30 C.F.R. § 206.173 How do I calculate the alternative methodology for dual accounting?
Title 30 - Mineral Resources
(a) Electing a dual accounting method. (1) If you are required to perform the accounting for comparison (dual accounting) under §206.176, you have two choices. You may elect to perform the dual accounting calculation according to either §206.176(a) (called actual dual accounting), or paragraph (b) of this section (called the alternative methodology for dual accounting). (2) You must make a separate election to use the alternative methodology for dual accounting for your Indian leases in each MMS-designated area. Your election for a designated area must apply to all of your Indian leases in that area. (i) MMS will publish in the (A) Alabama-Coushatta; (B) Blackfeet Reservation; (C) Crow Reservation; (D) Fort Belknap Reservation; (E) Fort Berthold Reservation; (F) Fort Peck Reservation; (G) Jicarilla Apache Reservation; (H) MMS-designated groups of counties in the State of Oklahoma; (I) Navajo Reservation; (J) Northern Cheyenne Reservation; (K) Rocky Boys Reservation; (L) Southern Ute Reservation; (M) Turtle Mountain Reservation; (N) Ute Mountain Ute Reservation; (O) Uintah and Ouray Reservation; (P) Wind River Reservation; and (Q) Any other area that MMS designates. MMS will publish a new area designation in the (ii) You may elect to begin using the alternative methodology for dual accounting at the beginning of any month. The first election to use the alternative methodology will be effective from the time of election through the end of the following calendar year. Thereafter, each election to use the alternative methodology must remain in effect for 2 calendar years. You may return to the actual dual accounting method only at the beginning of the next election period or with the written approval of MMS and the tribal lessor for tribal leases, and MMS for Indian allottee leases in the designated area. (iii) When you elect to use the alternative methodology for a designated area, you must also use the alternative methodology for any new wells commenced and any new leases acquired in the designated area during the term of the election. (b) Calculating value using the alternative methodology for dual accounting. (1) The alternative methodology adjusts the value of gas before processing determined under either §206.172 or §206.174 to provide the value of the gas after processing. You must use the value of the gas after processing for royalty payment purposes. The amount of the increase depends on your relationship with the owner(s) of the plant where the gas is processed. If you have no direct or indirect ownership interest in the processing plant, then the increase is lower, as provided in the table in paragraph (b)(2)(ii) of this section. If you have a direct or indirect ownership interest in the plant where the gas is processed, the increase is higher, as provided in paragraph (b)(2)(ii) of this section. (2) To calculate the value of the gas after processing using the alternative methodology for dual accounting, you must apply the increase to the value before processing, determined in either §206.172 or §206.174, as follows: (i) Value of gas after processing = (value determined under either §206.172 or §206.174, as applicable) × (1 + increment for dual accounting); and (ii) In this equation, the increment for dual accounting is the number you take from the applicable Btu range, determined under paragraph (b)(3) of this section, in the following table: (3) The applicable Btu for purposes of this section is the volume weighted-average Btu for the lease computed from measurements at the facility measurement point(s) for gas production from the lease. (4) If any of your gas from the lease is processed during a month, use the following two paragraphs to determine which amounts are subject to dual accounting and which dual accounting method you must use. (i) Weighted-average Btu content determined under paragraph (b)(3) of this section is greater than 1,000 Btu's per cubic foot (Btu/cf). All gas production from the lease is subject to dual accounting and you must use the alternative method for all that gas production if you elected to use the alternative method under this section. (ii) Weighted-average Btu content determined under paragraph (b)(3) of this section is less than or equal to 1,000 Btu/cf. Only the volumes of lease production measured at facility measurement points whose quality exceeds 1,000 Btu/cf are subject to dual accounting, and you may use the alternative methodology for these volumes. For gas measured at facility measurement points for these leases where the quality is equal to or less than 1,000 Btu/cf, you are not required to do dual accounting.
Title 30: Mineral Resources
PART 206—PRODUCT VALUATION
Subpart E—Indian Gas
§ 206.173 How do I calculate the alternative methodology for dual accounting?
------------------------------------------------------------------------ Increment Increment if Lessee if lessee has no has an BTU range ownership ownership interest in interest in plant plant------------------------------------------------------------------------1001 to 1050.................................. .0275 .03751051 to 1100.................................. .0400 .06251101 to 1150.................................. .0425 .07501151 to 1200.................................. .0700 .12251201 to 1250.................................. .0975 .17001251 to 1300.................................. .1175 .20501301 to 1350.................................. .1400 .24001351 to 1400.................................. .1450 .25001401 to 1450.................................. .1500 .26001451 to 1500.................................. .1550 .27001501 to 1550.................................. .1600 .28001551 to 1600.................................. .1650 .29001601 to 1650.................................. .1850 .32251651 to 1700.................................. .1950 .34251701+......................................... .2000 .3550------------------------------------------------------------------------
