Editorial: Paying their fair share

Tuesday, May 9, 2006 | 7:33 a.m.

A group of state and tribal governments is demanding that the federal government collect more royalty fees from energy companies that drill oil and natural gas on federal land. The Washington Post reports that the states and tribal governments believe the companies are not accurately reporting the quality and amount of natural gas they take, and therefore are underpaying royalties to the government.

It is the job of the Interior Department's Minerals Management Service to closely watchdog the drilling. But the agency is accepting claims made by the energy companies without accurate audits, according to the State and Tribal Royalty Audit Committee, a panel that represents 11 state governments (although not Nevada) and eight tribes. The companies owe taxpayers up to $30 billion in unpaid natural gas royalties, according to an estimate by one group official. But the Minerals Management Service has not responded to states pleading for more aggressive audits, Dennis Roller, vice chairman of the royalty audit panel, told the Post.

The energy companies claim they are paying adequate royalties and the Bush administration appears to be siding with them. But there certainly should be a much more skeptical view taken by the administration. After all, energy companies five years ago paid $400 million to settle a dispute over their unpaid oil royalties.

The Bush administration should direct the mineral agency to do its job and collect every cent that energy companies owe in royalties. If the administration won't take action, we would hope that Congress would intervene. Although the Republican-controlled Congress has a history of doing whatever the oil and gas industry wants, lawmakers should remember they represent the public first and should be doing everything in their power to protect taxpayers from energy companies unwilling to pay their fair share.