Posted on 03/02/2006 11:29:07 AM PST by soccer_maniac
WASHINGTON - How it happened or who's responsible is a mystery eight years after the fact. But what may have been a simple error — or perhaps something more ominous — has given a multimillion-dollar windfall to a group of oil and gas companies and could cost the government billions of dollars more in the years to come.
The Interior Department disclosed Wednesday that a provision was mysteriously deleted from hundreds of federal drilling leases in the late 1990s that would have required producers to pay royalties, once prices reached a certain level, on oil or gas taken from deep waters of the Gulf of Mexico.
(Excerpt) Read more at news.yahoo.com ...
So how much did the Clintons get for dropping that provision?
Clinton Legacy ping... the flow of slime never ends, does it?
You know the really sad thing. My sense of outrage is so crippled by the Democrats that I was just saddened by this. I am no longer outraged.
And I'm sure this story will be the lead in tonight's CBS Evening News.
SENATE INVESTIGATION!! OMG (freaking out)
I'm going to run to the TV and eagerly await CNN running it as breaking news..(sarc/off)
read the article carefully -- the language "was inadvertently dropped" from an addendum attached to more than 1,100 leases :)
There was a huge amount of rearranging of the *law* while Clinton was in office. I've seen it myself in the US Code.
The question is when will the pubs grow a pair and DO something about it?
Bush's fault!!! ....Oh he wasn't in office then.....Never mind.
Whew! I'm glad this happended under Clinton, or Freepers wouldn't care.
AP does not have to be excerpted:
How it happened or who's responsible is a mystery eight years after the fact. But what may have been a simple error — or perhaps something more ominous — has given a multimillion-dollar windfall to a group of oil and gas companies and could cost the government billions of dollars more in the years to come.
The Interior Department disclosed Wednesday that a provision was mysteriously deleted from hundreds of federal drilling leases in the late 1990s that would have required producers to pay royalties, once prices reached a certain level, on oil or gas taken from deep waters of the Gulf of Mexico.
In 1995, Congress exempted deep-water oil from royalty payments to spur development. But a price threshold was included in leases issued in 1996 and 1997 and again in leases sold in each year since 2000 that reinstates the royalties if market prices reach a certain level.
For some reason the language "was inadvertently dropped" from an addendum attached to more than 1,100 leases the Interior Department's Minerals Management Service issued for 1998 and 1999, Walter Cruickshank, the agency's deputy director, told a House Government Reform subcommittee Wednesday.
He said officials have not been able to determine who made the change, although he said it had to have been a human act, not a computer glitch.
"It is clear that there is no record telling people to take the language out," he said, and it was widely known that the department wanted the price threshold restriction in any oil and gas leases as a matter of policy.
In the late 1990s, when oil prices were well below the threshold, the issue may not have attracted attention.
Rep. Darrell Issa (news, bio, voting record), R-Calif., the subcommittee chairman, called the whole matter "suspicious."
"This is a $7 billion word processing error," Issa told reporters. He said some of the leases issued during those two years could remain in effect for as long as 85 years, so the government will be unable to collect royalty payments from oil and gas taken from those leases for decades to come.
While providing no specific number, Cruickshank said the government already has lost "several hundred million" dollars in royalty payments from the 1998-99 leases because they lacked the threshold language. If prices remain high, lost royalties "will be in the billions of dollars," he acknowledged.
The price threshold where royalties must be paid changes yearly. Most recently it was set at about $34 a barrel for oil and $4.34 per thousand cubic feet for natural gas, according to Interior officials. The price of oil Wednesday on the New York Mercantile Exchange was nearly $62 a barrel and the government estimates it will remain in the $50-a-barrel range for years to come. Natural gas prices have been in the $9-per-thousand-cubic-feet range.
Issa said he planned to seek more documents from the Minerals Management Service, and said the issue may need to be investigated by the Justice Department to determine whether there was any deliberate wrongdoing.
When Congress enacted the royalty relief program for deep-water exploration and development, it was embraced by the Clinton administration as a way to spur more energy production in areas where the technology and prospects of success were still somewhat uncertain.
Cruickshank said he had no explanation for why the threshold requirement was taken out of the lease language when an addendum was changed for the 1998-99 leases to reflect other regulatory changes.
"Everyone knew the (price) threshold applied" but people didn't focus on it because of low market prices at the time, said Cruickshank, who joined the agency in 1988 but was not involved in writing leases.
The mystery surrounding the 1998-99 leases is part of a broader question over whether any royalty relief should be given to the industry, given high oil and gas prices and huge industry profits.
The Interior Department estimates that as much as $66 billion worth of oil and natural gas that will be taken from the Gulf of Mexico between now and 2011 falls under the royalty relief law enacted by Congress in 1995. Much of that oil and gas will be subject to royalties under the price threshold provision, which is included in leases other than those issued in 1998-99.
Several oil and gas companies have challenged the legality of the threshold requirement in leases issued before 2001. Kerr McGee, a major natural gas producer, has given notice to the Interior Department that it will soon file a lawsuit arguing that the threshold provisions are illegal.
The Interior Department will "vigorously defend" the ability to impose royalties under a price threshold provision, said Cruickshank. "There's a lot of money at stake."
Bruce Babbitt alert!
