MMS CONSIDERING CHANGES ON OCS

The Minerals Management Service is asking industry for comments on policy options for the U.S. Outer Continental Shelf oil and gas program. MMS Director Cynthia Quarterman said the agency wants to determine if there are any changes needed in MMS policies that will yield better offshore management. MMS is seeking advice on how to slow expected declines in infrastructure and production in producing areas, promote environmentally sound development in other promising areas such as deep water, and

May 1, 1995

2 min read

The Minerals Management Service is asking industry for comments on policy options for the U.S. Outer Continental Shelf oil and gas program.

MMS Director Cynthia Quarterman said the agency wants to determine if there are any changes needed in MMS policies that will yield better offshore management.

MMS is seeking advice on how to slow expected declines in infrastructure and production in producing areas, promote environmentally sound development in other promising areas such as deep water, and assure that the government receives fair market value on OCS leases.

"To help us answer these questions, we're looking to states, local governments, other federal agencies, the oil and gas industry, and environmental groups to participate in the decisionmaking process," Quarterman said.

"No major policy changes would be made until we have consulted with all affected parties, and no changes would affect our high environmental and safety standards."

MMS has decided to continue offering annual, area-wide sales in the central and western Gulf of Mexico. In other planning areas, it may hold narrowly targeted sales, more typical tract selection sales, or tract nomination sales.

MMS is considering options such as issuing better guidelines on how producers can apply for royalty relief, more flexible royalty terms for some leases, more flexible lease extensions, modified rental and minimum bid policies, revised bid adequacy, procedures, and coastal impact assistance.

Quarterman said, "If MMS decides to adopt any of these proposals, I would like the changes to be in place for the mid-1996 western gulf sale. However, I'm more concerned with achieving the right balance of policies than with following any specific time line.

"Some of the options, particularly those involving more flexible royalty terms, would require regulatory changes."

MMS will hold a 2-day workshop in mid-June to discuss policy options and the guidelines it is developing for royalty relief on active leases. Written comments are being accepted until July 19.