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Unfortunately I believe that we are limited in what we can focus on. I think that if we proceed with the partisan sideshow of prosecuting Bush admin. officials, healthcare will get lost in the brouhaha.
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Oil-and-Sex Scandal Spawns Criticism, Hill Hearing

POSTED: 03:31 PM ET, 09/11/2008 by Derek Kravitz

Government officials, lawmakers and watchdog groups today called for action and further investigation into the ethics scandal at the Department of Interior's Denver oil-royalties office.

Yesterday, the department's inspector general released three reports detailing how officials at the office had accepted gifts, steered contracts and engaged in drug use and illicit sex with employees of energy firms.

Interior Secretary Dirk Kempthorne says he will unveil a plan to reform the management of the program, which collects billions of dollars worth of royalties each year from energy companies that drill on federal or Indian land or offshore.

"I am outraged by the immoral behavior, illegal activities, and appalling misconduct of several former and current long-serving career employees in the Minerals Management Service's Royalty in Kind program," Kempthorne said in a statement this morning. "These individuals have eroded the trust the American citizens deserve to have in their public servants."

Sen. Bill Nelson (D-Fla.) today sent a letter to Kempthorne asking him to fire the head of Interior's Minerals Management Service, Randall B. Luthi, who supervises the troubled royalties office.

The House Natural Resources Committee is planning a congressional hearing to discuss the scandal, tentatively scheduled for next Thursday. Witness lists have not yet been compiled but Kempthorne and Interior Inspector General Earl B. Devaney are expected to testify, committee spokeswoman Allyson Groff said.

Rep. Darrell Issa, R-Calif., pushed for Democratic lawmakers to reopen an investigation of the agency that began in 2006 by House Republicans. "Looking into and fixing these problems would have meant highlighting the enormous revenues that domestic oil and natural gas production contributes to our treasury. This just didn't fit into their anti-drilling campaign," he said.

Rep. Louise M. Slaughter (D-N.Y.), chairwoman of the House Rules Committee, said "The Bush Administration put an 'America for Sale' sign on the White House lawn from day one and has been courting Big Oil ever since.

"Democrats have been saying it for some time, but this proves it," she added. "This Administration is literally in bed with Big Oil. Little did we know they were such a cheap date."

Danielle Brian, the executive director of the watchdog group, Project on Government Oversight (POGO), said the reports' findings were "easily the worst instance of government misconduct that POGO has seen."

The Post has also learned that a review by the Government Accountability Office shows the government may not be getting the best possible return on oil and gas leases with companies drilling in the Gulf of Mexico.

The report obtained by The Post (PDF) says that among federally owned oil producing regions, the Gulf of Mexico ranks among the lowest in terms of what the government collects in royalties despite its vast oil resources. The report cites management problems such as restrictions in the ability to change lease agreements with companies to reflect rising or falling oil prices.

"Interior does not routinely evaluate the federal oil and gas fiscal system, monitor what other governments or resource owners are receiving for their energy resources, or evaluate and compare the attractiveness of federal lands and waters for oil and gas investment with that of other oil and gas regions," the report said.

Auditors recommended an independent panel be convened to conduct an across-the-board review of the Gulf leases. Interior Department officials disagreed with some of those findings, saying a two-year study of leases in the central and western parts of the Gulf of Mexico is already underway and that an independent panel would be a waste of resources.

One of the lawmakers who requested the Gulf of Mexico report -- Rep. Nick J. Rahall (D-W.Va.), the chairman of the House Committee on Natural Resources -- said the report "calls into question whether taxpayers are getting a fair return for the resources they own."

"The GAO also reports that the Interior Department has been dragging its feet when it comes to analyzing and modernizing its own royalty collection practices, perhaps costing the American people billions of dollars," Rahall said. "The Congress must take a very close look at GAO's recommendations for an independent panel to review the oil and gas fiscal system."

By Derek Kravitz |  September 11, 2008; 3:31 PM ET Post Investigations
Previous: The Daily Read | Next: Cold War Spy Testimony Revealed


Please email us to report offensive comments.

"Drill Baby Drill!" No wonder it sounded like it came from a porn movie.

