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e-CFR data is current as of September 29, 2020

Title 30Chapter IISubchapter BPart 250 → Subpart N


Title 30: Mineral Resources
PART 250—OIL AND GAS AND SULPHUR OPERATIONS IN THE OUTER CONTINENTAL SHELF


Subpart N—Outer Continental Shelf Civil Penalties


Contents

Outer Continental Shelf Lands Act Civil Penalties

§250.1400   How does BSEE begin the civil penalty process?
§250.1401   [Reserved]
§250.1402   Definitions.
§250.1403   What is the maximum civil penalty?
§250.1404   Which violations will BSEE review for potential civil penalties?
§250.1405   When is a case file developed?
§250.1406   When will BSEE notify me and provide penalty information?
§250.1407   How do I respond to the letter of notification?
§250.1408   When will I be notified of the Reviewing Officer's decision?
§250.1409   What are my appeal rights?

Federal Oil and Gas Royalty Management Act Civil Penalties Definitions

§250.1450   What definitions apply to this subpart?

Penalties After a Period To Correct

§250.1451   What may BSEE do if I violate a statute, regulation, order, or lease term relating to a Federal oil and gas lease?
§250.1452   What if I correct the violation?
§250.1453   What if I do not correct the violation?
§250.1454   How may I request a hearing on the record on a Notice of Noncompliance?
§250.1455   Does my request for a hearing on the record affect the penalties?
§250.1456   May I request a hearing on the record regarding the amount of a civil penalty if I did not request a hearing on the Notice of Noncompliance?

Penalties Without a Period To Correct

§250.1460   May I be subject to penalties without prior notice and an opportunity to correct?
§250.1461   How will BSEE inform me of violations without a period to correct?
§250.1462   How may I request a hearing on the record on a Notice of Noncompliance regarding violations without a period to correct?
§250.1463   Does my request for a hearing on the record affect the penalties?
§250.1464   May I request a hearing on the record regarding the amount of a civil penalty if I did not request a hearing on the Notice of Noncompliance?

General Provisions

§250.1470   How does BSEE decide what the amount of the penalty should be?
§250.1471   Does the penalty affect whether I owe interest?
§250.1472   How will the Office of Hearings and Appeals conduct the hearing on the record?
§250.1473   How may I appeal the Administrative Law Judge's decision?
§250.1474   May I seek judicial review of the decision of the Interior Board of Land Appeals?
§250.1475   When must I pay the penalty?
§250.1476   Can BSEE reduce my penalty once it is assessed?
§250.1477   How may BSEE collect the penalty?

Criminal Penalties

§250.1480   May the United States criminally prosecute me for violations under Federal oil and gas leases?

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Outer Continental Shelf Lands Act Civil Penalties

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§250.1400   How does BSEE begin the civil penalty process?

This subpart explains BSEEs civil penalty procedures whenever a lessee, operator or other person engaged in oil, gas, sulphur or other minerals operations in the OCS has a violation. Whenever BSEE determines, on the basis of available evidence, that a violation occurred and a civil penalty review is appropriate, it will prepare a case file. BSEE will appoint a Reviewing Officer.

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§250.1401   [Reserved]

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§250.1402   Definitions.

Terms used in this subpart have the following meaning:

Case file means a BSEE document file containing information and the record of evidence related to the alleged violation.

Civil penalty means a fine. It is a BSEE regulatory enforcement tool used in addition to Notices of Incidents of Noncompliance and directed suspensions of production or other operations.

Reviewing Officer means a BSEE employee assigned to review case files and assess civil penalties.

Violation means failure to comply with the Outer Continental Shelf Lands Act (OCSLA) or any other applicable laws, with any regulations issued under the OCSLA, or with the terms or provisions of leases, licenses, permits, rights-of-way, or other approvals issued under the OCSLA.

Violator means a person responsible for a violation.

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§250.1403   What is the maximum civil penalty?

