the resulting investigation. Claims for reward will be paid in proportion to the value of information furnished voluntarily and on the informant's own initiative with respect to recovered royalties or other payments. The amount of reward will be determined as follows: (i) For specific and responsible information that caused the investigation and resulted in recovery, the reward will be 10 percent of the first $75,000 recovered, 5 percent of the next $25,000, and 1 percent of any additional recovery. The total reward cannot exceed $100,000. (ii) For information that caused the examination and was of value in determining royalty or other payments due, although not specific, and for information that was a direct factor in recovering royalty or other payments, the reward will be 5 percent of the first $75,000 recovered, 2 (iii) For information that caused the investigation but was of no value in determining royalty or other payments due, the reward will be 1 percent of the first $75,000 recovered and (2) Rewards will be paid only if moneys are appropriated for that purpose. Subject to appropriations, payments will be made as soon as possible after collection of the amounts owed by the lessee, and after those amounts no longer are subject to dispute by the payor. The reward payment to an informant will be net of Federal and State income tax in accordance with withholding guidelines of the Internal Revenue Service and the applicable State(s). (3) A decision by the Director, MMS, either denying a reward or establishing the amount of any reward is a final departmental action and may not be appealed to the Interior Board of Land Appeals in accordance with the provisions of 30 CFR part 290. [52 FR 24451, July 1, 1987] (a) Payment of royalties and rentals. As specified under the provisions of the lease, the lessee shall submit all rental payments when due and shall pay in value or deliver in production all royalties in the amounts of value or production determined by MMS to be due. (b) If the lessor elects to take royalty in oil or gas, unless otherwise agreed upon, such royalty shall be delivered on the leasehold, by the lessee to the order of and without cost to the lessor, as instructed by the Associate Director. (c) Method of payment. The payor shall tender all payments in accordance with 30 CFR 218.51. [47 FR 47773, Oct. 27, 1982. Redesignated at 48 FR 35641, Aug. 5, 1983, and amended at 52 FR 23815, June 25, 1987] Remittance covering payments of royalty or rental on naval petroleum reserves must be accomplished by necessary identification information and sent direct to the Director, Naval Petroleum Reserves in California. [47 FR 47773, Oct. 27, 1982. Redesignated at 48 FR 35641, Aug. 5, 1983] (a) The failure to make timely or proper payments of any monies due pursuant to leases, permits, and contracts subject to these regulations will result in the collection by the MMS of the full amount past due plus a late payment charge. Exceptions to this late payment charge may be granted when estimated payments on minerals production have already been made timely and otherwise in accordance with instructions provided by MMS to the payor. However, late payment charges assessed with respect to any Indian lease, permit, or contract shall be collected and paid to the Indian or tribe to which the amount overdue is owed. (b) Late payment charges will be assessed on any late payment or underpayment from the date that the payment was due until the date that the payment was received at the MMS addresses specified in §218.51. Payments received at the specified MMS addresses after 4 p.m. mountain time are considered received the following business day. (c) Late payment charges apply to all underpayments and payments received after the date due. The charges include production and minimum royalties; assessments for liquidated damages; administrative fees and payments by purchasers of royalty taken-in-kind; or any other payments, fees, or assessments that a lessee/operator/permittee/payor/royalty taken-in-kind purchaser is required to pay by a specified date. The failure to pay past due amounts, including late-payment charges, will result in the initiation of other enforcement proceedings. (d) An overpayment on a lease or leases may be offset against an underpayment on a different lease or leases to determine a net underpayment on which interest is due pursuant to conditions specified in §218.42. [47 FR 47773, Oct. 27, 1982. Redesignated at 48 FR 35641, Aug. 5, 1983, and amended at 49 FR 37347, Sept. 21, 1984; 57 FR 41868, Sept. 14, 1992; 57 FR 62206, Dec. 30, 1992; 67 FR 19112, Apr. 18, 2002] (a) Any amount that is payable by MMS to a State but is not paid on the due date, as specified in §219.100 of this chapter, or that is held in a suspense account pending resolution of a dispute as specified in §219.101 of this chapter, shall accrue interest payable to the State. (b) Interest shall be computed at the underpayment rate established by the Internal Revenue Code, 26 U.S.C. 6621(a)(2) (Supp. 