Chevron Could Avoid Royalties From Oil Field Find

A group of oil companies led by Chevron (CVX) could avoid more than $1 billion in royalty payments to the federal government for oil in a field they said they discovered in the Gulf of Mexico last week, according to a newspaper report. The potential bonus to Chevron and its partners stems from a mistake the Interior Department made in signing offshore leases in the late 1990s for drilling in federal waters, The New York Times reported on its Web site. Chevron and its partners, Devon Energy Corp. (DVN) and Statoil ASA (STO) of Norway, have six leases in the Jack oil field, about 175 miles off the coast of Louisiana. Two of the leases allow the companies to avoid royalties on as much as 87.5 million barrels of oil per lease.