Sex Drugs and Oil

[Joanne98]

Chances are you've heard about the bacchanal known as the Minerals Management Service. The arm of the Interior Department charged with collecting some $10 billion a year in royalties from oil and gas companies, it has been caught up in scandal after scandal, including this week's revelations that top employees were in bed (and not just figuratively) with the oil officials they were supposed to regulate. In between glacially slow-to-arrive FOIA requests, I've been looking into MMS and its weird party culture off and on for more than a year. Here's a few juicy details that you won't read in the Inspector General's report.

The IG tells us about two MMS oil marketers, Stacy Leyshon and Crystel Edler, who became known among oil executives as the "MMS Chicks." Between 2002 and 2006, each received more than $2,700 in gifts on more than 60 occasions from oil companies, including meals, booze, lodging, and golf outings. Leyshon, who slept with two oil company employees, operated a sex toys side business known as "Passion Parties" (think Tupperware parties, but with dildos) and bragged that it paid more than her day job at MMS. She told the IG that nobody in the oil industry had purchased sex products from her (though three subordinates at MMS had). However, that account is contradicted by former MMS Deputy Junius Walker, a high-ranking employee who worked in Leyshon's Denver office before retiring. "She's selling that stuff to oil and gas companies," he told me last year. "I mean, that's what she was doing. She was going around, going down to the oil and gas companies, putting on presentations. . .They were having a really, really good time."

The highest ranking official criticized in the IG reports was Lucy Querques Denett, the former associate director of the minerals revenue management department, who retired earlier this year. The reports found that Denett worked with two employees to steer a lucrative consulting contract to one of them after he retired, violating competitive procurement rules. The other employee later retired to work on the same contract.

Denett's eagerness to look out for her aides went further than this, several sources told me. Oil royalty auditor Bobby Maxwell, who gained national attention in 2006 for his $50 million False Claims Act case against the department and oil company Kerr-McGee, told me he had wanted to audit contracts signed between oil companies and the department's problem-plagued Royalty In Kind division, which collects $4 billion a year in oil and gas instead of cash royalties. But in 2002 the RIK department refused to hand over the contracts, Maxwell says, and Denett told him, "Leave it alone." He says she never explained why RIK couldn't be audited.

http://www.motherjones.com/mojoblog/archives/2008/09/9686_exclusive_more.html

[ladjf]

1. "Hookers for Oil". How Republicanistic!