U.S. Department of the Interior
Office of the Secretary
For Immediate Release: October 30, 1998
Contact: John Wright 202/208-6416
Sylvia Baca Tapped to Serve as Acting Assistant Secretary
of the Interior for Land and Minerals Management
Sylvia V. Baca has been named Acting Assistant Secretary of the Interior for Land and Minerals Management, it was announced today by Interior Secretary Bruce Babbitt. She succeeds Assistant Secretary Robert (Bob) Armstrong who is retiring from public service effective October 30, 1998.
"Ms. Baca knows the issues extremely well and her experience will be invaluable in solving the energy, minerals and natural resources management challenges before the Department," Babbitt said. "She has demonstrated a deep commitment to the conservation and responsible development of the nation's natural resources."
Baca currently serves as Deputy Assistant Secretary for Land and Minerals Management, the second in charge of a division of the Interior Department that oversees the Minerals Management Service, Bureau of Land Management, and the Office of Surface Mining Reclamation and Enforcement.
Ms. Baca joined the Interior Department in 1995, as Deputy Assistant Secretary for Land and Minerals Management. She served a seven-month stint (January -August 1997) as Interim Director of the Bureau of Land Management, replacing Acting Director Mike Dombeck when he was appointed Director of the U.S. Forest Service. Prior to joining the Clinton Administration in 1995, she served as Director of Finance and Management of the City of Albuquerque, New Mexico, where she was responsible for the fiscal integrity of city assets. Ms. Baca also held several positions in New Mexico State Government, including five years with the Legislative Finance Committee.
A native of New Mexico, Ms. Baca received a Bachelor of University Studies in 1981, and a Master of Public Administration in 1989, from the University of New Mexico.
The Assistant Secretary of the Interior for Land and Minerals Management has administrative and managerial responsibility for the Bureau of Land Management, the Minerals Management Service, and the Office of Surface Mining Reclamation and Enforcement. Management responsibilities for these three bureaus include the management of 270 million acres of onshore public land; operations management for minerals on the 1.4 billion acres of Outer Continental Shelf, to the outer limits of the United States Exclusive Economic Zone; and management of surface mining and reclamation regulatory activities.
The Department of the Interior was a mess during Bruce Babitt's term. A federal judge ordered both Babitt and Treasury Sec. Rubin to find out where the money owed for grazing , mining and whatever was and they ignored him. They were both found in contempt. The lawyers for interior actually told the judge that rodents ate the records. The judge was furious. I am not sure that this mess is just a rehash of the missing money reported during Rubin's tenure.
Most likely it is. The indians were due quite a bit of money. Gail Norton inherited a huge problem. I will bet that the entire mess will be blamed on GW Bush and Dick Cheney.
U.S. Department of the Interior
Office of the Secretary
For Immediate Release: November 27, 2000
Contact: Tom Gorey 202/452-5031
Sylvia Baca Named Acting Director of BLM
Secretary of the Interior Bruce Babbitt today announced that Assistant Secretary of the Interior for Land and Minerals Management, Sylvia V. Baca, will serve in a dual capacity as Assistant Secretary and Acting Director of the Bureau of Land Management. She succeeds Tom Fry, who retired from federal service November 24. The appointment is effective immediately.
"I am delighted that Sylvia Baca has agreed to assume this additional responsibility and serve as both Assistant Secretary and as the BLM's Acting Director," Babbitt said. "She has a deep commitment to the management of America's public lands and the responsible development of the nation's natural resources."
Ms. Baca is no stranger to the BLM Director's position. She served a seven-month stint (January - August 1997) as Interim Director of the agency, replacing Act Director Mike Dombeck when he was appointed Director of the U.S. Forest Service. Ms. Baca currently serves as Assistant Secretary of the Interior for Land and Minerals Management, the agency with oversight responsibility for the Bureau of Land Management, Minerals Management Service, and the Office of Surface Mining, Reclamation and Enforcement.
Ms. Baca has served as Assistant Secretary for Land and Minerals Management since February 29, 2000, when the U.S. Senate confirmed her for that position. Before that, she served as Acting Assistant Secretary since October 1998. Ms. Baca joined the Interior Department in 1995 as Deputy Assistant Secretary for Land and Minerals Management.
Before joining the Clinton Administration in 1995, Baca served as Director of Finance and Management for the City of Albuquerque, where she was responsible for the fiscal integrity of city assets. Ms. Baca also held several positions in the New Mexico State government, including service with the Legislative Finance Committee and as Director of the State's Minority and Small Business program.
A native of Santa Fe, Baca received a Bachelor of University Studies in 1981 and a Master of Public Administration in 1989 from the University of New Mexico.
The BLM, an agency of the U.S. Department of the Interior, manages more land -- 264 million surface acres -- than any other Federal agency. Most of this public land is located in 12 Western States, including Alaska. The Bureau, with a budget of about $1.8 billion and a workforce of some 9,000 full-time, permanent employees, also administers 700 million acres of sub-surface mineral estate throughout the nation. The BLM preserves open space by managing the public lands for multiple uses, including outdoor recreation, livestock grazing, and mining, and by conserving natural, historical, cultural, and other resources found on the public lands.
I guess Clinton found a way to reimburse the oil companies for paying the U.N./Saddamn bribes
There is no issue that was dealt with honorable when the clinton's were involved.
Actually I think just about anything that keeps money out of government hands is a good thing, including this.
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