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 March 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Legal

Attestation / Endorsement services for seaman in UAE

The Maritime Administration of the United Arab Emirates has introduced services for the attestation of seaman contract and issuance of oil/chemical/gas tanker endorsement.

Concordia Captain Tried to Blame Wreck on Electrical Blackout

The captain of the Costa Concordia tried to persuade the crisis coordinator of the cruise line to pretend an electrical blackout had caused the shipwreck, a court was told on Monday.

Hong Kong Bans Import of Kumamoto Poultry

Hong Kong’s Center for Food Safety (CFS) of the Food and Environmental Hygiene Department announced today, April 14, that in view of a notification from the Japanese

Offshore

Med Urals Market Awaits Short May Loading Schedule

Activity in the Russian Urals crude market froze on Tuesday as traders said they were awaiting the first loading dates for May for signs of how much supplies from

BOEM Proposes GoM Oil and Gas Lease Sale

As part of President Obama’s all-of-the-above energy strategy to continue to expand safe and responsible domestic energy production, Bureau of Ocean Energy Management (BOEM) Director Tommy P.

North Sea Traders Eye VLCCs to Asia, Libya Caps

North Sea Forties crude differentials firmed on Tuesday as traders eyed two potential VLCC shipments to Asia, though gains were capped as the first cargo of Libyan

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Standards Naval Architecture Navigation Pod Propulsion Port Authority Salvage Ship Electronics Ship Simulators
rss | archive | history | articles | privacy | 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: 0.1032 sec (10 req/sec)