Bureau of Indian Affairs' Federal Indian Minerals Office

OIG audited the Federal Indian Minerals Office (FIMO), a multi-bureau partnership within the Department of the Interior (DOI), created to oversee and assist Navajo oil and gas allottees. We found that FIMO did not fully follow the requirements of its 2005 memorandum of understanding (MOU) because (1) the MOU is outdated and does not contain sufficient operational detail and (2) there was insufficient oversight by the Executive Management Group. As a result, we identified a number of issues that hinder FIMO’s management of oil and gas activities. These include poor communication about inspection and enforcement activities, unreconciled lease inventories, no coordination of outreach to allottees, a poor audit and compliance review process, and very little monitoring or oversight of FIMO.

 

FIMO emerged in the 1990’s as a one-of-a-kind partnership to assist Navajo oil and gas lease allottees, following a 1985 lawsuit alleging that DOI had not fulfilled its duty to make timely royalty and lease rental payments. DOI brought together staff from the Bureau of Indian Affairs, Bureau of Land Management, and Minerals Management Service (now the Office of Natural Resources Revenue) into a one-stop-shop to fulfill its Indian Trust responsibilities. Guided by successive MOUs, FIMO is responsible for three core functions— 

• lease administration, which includes permitting; inspection and enforcement; 

• production accountability; and

• royalty compliance.

 

We made 14 recommendations to strengthen FIMO’s oversight of Navajo allottee oil and gas activities.