Rule2025-15385
Offshore Distribution Cap Changes
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
August 13, 2025
Effective
August 13, 2025
Issuing agencies
Interior DepartmentNatural Resources Revenue Office
Abstract
ONRR disburses certain monies generated from offshore oil and gas production on the Outer Continental Shelf ("OCS") in accordance with applicable laws. Through the enactment of the One Big Beautiful Bill Act (OBBB), Congress amended the offshore distribution caps for these disbursements. ONRR is therefore amending its regulations to be consistent with these statutory changes.
Full Text
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<title>Federal Register, Volume 90 Issue 154 (Wednesday, August 13, 2025)</title>
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[Federal Register Volume 90, Number 154 (Wednesday, August 13, 2025)]
[Rules and Regulations]
[Pages 38938-38940]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-15385]
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DEPARTMENT OF THE INTERIOR
Office of Natural Resources Revenue
30 CFR Part 1219
[Docket No. ONRR-2025-00034; DS6363400 DRT000000.CH7000 256D1113RT]
RIN 1012-AA41
Offshore Distribution Cap Changes
AGENCY: Office of Natural Resources Revenue (``ONRR''), Interior.
ACTION: Direct final rule.
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SUMMARY: ONRR disburses certain monies generated from offshore oil and
gas production on the Outer Continental Shelf (``OCS'') in accordance
with applicable laws. Through the enactment of the One Big Beautiful
Bill Act (OBBB), Congress amended the offshore distribution caps for
these disbursements. ONRR is therefore amending its regulations to be
consistent with these statutory changes.
DATES: This rule is effective on August 13, 2025.
FOR FURTHER INFORMATION CONTACT: For regulatory and procedural
questions, contact Alexis Long, Regulations Supervisor, at (303) 231-
3627 or by email at <a href="/cdn-cgi/l/email-protection#4908252c31203a670526272e0926273b3b672e263f"><span class="__cf_email__" data-cfemail="0849646d70617b264467666f4867667a7a266f677e">[email protected]</span></a>. For royalty valuation
questions, contact Amy Lunt, Royalty Valuation and Regulations Program
Manager, at (303) 231-3746, or by email at <a href="/cdn-cgi/l/email-protection#7d3c100453310813093d12130f0f531a120b"><span class="__cf_email__" data-cfemail="da9bb7a3f496afb4ae9ab5b4a8a8f4bdb5ac">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
I. Background
The Outer Continental Shelf Lands Act (``OCSLA''), 43 U.S.C. 1331-
1356a, governs the leasing of submerged lands on the OCS for oil and
gas exploration and production. OCSLA authorizes the Secretary of the
Interior (``Secretary'') to issue leases through competitive bidding
and outlines various bidding systems, royalty structures, and
conditions for lease agreements. Specific to this action, OCSLA, as
amended by the Gulf of Mexico Energy Security Act of 2006, requires
that the Secretary disburse a portion of the revenues generated from
OCS lease production (``OCS revenues'') to certain States, Coastal
Political Subdivisions (``CPSs''), and the Land and Water Conservation
Fund (``LWCF''). OCSLA establishes a cap for a specified timeframe for
the potential amount available for allocation to these States, CPSs,
and the LWCF. See 43 U.S.C. 1331 note.
ONRR's regulations at 30 CFR part 1219 govern the distribution and
disbursement of OCS revenues pursuant to the requirements set forth in
OCSLA. OCSLA's disbursement provision was amended by the OBBB (Pub. L.
119-21) at Sec. 50102(e). As a result, ONRR is amending its
regulations, at 30 CFR 1219.512, to accordingly raise the cap on the
distribution of OCS revenues from $500 million to $650 million for
fiscal years 2025 through 2034 and to $500 million for fiscal years
2035 through 2055.
II. Procedural Matters
A. Regulatory Planning and Review (Executive Orders 12866 and 13563)
Executive Order (``E.O.'') 12866, as reaffirmed by E.O. 13563,
provides that the Office of Information and Regulatory Affairs
(``OIRA'') in the Office of Management and Budget (``OMB'') will review
all significant rules. OIRA has determined this rule is not significant
under E.O. 12866.
E.O. 13563 reaffirms the principles of E.O. 12866 while calling for
improvements in the United States' regulatory system to promote
predictability, reduce uncertainty, and use the most innovative and
least burdensome tools for achieving regulatory ends. E.O. 13563
directs agencies to consider regulatory approaches that reduce burdens
and maintain flexibility and freedom of choice for the public where
these approaches are relevant, feasible, and consistent with regulatory
objectives. E.O. 13563 emphasizes that regulations must be based on the
best available science and that the rulemaking process must allow for
public participation and an open exchange of ideas. ONRR developed this
rule in a manner consistent with these requirements.
