Interior Department’s Office of Natural Resources Revenue (ONRR) Tuesday penalized Oxy USA Inc. nearly $1 million for the “knowing or willful failure” to permit a state audit of the company’s oil and natural gas leases on federal lands in New Mexico.
The state of New Mexico asked the Houston-based producer several times to turn over the documents necessary for it to perform an audit of oil and gas revenue reporting and payment. The state sought to audit volumes, values and royalties for four federal leases and two agreements in New Mexico.
When Oxy failed to comply with the audit document requests, the state called on Interior’s ONRR’s Office of Enforcement (OE) to provide assistance in obtaining the needed information. The OE conducted a teleconference with Oxy and state auditors on Aug. 30, 2011, explaining that Oxy’s continued failure to provide the requested information would be met with a substantial civil penalty.
Oxy did turn over some of the sought-after documents by Sept. 16, 2011, but not all of them, ONRR said. ONRR levied a civil penalty of $947,200 on Oxy on April 15. The penalty covers the period from Sept. 16, 2011 through March 8, 2012. Oxy may request a rehearing of the penalty.
“The failure of Oxy to provide the necessary documents for an audit substantially delayed its completion, and that is simply unacceptable,” said ONRR Director Greg Gould.
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