Interior lacks staff to track unpaid oil royalties, feds find

By Heather Richards | 09/06/2024 04:16 PM EDT

The Government Accountability Office has deemed the national oil program “high risk” since 2011.

Interior Department headquarters.

Interior Department headquarters is seen in Washington on Aug. 9, 2023. Francis Chung/POLITICO

The agency that collects billions of dollars in oil and gas royalties for federal coffers needs more people and more data to ensure companies don’t underpay, according to a report released Friday by a congressional watchdog.

The Government Accountability Office found in its report that in the 11 years from 2012 to 2022, oil and gas companies paid the Interior Department’s Office of Natural Resources Revenue (ONRR) $74 billion in royalties from the fossil fuels extracted from federal lands.

During that same period, the Interior Department also captured an additional $600 million in royalties that were owed but not initially paid.

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The report, requested by senior Democrats on the House Natural Resources Committee, comes at a time of increased scrutiny of the nation’s oil and gas program and oil companies’ profits. The Inflation Reduction Act raised royalty rates on federal lands for the first time since 1920. But the nation’s oil program has long been scrutinized by the GAO. The office has labeled Interior’s management of the national oil and gas program as “high risk” since 2011. Since then, Interior has taken steps to address orphan wells and other failings identified by a series of reports, according to GAO.

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