1987). (c) Interest shall be computed only for the number of days the disbursement is late. In the case of suspended amounts subject to interest, it shall be computed beginning with the calendar day following the day that the monies normally would have been paid to the State had they not been in suspense. [49 FR 37347, Sept. 21, 1984, as amended at 55 FR 37230, Sept. 10, 1990] (a) States are exempt from being assessed for any interest or penalties found to be due against the Department of the Interior for failure to comply with the Emergency Petroleum Allocation Act of 1973, as amended, or any regulation issued by the Secretary of Energy thereunder concerning the certification or processing of crude oil taken in-kind as royalty by the Secretary. (b) Any State shall be assessed for its share of any overcharge resulting from a determination that DOI failed to comply with the Emergency Petroleum Allocation Act of 1973, as amended. Each State's share shall be assessed against monies owed to the State. Such assessment shall be first against monies owed to such State as a result of royalty audits prior to January 12, 1983, the enactment date of the Federal Oil and Gas Royalty Management Act of 1982, then against other monies owed. The State shall be liable for any balance. (c) A State's liability for repayment of an overcharge under this section shall exist for any amounts resulting from a judgment in a civil suit or as the result of settlement of a claim through a negotiated agreement. State liability would be offset against future mineral revenue distributions to the State. [49 FR 37347, Sept. 21, 1984] Terms used in this subpart have the same meaning as in 30 U.S.C. 1702. [49 FR 37347, Sept. 21, 1984] (a) As specified under the provisions of the lease, the lessee shall submit all rental payments when due and shall pay in value or deliver in production all royalties and net profit shares in the amounts of value or production determined by MMS to be due. (b) The failure to make timely or proper payments of any monies due pursuant to leases, permits, and contracts subject to these regulations will result in the collection of the amount past due plus a late payment charge. Exceptions to this late payment charge may be granted when estimated payments on minerals production have already been made timely and otherwise in accordance with instructions provided by MMS to the payor. (c) Late payment charges will be assessed on any late payment or underpayment from the date that the payment was due until the date that the payment was received at the MMS addresses specified in §218.51. Payments received at the specified MMS addresses after 4 p.m. mountain time are considered received the following business day. (d) Late payment charges apply to all underpayments and payments received after the date due. These charges include production and minimum royalties; assessments for liquidated damages; administrative fees and payments by purchasers of royalty taken-in-kind; or any other payments, fees, or assessments that a lessee/operator/payor/permittee/royalty taken-in-kind purchaser is required to pay by a specified date. The failure to pay past due amounts, including late payment charges, will result in the initiation of other enforcement proceedings. (e) An overpayment on a lease or leases, excluding rental payments, may be offset against an underpayment on a different lease or leases to determine a net underpayment on which interest is due pursuant to conditions specified in §218.42. [47 FR 22528, May 25, 1982. Redesignated at 48 FR 35641, Aug. 5, 1983, and amended at 49 FR 37347, Sept. 21, 1984; 52 FR 23815, June 25, 1987; 57 FR 41868, Sept. 14, 1992; 57 FR 62206, Dec. 30, 1992; 67 FR 19112, Apr. 18, 2002] The annual rental paid in any year is in addition to, and is not credited against, any royalties due from production. The lessee must pay an annual rental as shown in paragraphs (a), (b), and (c) of this section. Discovery means one or more wells on the lease that meet the requirements in 250, subpart A of this title. (a) This paragraph applies to any lease not covered by paragraph (b) or paragraph (c) of this section. (b) This paragraph applies to any lease created by segregating a portion of a producing lease when there is no actual or allocated production on the segregated portion. The lessee must pay an annual rental for the segregated portion at the rate specified in the lease. The lessee must pay the rental as shown in the following table. (c) For leases issued subject to the net profit sharing provisions, annual rental payments shall be due and payable in advance, on the first day of each lease year which commences prior to the date the first profit share payment becomes due. The owner of any lease created by the segregation of a portion of a lease subject to net profit sharing provisions, shall pay an annual rental for such segregated portion at the rate per acre or hectare specified in the lease. This rental shall be payable each year following the year in which the segregation becomes