FOR IMMEDIATE RELEASECIV
WEDNESDAY, SEPTEMBER 27, 2000(202)514-2008
WWW.USDOJ.GOVTDD (202) 514-1888
UNITED STATES SETTLES WITH TEXACO
FOR UNDERPAYMENT OF ROYALTIES
WASHINGTON, D.C. -- Texaco, Inc. has agreed to pay $43 million to resolve claims that the oil company underpaid royalties due for oil produced on Federal and Indian leases from January 1, 1980 to December 31, 1998.
Federal leases are administered by the Minerals Management Service of the United States Department of the Interior. Each month, Texaco is required to report the amount of oil produced and the value of the oil produced on Federal and Indian leases. Texaco pays royalties based upon the value of the oil it reports.
The settlement resolves allegations that Texaco systematically under-reported the value of oil its affiliated companies produced on Federal and Indian leases and, consequently, that the companies paid less royalties than they owed.
The settlement agreement was signed by representatives of several Indian tribes, as well as the federal government and Texaco. Two relators who had filed a complaint in the United States District Court in Lufkin, Texas against Texaco on behalf of the United States under the qui tam provisions of the False Claims Act will share in the proceeds of the settlement. In the same action, the federal government previously has settled with Mobil ($45 million), Oxy ($7.3 million), Chevron ($95 million), BP Amoco ($32 million), Conoco ($26 million), Sun Oil ($200,000), Pennzoil ($11.9 million), and Union Pacific Resources ($2.7 million).
The investigation and settlement were jointly handled by the United States Attorney's Office for the Eastern District of Texas, the Civil Division of the Department of Justice, the Department of the Interior's Office of Inspector General and the Minerals Management Service.