The Department of Justice and XTO Energy Inc. have reached a settlement of $16 million to resolve False Claims Act allegations filed against the company. The settlement comes after allegations that XTO Energy Inc. deducted costs of transporting carbon dioxide, failed to pay royalties on carbon dioxide, and improperly deducted costs necessary to put gas in marketable condition.
This press release states that the agreed settlement resolves allegations that the company deducted costs of transporting carbon dioxide, failed to pay royalties on carbon dioxide, and improperly deducted costs necessary to put gas in the marketable condition. "Mineral royalties provide an important source of income for the United States, Native Americans and various states," said Principal Deputy Assistant Attorney General Brian Boynton, head of the Justice Department's Civil Division. "This settlement demonstrates that the department will hold accountable those who knowingly take improper advantage of our public resources. " Cole Finegan, U.S. Attorney for the District of Colorado, said "Taxpayers expect that every penny of these royalties gets paid."
The settlement resolves allegations that XTO knowingly deducted payments to third parties for gas transportation and processing that included the cost to place the gas in a marketable condition. From January 2016 to June 2016, XTO knowingly deducted from federal royalty payments on natural gas the costs of transporting carbon dioxide entrained in that gas. Additionally, from May 2010 to March 2016, the company failed to pay federal royalties owed on carbon dioxide produced at the Castle Valley Plan in Utah.
"Taxpayers expect that every penny of these royalties gets paid," said Cole Finegan, U.S. Attorney for the District of Colorado.
Since 2017, the Department of Justice and its agency partners have recovered over $25 million from energy companies that deducted the costs of putting their gas in marketable condition through the False Claims Act.
XTO Energy Inc., founded in 1986, is a leading oil and natural gas producer in the United States. The company has a team of over 4,700 workers and operates in major U.S. unconventional producing regions.