effective and shall continue to be due and payable, in advance, on the first day of each year which commences prior to the date the first profit share payment becomes due. [44 FR 38276, June 29, 1979, as amended at 45 FR 69175, Oct. 17, 1980; 47 FR 25972, June 16, 1982. Redesignated at 47 FR 47006, Oct. 22, 1982, and at 48 FR 35641, Aug. 5, 1983; 66 FR 11518, Feb. 23, 2001; 67 FR 19112, Apr. 18, 2002] Upon the establishment of the Fishermen's Contingency Fund, any holder of a lease issued or maintained under the Outer Continental Shelf Lands Act and any holder of an exploration permit or of an easement or right-of-way for the construction of a pipeline, shall pay an amount specified by the Director, MMS, who shall assess and collect the specified amount from each holder and deposit it into the Fund. With respect to prelease exploratory drilling permits, the amount will be collected at the time of issuance of the permit. [52 FR 5458, Feb. 23, 1987] (a) MMS will not relieve the lessee of the obligation to pay rental or minimum royalty for or during the suspension if the Regional Supervisor: (1) Grants a suspension of operations or production, or both, at the request of the lessee; or (2) Directs a suspension of operations or production, or both, under 30 CFR 250.173(a). (b) MMS will not require a lessee to pay rental or minimum royalty for or during the suspension if the Regional Supervisor directs a suspension of operations or production, or both, except as provided in (a)(2) of this section. (c) If the lease anniversary date falls within a period of suspension for which no rental or minimum royalty payments are required under paragraph (a) of this section, the prorated rentals or minimum royalties are due and payable as of the date the suspension period terminates. These amounts shall be computed and notice thereof given the lessee. The lessee shall pay the amount due within 30 days after receipt of such notice. The anniversary date of a lease shall not change by reason of any period of lease suspension or rental or royalty relief resulting therefrom. [44 FR 38276, June 29, 1979; 44 FR 55380, Sept. 26, 1979. Redesignated and amended at 47 FR 47006, 47007, Oct. 22, 1982. Further redesignated at 48 FR 35641, Aug. 5, 1983 and amended at 51 FR 19063, May 27, 1986; 54 FR 50616, Dec. 8, 1989; 64 FR 72775, Dec. 28, 1999] (a) Payment of royalties and rentals. With the exception of first-year rental, the payor shall tender all payments in accordance with §218.51. First-year rental shall be paid in accordance with paragraph (c) of this section. (b) Payment of the one-fifth bonus bid amount. (1) Each lease bid must include a payment for the one-fifth bonus bid deposit amount unless the bidder is otherwise directed by the Secretary. Further instructions on how to make payment with the bid will be included in the notice of each lease offering. EFT may be used as a method of payment for the one-fifth bonus bid amount. (2) Beginning with lease offerings held after February 1, 1984, the one-fifth bonus amount received from a high bidder shall be deposited into an escrow account created pursuant to an agreement between the Departments of the Interior and Treasury, pending acceptance or rejection of the bid. The one-fifth bonus funds will be invested in public debt securities. Investment of this amount by the U.S. Government does not indicate acceptance of the bid. The one-fifth bonus checks submitted with bids other than the highest valid bid shall be returned to respective bidders after bids are opened, recorded, and ranked. Return of such checks will not affect the status, validity, or ranking of bids. The one-fifth bonus bid amount received from any high bidder and held by the Government pending acceptance or rejection, will be returned with actual interest earned, if the bid is subsequently rejected. The interest accrued during the period held in the account pending acceptance or rejection of the bid will accrue to the Government when the bid is accepted. (c) Payment of the four-fifths bonus bid amount and the first year's rental. Payment shall be made to MMS by EFT unless otherwise directed by the Secretary. The payment by EFT via the FRCS must be received by the Federal Reserve Bank of New York no later than noon, eastern standard time, on the 11th business day after receipt of the lease forms by the successful bidder. A “business day” is considered to be a day on which the OCS regional office issuing the lease is open for business. The lease will not be executed by the appropriate MMS official until payment is received. Failure to remit by EFT or as directed by the Secretary within the time specified above will result in forfeiture of the one-fifth bonus bid amount and the lease will not be executed by the appropriate MMS official. Payors will not be held responsible for late payment due to actions beyond their control, such as mechanical or systems failure of FRCS or FDS. Payors will be held responsible for incorrect actions of their bank which result in late payments. A 2-day