The maximum civil penalty is $45,463 per day per violation.

[85 FR 12735, Mar. 4, 2020]

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§250.1404   Which violations will BSEE review for potential civil penalties?

BSEE will review each of the following violations for potential civil penalties:

(a) Violations that you do not correct within the period BSEE grants;

(b) Violations that BSEE determines may constitute, or constituted, a threat of serious, irreparable, or immediate harm or damage to life (including fish and other aquatic life), property, any mineral deposit, or the marine, coastal, or human environment; or

(c) Violations that cause serious, irreparable, or immediate harm or damage to life (including fish and other aquatic life), property, any mineral deposit, or the marine, coastal, or human environment.

(d) Violations of the oil spill financial responsibility requirements at 30 CFR part 553.

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§250.1405   When is a case file developed?

BSEE will develop a case file during its investigation of the violation, and forward it to a Reviewing Officer if any of the conditions in §250.1404 exist. The Reviewing Officer will review the case file and determine if a civil penalty is appropriate. The Reviewing Officer may administer oaths and issue subpoenas requiring witnesses to attend meetings, submit depositions, or produce evidence.

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§250.1406   When will BSEE notify me and provide penalty information?

If the Reviewing Officer determines that a civil penalty should be assessed, the Reviewing Officer will send the violator a letter of notification. The letter of notification will include:

(a) The amount of the proposed civil penalty;

(b) Information on the violation(s); and

(c) Instruction on how to obtain a copy of the case file, schedule a meeting, submit information, or pay the penalty.

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§250.1407   How do I respond to the letter of notification?

You have 30 calendar days after you receive the Reviewing Officer's letter to either:

(a) Request, in writing, a meeting with the Reviewing Officer;

(b) Submit additional information; or

(c) Pay the proposed civil penalty.

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§250.1408   When will I be notified of the Reviewing Officer's decision?

At the end of the 30 calendar days or after the meeting and submittal of additional information, the Reviewing Officer will review the case file, including all information you submitted, and send you a decision. The decision will include the amount of any final civil penalty, the basis for the civil penalty, and instructions for paying or appealing the civil penalty.

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§250.1409   What are my appeal rights?

(a) When you receive the Reviewing Officer's final decision, you have 60 days to either pay the penalty or file an appeal in accordance with 30 CFR part 290, subpart A.

(b) If you file an appeal, you must either:

(1) Submit a surety bond in the amount of the penalty to the appropriate Leasing Office in the Region where the penalty was assessed, following instructions that the Reviewing Officer will include in the final decision; or

(2) Notify the appropriate Leasing Office, in the Region where the penalty was assessed, that you want your lease-specific/area-wide bond on file to be used as the bond for the penalty amount.

(c) If you choose the alternative in paragraph (b)(2) of this section, the BOEM Regional Director may require additional security (i.e., security in excess of your existing bond) to ensure sufficient coverage during an appeal. In that event, the Regional Director will require you to post the supplemental bond with the regional office in the same manner as under 30 CFR 556.53(d) through (f). If the Regional Director determines the appeal should be covered by a lease-specific abandonment account then you must establish an account that meets the requirements of 30 CFR part 556.56.

(d) If you do not either pay the penalty or file a timely appeal, BSEE will take one or more of the following actions:

(1) We will collect the amount you were assessed, plus interest, late payment charges, and other fees as provided by law, from the date you received the Reviewing Officer's final decision until the date we receive payment;

(2) We may initiate additional enforcement, including, if appropriate, cancellation of the lease, right-of-way, license, permit, or approval, or the forfeiture of a bond under this part; or

(3) We may bar you from doing further business with the Federal Government according to Executive Orders 12549 and 12689, and section 2455 of the Federal Acquisition Streamlining Act of 1994, 31 U.S.C. 6101. The Department of the Interior's regulations implementing these authorities are found at 43 CFR part 12, subpart D.

