| (I) The applicant shall designate the payor who will
submit the annual royalty payments and, if there are multiple payors
for a lease, the share of royalty the designated payors will submit.
Upon approval, GLO staff will assign an annual submission certification
number to the designated payor and the GLO will authorize the designated
payor to submit the designated share of royalty payments on an annual
basis. The applicant shall notify the GLO in writing of any change
in the payor designation within ten business days of its effective
date.
(II) Payors, after approval, shall pay annual royalties
for the following January 1 to December 31 annual production periods.
(III) Payors, after approval, shall continue to make
payments on a monthly basis until the commencement of the next annual
production period.
(IV) Each year, payors shall ensure that all annual
oil and condensate royalties are timely received by the GLO on or
before the fifth day of February following each annual production
period. Each year, payors shall ensure that all annual gas royalties
are timely received by the GLO on or before the 15th day of February
following each annual production period.
(V) After the payor receives GLO approval for annual
royalty payments, if the total annual oil, condensate, and gas royalty
due under a lease exceeds $3,000 for any annual production period,
payors shall resume making monthly royalty payments starting with
the January production month immediately following that annual production
period.
(VI) For any royalty approved to be paid on an annual
basis, payors shall ensure that the total royalties that have accrued
as of the date of a complete lease forfeiture, release, termination,
assignment, or any change of designated payor, are timely received
by the GLO on or before 75 calendar days after that date. If a change
of payor occurs for a lease with multiple payors, only the changing
payor shall pay the accrued royalties for which he is designated as
being responsible on or before 75 calendar days after the change.
(VII) Any forfeiture, release, termination, assignment,
or change of operator or payor, does not affect the approved annual
royalty payment status, subject to subclause (VI) of this clause.
However, as provided in §9.93(l) of this title (relating to Assignment),
an assignee or successor in interest is liable for all unsatisfied
royalty requirements of the assignor or predecessor in interest.
(VIII) The GLO may prescribe further specific forms
and instructions applicable to this subparagraph.
(IX) The GLO has the sole discretion to approve annual
royalty payments. Approval does not affect the state's right to take
its royalty in-kind, nor does it constitute a finding that a lease
has been maintained in force and effect or otherwise ratify or revive
any lease. GLO approval does not abrogate the lessee's responsibility
to submit timely royalty payments and reports to the GLO as provided
in subparagraphs (L) and (M) of this paragraph.
(X) Determination of royalty due for purposes of clause
(ii) of this subparagraph is not an official GLO determination of
royalty due under a lease. The GLO may audit any lease to determine
if royalty was properly paid and may pursue its rights and remedies
through an administrative hearing or litigation.
(F) Gas royalties--due date.
(i) Lessee shall ensure that all gas royalties, except
royalties approved by GLO to be paid on an annual basis, are timely
received by the GLO on or before the 15th day of the second month
following the month of production.
(ii) The provisions of subparagraph (E)(ii)(I) - (X)
of this paragraph apply to the payment of gas royalties.
(G) Required reports--due date.
(i) Lessees shall ensure that all required production/royalty
reports and other required documents (hereafter "reports" in subparagraph
(G) of this paragraph), in whatever format submitted, for gas or oil
and condensate are timely received by the GLO on or before the due
date of the corresponding monthly royalty payment.
(ii) Upon application to and written approval by the
GLO, future reports for leases for which oil, condensate, and gas
royalty due for the immediately preceding September 1 to August 31
period equaled $3,000 or less may be submitted on an annual, rather
than monthly, basis. A party who is both a payor and a reporter for
a lease shall submit both payments and reports on a monthly or, if
the GLO grants approval, an annual, basis.
(I) The applicant shall designate the reporter who
will submit the annual reports and, if there are multiple reporters
for a lease, the information the designated reporter will submit.
Upon approval, GLO staff will assign an annual submission certification
number to the designated reporter and the GLO will authorize the designated
reporter to submit the designated reports on an annual basis. The
applicant shall notify GLO in writing of any change in the reporter
designation within ten business days of its effective date.
(II) Reporters, after approval, shall submit annual
reports for the following January 1 to December 31 annual production
periods.
(III) Reporters, after approval, shall continue to
submit reports on a monthly basis until the commencement of the next
annual production period. Unless the GLO expressly approves otherwise
in writing, reporters shall submit unit production/royalty reports
on a monthly basis regardless of the annual reporting status of individual
leases within the unit.
(IV) Each year, reporters shall ensure that all annual
reports concerning oil and condensate are timely received by the GLO
on or before the fifth day of February following each annual production
period. Each year, reporters shall ensure that all annual reports
concerning gas are timely received by the GLO on or before the 15th
day of February following each annual production period.
(V) After the reporter receives GLO approval for annual
reporting, if the total annual oil, condensate, and gas royalty due
under a lease exceeds $3,000 for any annual production period, reporters
shall resume making monthly reports starting with the January production
month immediately following that annual production period.
(VI) Reporters shall ensure that all reports approved
by the GLO for submission on an annual basis are timely received by
the GLO on or before 75 calendar days after a complete lease forfeiture,
release, termination, assignment, or any change of designated reporter.
If a change of reporter occurs for a lease with multiple reporters,
only the changing reporter shall submit the reports for which he is
designated as being responsible on or before 75 calendar days after
the change.
(VII) Any forfeiture, release, termination, assignment,
or change of operator or reporter does not affect the approved annual
reporting status, subject to subclause (VI) of this clause. However,
as provided in §9.93(l) of this title (relating to Assignment),
an assignee or successor in interest is liable for all unsatisfied
reporting requirements of the assignor or predecessor in interest.
(VIII) The GLO may prescribe further specific forms
and instructions applicable to this subparagraph.
(IX) The GLO has the sole discretion to approve annual
reporting. Approval does not affect the state's right to take its
royalty in-kind, nor does it constitute a finding that a lease has
been maintained in force and effect or otherwise ratify or revive
any lease. GLO approval does not abrogate the lessee's responsibility
to submit timely royalty payments and reports to the GLO as provided
in subparagraphs (L) and (M) of this paragraph.
(X) Determination of royalty due for purposes of clause
(ii) of this subparagraph is not an official GLO determination of
royalty due under a lease. The GLO may audit any lease to determine
if royalty was properly paid and may pursue its rights and remedies
through an administrative hearing or litigation.
(iii) Lessees shall identify the relevant GLO lease
numbers and annual submission certification numbers, if any, on all
required reports. Reports that fail to identify these numbers shall
be considered delinquent and shall be subject to the delinquency provisions
of subsection (b)(3) of this section.
(H) Gas contracts. Lessees shall file with the GLO
a copy of all contracts under which gas is sold or processed and all
subsequent agreements or amendments to such contracts within 30 days
of entering into or making such contracts, agreements, or amendments.
Such contracts, agreements, and amendments, when received by the GLO
will be held in confidence by the GLO unless otherwise authorized
by lessee.
(I) Gas contract brief (Form GLO-5).
Cont'd... |
