Devon Energy agrees to pay $6.15 million to settle False Claims Act allegations

FILE: $100 bills. (NEXSTAR)

FILE: $100 bills. (NEXSTAR)

OKLAHOMA CITY (KFOR) – An Oklahoma-based oil and natural gas company has agreed to a multi-million dollar settlement to resolve allegations that it underpaid and underreported royalties.

Devon Energy Corporation and its affiliates has agreed to pay $6.15 million to resolve allegations that it violated the False Claims Act by underpaying and underreporting royalties for natural gas from federal lands in Wyoming and New Mexico.

“We hold our public lands very dear in Colorado,” said Acting U.S. Attorney Matthew T. Kirsch for the District of Colorado. “We will not allow companies extracting natural resources from those lands to avoid paying what they rightfully owe.”

The United States leases federal lands for the production of natural gas in exchange for the payment of royalties on the value of the gas produced.

The settlement resolves allegations that, in calculating royalties, Devon improperly deducted payments to third-parties for gas transportation and processing that included costs to place the gas in marketable condition, and thereby knowingly underreported and underpaid royalties to the Department of the Interior.

“The United States allows companies to remove gas from federal lands, which belong to all of us, in exchange for the payment of appropriate royalties,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “This settlement demonstrates that the government will hold accountable those who take improper advantage of public resources.”

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