OXY USA Loses Appeal to Avoid $1.8 Million Gas Royalty Payments

OXY USA Inc. must face the U.S. Department of the Interior’s order to pay $1.8 million in gas royalty payments after the Tenth Circuit affirmed Monday that the department can reject one company’s valuation method and use its own instead.

OXY challenged the department’s revaluation of carbon dioxide produced from federal oil and gas leases it acquired from Amerada Hess Corp. Sales prices are generally used to calculate value for royalties when lessees sell their gas in arms-length transactions. But Hess used almost all of the carbon dioxide it produced in the Bravo Dome Unit for its own purposes during ...