Posted by: Teri B. | September 11, 2008 5:10 PM

This is why we should elect Obama, he would solve all these issues. Biden was the best choice to help him with this, what do the republicans have? Nothing a so called war hero and a female.. we got this in the bag.

Posted by: obamapwnsu | September 11, 2008 5:14 PM

People giving money, drugs and sex to lawmakers to get their way, I've never heard of such a thing. Question is whether either party is getting their money's worth. I've got a case of 2 cycle in my garage and I'm looking for a well endowed blond.

Posted by: Buddesatva | September 11, 2008 5:16 PM

I don't think this is entirely a Republican scandal, we'd need a media that would report each of the suspects, how they were hired, and some biographical information. I consider myself an independent and I least of all identify with the Republican party and the Bush administration, but its best not to blame people before evidence supports your accusations.

Posted by: Lost Cause | September 11, 2008 5:19 PM

McCain lost his maverick status when he endorsed George W. Bush in 2004. Everything he accomplished as a maverick was watered down or destroyed completely by the Bush administration.

Posted by: Jay | September 11, 2008 5:19 PM

Did you happen to notice it was dems blocking the investigation and a republican who pushed to reopen it

Posted by: canuread | September 11, 2008 5:19 PM

If i'm not wrong, pretty sure Billy boy was in office when these ppl were appointed...

Posted by: ... | September 11, 2008 5:19 PM

you notice they didn't mention lifers party affiliations.... that always means Democrats were involved.. Yea Oblaba will fix it hahhahahahaha

Posted by: palinforprez | September 11, 2008 5:21 PM

It has been my opinion for a very long time, that the Republicans and the Oil Companies were cut from the same cloth.
Neither one of them has an honest bone in their body. It's Greed, Power, Greed, Power. We even have our Government putting up wals between an American Country, and their oil supply when we improve our oil supply doing business with them. Of course, Mr. Chavez is a socialist, and Republicans do not deal with socialists.
Which begs the question; Why are we doing all that business with China? Republicans and conservatives have always had two sets of rules to match their double standards.

Posted by: Weedly | September 11, 2008 5:32 PM

I think the oil companies call this "gaining access".
Any way I can "gain access" some access too? It sounds like fun

Posted by: Norris Hall | September 11, 2008 5:40 PM

If giant oil producers can afford to consistently provide bribes to government employees as a part of their cost of doing business, then I think that Joe Taxpayer should receive the benefit of these dollars instead. Any bribes and prizes for these government employees should go to reduce the Bush-Cheney- created deficit.

Posted by: aaugh | September 11, 2008 5:43 PM


Posted by: russell | September 11, 2008 5:47 PM

Why is it that when ever a scandal erupts in the government it becomes a partisan game of name calling between the two major parties? With so much hate mongering instead of actual fact finding it is no wonder Congress will go down as one of the most despised inefficient organization in the country. If was a business it would have been long since financially and morally bankrupt. These people are civil service employees and the party is immaterial. File corruption charges against the offenders and let justice take it's course. Keep the politics out of it until there is a proven connection.

Posted by: Dale Parker | September 11, 2008 5:54 PM

Now maybe the government can see what happened to the money the the oil companies such as Mustang Oil in Oklahoma held from Native American descendents that are still having to fight to prove their ancestry. Those that hold land records signed by the Chiefs of the Choctaw & Chickasaw Nations of old before their ethnicity changed. Those that have land records that show land issued by the Department of Interior.

Posted by: Blackwing | September 11, 2008 6:17 PM

I agree with the comments about keeping parties out of it. Name calling gets us nowhere, discussing issues and possible solutions is the way to go. Also, why doesn't the government share these revenues with the states? I am an independent, but I definitely don't agree with that. Anyone know where I can find out more about that particular issue? Thanks.

Posted by: Julia | September 11, 2008 8:58 PM

If you would read more closely and click on the links, you would see that it is a Democratic scandall started by old Billy boy!