B. Regulatory Flexibility Act
This rule will not have a significant economic effect on a
substantial number of small entities under the Regulatory Flexibility
Act (``RFA''), 5 U.S.C. 601, et seq., because this rule only adjusts
the cap for OCS revenue disbursed and distributed by ONRR. This rule is
updating the distribution cap amount for the specified fiscal years
outlined in its regulations to be consistent with recent statutory
changes. Therefore, ONRR is not required to prepare a RFA analysis for
this rulemaking.
C. Congressional Review Act
This rule is not a major rule under 5 U.S.C. 804(2), the
Congressional Review Act. This rule:
(a) Does not have an annual effect on the economy of $100 million
or more;
(b) Will not cause a major increase in costs or prices for
consumers; individual industries; Federal, State, local government
agencies; or geographic regions; and
(c) Does not have significant adverse effects on competition,
employment, investment, productivity, innovation, or the ability of
United States-based enterprises to compete with foreign-based
enterprises.
D. Unfunded Mandates Reform Act
This rule does not impose an unfunded mandate on State, local, or
Tribal governments or the private sector of more than $100 million per
year. This rule does not have a significant or unique effect on State,
local, or Tribal governments or the private sector. Therefore, ONRR is
not required to provide a statement containing the information set
forth in the Unfunded Mandates Reform Act (2 U.S.C. 1531 et seq.).
E. Takings (E.O. 12630)
This rule does not result in a taking of private property or
otherwise have takings implications under E.O. 12630. Therefore, this
rule does not require a takings implication assessment.
[[Page 38939]]
F. Federalism (E.O. 13132)
Under the criteria in Section 1 of E.O. 13132, this rule does not
have sufficient Federalism implications to warrant the preparation of a
Federalism summary impact statement. The management of Federal oil and
gas is the responsibility of the Secretary, and ONRR distributes all
the royalties that it collects under Federal oil and gas leases as
directed by the relevant disbursement statutes. ONRR does not
anticipate this rule altering the relationship between the Federal and
State governments as defined in E.O. 13132.
G. Civil Justice Reform (E.O. 12988)
This rule complies with the requirements of E.O. 12988.
Specifically, this rule:
(a) Meets the criteria of section 3(a), which requires that ONRR
review all regulations to eliminate errors and ambiguity and to write
them to minimize litigation; and
(b) Meets the criteria of section 3(b)(2), which requires that ONRR
write all regulations in clear language, using clear legal standards.
H. Consultation With Indian Tribal Governments (E.O. 13175)
The Department of the Interior (``DOI'') strives to strengthen its
government-to-government relationship with Indian Tribes through a
commitment to consultation with Indian Tribes and recognition of their
right to self-governance and Tribal sovereignty. Under the DOI's
consultation policy and the criteria in E.O. 13175, ONRR evaluated this
rule and determined that it will have no substantial, direct effects on
Federally recognized Indian Tribes and does not require consultation.
I. Paperwork Reduction Act
This rule:
(a) Does not contain any new information collection
requirements; and
(b) Does not require a submission to OMB under the Paperwork
Reduction Act of 1995 (44 U.S.C. 3501 et seq.). See 5 CFR
1320.4(a)(2).
J. National Environmental Policy Act of 1969 (``NEPA'')
This rule does not constitute a major Federal action significantly
affecting the quality of the human environment. ONRR is not required to
provide a detailed statement under NEPA because this rule qualifies for
categorical exclusion under 43 CFR 46.210(i) in that this rule is ``. .
. of an administrative, financial, legal, technical, or procedural
nature . . . .'' ONRR also has determined that this rule is not
involved in any of the extraordinary circumstances listed in 43 CFR
46.215 that would require further analysis under NEPA.
K. Effects on the Energy Supply (E.O. 13211)
This rule is not a significant energy action under the definition
in E.O. 13211 and, therefore, does not require a Statement of Energy
Effects.
L. Clarity of This Regulation
ONRR is required by E.O. 12866 (section 1(b)(12)), E.O. 12988
(section 3(b)(1)(B)), and E.O. 13563 (section 1(a)), and by the
Presidential Memorandum of June 1, 1998, to write all rules in plain
language. This means that each rule ONRR publishes must:
(1) Be logically organized;
(2) Use the active voice to address readers directly;
(3) Use common, everyday words and clear language rather than
jargon;
(4) Be divided into short sections and sentences; and
(5) Use lists and tables wherever possible.