grace period will be allowed to make up a deficient payment, but a late payment charge will be assessed for this late payment and a penalty will also be assessed if appropriate. Late payment charges will be assessed in accordance with Subpart B of this part. (d) General. (1) Payors using the appropriate means of payment (EFT, check, etc.) may pay for multiple lease obligations with a single remittance but must ensure that the payment complies with subpart B of this part and the remittance advice adequately identifies the single payment. The format to be used for such identification will be provided by the MMS Accounting Center. (2) Where to pay. (3) The MMS mailing addresses for payments to MMS are specified in §218.51. (4) Payments received at the MMS addresses after 4 p.m. mountain time are considered received the following business day. (e) Miscellaneous payments. Payments shall be made to the manager of the appropriate Outer Continental Shelf field office by cash, check or bank draft payable to “Department of the Interior—MMS” for miscellaneous payments such as: (1) Pipeline rights-of-way application filing fees and rentals, pipeline accessory site rentals and application fees, and other related costs. (2) Filing and approval fees for transfers of interest in leases. [49 FR 8605, Mar. 8, 1984, as amended at 52 FR 23815, June 25, 1987; 53 FR 43201, Oct. 26, 1988; 57 FR 41868, Sept. 14, 1992; 62 FR 19499, Apr. 22, 1997; 67 FR 19112, Apr. 18, 2002] Terms used in this subpart have the same meaning as in 30 U.S.C. 1702. [52 FR 23815, June 25, 1987] As specified under the provisions of the lease, the lessee shall submit all rental and deferred bonus payments when due and shall pay in value all royalties in the amount determined by MMS to be due. [52 FR 23815, June 25, 1987] You must tender all payments in accordance with §218.51, except as follows: (a) For purposes of this section, report means the Solid Minerals Production and Royalty Report, Form MMS–4430, rather than the Form MMS–2014. (b) For Form MMS–4430 payments, include both your customer identification and your customer document identification numbers on your payment document, rather than the information required under §218.51(f)(1). (c) For a rental payment that is not reported on Form MMS–4430, include the MMS Courtesy Notice when provided or write your customer identification number and Government-assigned lease number on the payment document, rather than the information required under §218.51(f)(4)(iii). [66 FR 45773, Aug. 30, 2001] (a) The failure to make timely or proper payment of any monies due pursuant to leases and contracts subject to these rules will result in the collection by MMS of the full amount past due plus a late payment charge. Exceptions to this late payment charge may be granted when estimated payments on minerals production have already been made timely and otherwise in accordance with instructions provided by MMS to the operator/lessee. However, late payment charges assessed with respect to any Indian lease, permit, or contract shall be collected and paid to the Indian or tribe to which the amount overdue is owed. (b) Late payment charges will be assessed on any late payment or underpayment from the date that the payment was due until the date that the payment was received at the MMS addresses specified in §218.51. Payments received at the specified MMS addresses after 4 p.m. mountain time are considered received the following business day. (c) Late payment charges are calculated on the basis of a percentage assessment rate. In the absence of a specific lease, permit, license or contract provision prescribing a different rate, this percentage assessment rate is prescribed by the Department of the Treasury as the “Treasury Current Value of Funds Rate.” (d) This rate is available in the Treasury Fiscal Requirements Manual Bulletins that are published prior to the first day of each calendar quarter for application to overdue payments or underpayments in the new calendar quarter. The rate is also published in the Notices section of the (e) Late payment charges apply to all underpayments and payments received after the date due. These charges include production, minimum, or advance royalties; assessments for liquidated damages; or any other payments, fees, or assessments that an operator/lessee is required to pay by a specified date. The failure to pay past due payments, including late payment charges, will result in the initiation of other enforcement proceedings. (f) An overpayment on a lease or leases may be offset against an underpayment on a different lease or leases to determine a net underpayment on which interest is due pursuant to conditions specified in §218.42. [47 FR 33195, July 30, 1982; 47 FR 53366, Nov. 26, 1982. Redesignated at 48 FR 35641, Aug. 5, 1983, and further redesignated at 52 FR 23815, June 25, 1987, as amended at 57 FR 41868, Sept. 14, 1992; 57 FR 62207, Dec. 30, 1992; 59 FR 14559, Mar. 29, 1994; 65 FR 55189, Sept. 13, 2000; 67 FR 19112, Apr. 18, 2002] (a) Whenever