Chevron to pay $46 mln to settle royalty charges

Chevron to pay $46 mln to settle royalty charges


WASHINGTON, Dec 23 (Reuters) - Chevron Corp has agreed to pay almost $46 million to settle charges it underpaid royalties owed for natural gas produced from federal and Indian leases, the Justice Department said on Wednesday.

Chevron and the two companies it now owns, Texaco and Unocal Inc, were accused of under-reporting the value of the natural gas they took between March 1988 and November 2008 and therefore paid less royalties than owed, the Justice Department said.

Companies are required to report the value of the natural gas they produce from federal and Indian leases and pay a percentage as royalties.

"This settlement successfully ends long-standing litigation and ensures that taxpayers receive their fair share of royalty revenues from energy production on federal and American Indian lands," Interior Secretary Ken Salazar said in a statement.

The Interior Department's Minerals Management Service oversees the collection of royalties from the leases.

Most of the money will be disbursed to federal, state and American Indian accounts that were affected by the underpayments, Salazar said.

Chevron said in a statement it settled the case "simply to bring an end to a long and expensive legal proceeding" and that all claims were resolved by mutual agreement.

"The agreement states that Chevron makes no admission of any kind concerning improper or fraudulent actions or omissions on its part and Chevron re-asserts that it did not engage in such activities," the statement said. (Reporting by Jeremy Pelofsky; editing by Richard Chang, Phil Berlowitz and Andre Grenon)

Source URL: http://www.reuters.com/article/idUSN2316752620091224?type=marketsNews