ONRR ISSUES $2.7 MLN CIVIL PENALTY AGAINST APACHE CORP.

     (The following press release from U.S. Department of the Interior was 
received by e-mail. The sender verified the statement.) 
ONRR Issues $2.7 million Civil Penalty to Apache Corp. 
Company Cited for Submission of False Information 
DENVER – The Department of the Interior’s Office of Natural Resources
Revenue (ONRR) announced today that it has assessed Apache Corporation a
$2,719,000 civil penalty for “knowing or willful” submission of false
information. 
The civil penalty stems from an ONRR audit that found Apache was improperly
deducting transportation costs on its Outer Continental Shelf Lands Act
Section 6 leases in the Gulf of Mexico.  The Section 6 leases at issue do
not allow transportation deductions from royalty payments. 
“This civil penalty supports ONRR’s continuing efforts to enforce correct
reporting and accurate royalty payments,” said Paul A. Mussenden,
Interior’s Deputy Assistant Secretary for Natural Resources Revenue
Management.  “Accurate reporting is essential for proper royalty collection
and a first line of defense in ensuring that ONRR collects every dollar due
to the American taxpayer.” 
ONRR auditors ordered Apache in May 2010 to stop claiming the
transportation deductions on its Section 6 leases and to pay back the
deductions.  While Apache complied and paid the additional royalties, in
August 2010 it again began deducting transportation costs from its royalty
payments on those same Section 6 leases.  In July 2011, ONRR’s Audit and
Compliance Management Program referred the matter to the Office of
Enforcement, which issued the civil penalty in late September after
concluding its investigation. 
The Office of Natural Resources Revenue, part of the Department’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 2012, the agency disbursed more than $12.15 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. 
(rml) NY
 
 
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