30 C.F.R. § 203.69 If my application is approved, what royalty relief will I receive?
Title 30 - Mineral Resources
If we approve your application, subject to certain conditions, we will not collect royalties on a specified suspension volume for your field, development project, or expansion project. Suspension volumes include volumes allocated to a lease under an approved unit agreement, but exclude any volumes of production that are not normally royalty-bearing under the lease or the regulations of this chapter (e.g., fuel gas). (a) For authorized fields, the minimum royalty-suspension volumes are: (1) 17.5 million barrels of oil equivalent (MMBOE) for fields in 200 to 400 meters of water; (2) 52.5 MMBOE for fields in 400 to 800 meters of water; and (3) 87.5 MMBOE for fields in more than 800 meters of water. (b) For development projects, any relief we grant applies only to project wells and replaces the royalty suspension volume with which we issued your lease. If your project is economic given the royalty suspension volume with which we issued your lease, we will reject the application. Otherwise, the minimum royalty suspension volumes are as shown in the following table: (c) If your application includes pre-Act or eligible leases in different categories of water depth, we apply the minimum royalty suspension volume for the deepest such lease then assigned to the field. We base the water depth and makeup of a field on the water-depth delineations in the “Lease Terms and Economic Conditions” map and the “Field Names Master List” documents and updates in effect at the time your application is deemed complete. These publications are available from the MMS Regional Office for the GOM. (d) You will get a royalty suspension volume above the minimum if we determine that you need more to make the field or development project economic. (e) For expansion projects, the minimum royalty suspension volume equals 10 percent of the median of the distribution of known recoverable resources upon which we based approval of your application from all reservoirs included in your project plus any suspension volumes required under §203.66. If we determine that your expansion project may be economic only with more relief, we will determine and grant you the royalty suspension volume necessary to make the project economic. (f) The royalty suspension volume applicable to specific leases will continue through the end of the month in which cumulative production reaches that volume. You must calculate cumulative production from all the leases in the authorized field or project that are entitled to share the royalty suspension volume. [63 FR 2618, Jan. 16, 1998, as amended at 67 FR 1876, Jan. 15, 2002]
Title 30: Mineral Resources
PART 203—RELIEF OR REDUCTION IN ROYALTY RATES
Subpart B—OCS Oil, Gas, and Sulfur General
Royalty Relief For Deep Water Expansion Projects And Pre-Act Deep Water Leases
§ 203.69 If my application is approved, what royalty relief will I receive?
------------------------------------------------------------------------ The minimum royalty For suspension volume is Plus------------------------------------------------------------------------(1) RS leases................. A volume equal to the 10 percent of combined royalty the median of suspension volumes the (or the volume distribution of equivalent based on known the data in your recoverable approved application resources upon for other forms of which we based royalty suspension) approval of with which we issued your the leases application participating in the from all application that have reservoirs or plan a well into a included in the reservoir identified project. in the application.(2) Other deep water leases A volume equal to 10 issued in sales after percent of the median November 28, 2000. of the distribution of known recoverable resources upon which we based approval of your application from all reservoirs included in the project.------------------------------------------------------------------------
