Interior talks with companies over oil - AP

[Eugene]

Interior talks with companies ober oil

By H. JOSEF HEBERT, Associated Press Writer

Tue Feb 27, 7:59 PM ET

WASHINGTON - The Interior Department is negotiating with 22 companies to try
to recoup lost oil and gas royalties because of a government leasing mistake,
according to the head of the agency that runs the lease program.

Johnnie Burton, director of the department's Minerals Management Service, did
not name the companies, but said she "looked forward" to reaching additional
agreements "in the near future."

-snip-

The government has not been able to collect royalties on the deep-water leases
issued in 1998-99 because a provision was omitted that would have triggered
royalty payments once the market price for the oil or gas reached a certain
level.

-snip-

There are more than 40 holders of 1998-99 leases that have refused to pay the
royalties they avoided because of the government mistake. The companies
generally argue the leases are a valid contract that the government must stand
by — even if an error was committed.

-snip-

Ironically, 25 of the companies refusing to rework the 1998-99 leases were
aggressively seeking new leases last year.

-snip-

Full article: http://news.yahoo.com/s/ap/20070228/ap_on_go_ca_st_pe/oil_royalties_1