Last week I sent out an email invitation to our membership regarding a meeting to be held TOMORROW at 10am at the New Mexico State Land Office. This meeting will be an opportunity for industry to tell our regulators where we need some relief due to low commodity pricing.

In addition, we will have the opportunity to discuss the current stripper well program 19-10-5.1 NMSA (attached) which is already available to producers but is not widely used. This program allows oil well stripper producers to ask for a royalty rate reduction from 12.5% to 5% for a period of three years upon a showing that the operator has taken reasonable steps to minimize his costs of operating the oil well; the oil well will likely be plugged and abandoned in the near future, with a resulting loss of reserves, if operating costs are not reduced further; the oil well will produce for a longer period, and the amount of oil produced will ultimately be larger, if the royalty rate is lowered; and a lower royalty rate will actually maximize revenue to the trust beneficiaries.

If it is important for you or your company to 1. understand the current regulations on the books regarding royalty rate reductions or, 2. to understand the current regulations for temporary shut-in status, or, 3. to ask our regulators for some relief in another area. Please attend this meeting!

If you can not attend, PLEASE SEND ME YOUR COMMENTS so we have the opportunity to present our concerns! Due to technical limitations we will not have conference call ability.

The BLM has announced four public meetings on their proposed rule to reduce waste from venting, flaring and leaks, and to clarify when produced gas lost through venting, flaring or leaks is subject to royalties. The first of the four meetings will be held February 16 in Farmington at the San Juan College Room 7103 at 1:00 p.m.

Please see the linked notice for RSVP information and additional dates and locations. A call-in number is also provided for those who cannot attend. The proposed rule can be found at . The attached also provides contact information if you have further questions.

If you currently have Rights of Way (ROW) on Federal Lands, the Federal Government has updated the fees associated with ROW annual payments beginning for years 2016 to 2025.

Please see the attached letter which was sent to current ROW holders in December 2015.

Updated information on Federal ROW rental fee schedules (cost recovery) can be found at this website.

If you have questions, please contact Stephen Fusilier, BLM Rights-of-Way Branch Chief, at (202.912.7148) or sfusilie@blm.gov

Yesterday, IPANM attended the BLM stakeholder meeting for revisions to OnShore Orders #3, #4 and #5. The revisions are very technical in nature and will severely impact ANY COMPANY THAT OPERATES ON FEDERAL LANDS. Comments are due by December 14th. IPANM has already commented on OSO #3. We will update those comments and will prepare comments for OSO#4 and #5. We will also sign on to those prepared by Western Energy Alliance and IPAA. Comments are due December 14th.

Due to multiple requests from IPANM as well as others, the BLM has established a call in line for the meeting tomorrow in Oklahoma city. From the BLM, I received the following notice:
“Individuals who want to take part via telephone may call 1-800-857-2889, and when prompted, enter the passcode 4111819. The phone number and passcode is the same for both meetings. — The Bureau of Land Management”

The meetings will be:

• Dec. 3 at 1:00 p.m. CST. It is being held at the Renaissance Oklahoma City Convention Center Hotel, 10 N Broadway Avenue, Oklahoma City, OK 73102.

• Dec. 8 at 1:00 p.m. MST. This meeting is taking place at the Astoria Hotel and Event Center, 363 15th St W., Dickinson, ND 58601.

Copies of the Powerpoint presentations about the proposed regulations are available at . Also posted on the site are copies of the proposed regulations.

Order 3 establishes standards to ensure that oil and gas are properly and securely handled to prevent theft and loss and to enable accurate measurement and production accountability. Orders 4 and 5 establish minimum standards for the accurate measurement of all oil and gas, respectively. Like the existing orders, the purpose of the proposed rules is to ensure that the oil and gas produced from Federal and Indian leases (except Osage Tribe) are accurately measured and accounted for, so that the proper royalties due are paid. Royalties are split between the Federal treasury and the State where the production occurs. Indian tribes and individual Indian allotment owners keep 100 percent of the royalties collected from leases on their lands.

These rulemakings are underway because Onshore Orders 3, 4, and 5 were put in place in 1989 and have not been updated since. As a result, they do not reflect modern measurement techniques. The requirements contained in the proposed rules reflect advances in technology, as well as critical updates in industry standards and practices. These proposals also respond directly to concerns from the Government Accountability Office, the Department of the Interior’s Office of Inspector General, and the Secretary’s Subcommittee on Royalty Management.

In addition to accepting comments at the meetings, comments are also being accepted through December 14 by any of the following means:

• Mail to U.S. Department of the Interior, Director (630), Bureau of Land Management, Mail Stop 2134LM, 1849 C Street, NW, Washington, DC 20240,
o Attention: 1004-AE15 (for Site Security),
o 1004-AE16 (for Oil Measurement), or
o 1004-AE17 (for Gas Measurement), or

• Via the Internet at http://www.regulations.gov. Follow the instructions at this website.