Claris Law Legal Blogging Community

Editor: Mike Bothwell
Profession: Qui Tam Attorney

Category: Settlements and Verdicts

A subsidiary of Conoco Phillips has agreed to pay $97.5 million to the United States to settle allegations that it underpaid royalties owed on natural gas produced from federal and Indian leases.

The subsidiary, Burlington Resources Inc., was alleged to have under-reported the value of natural gas it produced from the leases from 1988 to 2005. Burlington was required to report to the U.S. Department of Interior's Minerals Management Service the value of the natural gas produced from its leases and pay a percentage of the reported value as royalties. Instead, the United States claims that Burlington claimed excessive deductions for the cost of transporting and treating the gas, as well as under-reporting the value of the gas it produced. As part of the same False Claims Act case, Shell Oil Co. previously agreed to pay $56 million and Dominion Exploration and Production Co. agreed to pay $2 million to settle the allegations against them. The United States is continuing its claims against Exxon-Mobile Corp.