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Code of Federal Regulations Title 30. Mineral Resources § 30.1206.452 How do I calculate royalty value for coal?

Current as of January 02, 2025 | Updated by Findlaw Staff

<Text of section effective Nov. 1, 2021, as delayed by 86 FR 9286;  86 FR 20032.>
<For compliance date(s) of amendment(s) to section, see 86 FR 4612;  86 FR 20032.>

(a) The value of coal under this section for royalty purposes is the gross proceeds accruing to you or your affiliate under the first arm's-length contract, or another person, less an applicable transportation allowance determined under §§ 1206.460 through 1206.462 and washing allowance under §§ 1206.467 through 1206.469. You must use this paragraph (a) to value coal when:

(1) You sell under an arm's-length contract;  or

(2) You sell or transfer to your affiliate or another person under a non-arm's-length contract, and that affiliate or person, or another affiliate of either of them, then sells the coal under an arm's-length contract.

(b) If you have no contract for the sale of coal subject to this section because you or your affiliate used the coal in a power plant that you or your affiliate own(s) for the generation and sale of electricity:

(1) You must propose to ONRR a method to determine the value using the procedures in § 1206.458(a).

(2) You must use that method to determine value, for royalty purposes, until ONRR issues a determination.

(3) After ONRR issues a determination, you must make the adjustments under § 1206.453(a)(2).

(c) [Reserved by 86 FR 4658]

(d) If you are entitled to take a washing allowance and transportation allowance for royalty purposes under this section, under no circumstances may the washing allowance plus the transportation allowance reduce the royalty value of the coal to zero.

(e) The values in this section do not apply if ONRR decides to value your coal under § 1206.454.

1  The reference to September 7, 2017, in this paragraph, should be to September 6, 2017, the published effective date of 81 FR 43338, and the corresponding date of the Court vacation.
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Cite this article: FindLaw.com - Code of Federal Regulations Title 30. Mineral Resources § 30.1206.452 How do I calculate royalty value for coal? - last updated January 02, 2025 | https://codes.findlaw.com/cfr/title-30-mineral-resources/cfr-sect-30-1206-452/

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