Numerous commenters normally supported the proposal to permit limiting 3rd-party guarantees to a specific quantity. Reaction:
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A commenter proposed that the Section should not demand supplemental bonding for ROW pipelines which have been servicing and connected with superior worth leases for the reason that some organizations individual an curiosity while in the reserves that their ROW pipeline services. Response:
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No reviews had been been given exclusively within the proposed amendment to rename the lease-precise abandonment accounts in 30 CFR 556.904 as “Decommissioning Accounts” or the proposed Modification to eliminate the prerequisite to pledge Treasury securities to fund the account before the funds equal the most quantity insurable via the FDIC/FSLIC.
BOEM acknowledges the commenters' assistance and agrees that employing a credit rating threshold of expenditure quality strikes the right balance among equally DOI's and the conventional Vitality sector's purpose to shield the American taxpayers from publicity to economic reduction connected to OCS enhancement as well as the load of giving economical assurance due to the lower default threat associated with corporations that keep an financial commitment grade credit history ranking.
Whilst commenters supplied a conceptual argument to keep the report of compliance criterion, they delivered no new data to suggest a correlation in between fiscal energy of a corporation and its record of compliance. As discussed inside the preamble on the proposed rule at 88 FR 42142, BOEM examined the amount of incidents of non-compliance (INCs) issued by BSEE, their severity, and the connection amongst INCs and economical health/strength of businesses and located that the information wasn't a trusted indicator of monetary toughness. The info show that the number of incidents is correlated with the amount of constructions a lessee has around the OCS, instead of necessarily towards the financial wellness in the lessee. Moreover, BOEM's fiscal assurance method is get more info not really in and of alone meant to endorse protection or compliance (you will find other Division laws addressing these matters), but to assure that a lessee can fiscally provide a noncompliant lease into compliance.
BOEM acknowledges the commenters' tips that the Office must involve economic assurance from all co-lessees that do not keep an expense quality credit ranking for their respective Doing work interests but concludes that it is impractical To judge co-lessees and working legal rights proprietors due to the fact Every single co-lessee is liable for the whole obligation and not their proportional share. DOI is finalizing, as proposed in thirty CFR 556.
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BOEM disagrees with the commenter's assertion which the Division shouldn't demand supplemental bonding for ROW pipelines which can be servicing and related to high benefit leases.
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Many commenters supported the usage of the P70 worth and suggested that BOEM adopt the P70 value in the ultimate rule for regularity Along with the said goal of the proposed rule: in order that current lessees are economically ready to conduct their decommissioning obligations. Reaction:
Nevertheless the relevance of this resolution is proscribed. It focuses exclusively on the safety of navigation and of lifetime at sea, which includes property as well as maritime atmosphere.