UNITED STATES DEPARTMENT OF THE INTERIOR
BUREAU OF LAND MANAGEMENT
WASHINGTON, D.C. 20240http://www.blm.gov
April 15, 2013
In Reply Refer To:
3100 (310) P
EMS TRANSMISSION 04/15/2013
Instruction Memorandum No. 2013-104
To: State Directors
From: Assistant Director, Minerals and Realty Management
Subject: Notice of Staking and Application for Permit to Drill Processing DD: 07/22/13
Program Areas: Federal lease or agreement; Indian tribal lease or agreement; and Indian allotted lease or agreement Oil and Gas Application for Permit to Drill Processing.
Purpose: This Instruction Memorandum (IM) supplements existing Bureau of Land Management (BLM) policy and guidance for processing Applications for Permit to Drill (APD) and outlines the regulatory and statutory requirements of Onshore Oil and Gas Order Number 1 (Order 1) and the Energy Policy Act of 2005 (EPAct).
Policy/Action: Processing APDs in a timely manner is a high priority in the BLM and the Secretary continues to emphasize its importance and impact in serving domestic energy needs. Each BLM office will follow the procedures outlined in this IM when processing APDs.
- Attachment 1 provides a sample template for the 10-day letter.
- Attachment 2 provides a sample template for the 30-day letter (deferral notice).
- Attachment 3 provides linked flowcharts of the process defined in this IM.
- Attachment 4 provides excerpts from the text of the EPAct and Order 1 that pertain to the APD process timeframes.
- Attachment 5 provides Notice of Staking (NOS)/APD and standalone APD process timelines.
- Attachment 6 provides a list of existing policies pertaining to APD processing.
- Attachment 7 provides detailed lists of recommendations to help improve APD processing efficiency.
This policy and Order 1 identify specific process requirements and mandatory timeframes for BLM and operator action. All timeframes listed below are in calendar days unless specifically defined as business days.
The Automated Fluid Mineral Support System (AFMSS) is the BLM’s national database for tracking APDs. To establish a clear and defensible record and to support program funding, it is critical that the BLM populate the appropriate data and completion dates into AFMSS at each step of the APD management process. BLM prescribes national policy and procedures for the AFMSS data entry in WO‑IM-2005-046, Policy for Entry of Data into APD Processing Tracking and Monitoring Fields in the AFMSS Database. The IM also describes the mandatory data fields and the required timeframes for populating those data fields.
What is a Complete APD?
An APD must be complete (no deficiencies) and include all additional necessary information needed by the BLM in order to process the APD. Upon notification by the BLM (via 10-day letter), the operator has 45 days to resolve deficiencies (making the APD complete) or request an extension in writing. However, operators have up to 2 years from the notice of BLM deferral (30-day letter) to provide the necessary information (see next section for the necessary information description). The BLM staffing and funding is too limited to maintain an inventory of incomplete APDs beyond the required timeframes prescribed by Order 1.
Order 1 defines the requirements (items 1 through 7 below) of a complete APD (Order 1, III.D). However, the BLM may consider an item a deficiency if an Order or Notice (item 8) requires it. These components must be present, accurate, and sufficient for analysis. A complete APD includes the following:
- Completed Form 3160-3, Application for Permit to Drill or Re-Enter (including APD Processing Fee);
- Well Plat;
- Drilling Plan (must include all Order 1 defined components);
- Surface Use Plan of Operations, if applicable (must include all Order 1 defined components);
- Operator Certification;
- Onsite Inspection, including correcting any of the above due to changes made at the onsite; and
- Other information required by Order or Notice.
If any of the above is missing, inaccurate, or insufficient, then the BLM considers the APD incomplete.
Early in the process, the BLM must verify the need for rights-of-way and other surface use permits associated with the APD. The BLM should use the same National Environmental Policy Act (NEPA) analysis document for the APD, its associated rights-of-way, and other surface use permits, as prescribed by Order 1 whenever appropriate and possible to help expedite analysis.
As soon as all of the above items (1 through 8) are present, accurate, and sufficient, then the BLM considers the APD package complete. For all APDs requiring BLM approval, the BLM must enter the APD Complete Date (APD Cmplt) into AFMSS within 3 business days of the BLM deeming the package complete. NOTE: This date should not be the date the APD is ready for final signature/approval; it is the date the package is complete (or no more deficiencies) as outlined above.
To enter the date, from the AFMSS Main Menu, select “Operations”, then “Wells”. This will launch the Well List screen. Enter data into the Query By Example (QBE) field(s) to locate the desired record, e.g., well name, well number, case number, etc. Click on the “Query” button. Highlight the applicable record and click on the “APD Reviews” button, and select “APD Approval”. On the APD Approval GLB.81 screen, enter the date the APD package is complete into the field adjacent to “APD Cmplt”.
