Gas Royalties Dispute Ends in $87M Settlement

(CN) - Oil and gas company Range Resources will pay $87.5 million to settle a class action in Oklahoma over natural gas royalties.

The 2010 complaint in Grady County District Court accused the independent energy firm of short-changing property owners on royalties through the alleged costs of making the gas drilled from their properties "marketable."

The class members demanded $160 million from the Fort Worth, Texas-based company.

Under the terms of the settlement, Range will pay $87.5 million in cash regarding the calculation, reporting and payment of royalties previous to May 31, according to a June 3 filing with the Securities and Exchange Commission.

The company had previously disclosed that it spent $35 million litigating the case in the first quarter of the year. It says it will make an incremental charge of $52.5 million in the second quarter as a result of the settlement.

The company also previously announced the sale of properties in Delaware and the Permian Basin for $87 million, which will be recorded in the second quarter, as well.

In 2011, Range sold its massive holdings in the Barnett Shale in Texas for $900 million, according to its website.

It used the money to fund its growing operations in the Marcellus Shale in the eastern United States, resulting in the doubling of its daily net production from the year before.

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