Posted by: ed | September 11, 2008 9:37 PM

Cue the tele-prompter:

1. It's Clinton's fault.
2. Who hired these bums? Democrats, that's who. (Never mind the that the republicans have been in control of the oversight for nearly 8 years.)
3. Insert insulting racist variations of Obama here _____.
4. Shout "nanananana I can't hear you" to blot out debate.

Rinse, repeat.

Posted by: GOP blog comment talking points | September 11, 2008 9:46 PM

this isnt a sex is bushes whitehouse selling america out for his oil friends at any expense whatsoever to our enviroment......we all are getting drilled by these immoral, earth-killing are not talking about the life of the precisous earth over and above all humans.....

Posted by: wm musson | September 11, 2008 9:49 PM

Investigate Luthi too and all the Assistant Secretaries all the way up to the Secretary - they are all guilty. Remember Abramoff, Steve Griles, Julie A. MacDonald, Gale Norton, Paul Hoffman, David Smith, Craig Manson, and countless others.

Posted by: DOI employee | September 11, 2008 9:50 PM

We encourage users to analyze, comment on and even challenge's articles, blogs, reviews and multimedia features.

User reviews and comments that include profanity or personal attacks or other inappropriate comments or material will be removed from the site. Additionally, entries that are unsigned or contain "signatures" by someone other than the actual author will be removed. Finally, we will take steps to block users who violate any of our posting standards, terms of use or privacy policies or any other policies governing this site. Please review the full rules governing commentaries and discussions.

Posted by: WashingtonPost | September 11, 2008 9:56 PM

This is why we need regulation.
Why arent the Oil representives and Goverment representives being charged
with criminal activities. I guess it
really doent matter, Bush will just
pardon them anyways.

Posted by: Nobody | September 11, 2008 10:23 PM

The Republican Party's ideology and policies are getting so old they can't even screw America anymore without plenty of lubrication. Keep the party goin'. Welcome McSame and his date.

Enron, Bank failures, oil companies screwing America? All the Republicans want you to talk about is lipstick and condoms.

Posted by: thebob.bob | September 11, 2008 10:55 PM

it was insane to vote for bush. i didn't because i knew he was dumber than a box of rocks. cheney was crooked the day he walked in office. the guy can lie with a straight face and is paranoid the bad guys are gonna get him.

they selected the most incompetent group to run our government...mccain the maverick wasn't any different...he just limited his public exposure...learned that from the S&L scandal.

we had anarchy for 8 years... 8 years of treasury looting and nobody paying taxes... bloated the government with homeland security no-loads and made the DoD acquisition process into another welfare and WPA program.

this will take a long time to clean up..

all his incompetent political appointees rolled over into permanent cushy civil servant jobs... we need to unload all the excess DoD contractor workforce... the BS IT work being done, etc.

Posted by: frank | September 12, 2008 12:04 AM

I like politicians like Larry Craig who was going for free sex at the airport rather than hitting up the oil companies for sex. I suggest the house deal with their own mess first, i.e.Rangel,Jefferson,et al before they clean up the interior department. Seems like the only bi-partisan endeavor in Congress is corruption,

Posted by: marfen | September 12, 2008 12:41 AM

When Rome was dying they had sex orgies. When Hitlers Germany was dying they tried to destroy their country & people. As George Bush's Presidency dies he's trying to punish the common person for their lack of support.

Posted by: SadAmerican | September 12, 2008 2:14 AM

The biggest problem we have is taking responsibility for our own party's failures. Both parties will cry for justice when it is the other party, but they will look away when it is their own party. Truth and Integrity in our country has slipped to an all time low.

We the people have to demand that all members of Congress, the Administration, the Justice Department and government employees, are free from this corruption.

This starts with demanding the truth. Any lie spoken by a member of Congress or the Administration should be grounds for dismissal, period.

Posted by: Geoffrey from NY | September 12, 2008 7:16 AM

There is culture of corruption and blatant
nepotisim and favoritism in MMS offices. Congress or IG should do an independet investigation and do not trust present political appointiees to do the job.

Posted by: DOI Employee | September 12, 2008 8:18 PM

We all know Bush is from oil people before becoming Prez, along with Cheney and Condo Rice. What is the surprise here?

Posted by: Grace Angela | September 13, 2008 2:15 PM

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