What is the difference between Deficiencies and Necessary Information?
Deficiencies and necessary information are different and trigger different sets of actions.
- Deficiencies are items that are missing or insufficient and the BLM requires these items for a complete APD (as noted above). Operators have 45 days from notification via the 10-day letter to correct deficiencies or request an extension in writing.
- Necessary information includes items an operator can provide the BLM to help meet the BLM’s responsibilities. This occurs after the BLM deems the APD complete and before the BLM can complete analysis of the APD. Operators have up to 2 years from receipt of 30-day letter to submit necessary information.
o The BLM considers necessary information as any additional items necessary for the BLM to complete the analysis (separate from and in addition to deficiencies) such as a water management plan, alternative bonding, or air quality modeling. Due to funding and staffing limitations, in most cases the BLM will not be able to process the APD unless the operator provides this necessary information.
o The BLM will note these necessary items separately from the deficiencies and identify them in both the 10-day (if known at that point to provide advance notice) and the 30-day letters to the operator (see attachments 1 and 2).
- The BLM should also note in the 10- and 30-day letters whether the BLM will need additional information to process the APD, but not identified in Order 1, such as the need for a cultural or wildlife survey. See attachments 1 and 2 for letter format samples. The BLM may request operators to complete these inventories if that will help the BLM expedite the APD process.
Although an APD may be complete, the BLM cannot process the APD without all the necessary information. If the operator does not submit the necessary information that the BLM requires within the BLM’s 30-day processing timeline, the BLM must notify the operator in the 30-day letter that the BLM is deferring action on the APD until the operator submits the necessary information. If the operator does not submit the necessary information within 2 years, the BLM will take formal action to deny the APD. Please refer to the APD process flowchart in attachment 3. The BLM has recognized that APD submittals not meeting the BLM’s requirements and standards, as well as industry turnover in trained permitting specialists, contribute to process inefficiencies and resulting delays in review and approval of APDs.
The BLM will also notify the operator in the 30-day letter what actions the BLM, the U.S. Forest Service (USFS), or other agencies need to take before making a final decision on the APD (e.g., the NEPA document is still in progress). In this circumstance, when the agency has to act, there is no defined timeframe for processing the APD—other than as soon as staffing is available and NEPA analysis is complete. However, the BLM must continue processing as quickly as possible, and provide the operator a reasonable timeframe for completion.
APD processing critical steps: What actions are required by the BLM and the Operator?
- Within 10 days of receiving an NOS or an APD, the BLM (in consultation with any other applicable Surface Management Agency (SMA)), will:
o Review the NOS or APD for the required information; and
o Schedule an onsite inspection with the operator and SMA, including the private surface owner (if applicable). NOTE: This does not imply that the BLM must conduct the onsite inspection within the 10 days, just schedule the onsite.
- The BLM and the Federal SMA (i.e., USFS) must provide at least 30 days public notice (posting) of the required information from the APD or corresponding NOS before the BLM may approve an APD for a Federal well. The regulations do not require the BLM to post an APD for an Indian oil and gas well. Posting will be in an area of the BLM field office having jurisdiction over the NOS/APD that is readily accessible to the public and, when possible, electronically on the internet (43 CFR 3162.3-1(g); Order 1, III.E.1).
Notice of Staking Option
- For an NOS onsite inspection, all parties who attend the onsite inspection will develop a list of resource concerns that the operator must address in the APD, if any. The BLM will provide this list to the operator either at the onsite inspection or within 7 days of the onsite by a letter or email (Order 1, III.C). The BLM should also include a list of recommended Best Management Practices (BMP) including ideas of interim reclamation needs for consideration by the operator in their APD.
- Within 60 days of the onsite inspection for an NOS, the operator must submit the corresponding APD or the BLM will return the NOS to the operator (Order 1, III.C). If the operator chooses to follow the NOS option, but does not submit their APD within 60 days of the onsite inspection, the BLM will return the NOS, void the posting period, and may require a new onsite inspection.
Application for Permit to Drill
- For an APD onsite inspection, the operator should have already incorporated BMPs (including proposed interim reclamation) into their APD as operator-committed measures or design features. The BLM will notify the operator of any additional deficiencies discovered during the onsite inspection (Order 1, III.E.2.a), and, within 7 days, follow-up with a deficiency letter or email if the deficiencies require greater detail or the operator requests it.
- Notify the operator via the 10-day letter (see attachment 1) whether or not the application is complete and request submission of missing information (deficiencies and necessary information, if known) in this 10-day notice (Order 1, III.C., III.E.2.a). Field offices often refer to this letter as the deficiency letter.
