Attorney Diana Bob was quoted in a Law360 article titled “DOI Royalty Rule Clears Up Tribal Oil Pricing.” The article discusses the effects of new U.S. Department of the Interior (DOI) regulations that redefine the valuation of oil produced from leased tribal land. The regulations show the federal government’s commitment to simplifying tribal economic development while also simplifying for oil producers the complex tribal and federal regulations that govern operations on tribal lands.
The regulations include a revised method by which royalties paid to Indian Country lessors are calculated, and, by one estimate, will raise the royalties paid by some $20 million per year. The tradeoff for industry comes in benefits such as certainty in meeting the majority of their obligation in real time, lower accounting and administrative costs, simplified audits and fewer administrative appeals and litigation.
According to Bob, the regulations should improve communications between the DOI and tribe members owed royalties while providing the agency a consistent standard in procuring reasonable royalties for Native Americans as required by the Indian Mineral Leasing Act. “This rule is seeking to frame a calculation that is reasonable under that case law, but also creates consistency and can manage some expectations systematically for the oil royalties,” she said.
Read “DOI Royalty Rule Clears Up Tribal Oil Pricing,” published on May 5, 2015. (Subscription Required.)