Improvements Needed in the Department of the Interior's Measurement of Offshore Oil for Royalty Purposes
RCED-84-78
Published: Apr 30, 1984. Publicly Released: May 30, 1984.
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Highlights
Pursuant to a congressional request, GAO reviewed the Department of the Interior's activities relating to the measurement of oil produced on the Outer Continental Shelf, focusing on: (1) identifying the procedures Interior uses to ensure that offshore oil production is measured accurately for royalty purposes; (2) determining whether offshore operators are complying with regulations concerning the accuracy of production measurement devices; (3) determining whether Interior uses production measurement data to ensure that sales volumes are reported accurately; and (4) reviewing the extent to which data are being considered for inclusion in the new Automated Royalty Management Program.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of the Interior | To better ensure that sales volumes are accurately reported for royalty payment purposes in the Gulf of Mexico Region, the Secretary of the Interior should require the Director, MMS, to implement plans for improved receipt and review of meter-testing reports and make greater use of the data it receives for this purpose. Through the use of additional staff recently assigned and adoption of automation, to the extent possible, meter-testing reports should be matched with run tickets on a selective basis. |
Closed – Implemented
Interior matched a sample of meter-testing reports to run tickets until a computerized system became operational. The computer system has been developed and will be fully operational by January 1989.
|
| Department of the Interior | When the Auditing and Financial System and the Production Accounting and Auditing System (PAAS) becomes fully operational, the Secretary of the Interior should require the Director, MMS, to use the meter-testing and run ticket data from its Gulf of Mexico Region's automated information system in conjunction with PAAS, to verify that reported sales volume measurements are accurate by matching meter-testing reports with run tickets as a routine audit procedure. |
Closed – Implemented
Interior developed an automated Liquid Verification System to complete a 100-percent verification of the meter-testing reports with run tickets. MMS plans to have the system fully operational by January 1989.
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Topics
Information systemsInternal controlsMonitoringOffshore oil resourcesOil leasesReporting requirementsRoyalty paymentsStatistical dataAuditsFinancial systems