---
kind: "section"
citation: "30 C.F.R. § 550.1011"
title: "30"
number: "550.1011"
heading: "Financial assurance requirements for pipeline right-of-way (ROW) grant holders."
url: "https://uscodex.org/cfr/30/550.1011"
---

# §550.1011. Financial assurance requirements for pipeline right-of-way (ROW) grant holders.

- (a) Except as provided in [paragraph (b)](#b) of this section, when you apply for, attempt to assign, or are the holder of a pipeline right-of-way (ROW) grant, you must furnish and maintain $300,000 of area-wide financial assurance that guarantees compliance with the regulations and the terms and conditions of all the pipeline ROW grants you hold in an OCS area as defined in [§ 556.900(b)](/cfr/30/556.900.md?p=b) of this subchapter. The requirement to furnish and maintain area-wide financial assurance for a pipeline ROW grant is separate and distinct from the requirement to provide financial assurance for a lease or right-of-use and easement (RUE).
- (b) The requirement to furnish and maintain area-wide pipeline ROW financial assurance under [paragraph (a)](#a) of this section may be satisfied if your operator or a co-grant holder provides such financial assurance in the required amount that guarantees compliance with the regulations and the terms and conditions of the grant.
- (c) The requirements for lease financial assurance in §§ [556.900(d) through (g)](/cfr/30/556.900.md?p=d..g) and [556.902](/cfr/30/556.902.md) of this subchapter apply to the area-wide financial assurance required in [paragraph (a)](#a) of this section.
- (d) The Regional Director, using the criteria set forth in [§ 556.901(d)(1) through (3)](/cfr/30/556.901.md?p=d-1..d-3) of this subchapter, will evaluate your financial ability to carry out present and future obligations, and as a result, may require supplemental financial assurance (i.e., above the amount required by [paragraph (a)](#a) of this section) to ensure compliance with the obligations under your pipeline right-of-way grant.
- (e) **The supplemental financial assurance required under paragraph (d) of this section must—**
  - (1) Meet the requirements of §§ [556.900(d) through (g)](/cfr/30/556.900.md?p=d..g) and [556.902](/cfr/30/556.902.md) of this subchapter, and
  - (2) Cover costs and liabilities for compliance with the obligations of your ROW grants and with applicable BOEM and BSEE orders.
- (f) If you fail to replace any deficient financial assurance upon demand or fail to provide supplemental financial assurance upon demand, the Regional Director may:
  - (1) Assess penalties under subpart N of this part;
  - (2) Request BSEE to suspend operations on your pipeline ROW; and/or
  - (3) Initiate action for forfeiture of your pipeline ROW grant in accordance with [§ 250.1013](/cfr/30/250.1013.md) of this title.

## Notes

### Amendments

[89 FR 31590, Apr. 24, 2024]

### Authority

Authority: 30 U.S.C. 1751; 31 U.S.C. 9701; 43 U.S.C. 1334.

### Source

Source: 76 FR 64623, Oct. 18, 2011, unless otherwise noted.

### Amendments

[89 FR 31590, Apr. 24, 2024]