(The following is a reformatted version of a corrected press
release issued by The Department of the Interior’s Office of
Natural Resources Revenue and received via electronic mail.
The release was confirmed by the sender.)
Dear News Media: This corrects the second paragraph indicating
this is a civil penalty, and not a settlement.
July 18, 2012
BP America pays $5.2 million civil penalty for inaccurate
reporting on energy production on Tribal lands
DENVER - The Department of the Interior’s Office of Natural
Resources Revenue (ONRR) announced today that BP America Inc.
paid a $5.2 million civil penalty for submitting false,
inaccurate, or misleading reports for energy production that
occurred on Southern Ute Indian Tribal lands in southwestern
“This civil penalty demonstrates the expertise, skill and
tenacity of the Tribal auditors and ONRR enforcement team
members who discovered and pursued this repeated misreporting of
royalty and production information, and underscores the value of
our partnership with Tribal and State auditors under our
cooperative agreements,” said Paul A. Mussenden, Deputy
Assistant Secretary for Natural Resources Revenue Management.
“ONRR remains committed to collecting every dollar due from
energy production that occurs on Federal and American Indian
lands, and rigorous enforcement of our regulations requiring
accurate reporting is crucial to that effort.”
ONRR’s Office of Enforcement originally issued the civil penalty
in June 2010. Although BP America initially requested a hearing
on the civil penalty, it decided to pay the penalty instead.
ONRR received payment on July 17.
Mussenden praised the work of Southern Ute Tribal auditors who
initially discovered the errors. The Tribe’s audit was
conducted as part of a cooperative agreement with ONRR.
The Southern Ute Tribal auditors and ONRR found that BP reported
incorrect “product codes” and “sales type codes” resulting in
their use of incorrect royalty rates and prices for royalty
reporting purposes. BP also reported well production to the
After receiving audit issue letters and an order, the company
agreed with the auditors’ concerns and repeatedly promised to
correct the problems, which they attributed to errors in their
automated files. However, ONRR and the Tribal auditors found
the same errors in later reviews, prompting ONRR to issue the
civil penalty. BP America has now corrected the reporting
The Office of Natural Resources Revenue, part of the DOI’s
Office of Policy, Management and Budget, is responsible for
collecting and disbursing revenues from energy production that
occurs onshore on Federal and American Indian lands, and
offshore in the Outer Continental Shelf. During Fiscal Year
2011, the agency disbursed nearly $11.2 billion to states,
American Indian Tribes and individual Indian mineral owners, and
to various Federal accounts, including the U.S. Treasury, the
Land and Water Conservation Fund, and the Reclamation Fund.
ONRR Public Affairs, (303) 231-3162
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