30 U.S.C. § 1727 — Royalties on all extracted methane

Page 376 TITLE 30—MINERAL LANDS AND MINING § 1727 jointly determine, on a case by case basis, the amount of what marginal production from a lease or leases or well or wells, or parts thereof, shall be subject to a prepayment under sub- section (b) or regulatory relief under subsection (c). If the State concerned does not consent, such prepayments or regulatory relief shall not be made available under this section for such marginal production: Provided, That if royalty payments from a lease or leases, or well or wells are not shared with any State, such determina- tion shall be made solely by the Secretary. (b) Prepayment of royalty (1) In general Notwithstanding the provisions of any lease to the contrary, for any lease or leases or well or wells identified by the Secretary and the State concerned pursuant to subsection (a), the Secretary is authorized to accept a pre- payment for royalties in lieu of monthly roy- alty payments under the lease for the remain- der of the lease term if the affected lessee so agrees. Any prepayment agreed to by the Sec- retary, State concerned and lessee which is less than an average $500 per month in total royalties shall be effectuated under this sec- tion not earlier than two years after August 13, 1996, and, any prepayment which is greater than an average $500 per month in total royal- ties shall be effectuated under this section not earlier than three years after August 13, 1996. The Secretary and the State concerned may condition their acceptance of the prepayment authorized under this section on the lessee’s agreeing to such terms and conditions as the Secretary and the State concerned deem ap- propriate and consistent with the purposes of this chapter. Such terms may— (A) provide for prepayment that does not result in a loss of revenue to the United States in present value terms; (B) include provisions for receiving addi- tional prepayments or royalties for develop- ments in the lease or leases or well or wells that deviate significantly from the assump- tions and facts on which the valuation is de- termined; and (C) require the lessee or its designee to provide such periodic production reports as may be necessary to allow the Secretary and the State concerned to monitor production for the purposes of subparagraph (B). (2) State share A prepayment under this section shall be shared by the Secretary with any State or other recipient to the same extent as any roy- alty payment for such lease. (3) Satisfaction of obligation Except as may be provided in the terms and conditions established by the Secretary under subsection (b), a lessee or its designee who makes a prepayment under this section shall have satisfied in full the lessee’s obligation to pay royalty on the production stream sold from the lease or leases or well or wells. (c) Alternative accounting and auditing require- ments Within one year after August 13, 1996, the Sec- retary or the delegated State shall provide ac- counting, reporting, and auditing relief that will encourage lessees to continue to produce and de- velop properties subject to subsection (a): Pro- vided, That such relief will only be available to lessees in a State that concurs, which concur- rence is not required if royalty payments from the lease or leases or well or wells are not shared with any State. Prior to granting such relief, the Secretary and, if appropriate, the State concerned shall agree that the type of marginal wells and relief provided under this paragraph is in the best interest of the United States and, if appropriate, the State concerned. (Pub. L. 97–451, title I, § 117, as added Pub. L. 104–185, § 7(a), Aug. 13, 1996, 110 Stat. 1715; amend- ed Pub. L. 104–200, § 1(7), Sept. 22, 1996, 110 Stat. 2421.) Editorial Notes CODIFICATION Pub. L. 104–185, § 4(a), which directed the addition of this section at the end of the Federal Oil and Gas Roy- alty Management Act of 1982, was executed by adding this section at the end of title I of that Act to reflect the probable intent of Congress. AMENDMENTS 1996—Subsec. (b)(1)(C). Pub. L. 104–200, § 1(7), sub- stituted ‘‘its designee’’ for ‘‘it designee’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section applicable with respect to production of oil and gas after the first day of the month following Aug. 13, 1996, except as provided by this section, see section 11 of Pub. L. 104–185, set out as an Effective Date of 1996 Amendment note under section 1701 of this title. APPLICABILITY Section not applicable to any privately owned min- erals or with respect to Indian lands, see sections 9 and 10 of Pub. L. 104–185, set out as an Applicability of 1996 Amendment note under section 1701 of this title. § 1727. Royalties on all extracted methane (a) In general For all leases issued after August 16, 2022, ex- cept as provided in subsection (b), royalties paid for gas produced from Federal land and on the outer Continental Shelf shall be assessed on all gas produced, including all gas that is consumed or lost by venting, flaring, or negligent releases through any equipment during upstream oper- ations. (b) Exception Subsection (a) shall not apply with respect to— (1) gas vented or flared for not longer than 48 hours in an emergency situation that poses a danger to human health, safety, or the envi- ronment; (2) gas used or consumed within the area of the lease, unit, or communitized area for the benefit of the