- After receiving notice from the BLM of their deficiencies, the operator has 45 days to submit a response to correct the deficiencies. The BLM may return the APD (Order 1, III.E.2.a) unless the BLM receives all required information and the information received is sufficient for analysis.
o The 30-day timeframe to process the APD starts on the date the BLM deems the APD complete in accordance with Order 1, III.D.
- After receiving notice from the BLM of the necessary information needed in the 30-day letter, the operator has 2 years to submit the necessary information or the BLM will deny the APD (Order 1, III.E.2.d).
- The BLM will notify the operator within 7 days of receiving a response to correct the deficiencies from the operator if the APD is now complete. The BLM will also inform the operator of necessary information that is still missing.
- Within 30 days after the operator submits a complete application, including any changes from the onsite inspection, the BLM must do one of the following:
o Approve the application, subject to any necessary Conditions of Approval, if the application has met all other requirements of NEPA, National Historical Preservation Act, Endangered Species Act, and other laws (Order 1, III.E.2.b.1).
o Notify the operator via the 30-day letter (attachment 2) that the BLM is deferring action on the APD permit (Order 1, III.E.2.b.2). This deferral option process and requirements are defined in Order 1, Section III.E.2.c. The BLM most often uses this option to provide the operator notice and reasons why the APD requires longer than 30 days to process. Examples include:
The operator needs to submit additional necessary information;
The BLM needs to complete the NEPA analysis (with a reasonable estimate for the BLM to complete the analysis);
The BLM needs cultural, biological, or paleontological surveys; and
The BLM needs another agency’s concurrence.
This is the point at which the operator has completed their part in the process and is now waiting on the BLM. Operators may request a suspension of operations and/or production at this point and the BLM will process the suspension request, if appropriate.
o Deny the permit if there are no identifiable actions that the operator could take to enable the BLM to issue the permit (Order 1, III.E.2.b.3).
The BLM will return any incomplete APD that is deficient past 45 days unless the operator meets the requirements described below.
- If the BLM receives all required components and the APD is sufficient for analysis, the BLM will consider the APD complete.
o The 30-day timeframe to process the APD starts on the date of receipt of the complete information.
- The operator has 45 days after receiving notice from the BLM to complete the APD package. If the operator fails to submit information sufficient to resolve identified deficiencies within the 45-day timeframe, the BLM will return the APD.
- The BLM will not refund an APD processing fee or apply it to another APD for any returned or denied APD under any circumstances.
- If the operator knows they will not be able to meet the 45-day timeframe for reasons beyond their control, they must submit a written request for extension prior to the 45th day. NOTE: Field offices will determine the format that they will accept and adjust the template letters accordingly. The written request can be in the form of a letter, email, or fax depending on the field office’s discretion.
- The BLM will consider the extension request if the operator can demonstrate their diligence (providing reasons and examples of why the delay is occurring beyond their control) in attempting to correct the deficiencies and can provide a date by which they will correct the deficiencies. If the BLM determines that the request does not warrant an extension, the BLM will return the APD as incomplete.
o The BLM will determine whether to grant an extension beyond the required 45 days and will document this request in the well file and in AFMSS under “Remarks.” If the operator fails to submit deficiencies by the date defined in the extension request, the BLM will return the APD.
- All offices must adjust their 10-day letter templates (see attachment 1 for a sample format) to include notice of these extension and suspension request statements (listed above) so that the operators are aware that they can apply for these extensions. The 10-day letter must also identify both the deficiencies needing correction within 45 days and the additional necessary information needed by the BLM to process the APD.
- The BLM will notify the operator within 7 days of receiving their response to correct the deficiencies if the APD is now complete. The BLM may also inform the operator of necessary information that is still missing. If the APD is still not complete, the BLM will notify the operator and allow the operator 10 additional days to submit a written request to the BLM for an extension. The request must describe how they will address all outstanding deficiencies and the timeframe requested to complete the deficiencies.
o The BLM will consider the additional extension request if the operator can prove their diligence (providing reasons and examples of why the delay is occurring) in attempting to correct the deficiencies and can provide a date by which they will correct the deficiencies. If the BLM determines that the request does not warrant an additional extension, the BLM will return the APD as incomplete. After the BLM makes a decision regarding the extension, the BLM must document the decision in the well record and under remarks in the Well Header Screen in AFMSS.
The BLM must enter the disposition of the APD into AFMSS within 5 business days from the approving official’s signature date or immediately upon electronic signature.
