BOEM Adjusts Amount of Monetary Penalties for Oil and Gas Companies

Release Date

The Bureau of Ocean Energy Management (BOEM) today announced a final rule that sets the maximum daily civil penalty (MDCP) amounts for violations of the Federal Oil and Gas Royalty Management Act (FOGRMA) in accordance with Federal law. 

The rule, which will publish in the Federal Register on Thursday, July 22, 2021, cross-references BOEM’s regulations to those of the Office of Natural Resources Revenue (ONRR) that also set MDCP amounts for FOGRMA violations. With this action, BOEM is adopting ONRR’s MDCP amounts and any future inflation adjustments that ONRR may make.

First approved in 1982, FOGRMA gives the Secretary of the Interior authority to audit and enforce royalty payment obligations on Federal and Indian oil and gas leases. Within the Department of the Interior, FOGRMA gives BOEM additional authority to use civil penalties as an enforcement tool for violations of the Outer Continental Shelf Lands Act and any regulations issued under it. ONRR is the agency responsible for collecting the majority of revenues from energy leases and auditing royalty payments under FOGRMA.

BOEM is amending its rules found at 30 CFR 550.1453 and 550.1460, which specifically address FOGRMA. The changes are in keeping with the Office of Management and Budget Memorandum M-21-10, Implementation of Penalty Inflation Adjustments for 2021, pursuant to the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015.

ONRR’s civil penalty regulations are found in 30 CFR part 1241. On February 2, 2021, ONRR published the final rule adjusting the MDCP amounts in 30 CFR part 1241 for calendar year 2021.  See 86 FR 7808. 

Questions about the Final Rule can be addressed to Beverly Winston in BOEM’s Office of Public Affairs.