A report released today by the Government Accountability Office (GAO) concludes that the Minerals Management Service (MMS) is at risk of under collecting oil and gas royalties owed to federal taxpayers under the agency's Royalty-in-Kind Program (RIK). Recently, the RIK program has been exposed as the source of widespread inappropriate misconduct between the program's employees and oil and gas industry executives. Concerns with the program focused on the reliance of industry-reported data, which the GAO stated could lead to the inaccurate collection of oil and gas royalties.

In addition to raising concerns with data reporting and verification, the report questions the MMS’s annual review of the program’s performance. The GAO suggested that these reviews, “may overstate the program’s benefits.” Furthermore, the GAO concludes that the annual reviews do not provide Congress with sufficient information to accurately measure the program’s performance.

To read the full report visit: http://www.gao.gov/new.items/d08942r.pdf

Other Taxpayer resources on the Royalty-in-Kind Program:

Royalty-in-Kind: A Costly Complication

Sex, Drugs, and Mismanagement at the Department of the Interior