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Dominion and Marathon Oil Settle FCA Allegations for $6.2 Million

August 20, 2010

According to the Department of Justice, two energy companies, Dominion Oklahoma Texas Exploration & Production Inc. and Marathon Oil Company, have agreed to pay the United States a combined $6.2 million to settle allegations that the companies fraudulently misreported the amount of natural gas they harvested from U.S and Indian lands – resulting in the underpayment of royalties.

Dominion and Marathon Oil operate  on federal and Indian lands under leases that require they accurately report the amount and value of natural gas gleaned from the land.   The U.S. alleges that the companies falsely deducted certain costs from the value reports and fraudulently reported refined gas as unrefined.  As a result, the reports the companies submitted were allegedly false and the royalties paid were insufficient.

Dominion will pay $2,219,974.98 and Marathon Oil $4,697,476.57.  Whistleblower Harold Wright, who prompted the investigation by filing a qui tam False Claims Act lawsuit, will receive $1.822 million in the settlement.  Wright’s lawsuit named several other companies who have already settled similar claims.  Fraudblawg has previously reported on the settlements here.

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