Anadarko, Kerr-McGee settle federal gas royalty charges

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, June 20 -- Anadarko Petroleum Corp. and Kerr McGee Corp., which Anadarko acquired in 2006, agreed to pay more than $17 million to settle charges that they filed false claims on natural gas produced from federal lands, the US Departments of Justice and the Interior said on June 20.

The settlement resolved federal charges that the producers improperly deducted from royalty values the cost of boosting gas up to pipeline pressures, and improperly reported processed gas as unprocessed to reduce royalty payments, DOI’s Office of Natural Resources Revenue said.

The companies were independent and were separately named when Harold Wright sued them as a private citizen in 1996 under the False Claims Act, ONRR said. Wright’s heirs will receive $1.95 million as their share of the settlement because he is deceased, it added.

The settlement involved ONRR, DOJ’s Civil Division, and the US Attorney for Texas’s Eastern District, with assistant from DOI’s Inspector General and Solicitor’s offices, ONRR indicated. It said this and preceding settlements since 2007 with other companies named in Wright’s whistle-blower lawsuit total $250 million.

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