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Federal Oil and Gas Royalty Management Act Civil Penalties Definitions

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§250.1450   What definitions apply to this subpart?

The terms used in this subpart have the same meaning as in 30 U.S.C. 1702.

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Penalties After a Period To Correct

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§250.1451   What may BSEE do if I violate a statute, regulation, order, or lease term relating to a Federal oil and gas lease?

(a) If we believe that you have not followed any requirement of a statute, regulation, order, or lease term for any Federal oil or gas lease, we may send you a Notice of Noncompliance informing you what the violation is and what you need to do to correct it to avoid civil penalties under 30 U.S.C. 1719(a) and (b).

(b) We will serve the Notice of Noncompliance by registered mail or personal service using the most current address on file as maintained by the BOEM Leasing Office in your respective Region.

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§250.1452   What if I correct the violation?

The matter will be closed if you correct all of the violations identified in the Notice of Noncompliance within 20 days after you receive the Notice (or within a longer time period specified in the Notice).

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§250.1453   What if I do not correct the violation?

(a) We may send you a Notice of Civil Penalty if you do not correct all of the violations identified in the Notice of Noncompliance within 20 days after you receive the Notice of Noncompliance (or within a longer time period specified in that Notice). The Notice of Civil Penalty will tell you how much penalty you must pay. The penalty may be up to $500 per day, beginning with the date of the Notice of Noncompliance, for each violation identified in the Notice of Noncompliance for as long as you do not correct the violations.

(b) If you do not correct all of the violations identified in the Notice of Noncompliance within 40 days after you receive the Notice of Noncompliance (or 20 days following the expiration of a longer time period specified in that Notice), we may increase the penalty to up to $5,000 per day, beginning with the date of the Notice of Noncompliance, for each violation for as long as you do not correct the violations.

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§250.1454   How may I request a hearing on the record on a Notice of Noncompliance?

You may request a hearing on the record on a Notice of Noncompliance by filing a request within 30 days of the date you received the Notice of Noncompliance with the Hearings Division (Departmental), Office of Hearings and Appeals, U.S. Department of the Interior, 801 North Quincy Street, Arlington, Virginia 22203. You may do this regardless of whether you correct the violations identified in the Notice of Noncompliance.

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§250.1455   Does my request for a hearing on the record affect the penalties?

(a) If you do not correct the violations identified in the Notice of Noncompliance, the penalties will continue to accrue even if you request a hearing on the record.

(b) You may petition the Hearings Division (Departmental) of the Office of Hearings and Appeals, to stay the accrual of penalties pending the hearing on the record and a decision by the Administrative Law Judge under §250.1472.

(1) You must file your petition within 45 calendar days of receiving the Notice of Noncompliance.

(2) To stay the accrual of penalties, you must post a bond or other surety instrument, or demonstrate financial solvency, using the standards and requirements as prescribed in BOEM's regulations, 30 CFR part 550, subpart N. The posted amount must cover the unpaid principal and interest due for the Notice of Noncompliance, plus the amount of any penalties accrued before the date a stay becomes effective.

(3) The Hearings Division will grant or deny the petition under 43 CFR 4.21(b).

[76 FR 64462, Oct. 18, 2011, as amended at 81 FR 36150, June 6, 2016]

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§250.1456   May I request a hearing on the record regarding the amount of a civil penalty if I did not request a hearing on the Notice of Noncompliance?

(a) You may request a hearing on the record to challenge only the amount of a civil penalty when you receive a Notice of Civil Penalty, if you did not previously request a hearing on the record under §250.1454. If you did not request a hearing on the record on the Notice of Noncompliance under §250.1454, you may not contest your underlying liability for civil penalties.

(b) You must file your request within 10 days after you receive the Notice of Civil Penalty with the Hearings Division (Departmental), Office of Hearings and Appeals, U.S. Department of the Interior, 801 North Quincy Street, Arlington, Virginia 22203.

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Penalties Without a Period To Correct

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§250.1460   May I be subject to penalties without prior notice and an opportunity to correct?

