Ten oil companies may renegotiate drill leases: U.S.

WASHINGTON (Reuters) – The U.S. Interior Department told Congress on Thursday that about 10 oil companies have shown an interest in renegotiating drilling leases that at present would allow the companies to avoid paying billions of dollars in royalties normally owed on oil and natural gas found in the Gulf of Mexico.

The department mistakenly left out language in drilling contracts signed with energy companies in 1998 and 1999 that would have ended a waiver of royalties when oil and natural gas prices were at certain high levels.

The Department’s Minerals Management Service, which oversees drilling in federal offshore waters, sent letters to all 55 companies that own interests in the disputed leases, Deputy Interior Secretary Lynn Scarlett testified at a House Government Reform Committee hearing investigating the matter.

“Approximately 20 of the recipients responded to the letter. To date, approximately half of those have met or have scheduled meetings with Departmental representatives,” Scarlett said.

Reuters