43 CFR § 3103.3-1 - Royalty on production.

§ 3103.3-1 Royalty on production.

(a) Royalty on production will be payable only on the mineral interest owned by the United States. Royalty must be paid in amount or value of the production removed or sold as follows:

(1) For leases issued on or before January 17, 2017, the rate prescribed in the lease or in applicable regulations at the time of lease issuance;

(2) For leases issued after January 17, 2017:

(i) 12 1/2 percent on all noncompetitive leases;

(ii) A rate of not less than 12 1/2 percent on all competitive leases, exchange and renewal leases, and leases issued in lieu of unpatented oil placer mining claims under § 3108.2-4 of this title;

(3) 16 2/3 percent on noncompetitive leases reinstated under § 3108.2-3 of this title plus an additional 2 percentage-point increase added for each succeeding reinstatement;

(4) The rate used for royalty determination that appears in a lease that is reinstated or that is in force for competitive leases at the time of issuance of the lease that is reinstated, plus 4 percentage points, plus an additional 2 percentage points for each succeeding reinstatement.

(b) Leases that qualify under specific provisions of the Act of August 8, 1946 (30 U.S.C. 226c) may apply for a limitation of a 12 1/2 percent royalty rate.

(c) The average production per well per day for oil and gas will be determined pursuant to 43 CFR 3162.7-4.

(d) Payment of a royalty on the helium component of gas will not convey the right to extract the helium from the gas stream. Applications for the right to extract helium from the gas stream will be made under part 16 of this title.

[81 FR 83077, Nov. 18, 2016, as amended at 81 FR 88634, Dec. 8, 2016]