MMS finally issues oil royalty reform rule

After 4 years and four revisions, the US Minerals Management Service has issued a final rule revising how producers calculate the cash royalties they owe on production from federal lands.The rule affects about 230,000 b/d of federal royalty oil, less about 50,000 b/d being sold through royalty in-kind and small refiner programs or being transferred to the Strategic Petroleum Reserve. MMS said, overall, federal leases produced about 1.7 million b/d last year.MMS is allowing producers a 3-month, interest-free grace period to give them time to change their accounting systems to comply with the regulation.Separately, MMS plans to issue a final rule in mid-May on the valuation of royalties fro...

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