an overpayment is made under an Indian solid mineral lease, a payor may recoup the overpayment through a recoupment on Form MMS–4430 against the current month's royalties or other revenues owed on the same lease. However, for any month a payor may not recoup more than 50 percent of the royalties or other revenues owed in that month under an individual allotted lease or more than 100 percent of the royalties or other revenues owed in that month under a tribal lease. (b) With written permission authorized by tribal statute or resolution, a payor may recoup an overpayment against royalties or other revenues owed in that month under other leases for which that tribe is the lessor. A copy of the tribe's written permission must be furnished to MMS for reporting recoupments. Call 1–888–201–6416 for instructions. Recouping overpayments on one allotted lease from royalties paid to another allotted lease is specifically prohibited. (c) Overpayments subject to recoupment under this section include all payments made in excess of the required payment for royalty, rental, bonus, or other amounts owed as specified by statute, regulation, order, or terms of an Indian mineral lease. (d) The MMS Director or his/her designee may order any payor to not recoup any amount for such reasonable period of time as may be necessary for MMS to review the nature and amount of any claimed overpayment. [60 FR 3087, Jan. 13, 1995, as amended at 66 FR 45773, Aug. 30, 2001; 66 FR 50827, Oct. 5, 2001] As specified under the provisions of the lease, the lessee shall submit all rental and deferred bonus payments when due and shall pay in value all royalties in the amount determined by MMS to be due. [52 FR 23815, June 25, 1987] The payor shall tender all payments in accordance with 30 CFR 218.51. [52 FR 23815, June 25, 1987] (a) The failure to make timely or proper payment of any monies due pursuant to leases and contracts subject to these regulations will result in the collection by the Minerals Management Service (MMS) of the full amount past due plus a late payment charge. Exceptions to this late payment charge may be granted when estimated payments on minerals production have already been made timely and otherwise in accordance with the instructions provided by the MMS to the payor. (b) Late payment charges will be assessed on any late payment or underpayment from the date that the payment was due until the date that the payment was received at the MMS addresses specified in §218.51. Payments received at the specified MMS addresses after 4 p.m. Mountain Time are considered received the following business day. (c) Late payment charges are calculated on the basis of a percentage assessment rate. In the absence of a specific lease, permit, license or contract provision prescribing a different rate, this percentage assessment rate is prescribed by the Department of the Treasury as the “Treasury Current Value of Funds Rate.” (d) This rate is available in the Treasury Fiscal Requirements Manual Bulletins that are published prior to the first day of each calendar quarter for application to overdue payments or underpayments in the new calendar quarter. The rate is also published in the Notices section of the (e) Late payment charges apply to all underpayments and payments received after the date due. These charges include production, minimum, and compensatory royalties; assessments for liquidated damages; administrative fees and payments by purchasers of royalty taken-in-kind; or any other payments, fees, or assessments that a lessee/operator/payor/royalty taken-in-kind purchaser is required to pay by a specified date. The failure to pay past due payments, including late payment charges, will result in the initiation of other enforcement proceedings. (f) An overpayment on a lease or leases may be offset against an underpayment on a different lease or leases to determine a net underpayment on which interest is due pursuant to conditions specified in §218.42. [47 FR 22528, May 25, 1982. Redesignated at 48 FR 35641, Aug. 5, 1983, and further redesignated at 51 FR 15767, Apr. 28, 1986 and 52 FR 23815, June 25, 1987, as amended at 57 FR 41868, Sept. 14, 1992; 57 FR 62207, Dec. 30, 1992; 59 FR 14559, Mar. 29, 1994; 65 FR 55189, Sept. 13, 2000; 67 FR 19112, Apr. 18, 2002]
Title 30: Mineral Resources
PART 218—COLLECTION OF ROYALTIES, RENTALS, BONUSES AND OTHER MONIES DUE THE FEDERAL GOVERNMENT
Section Contents
§ 218.10 Information collection.
§ 218.40 Assessments for incorrect or late reports and failure to report.
§ 218.41 Assessments for failure to submit payment of same amount as Form MMS–2014 or bill document or to provide adequate information.
§ 218.42 Cross-lease netting in calculation of late-payment interest.
§ 218.50 Timing of payment.
§ 218.51 How to make payments.
§ 218.52 How does a lessee designate a Designee?
§ 218.53 Recoupment of overpayments on Indian mineral leases.
§ 218.54 Late payments.
§ 218.55 Interest payments to Indians.
§ 218.56 Definitions.
§ 218.57 Providing information and claiming rewards.
