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Big oil firms pay big bucks to settle US charges of royalty fraud

Screen Shot 2014-03-10 at 23.56.16Extracts from a Reuters article by Alia Dharssi and Ashley Renders published Tuesday 13 May 2014 under the headline: Big oil firms accused of cheating on royalties lead fight to limit US disclosure rules

NEW YORK/WASHINGTON (Thomson Reuters Foundation) – Oil companies have paid $3 billion over the past 15 years to resolve a range of charges including that they regularly cheated the U.S. government and Native American communities out of royalties on oil and gas leases, raising concerns they use similar techniques to rob citizens in poor countries of resource wealth.

Royal Dutch Shell plc and Exxon Mobil Corp. are among the energy companies that have paid penalties and back payments on their U.S. energy leases and settled lawsuits accusing them of fraudulently underestimating the value of oil and gas to lower their royalty payments, research by Thomson Reuters Foundation shows.

These are the same companies leading the fight in the United States against strong transparency regulations that human rights advocates say are needed to help address massive corruption and extreme poverty in many resource-rich countries.

A different type of corruption involving Shell came to light in 2012 when a high court judge in London ruled that when Shell subsidiaries and the Italian oil giant Eni paid Nigeria $1.3 billion for an oil block in 2011, the majority of the money went to its former oil minister instead of public coffers.

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