Editorial: The royalty mess at the Interior Department

"A yearlong investigation has now provided unassailable evidence that the Interior Department abdicated its responsibility to collect royalties from oil and gas companies that drill on public lands, chiefly the Gulf of Mexico. The report increases the pressure on Congress to find a way to recover the money. It also increases the pressure on Dirk Kempthorne, the interior secretary, to accelerate his reforms of the Minerals Management Service, the agency that failed to collect the royalties.

The Interior Department has been hammered by Congress, but the strongest criticism has come from the department’s inspector general, Earl E. Devaney, whose final report was disclosed by Edmund L. Andrews in The Times on Monday. The report attributed the agency’s failure not so much to ineptitude as to lazy management, ethical lapses and a culture of secrecy that hid mistakes.

Top officials at the agency also seemed more concerned about the fortunes of the industry they were supposed to regulate than those of the federal government. In one case turned up by Mr. Devaney, officials decided it would impose a “hardship” on oil companies to demand that they calculate the back interest they owed. Officials were also said to have blocked efforts by four departmental auditors to recover the unpaid royalties."

Get the Story:
Editorial: The Royalty Mess (The New York Times 9/28)

Inspector General Report:
Minerals Management Service: False Claim Allegations (September 2006)

Another Inspector General Report:
Indian Trust Investigative Review (July 2007)

Relevant Links:
Indian Trust: Cobell v. Kempthorne - http://www.indiantrust.com

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