Two more producers agreed to make payments to settle federal charges that they knowingly underpaid natural gas royalties in an ongoing investigation originating with a whistle-blower's lawsuit, reported the US Justice Department and the Bureau of Ocean Energy Management, Regulation, and Enforcement. Marathon Oil Corp. agreed to pay nearly $4.7 million and Dominion Oklahoma Texas E&P Inc. agreed to pay more than $2.2 million to resolve federal claims that they improperly deducted from royalty values the cost of boosting gas up to pipeline pressures, the two federal entities said on Aug. 20. They added that the Dominion Resources Inc. subsidiary also improperly reported processed gas as unprocessed to reduce royalty payments.
The settlements were the latest arising from a lawsuit which Harold Wright filed in 1998 alleging that several producers underpaid royalties owed on several of their American Indian leases. Private citizens may sue on the United States' behalf under the federal False Claims Act qui tam, or whistleblower, provisions and share in any recovery. Wright's heirs will receive $1.822 million from these two settlements because he is deceased.
Previous settlements in the case, US ex rel Wright vs. Chevron USA Inc. et al, include Burlington Resources Corp., $105.3 million; Shell E&P, $56 million; Chevron, Texaco, and Unocal, $45.5 million; and Mobil, $32.2 million.
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