MMS Responds with Royalty Relief Modifications

Thursday, August 26, 1999
The U.S. Department of the Interior's Minerals Management Service (MMS) has updated two Notice to Lessees (NTL) to help the domestic industry adjust to and survive low prices. "Oil prices, adjusted for inflation, are down to levels last seen in the early 1970's," said Carolita Kallaur, associate director, Offshore Minerals Management Program. "While benefitting consumers generally, unanticipated price drops have some adverse consequences for society. When the price of oil falls, it can simply make continued production of a given oil field uneconomic. MMS would like to make sure industry has every opportunity to make a project economic rather than the nation losing the oil and gas resources that would be left behind if the wells are abandoned early." For the second time in five months, MMS lowered price forecasts used by existing leaseholders that apply for deepwater royalty relief. Fields in water deeper than 656 ft. in the Central and Western Gulf of Mexico (GOM) demonstrating economic need at these prices qualify for suspension of royalty payments. MMS has reduced its 1999 estimate price to better reflect prices companies are currently experiencing. MMS has revised its guidelines for those applying for deep water and end-of-life royalty relief. In addition, MMS has identified the need for relief outside these formal programs. Under the formal process for instance, a lessee who has invested significant resources to lower production costs would be required to wait at least a year before applying for end-of-life royalty relief. Under the new approach, a lessee who has made a commitment of capital and meets additional criteria would be able to apply immediately during this period of low oil prices. End-of-life royalty relief and exceptional circumstance relief are aimed at situations where resources would be prematurely abandoned without the relief being granted.
Maritime Reporter January 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Legal

Tanzania's Energy Minister Resigns

Tanzania's Energy and Minerals Minister Sospeter Muhongo resigned on Saturday amid a graft scandal that has rocked the gas-rich country and led Western donors to delay aid,

China's COSCO Group Returns to Profit

China Ocean Shipping Group Co (COSCO) returned to profit in 2014 after three years of losses, state media said on Saturday, citing an interview with the group's chairman.

Peru Grants Permit for Chinese-owned Mine

The government has granted Chinese-owned Jinzhao Mining Peru the environmental permit for its proposed $1.5 billion Pampa de Pongo iron mine, estimated to produce 22.

Offshore

Oil Platform Ablaze in the Gulf of Mexico

Fire broke out on an unmanned oil platform in the Gulf of Mexico approximately five miles south of Port Fourchon, La., the Bureau of Safety and Environmental Enforcement (BSEE) reported.

Subsea Crane Takes a Long Journey

Last September the test bed in Rostock was the stage of a single lift of the RL-K 7500 subsea crane. The same crane was then loaded and shipped to the South Korean customer.

Dynamic Positioning & the Potential for USCG Regulations

Dynamic positioning is a vessel capability provided by integration of a variety of individual systems and functions to automatically maintain a vessel’s position

 
 
Maritime Contracts Maritime Standards Naval Architecture Navigation Pipelines Salvage Ship Electronics Ship Repair Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1171 sec (9 req/sec)