The Interior Department will not try to recover US$1.3 billion in royalties lost because of faulty drilling leases and instead is focusing its talks with oil companies on getting money from future production.Acting Assistant Secretary Johnnie Burton said Thursday "it would be very hard to recoup" any of that revenue lost from oil already pumped under terms of the 1998-99 leases.
Because of a government cock-up, the eight- to 10-year leases did not require royalty payments if the price of oil topped US$36 a barrel.
Burton told reporters that one-third of the 59 companies that have an interest in the leases have indicated they would like to settle the matter.
But only 10 companies "have actually come into the building" for discussions, she said. Shell Oil Co. and BP PLC "keep telling us they are very close to signing" an agreement to resolve the issue.
