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Chevron Paying $95M To Settle Claim

January 13, 2000

WASHINGTON (AP) _ Chevron Corp. agreed Thursday to pay $95 million to resolve claims that it and affiliated companies underpaid royalties for producing oil from federal and Indian land for 11 years, the Justice Department said.

The department said the payment would resolve complaints under the False Claims Act that Chevron systematically underreported the value of oil it pumped from the leased property from Jan. 1, 1988 through Dec. 31, 1998.

The leases, administered by the Interior Department, were scattered throughout the West and the Gulf of Mexico. Chevron pays royalties based upon its monthly reports of the value of the oil it produces from federal and Indian land.

Representatives of several Indian tribes signed the agreement, as well as the federal government and Chevron, which is based in Richmond, Calif.

Under provisions of the False Claims Act, J. Benjamin Johnson Jr. and John Martineck, former employees of another oil company, Arco, will share $14.5 million of the settlement because they filed suit in Lufkin, Texas, against Chevron on behalf of the U.S. government.

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