The Federal Oil and Gas Royalty Management Act sets out several specific violations for which penalties accrue without an opportunity to first correct the violation.

(a) Under 30 U.S.C. 1719(c), you may be subject to penalties of up to $10,000 per day per violation for each day the violation continues if you:

(1) Fail or refuse to permit lawful entry, inspection, or audit; or

(2) Knowingly or willfully fail or refuse to notify the Secretary, within 5 business days after any well begins production on a lease site or allocated to a lease site, or resumes production in the case of a well which has been off production for more than 90 days, of the date on which production has begun or resumed.

(b) Under 30 U.S.C. 1719(d), you may be subject to civil penalties of up to $25,000 per day for each day each violation continues if you:

(1) Knowingly or willfully prepare, maintain, or submit false, inaccurate, or misleading reports, notices, affidavits, records, data, or other written information;

(2) Knowingly or willfully take or remove, transport, use or divert any oil or gas from any lease site without having valid legal authority to do so; or

(3) Purchase, accept, sell, transport, or convey to another person, any oil or gas knowing or having reason to know that such oil or gas was stolen or unlawfully removed or diverted.

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§250.1461   How will BSEE inform me of violations without a period to correct?

We will inform you of any violation, without a period to correct, by issuing a Notice of Noncompliance and Civil Penalty explaining the violation, how to correct it, and the penalty assessment. We will serve the Notice of Noncompliance and Civil Penalty by registered mail or personal service using your address of record as specified under 30 CFR part 1218, Subpart H.

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§250.1462   How may I request a hearing on the record on a Notice of Noncompliance regarding violations without a period to correct?

You may request a hearing on the record of a Notice of Noncompliance regarding violations without a period to correct by filing a request within 30 days after you receive the Notice of Noncompliance with the Hearings Division (Departmental), Office of Hearings and Appeals, U.S. Department of the Interior, 801 North Quincy Street, Arlington, Virginia 22203. You may do this regardless of whether you correct the violations identified in the Notice of Noncompliance.

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§250.1463   Does my request for a hearing on the record affect the penalties?

(a) If you do not correct the violations identified in the Notice of Noncompliance regarding violations without a period to correct, the penalties will continue to accrue even if you request a hearing on the record.

(b) You may ask the Hearings Division (Departmental) to stay the accrual of penalties pending the hearing on the record and a decision by the Administrative Law Judge under §250.1472.

(1) You must file your petition within 45 calendar days after you receive the Notice of Noncompliance.

(2) To stay the accrual of penalties, you must post a bond or other surety instrument, or demonstrate financial solvency, using the standards and requirements as prescribed in BOEM's regulations, 30 CFR part 550, subpart N. The posted amount must cover the unpaid principal and interest due for the Notice of Noncompliance, plus the amount of any penalties accrued before the date a stay becomes effective.

(3) The Hearings Division will grant or deny the petition under 43 CFR 4.21(b).

[76 FR 64462, Oct. 18, 2011, as amended at 81 FR 36150, June 6, 2016]

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§250.1464   May I request a hearing on the record regarding the amount of a civil penalty if I did not request a hearing on the Notice of Noncompliance?

(a) You may request a hearing on the record to challenge only the amount of a civil penalty when you receive a Notice of Civil Penalty regarding violations without a period to correct, if you did not previously request a hearing on the record under §250.1462. If you did not request a hearing on the record on the Notice of Noncompliance under §250.1462, you may not contest your underlying liability for civil penalties.

(b) You must file your request within 10 days after you receive Notice of Civil Penalty with the Hearings Division (Departmental), Office of Hearings and Appeals, U.S. Department of the Interior, 801 North Quincy, Arlington, Virginia 22203.

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General Provisions

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§250.1470   How does BSEE decide what the amount of the penalty should be?

We determine the amount of the penalty by considering the severity of the violations, your history of compliance, and if you are a small business.

