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B-156603 1 (1974-07-08)

handle is hein.gao/gaobadpsq0001 and id is 1 raw text is: DIGEST -NQ G CUILATIO0-1, /'~/ VeX COMPTROLLER GENERAL OF THE UNITEO STATES WASHINGTON,. D.. 20548 ,-15o3 JUL8 1914 The Honorable Henry X. Jackson, Chairm comittae on Interior and Insular Affairs United States Senate Dear Mr. Cmirom; This is In response to your request that ve veieLw the matter outUnoed in the report of Xarc 1., 1974, frow the Under Sacretary of the Interior to the President of the SenAte cocernin the application subidtted to tbe Department of the Interior (Interior) by Union Oil compasy of California (UWon) for credit against future royalty pay- mnts, Tour request also anticipated our review of the Aeting See- retary's response to the addtonal questions raised by you concern- ing the baLs for Interior's determnation that Union was entitled to credit totaling ;799,747.86 for overpayment on crtain. Outer Conti- nental Shelf (OCS) lmass. The claime overpaymts allagedly represented excess royalty payments that Union made on certain specified OCS leases during the period from July 1, 1966, to Decenbar 3, 1972. Prior to approval of the Unit Agreement on Xovmber 13, 1973, the Federal and State leases ware eredited with approximately 98 percent and 2 percent respectively of the total gas produced, uheweas the Ut Agree=mt provides for an allomatin of 96.5032 percent to six Federal OCS leases and 3.4968 percent to four Louisiana State leses retroactive to July 1, 1966. Consequently, Interior determined that Uion is eetitled to credit for over aymets msds to the United States on the basis of the orig- inal ellocation, althouh Ugh ' s initial requst for a refund of $852,197.61 vas recalculated by Interior and reduced to the present sm of $799,747.86. As stated Is the Under Secretary's letter of Masrch 1, 1974, section 10(as) of the Outer Contisemtal Shelf Lands Act, a!roved August 7, 1953, ch. 345, 67 Stat. 469, 43 U.S.C. 1339(a),Authorises the Secretary to repay amounts paid in comnection vith a lease issued under the Act whom he determines such payamt to have been In excess of the amount the less was lawfully required to pay, provided that the request for refund i filed within two years of the date of payment. Althouh the latter proviso might seem to bar allowance of that portion of Union's claim relating to paymeats made more than two years prior to July 27, 1973, the date Union applied for the refund credit, our deciston of November 5, 1965, B-L36603Yjupports a contrary result. djk 156