Daily Rules, Proposed Rules, and Notices of the Federal Government
The end of the comment period is also the deadline for the submission of qualification materials. All bidders interested in participating in the lease sale must have submitted all such qualification materials by the end of the 60-day comment period for this notice. All qualification materials must be postmarked no later than February 1, 2013.
If you wish to protect the confidentiality of your nominations or comments, clearly mark the relevant sections and request that BOEM treat them as confidential. Please label privileged or confidential information with the caption, "Contains Confidential Information" and consider submitting such information as a separate attachment. Treatment of confidential information is addressed in the section of this PSN entitled "Protection of Privileged or Confidential Information." Information that is not labeled as privileged or confidential will be regarded by BOEM as suitable for public release.
This PSN is published pursuant to subsection 8(p) of the OCS Lands Act (43 U.S.C. 1337(p)) ("the Act"), as amended by section 388 of the Energy Policy Act of 2005 (EPAct), and the implementing regulations at 30 CFR Part 585, including 30 CFR 585.211 & 585.216.
On February 3, 2012, BOEM published the Notice of Availability (NOA) (77 FR 5560) for the final Environmental Assessment (EA) and Finding of No Significant Impact (FONSI) for commercial wind lease issuance and site assessment activities on the Atlantic OCS offshore New Jersey, Delaware, Maryland, and Virginia. Consultations ran concurrently with the preparation of the EA and included consultation under the Endangered Species Act (ESA), Magnuson-Stevens Fishery Conservation and Management Act (MSFCMA), section 106 of the National Historic Preservation Act (NHPA), and the Coastal Zone Management Act (CZMA). The
The proposed lease area identified in this PSN matches the Virginia Wind Energy Area (WEA) described in the preferred alternative in the Regional EA. Additional environmental documentation will be prepared upon receipt of plans, such as a Site Assessment Plan (SAP) or Construction and Operations Plan (COP).
Potential bidders should be aware of two unsolicited nominations under consideration by BOEM, situated within or near the Virginia WEA. Additional information is provided below.
* The projected amount of rent and other payments due to the Government over the next 12 months;
* Any past due rent and other payments;
* Other monetary obligations (e.g., fines, liens); and
* The estimated cost of facility decommissioning.
Prior to lease issuance the Lessee must provide: (1) An initial lease-specific bond or other approved means of meeting the Lessor's initial financial assurance requirements in the amount of $100,000; and (2) a supplemental bond or other approved means of meeting the Lessor's supplemental financial assurance requirements in the amount of $338,397 to guarantee lease obligations from rental payments due to the Government over the first 12 months of the lease. Additional financial assurances will be required to address decommissioning, operating fee, and other obligations as the lease progresses.
The financial terms can be found in Addendum "B" of the proposed lease, which BOEM has made available with this notice on its Web site at:
Following publication of the FSN, each bidder must fill out the Bidder's Financial Form included in the FSN. BOEM has made a copy of the proposed form available with this notice on its Web site at:
Following the auction, bid deposits will be applied against any bonus bids or other obligations owed to BOEM. If the bid deposit exceeds the bidder's total financial obligation, the balance of the bid deposit will be refunded to the bidder.
A large scale map of this area showing boundaries of the area with numbered blocks is available from BOEM at the following address: Bureau of Ocean Energy Management, Office of Renewable Energy Programs, 381 Elden Street, HM 1328, Herndon, Virginia 20170, Phone: (703) 787-1300, Fax: (703) 787-1708.
BOEM has decided to auction the area as a single zone resulting in a single lease in order to take advantage of the simplicity of this type of sale, the importance of which was highlighted by comments received in response to the Auction Format Information Request (76 FR 76174). Feedback from a member of the BOEM Virginia Renewable Energy Task Force suggested that offering the area in two zones could attract lower electricity prices for offshore wind generation in the event two different developers won different zones. However, splitting the area into two zones would not have prevented a single developer from winning both zones. Other Task Force members have endorsed the proposed single zone approach to facilitate potential phased development. If additional relevant comments regarding the auction format are submitted to BOEM in response to this PSN, BOEM will consider them.
Addendum "A" (Description of Leased Area and Lease Activities);
Addendum "B" (Lease Term and Financial Schedule);
Addendum "C" (Lease Specific Terms, Conditions, and Stipulations);
Addendum "D" (Project Easement);
Addendum "E" (Rent Schedule); and
Appendix A (High Resolution Geophysical Surveys and Analysis for the Identification or Reporting of Archaeological Resources).
Addenda "A", "B", and "C" provide detailed descriptions of lease terms and conditions. Addenda "D" and "E" will be completed at the time of COP approval.
After considering comments on the PSN and these proposed provisions, BOEM will publish final lease terms and conditions in a FSN.
The lease form included as part of this proposed lease has been updated since its publication on February 3, 2012. A discussion of specific changes to the lease form is available separately on BOEM's Web site at:
Pursuant to 30 CFR 585.629, a leaseholder may request in its COP to develop its commercial lease in phases. If a leaseholder requests, and BOEM approves, phased development, this approval will not affect the length of the preliminary, site assessment, or commercial terms offered under the lease. The COP must describe in sufficient detail the activities proposed for all phases of commercial development, including a schedule detailing the proposed timelines for phased development. Further, the COP must include the results of all site characterization surveys, as described in 30 CFR 585.626(a), necessary to support each phase of commercial development. The requirements of the SAP remain the same as they would under a non-phased development scenario, and must meet the requirements provided in the regulatory provisions in 30 CFR 585.605-613 for the full commercial lease area.
