MMS Publishes New Rule on Rights-of-Use in Offshore Waters

A new Federal rule for oil and gas production in federal offshore waters now provides rights-of-use and easement. The rule is expected to make it easier for companies to gain access to areas adjacent to their producing oil and gas leases for production related uses such as pipelines and surface platforms. The rule also establishes fees on a per acre basis. The final rule was published by the Minerals Management Service on Friday, December 12, 2003 in the Federal Register.

"The changes will provide equity for the public by charging a fair rental fee for companies that request and are granted use of what can sometimes be a very large area," said MMS Director Johnnie Burton. "We make difficult decisions every day in balancing America's need for energy, fair value for use of Federal lands, and the protection of the environment. This is another decision that addresses all three goals," Burton added. The final rule amends MMS regulations governing oil and gas operations in the outer continental shelf to require lessees to pay a rental fee when they obtain an easement and increases the amount pipeline right-of-way holders pay.

When a company requires use of an area for a platform in connection with a pipeline or requires use of an off-lease area for purposes related to the operation of the lease, the company may obtain use of the area. Without this change in the regulations, there is no charge for a right-of-use and easement and the charge for an area associated with a pipeline right-of-way is a flat fee. According to the MMS, complex operations in deep waters have created situations where companies have requested use of several square miles for purposes related to a lease or a pipeline.
Company: Minerals Management Service (MMS) more info
 - Obama Names New Head of MMS (Jun 15)
 - Abbey Implements New Drilling Requirements (Jun 07)
 - MMS Chief Resigns (May 27)