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Royalty Audit

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Royalty Audit

The Texas General Land Office, through its Financial Management division, performs audits, limited reviews, and reconciliations on the oil and gas royalty data received by the state.

These audits ensure the royalty paid to the state accounts for all oil and gas produced on state lands, or lands in which the state has an interest, and is valued accurately in accordance with the lease agreements.

The Texas Natural Resources Code authorizes the Land Office to conduct these royalty audits, which include the right to inspect and examine books, accounts, reports, and other records relating to the payment of royalties, in-kind volume deliveries, and/or other consideration due to the state.

In addition, Federal legislation allows the U.S. Department of the Interior to delegate to the Land Office the right to conduct audits of federal lands in which the state of Texas shares in the resources.