Guidance and examples of the appropriate documentation demonstrating your legal qualifications can be found in Chapter 2 and Appendix B of
Please note that it may take a number of weeks for you to establish your legal, technical, and financial qualifications. We advise potential bidders planning to participate in a sale to establish their qualifications promptly. It is not uncommon for BOEM to request additional materials establishing qualifications following an initial review of the qualifications package. Any potential bidder whose qualification package is incomplete at the time the FSN for this sale is published in the
A bidder remains active as long as it continues to meet BOEM's asking price associated with ensuing rounds. If more than one active bid is received in a round, BOEM increases the asking price incrementally and conducts another auction round. Between rounds, active
Bidders exiting the auction are allowed to submit an exit bid at an offer price greater than the clock price in the previous round and less than the incremented clock price in the current round. Once a bidder exits the auction, either by submitting an exit bid or by failing to submit an active bid, it will no longer be allowed to submit bids in any subsequent round. If a bidder leaves the auction without submitting an exit bid, BOEM will treat the last round's clock price as the bidder's exit bid in the current round. Exit bids are not considered to be active bids for purpose of determining whether to conclude the auction.
The lease is awarded to the sole bidder submitting an active bid in the final round of the auction at the final round's stated auction price. If an active bid is not received in the final round, the lease is awarded to the bidder offering the highest exit bid price for the lease. If there is a tie at the highest exit bid price offered, the winning bidder is chosen by a random draw.
Specific details about certain administrative aspects of the auction sale process will be described in the FSN. These aspects include how the clock price will increase in various stages of the auction, the duration of each bidding round, the amount of time provided between rounds, the number of rounds expected per day, and the days on which the auction process will continue, if necessary, beyond the first day. Bidders may expect multiple rounds per day to occur during normal business hours. The amount of time allowed for bidders to enter bids and the time between rounds may be reduced as the auction progresses based on the patterns of bidding to increase the pace of the auction. Bidders will be notified of the round schedule at the start of each day of the auction.
1. Execute the lease on the bidder's behalf;
2. File financial assurance as required under 30 CFR 585.515-537; and
3. Pay the balance of the bonus bid (bid amount less the bid deposit).
If a winning bidder does not meet these three requirements within 10 business days of receiving the lease copies as described above, or if a winning bidder otherwise fails to comply with applicable regulations or the terms of the FSN, the winning bidder will forfeit its bid deposit. BOEM may extend this 10 business-day time period if it determines the delay was caused by events beyond the winning bidder's control.
BOEM will not execute a lease until the three requirements above have been satisfied, BOEM has accepted the winning bidder's financial assurance, and BOEM has processed the winning bidder's payment. Please note the required timelines for providing financial assurance. The winning bidder may meet financial assurance requirements by posting a surety bond or by setting up an escrow account with a trust agreement giving BOEM the right to withdraw the money held in the account on demand by BOEM. BOEM may accept other forms of financial assurance on a case-by-case basis in accordance with its regulations. BOEM encourages winning bidders to discuss the financial assurance requirement with BOEM as soon as possible after the auction has concluded.
Within 45 calendar days of the date that the Lessee receives the lease copies, the Lessee must pay the first year's rent.
In accordance with the Act at 43 U.S.C. 1337(c), following the auction, and before the acceptance of bids and the issuance of leases, BOEM will "allow the Attorney General, in consultation with the Federal Trade Commission, thirty days to review the results of the lease sale."
If a bidder is found to have engaged in anti-competitive behavior or otherwise violated BOEM's rules in connection with its participation in the competitive bidding process, BOEM may reject the high bid pursuant to its regulations at 30 CFR 585.222(a)(2).
Anti-competitive behavior determinations are fact specific. However, such behavior may manifest itself in several different ways, including, but not limited to:
* An agreement, either express or tacit, among bidders to not bid in an auction, or to bid a particular price;
* An agreement among bidders not to bid in a particular location;
* An agreement among bidders not to bid against each other; and
* Other agreements among bidders that have the effect of limiting the final auction price.
* If awarding a lease would otherwise create a situation inconsistent with the antitrust laws (
For more information on whether specific communications or agreements could constitute a violation of Federal antitrust law, please see
I certify that [name of qualified bidder] did not engage in anticompetitive bidding behavior in violation of Federal law, BOEM's regulations, or auction procedures.
I certify that this bid is made in a good faith effort to win a lease to engage in the development of renewable energy resources.
(a) If BOEM rejects your bid, BOEM will provide a written statement of the reasons and refund any money deposited with your bid, without interest.
(b) You will then be able to ask the BOEM Director for reconsideration, in writing, within 15 business days of bid rejection, under 30 CFR 585.118(c)(1). We will send you a written response either affirming or reversing the rejection.
The procedures for appealing adverse final decisions with respect to lease sales are described in 30 CFR 585.118(c).
However, BOEM will not treat as confidential any aggregate summaries of such information or comments not containing such information. Additionally, BOEM may not treat as confidential the legal title of the commenting entity (e.g., the name of your company). Information that is not labeled as privileged or confidential will be regarded by BOEM as suitable for public release.
BOEM is required, after consultation with the Secretary, to withhold the location, character, or ownership of historic resources if it determines that disclosure may, among other things, cause a significant invasion of privacy, risk harm to the historic resources or impede the use of a traditional religious site by practitioners. Tribal entities and other interested parties should designate information that they wish to be held as confidential.