lease, unit, or communitized area; or (3) gas that is unavoidably lost. (Pub. L. 117–169, title V, § 50263, Aug. 16, 2022, 136 Stat. 2058.) Page 377 TITLE 30—MINERAL LANDS AND MINING § 1733 Editorial Notes CODIFICATION Section was enacted as part of Pub L. 117–169, and not as part of the Federal Oil and Gas Royalty Manage- ment Act of 1982 which comprises this chapter. SUBCHAPTER II—STATES AND INDIAN TRIBES § 1731. Application of subchapter This subchapter shall apply only with respect to oil and gas leases on Federal lands or Indian lands. Nothing in this subchapter shall be con- strued to apply to any lease on the Outer Conti- nental Shelf. (Pub. L. 97–451, title II, § 201, Jan. 12, 1983, 96 Stat. 2457.) § 1731a. Application of subchapter to leases of lands within three miles of seaward bound- aries of coastal States For fiscal year 1990 and each fiscal year there- after, notwithstanding the provisions of section 1731 of this title, sections 1732 through 1736 of this title shall apply to any lease or portion of a lease subject to section 1337(g) of title 43, which, for purposes of those provisions and for no other purposes, shall be regarded as within the coastal State or States entitled to receive revenues from it under section 1337(g) of title 43. (Pub. L. 101–121, title I, Oct. 23, 1989, 103 Stat. 711.) Editorial Notes CODIFICATION Section was enacted as part of the Department of the Interior and Related Agencies Appropriations Act, 1990, and not as part of the Federal Oil and Gas Royalty Management Act of 1982 which comprises this chapter. Statutory Notes and Related Subsidiaries SIMILAR PROVISIONS Similar provisions were contained in Pub. L. 100–446, title I, Sept. 27, 1988, 102 Stat. 1791. § 1732. Cooperative agreements (a) Authorization of Secretary; permission of In- dian tribe required for activities on Indian lands The Secretary is authorized to enter into a co- operative agreement or agreements with any State or Indian tribe to share oil or gas royalty management information, to carry out inspec- tion, auditing, investigation or enforcement (not including the collection of royalties, civil or criminal penalties or other payments) activi- ties under this chapter in cooperation with the Secretary, and to carry out any other activity described in section 1718 of this title. The Sec- retary shall not enter into any such cooperative agreement with a State with respect to any such activities on Indian lands, except with the per- mission of the Indian tribe involved. (b) Access to royalty accounting information Except as provided in section 1733 of this title, and pursuant to a cooperative agreement— (1) each State shall, upon request, have ac- cess to all royalty accounting information in the possession of the Secretary respecting the production, removal, or sale of oil or gas from leases on Federal lands within the State; and (2) each Indian tribe shall, upon request, have access to all royalty accounting informa- tion in the possession of the Secretary re- specting the production, removal, or sale of oil or gas from leases on Indian lands under the jurisdiction of such tribe. Information shall be made available under para- graphs (1) and (2) as soon as practicable after it comes into the possession of the Secretary. Ef- fective October 1, 1983, such information shall be made available under paragraphs (1) and (2) not later than 30 days after such information comes into the possession of the Secretary. (c) Agreements in accordance with chapter 63 of title 31; terms and conditions Any cooperative agreement entered into pur- suant to this section shall be in accordance with the provisions of chapter 63 of title 31, and shall contain such terms and conditions as the Sec- retary deems appropriate and consistent with the purposes of this chapter, including, but not limited to, a limitation on the use of Federal as- sistance to those costs which are directly re- quired to carry out the agreed upon activities. (Pub. L. 97–451, title II, § 202, Jan. 12, 1983, 96 Stat. 2457.) Editorial Notes CODIFICATION In subsec. (c), ‘‘chapter 63 of title 31’’ substituted for ‘‘the Federal Grant and Cooperative Agreement Act of 1977’’ on authority of Pub. L. 97–258, § 4(b), Sept. 13, 1982, 96 Stat. 1067, the first section of which Act enacted Title 31, Money and Finance. Statutory Notes and Related Subsidiaries APPLICABILITY Pub. L. 104–185, § 8(a), Aug. 13, 1996, 110 Stat. 1717, pro- vided that: ‘‘With respect to Federal lands, sections 202 and 307 of the Federal Oil and Gas Royalty Manage- ment Act of 1982 (30 U.S.C. 1732 and 1755), are no longer applicable. The applicability of those sections to Indian leases is not affected.’’ § 1733. Information (a) Availability of confidential information by Secretary pursuant to cooperative agree- ments; conditions Trade secrets, proprietary and other confiden- tial information shall be made available by the Secretary, pursuant to a cooperative agreement, to a State or Indian tribe upon request only if— (1) such State or Indian tribe consents in writing to restrict the dissemination of the in- formation to those who are directly involved in an audit or investigation under this chapter and who have a need to know; (2) such State or tribe accepts liability for wrongful disclosure; (3) in the case of a State, such State dem- onstrates that such information is essential to the conduct of an audit or investigation or to litigation under section 1734 of this title; and