- To enter this date, from the AFMSS Main Menu, select “Operations” and then select “Wells”. This will launch the Well List screen. Enter data into the Query By Example (QBE) field(s) to locate the desired record, e.g., well name, well number, case number, etc. Click on the “Query” button. Highlight the applicable record and click on the “APD Reviews” button. Select “APD Approval”. On the APD Approval GLB.81 screen, enter the disposition date into the field adjacent to “Disp Date”. Select the applicable Disposition by clicking on the down arrow button and selecting the needed disposition (approved, cancelled, denied, rejected, returned, or withdrawn). For APDs requiring BLM approval, do not use “accepted” as the disposition. Expired and rescinded should be used only for those APDs that have been approved previously and have gone past the timeframe of 2 years (or any approved extension).
Can an operator prioritize APDs for BLM processing?
The BLM encourages all offices to conduct frequent meetings with operators to identify the highest priority APDs so that BLM staff can focus on these APDs at the earliest possible time. Excess inventories of drilling permit applications no longer wanted by the operators slow down the entire field office APD process and degrade program capacity. To increase staff effectiveness, the BLM should request the operator to identify any APDs the operator no longer wishes to see processed so that the BLM can return those APDs to the operator. Operators must remain vigilant and it remains their responsibility to manage their APD submittals to match their corporate drilling strategies.
- If an operator has provided a list of their highest priority APDs, the operator’s other pending APDs must also continue to meet the requirements of Order 1.
- If an operator fails to resolve the deficiencies in the low priority APDs within 45 days of the BLM notifying them of the deficiencies, the BLM will return the deficient APDs to the operator.
What Existing Policies Pertain to APD Processing?
For reference, attachment 6 is a list of IMs, Information Bulletins, guidance, statutes, and regulations that pertain to the APD process.
Specifically, WO-IM-2007-203, Process Improvement for Oil, Gas, Geothermal, Geophysical, and Related Rights-of-Way Approvals, provides detailed lists of recommendations to help improve APD processing efficiency in its attachment 1 (see attachment 7). Field and state office staff should review and follow these recommendations whenever possible. They should also determine which recommendations, if not all, that they could implement and then monitor their process to determine if their office is making gains in APD process efficiency. Whenever possible, manage the risk, look to streamline NEPA, or combine permits analyzed to reduce potential repetition.
Timeframe: This policy is effective upon issuance. The BLM will integrate this policy into the development of the new AFMSS 2.0 APD Processing System. In preparation of the system going live in fiscal year 2013, each State Director (with oil and gas well permitting activity) will develop a plan to ensure that the offices in their jurisdiction fully understand and follow this policy consistently. They will submit the plan to the Washington Office within 90 days of the issuance of this policy. The Washington Office will review the plans and return them as acceptable within 30 days, or will schedule meetings to work through any concerns or clarifications.
Budget Impact: This policy will not result in any additional impact to oil and gas budgets.
Background: Industry and Congress continue to scrutinize the BLM for not processing APDs in a timely manner. Operators have sought State Director Reviews and appealed to the Interior Board of Land Appeals and District Courts stating the BLM has not been meeting these required timeframes. The regulations require the BLM and the operators to follow the timeframes established in Order 1 and the EPAct. In many cases, the BLM and operators are not meeting established timeframes. A significant contributor to the longer processing timeframes is the submission of incomplete APDs by the operator; and the operators, like the BLM, suffer from turnover of their permitting staff. In some BLM offices, only 10 percent of the APDs received meet the BLM’s standards for complete APDs. The BLM staff and operators would benefit from additional clarity to help ensure everyone understands and meets the required timeframes given limited program budgets.
The BLM Washington Office Division of Fluid Minerals (WO-310) is currently working with state and field offices to develop a system to automate much of the APD process. This automation effort will make the BLM APD process an electronic process, helping the BLM maintain better data quality. The BLM expects to deploy the system during fiscal year 2013 and will issue policy and guidance specific to that system, with associated training, to implement that system. WO-310 also distributes monthly office APD progress reports for discussions with the states at the program and management level.
Manual/Handbook Sections Affected: None.
Coordination: An interdisciplinary team consisting of representatives from state and field offices and WO-310 developed this IM. In addition, the team consulted other Washington, state, and field office staff in the preparation of the IM through two field-level reviews.
If there are any questions concerning this IM, please contact me at 202-208-4201 or Steven Wells, Division Chief, Fluid Minerals, at 202-912-7143. Your staff may contact Ben Kniola, Natural Resource Specialist, Washington Office Division of Fluid Minerals (WO-310), at 202-912-7159 or firstname.lastname@example.org
Signed by: Authenticated by:
Michael Nedd Robert M. Williams
Assistant Director Division of IRM Governance,WO-560
Minerals and Realty Management