DENVER—The federal government is penalizing an oil and gas company $1.7 million for late royalty payments.
The Department of the Interior said Thursday that Merrion Oil and Gas Corp., based in Farmington, N.M., made a practice of failing to make timely royalty payments on 18 federal oil and gas leases in Colorado over a period of seven years.
Company President T. Greg Merrion responded Thursday that if payments have ever been late, they have been paid with interest.
Merrion says that upon initial review, it appears the methodology used to determine the $1.7 million penalty “may not be commensurate for the circumstances.”
The company can request a hearing on the penalty. Merrion says his company looks forward to resolving the agency’s claims.
