DENVER | A state audit found Colorado may be losing significant tax revenue due to oil and gas companies failing to submit thousands of monthly reports used to track how much energy they produce.
The audit estimated the energy producers operating in Colorado would have been subject to “about $308 million in penalties for delinquent reports,” Colorado Public Radio reports.
Regulators are not imposing penalties or tracking missing or incomplete production reports, the audit found.
The reports help the state determine whether the companies have paid the correct tax amounts.
The audit said 10% of operators also filed reports with missing information.
“It was distressing to see that there was a culture of acceptance of not filing forms,” said Rep. Dafna Michaelsen Jenet, the Democratic vice chair of the committee. “And the top producers are the biggest violators and we’re talking about thousands upon thousands of forms not filed. ”
One company failed to submit as many as 1,123 monthly well reports in 2016 that may have equaled an additional $2.6 million in severance taxes the operator would have owed the state, the audit found.
The Colorado Oil and Gas Conservation Commission did not impose the possible penalties, the report said.
The conservation commission plans a technology fix to accurately track the production reports and identify missing or incomplete reports. The update is expected to be completed in the next few days, a commission spokesperson said.
“The audit really exposed a lot of gaps that we think can be easily remedied,” said Republican audit committee chair Rep. Lori Saine. “The commission has agreed to do these things.”