If you believe ONRR has not met these requirements, please send
your comments to <a href="/cdn-cgi/l/email-protection#ce81809c9c919caba9bba2afbaa7a1a0bd83afa7a2aca1b68ea1a0bcbce0a9a1b8"><span class="__cf_email__" data-cfemail="4a0504181815182f2d3f262b3e23252439072b23262825320a25243838642d253c">[email protected]</span></a>. Your comments should
be as specific as possible. For example, you should identify the number
of the sections or paragraphs that you find unclear, which sections or
sentences are too long, the sections where you feel lists or tables
would be useful, etc.
M. Administrative Procedure Act (``APA'')
ONRR finds good cause to publish this rule without notice and
comment. Pursuant to the APA at 5 U.S.C. 553(b)(B), good cause exists
when an agency determines that notice and public comment procedures are
impractical, unnecessary, or contrary to the public interest. This rule
serves to implement statutory changes that are already in effect and
that ONRR has no discretion to alter. A delay in the finality of this
action would be contrary to public interest and would likely create
confusion by unnecessarily maintaining outdated OCS revenue caps in
ONRR's regulations. Any confusion could result in unnecessary
litigation further delaying implementation of the statutory changes.
Additionally, delay could impede ONRR's timely execution of its
functions, namely accurate and timely distribution of the relevant
funds. For these reasons, ONRR finds good cause to publish this rule
without notice and comment.
ONRR also finds good cause for this rule to become effective
immediately upon publication in the Federal Register under 5 U.S.C.
553(d)(3). ONRR must publish this final rule to update its regulations
to comply with recent statutory changes to the cap on the disbursement
and distribution of OCS revenues. Because ONRR is only updating its
regulations to reflect the statutory changes already in effect and any
delay or confusion would be contrary to the public interest, ONRR
determined good cause exists under the APA for this rule to become
effective upon publication.
List of Subjects in 30 CFR Part 1219
Government contracts, Indians--lands, Mineral royalties, Oil and
gas exploration, Public lands--mineral resources.
April L. Lockler,
Acting Director, Office of Natural Resources Revenue.
Authority and Issuance
For the reasons discussed in the preamble, ONRR amends 30 CFR part
1219 as set forth below:
PART 1219--DISTRIBUTION AND DISBURSEMENT OF ROYALTIES, RENTALS, AND
BONUSES
0
1. The authority citation for part 1219 continues to read as follows:
Authority: Section 104, Pub. L. 97-451, 96 Stat. 2451 (30
U.S.C. 1714), Pub. L. 109-432, Div. C, Title I, 120 Stat. 3000.
0
2. Amend Sec. 1219.512 by:
0
a. Revising paragraph (b); and
0
b. Adding a new paragraph (c).
The revisions read as follows:
Sec. 1219.512 How will ONRR divide the qualified OCS revenues (Phase
II)?
* * * * *
(b) For fiscal years 2017 through 2024 and 2035 through 2055, the
Secretary of the Treasury will deposit 50 percent of the qualified OCS
revenues (Phase II--capped) into a special U.S. Treasury account. The
total amount of qualified OCS revenues (Phase II--capped) deposited in
the special U.S. Treasury account and available for allocation to the
Gulf producing States, the CPSs and the LWCF, under this subpart,
cannot exceed $500,000,000 for each of the fiscal years 2017 through
2024 and 2035 through 2055. After applying the cap, if applicable, ONRR
will disburse 75 percent to the Gulf producing States and 25 percent to
the LWCF. Of the revenues disbursed to a Gulf producing State, we will
disburse 20 percent directly to the CPSs within that State. Each Gulf
producing State will receive at least 10 percent of the qualified OCS
revenues (Phase II--capped) available for
[[Page 38940]]
allocation to the Gulf producing States each fiscal year.
(c) For fiscal years 2025 through 2034, the total amount of
qualified OCS revenues (Phase II--capped) deposited in the special U.S.
Treasury account and available for allocation to the Gulf producing
States, the CPSs and the LWCF, under this subpart, cannot exceed
$650,000,000 for each fiscal year. After applying the cap, if
applicable, ONRR will disburse the amounts pursuant to paragraph (b) of
this section.
[FR Doc. 2025-15385 Filed 8-12-25; 8:45 am]
BILLING CODE 4335-30-P
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