Federal Lease Operator Did Not Report Actual Mineral Production Measurements

The OIG investigated allegations that a lease operator may have submitted false Oil and Gas Operations Reports (OGOR) to the Office of Natural Resources Revenue (ONRR) to avoid paying plugging and abandonment costs for a well.

We found that from May 2015 to January 2017 the lease operator did not submit actual production measurements as required, but instead estimated production for the well at one barrel per month in the OGORs he submitted to ONRR. We also found that the Bureau of Land Management (BLM) determined that the well was not capable of producing minerals in paying quantities and issued the operator an order to address BLM’s determination.