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§250.1471   Does the penalty affect whether I owe interest?

If you do not pay the penalty by the date required under §250.1475(d), BSEE will assess you late payment interest on the penalty amount at the same rate interest is assessed under 30 CFR 1218.54.

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§250.1472   How will the Office of Hearings and Appeals conduct the hearing on the record?

If you request a hearing on the record under §§250.1454, 250.1456, 250.1462, or 250.1464, the hearing will be conducted by a Departmental Administrative Law Judge from the Office of Hearings and Appeals. After the hearing, the Administrative Law Judge will issue a decision in accordance with the evidence presented and applicable law.

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§250.1473   How may I appeal the Administrative Law Judge's decision?

If you are adversely affected by the Administrative Law Judge's decision, you may appeal that decision to the Interior Board of Land Appeals under 43 CFR part 4, subpart E.

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§250.1474   May I seek judicial review of the decision of the Interior Board of Land Appeals?

Under 30 U.S.C. 1719(j), you may seek judicial review of the decision of the Interior Board of Land Appeals. A suit for judicial review in the District Court will be barred unless filed within 90 days after the final order.

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§250.1475   When must I pay the penalty?

(a) You must pay the amount of the Notice of Civil Penalty issued under §250.1453 or §250.1461, if you do not request a hearing on the record under §250.1454, §250.1456, §250.1462, or §250.1464.

(b) If you request a hearing on the record under §250.1454, §250.1456, §250.1462, or §250.1464, but you do not appeal the determination of the Administrative Law Judge to the Interior Board of Land Appeals under §250.1473, you must pay the amount assessed by the Administrative Law Judge.

(c) If you appeal the determination of the Administrative Law Judge to the Interior Board of Land Appeals, you must pay the amount assessed in the IBLA decision.

(d) You must pay the penalty assessed within 40 days after:

(1) You received the Notice of Civil Penalty, if you did not request a hearing on the record under either §250.1454, §250.1456, §250.1462, or §250.1464;

(2) You received an Administrative Law Judge's decision under §250.1472, if you obtained a stay of the accrual of penalties pending the hearing on the record under §250.1455(b) or §250.1463(b) and did not appeal the Administrative Law Judge's determination to the IBLA under §250.1473;

(3) You received an IBLA decision under §250.1473 if the IBLA continued the stay of accrual of penalties pending its decision and you did not seek judicial review of the IBLA's decision; or

(4) A final non-appealable judgment of a court of competent jurisdiction is entered, if you sought judicial review of the IBLA's decision and the Department or the appropriate court suspended compliance with the IBLA's decision pending the adjudication of the case.

(e) If you do not pay, that amount is subject to collection under the provisions of §250.1477.

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§250.1476   Can BSEE reduce my penalty once it is assessed?

Under 30 U.S.C. 1719(g), the Director or his or her delegate may compromise or reduce civil penalties assessed under this part.

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§250.1477   How may BSEE collect the penalty?

(a) BSEE may use all available means to collect the penalty including, but not limited to:

(1) Requiring the lease surety, for amounts owed by lessees, to pay the penalty;

(2) Deducting the amount of the penalty from any sums the United States owes to you; and

(3) Using judicial process to compel your payment under 30 U.S.C. 1719(k).

(b) If the Department uses judicial process, or if you seek judicial review under §250.1474 and the court upholds assessment of a penalty, the court shall have jurisdiction to award the amount assessed plus interest assessed from the date of the expiration of the 90-day period referred to in §250.1474. The amount of any penalty, as finally determined, may be deducted from any sum owing to you by the United States.

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Criminal Penalties

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§250.1480   May the United States criminally prosecute me for violations under Federal oil and gas leases?

If you commit an act for which a civil penalty is provided at 30 U.S.C. 1719(d) and §250.1460(b), the United States may pursue criminal penalties as provided at 30 U.S.C. 1720, in addition to any authority for prosecution under other statutes.

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