Amoco: Indians Allege Royalty Evasion

AMOCO Production Company, a branch of Standard Oil of Indiana, finds itself at the center of a controversy involving alleged oil company thefts of American Indian petroleum.

AMOCO has conceded that it failed to pay royalties to the Shoshone and Arapahoe tribes on the Wind River Indian Reservation in northwestern Wyoming for at least some of the oil produced there from 1972-1978. Admitting "accounting errors" due "probably to human failure," AMOCO's public relations officer, Annie Coomer, denied. any wrongdoing by the company: "We have not stolen any oil." AMOCO has yet to calculate the amount of money involved in its "accounting errors," she added. The royalty is between 12-12.5 percent of the value of each barrel produced.

The director of minerals for the Arapahoe and Shoshone tribes, Charles Thomas, is investigating AMOCO's operations on the reservation, and claims to have figures for at least some of the unpaid royalties. "Nearly a million barrels of oil have been taken" from just two sites leased by AMOCO from January 1975 July 1980, "and I can find no record of royalty payments for any of them," says Thomas, who was formerly an inspector with the U.S. Geological Survey, the government agency responsible for monitoring oil leases on Indian and federal lands.

Using current oil prices, the royalty payments AMOCO owes to the Shoshone and Arapahoe for just these two leases are about S4,375,000, if Thomas' figures are accurate. "He's been right all along,-says Timothy Woodcock, staff director for the Senate Select Committee on Indian Affairs.

Thomas' findings may be just the tip of the iceberg. AMOCO has several other leases on the reservation, including one which is a good deal larger than those Thomas has already investigated. In addition, there are a total of 30 oil companies leasing on the 2.5 million-acre reservation. Thomas has looked at only 14 of the 92 leases there, "and not one of them was up to snuff," he says.

Life for Charles Thomas has not been easy since he began investigating the oil companies on Wind River Reservation. While employed by the U.S. Geological Survey in the north central region of Wyoming, Thomas had responsibility for inspecting the operations at Wind River. Last June, he stopped an oil truck which was transporting oil in a manner which violated \federal regulations. After reporting the occurrence to his superiors, Thomas redoubled his inspections and found discrepancy after discrepancy. He began to receive anonymous threatening phone calls, and in August he was transferred to Alaska by the U.S.G.S. for his own protection. "I was informed I had all these oil companies mad enough to shoot me." Thomas said.

The threats against Thomas continued while he was in Alaska, but when he was asked in November by the Wind River Reservation to return to Wyoming, he accepted their offer that he become director of minerals for the tribes. Back in Wyoming, the threats became more blatant. "When I catch him alone, I'm going to kill him," one telephone caller told Thomas' wife. One day in late January, separate attempts were made on the lives of Thomas and his wife. A truck tailed his wife's car, then "just as they pulled up next to her, they threw a bucket at her car from the passenger side of the truck," Thomas said. "If she had gone off the road, she would have been killed or severely injured," he added, pointing out that there was a 16-foot embankment at the place where the incident occurred. Thomas himself was chased down Wind River Canyon, a windy and dangerous road, at about 75 m.p.h. by a different truck some 100 miles away from where his wife had been threatened.

"It seems to me I was getting too close toA MOCO," explains Thomas. AMOCO denies any connection with the threats to Thomas and his wife. "We certainly have no knowledge of threats on Mr. Thomas' life, and we know of no reason for there to be any threats against his life," says Annie Coomer of AMOCO.

AMOCO's "accounting errors" on the Wind River Reservation are apparently nothing unusual. "Oil companies are calling many of the shots and doing whatever they please in the oil fields," says Senator John Melcher of Montana, a member of the Select Committee on Indian Affairs. Hearings of the committee held in early April revealed that the U.S. Geological Survey is not carrying out its duties to ensure that proper royalty payments are being paid by oil companies on Indian and federal lands. Senator Melcher said at the hearing that Secretary of the Interior James Watt "told me in his office that the system we arc now using in the Geological Survey could lose up to a million dollars a day in royalty accounting, and no one would know about n."

Currently, the inspector general's office of the Interior Department, the FBI, and the Justice Department are investigating allegations of crude oil theft in western states.