Conoco Phillips' Subsidiary to Pay United States $97.5 Million for Fraudulent Underpayment of Natural Gas Royalties
Conoco Phillips affiliate, Burlington Resources Inc. has agreed to pay the United States $97.5 million to resolve claims that it underpaid royalties owed on natural gas produced from federal and Indian leases, the Justice Department announced today. Last year, Burlington became a wholly owned subsidiary of Conoco Phillips, the third largest integrated energy company in the United States.
It is good to see that the government is not backing down on going after oil and energy companies for False Claims Act cases. It is also good to see that industry insiders are stepping up to the plate as whistleblowers and turning their companies in for fraudulent acts.
The Burlington Resources settlement resolves allegations under the False Claims Act that Burlington systematically under-reported the value of natural gas that it produced from onshore federal and Indian leases from March 1, 1988, to March 31, 2005, and consequently, paid less royalties than it owed to the United States and various Indian tribes.
The settlement with Burlington arises from a lawsuit filed by a private whistleblower under the False Claims Act, which alleges that a number of companies systematically underpaid royalties due for their federal and Indian natural gas production. The Justice Department partially intervened against several defendants in the lawsuit, and previously settled with Shell Oil Co. for $56 million and Dominion Exploration and Production Co. for $2 million. The Department is continuing to pursue claims against Exxon-Mobil Corp.
Click here to read more from the Department of Justice on this Conoco Phillips subsidiary, Burlington Resources case.
