NYT: Fewer Audits Being Done of Oil Leases on U.S. Land

Fewer Audits Being Done of Oil Leases on U.S. Land

By EDMUND L. ANDREWS
Published: March 1, 2006

WASHINGTON, Feb. 28 — The Bush administration is scaling back on audits of energy companies that pay billions of dollars for leases to produce oil and gas on federal property, state officials said.

The changes have drawn protests from several oil-producing states and American Indian tribes, which receive a share of the royalties energy companies pay the federal government for oil and gas produced on public lands. Those royalties have risen much more slowly than prices for oil and gas, which reached record highs last year and are expected to remain high for several years.

Officials at the Interior Department, which oversees federal leases for oil and gas, say the apparent shortfall stems largely from changes in production and lag times in reporting that distort the government's published statistics.

But in a letter last week to House members, a group of state and tribal auditors said that the Interior Department had cut back on audits in favor of a much looser approach known as "compliance review" that could miss many instances of cheating.

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http://www.nytimes.com/2006/03/01/business/01leases.html