WASHINGTON — Interior Department officials said Thursday that they expect lengthy litigation with big oil companies over disputed royalty payments for oil produced on federal lands in California before 1980.
The department's Minerals Management Service has sent out bills totaling $385.4 million to a number of oil companies; all have appealed.
"The lawyers will ultimately decide" how much of the estimated underpayments the government eventually collects, said MMS Director Cynthia Quarterman.
The dispute stems from the prices companies used to calculate royalties. The government says royalty payments were based on artificially low prices. Oil companies dispute the charges and say the government can't collect after so much time.
Shell Oil Co. owes the most, $176 million, the government says. Oryx Energy Co., Mobil Corp. and USX-Marathon Oil Corp. owe a combined $118 million, and $91 million has been billed to eight other companies.