§ 218.100 Royalty and rental payments.
§ 218.101 Royalty and rental remittance (naval petroleum reserves).
§ 218.102 Late payment or underpayment charges.
§ 218.103 Payments to States.
§ 218.104 Exemption of States from certain interest and penalties.
§ 218.105 Definitions.
§ 218.150 Royalties, net profit shares, and rental payments.
§ 218.151 Rental fees.
§ 218.152 Fishermen's Contingency Fund.
§ 218.153 [Reserved]
§ 218.154 Effect of suspensions on royalty and rental.
§ 218.155 Method of payment.
§ 218.156 Definitions.
§ 218.200 Payment of royalties, rentals, and deferred bonuses.
§ 218.201 Method of payment.
§ 218.202 Late payment or underpayment charges.
§ 218.203 Recoupment of overpayments on Indian mineral leases.
§ 218.300 Payment of royalties, rentals, and deferred bonuses.
§ 218.301 Method of payment.
§ 218.302 Late payment or underpayment charges.
Subpart A—General Provisions
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§ 218.10 Information collection.
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§ 218.40 Assessments for incorrect or late reports and failure to report.
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§ 218.41 Assessments for failure to submit payment of same amount as Form MMS–2014 or bill document or to provide adequate information.
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§ 218.42 Cross-lease netting in calculation of late-payment interest.
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Subpart B—Oil and Gas, General
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§ 218.50 Timing of payment.
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§ 218.51 How to make payments.
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§ 218.52 How does a lessee designate a Designee?
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§ 218.53 Recoupment of overpayments on Indian mineral leases.
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§ 218.54 Late payments.
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§ 218.55 Interest payments to Indians.
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§ 218.56 Definitions.
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§ 218.57 Providing information and claiming rewards.
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Subpart C—Oil and Gas, Onshore
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§ 218.100 Royalty and rental payments.
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§ 218.101 Royalty and rental remittance (naval petroleum reserves).
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§ 218.102 Late payment or underpayment charges.
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§ 218.103 Payments to States.
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§ 218.104 Exemption of States from certain interest and penalties.
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§ 218.105 Definitions.
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Subpart D—Oil, Gas and Sulfur, Offshore
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§ 218.150 Royalties, net profit shares, and rental payments.
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§ 218.151 Rental fees.
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------------------------------------------------------------------------ Issued as a For_ result of a sale The lessee must pay held_ rental_------------------------------------------------------------------------(1) An oil and gas lease...... Before March 26, On or before the 2001. first day of each lease year before the discovery of oil or gas on the lease.(2) An oil and gas lease...... After March 26, On or before the 2001. first day of each lease year before the discovery of oil or gas on the lease, then on or before the last day of each lease year in any full year in which royalties on production are not due.(3) A mineral lease for other Before March 26, On or before the than oil or gas. 2001. first day of each lease year before the discovery of paying quantities.(4) A mineral lease for other After March 26, On or before the than oil or gas. 2001. first day of each lease year before the date the first royalty payment is due on the lease, then on or before the last day of each lease year in any full year in which royalties on production are not due.------------------------------------------------------------------------
------------------------------------------------------------------------ If the lease results from a segregation_ The lessee must pay rental_------------------------------------------------------------------------(1) Before March 26, 2001......... On or before the first day of each lease year before the discovery of oil or gas on the segregated portion.(2) After March 26, 2001.......... On or before the first day of each lease year before the discovery of oil or gas on the lease, then on or before the last day of each lease year in any full year in which royalties on production are not due.------------------------------------------------------------------------
§ 218.152 Fishermen's Contingency Fund.
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§ 218.153 [Reserved]
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§ 218.154 Effect of suspensions on royalty and rental.
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§ 218.155 Method of payment.
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§ 218.156 Definitions.
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Subpart E—Solid Minerals—General
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§ 218.200 Payment of royalties, rentals, and deferred bonuses.
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§ 218.201 Method of payment.
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§ 218.202 Late payment or underpayment charges.
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§ 218.203 Recoupment of overpayments on Indian mineral leases.
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Subpart F—Geothermal Resources
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§ 218.300 Payment of royalties, rentals, and deferred bonuses.
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§ 218.301 Method of payment.
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§ 218.302 Late payment or underpayment charges.
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Subpart G—Indian Lands [Reserved]
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