Chevron Corp., Texaco, Unocal and affiliated companies will pay the federal government $45.6 million to resolve claims that they violated the False Claims Act by knowingly underpaying royalties owed on natural gas produced from federal and Indian leases.
The settlement resolves claims that the companies improperly deducted from royalty values the cost of boosting gas up to pipeline pressures, used affiliate transactions to falsely reduce the reported value of gas taken from federal and Indian leases, and improperly reported processed gas as unprocessed gas to reduce royalty payments.
The lawsuit began as a whistleblower suit filed under the qui tam provisions of the False Claims Act. The whistleblower is deceased but his heirs will receive $12.3 million as his relator’s share.