US Accuses BP of Misreporting Output in Colorado
June 30, 2010 - 11:12 AMThe Interior Department has fined BP America $5.2 million for allegedly submitting false reports about energy production on an Indian reservation in Colorado.
The Interior Department said Wednesday that the U.S. unit of BP PLC repeatedly misreported royalty rates for natural gas on Southern Ute Indian tribal lands. Interior spokesman Patrick Etchart said BP was not taking more natural gas than reported. Instead, BP at times reported erroneous royalty rates, or listed natural gas coming from the wrong wells, he said.
BP officials didn't immediately return a call seeking comment.
Southern Ute auditors said they discovered incorrect reports in 2007 and reported them to BP, which blamed the misreporting on a computer glitch and promised to make changes. Etchart wasn't sure how far back the errors went.
However, BP's reporting errors continued after the audit pointed out the problems, leading to the fine.
"We are committed to collecting every dollar due from energy production that occurs on federal and American Indian lands, and accurate reporting is crucial to that effort," said Michael R. Bromwich, head of the Interior Department's Bureau of Ocean Energy Management, Regulation and Enforcement. The ongoing errors indicated the misreporting was "knowing or willful," Bromwich said in a written statement.
Bromwich took office last week. He has been tasked with making changes to the Minerals Management Service, which has been criticized for lax oversight of offshore drilling before BP's Gulf of Mexico oil spill.
Tribal leader Chairman Matthew J. Box praised the settlement in a statement but couldn't immediately be reached for further comment.
The Interior Department said the fine is unrelated to the Gulf spill. BP can appeal the Colorado fine of $5,189,800 but gave no immediate word if it would.
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