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Dick Cheney’s Wyoming’s Face at MMS

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Since we’ve been discussing the way that BP has adopted Dick Cheney’s face for its Deepwater Horizon disaster, I thought I’d link to this article, noting how close the Mineral Management Service and Cheney’s state of Wyoming are. (h/t POGO)

The federal agency cited for an overly “cozy relationship” with the energy industry, which may have contributed to the Deepwater Horizon drilling disaster, has enjoyed extensive Wyoming political and economic connections since its creation in 1982 by then-Secretary of Interior James G. Watt, a native of Lusk in eastern Wyoming.

[snip]

The Wyoming connection was especially evident from 2000 to 2008, during the two administrations of President George W. Bush and his vice president, Wyoming native Dick Cheney. A former chief executive of Halliburton, Cheney took an early and very active interest in energy policy and placed several Wyoming political friends in key positions in the Department of Interior.

Before he took office, for example, Cheney selected David J. Gribbin III, a high school and college friend from Wyoming, to be his transitional liaison with Congress. Gribbin previously worked for Cheney as Halliburton’s chief lobbyist in the capital.

Cheney then chose Thomas Sansonetti, a prominent Cheyenne lawyer and GOP activist, to head the team choosing top personnel for the Department of Interior, which oversees Minerals Management Service.

Sansonetti, a member of the conservative Federalist Society, picked Gayle Norton to head Interior. Although not from Wyoming, native Coloradan Norton was a longtime protégée of James Watt in the Mountain States Legal Foundation, of which Watt was the founding director. Like Sansonetti, Norton was a member of the Federalist Society.

Norton, in turn, named former Sheridan, Wyoming, lawyer Rebecca W. Watson as assistant Interior Secretary for Land and Minerals Management. Watson was responsible for the Bureau of Land Management, the Office of Surface Mining and the Minerals Management Service.

[snip]

Most importantly, from 2002 to 2008, the Minerals Management Service was directed  by two former Wyoming GOP legislators, Rejane “Johnnie” Burton of Casper  and Randall Luthi, of  Freedom.

Burton, who had managed the Wyoming Department of Revenue under former Gov. Jim Geringer, in 2007 resigned under fire from her $168,000-a-year Minerals Management director’s job after the Department of Interior Inspector General found widespread corruption in the agency’s Colorado-based royalty collection office, and questions were raised in Congress about Burton’s handling of offshore leases.

[snip]

Burton now works as a $49,000-a-year aide for longtime friend and former legislative colleague Wyoming U.S. Rep. Cynthia Lummis.

There’s lots, lots more at the link.

Lummis, Wyoming’s only Congressperson, is one of the many BP apologists on the Natural Resources Committee. But I guess it must be easy to be such an apologist, given that you’ve got former top Administration staffers working for you for less than a third of what they used to get in DC.

All of which suggests that one of the reasons the regulatory agency overseeing drilling on public lands is so lax is that it is captive to a bunch of Wyoming hacks who use the revenue from drilling in lieu of income taxes. You see, we’ve just sacrificed the Gulf’s ecosystem because a bunch of folks from Wyoming want to pretend that drilling creates free money.

Cheney photo Copyright World Economic Forum (www.weforum.org) swiss-image.ch/Photo by Jean-Bernard Sieber

Breaking! Obama Cabinet Official Looks Backward!

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Doug Lamborn (R-CO Whiner) complained to Ken Salazar that there had been too much focus on the sex and drug scandal of MMS under the Bush Administration.  Salazar let him have it.

Lamborn: We all want to get to the bottom of this tragedy. And I think we all agree that finger-pointing will not get us there. I don’t understand–I have to be real honest here–why you and others keep harping on what MMS did or didn’t do in the previous Administration, when you did know about these problems when you came into office and you have been in charge of them for more than a year now. Why aren’t we talking about the here and now?

Salazar: Well we are talking, Congressman Lamborn, about the here and now, and that’s why people have been terminated, people have been referred over to prosecution, and we’ve done a lot to clean house at MMS. Unlike the prior Administration, this is not the candy store of the oil and gas kingdom which you and others were a part of. And so we have moved forward in a manner that is thoughtful, that is responsible, that holds those accountable. And those who violate the law, Congressman Lamborn, will be terminated and whatever other sanctions of law are appropriate, those sanctions of law will be applied.

On February 4, 2009, after Salazar halted some of Bush’s drilling efforts and asked DOJ to reconsider for prosecution some of those involved in the worst MMS scandals, I mused with some surprise that Ken Salazar was at that point the high point of the Obama Administration for me.b

And for his strengths and weaknesses since then, I gotta say that Salazar is still the only one who looked backward in timely manner and because of that could say, this clearly, that he had put the corruption of the Bush Administration behind him.

How Much Does BP Pay Us for Privilege of Soiling Our Shores?

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The Mineral Management Service claims that revenues from oil production once became the country’s second largest source of revenue after income tax.

As the industry continued to evolve through the 1950s, oil production became the second-largest revenue generator for the country, after income taxes.

That’s a historical claim, though the American Petroleum Institute still pitches a version of it: “one of the federal government’s largest sources of non-tax income.” But it got me thinking about how much we’re actually getting from the oil companies, like BP, in exchange for them soiling our shores.

Last year, the Minerals Revenue Management department of the Mineral Management Service reported $9.9 billion in royalties from all mineral exploitation. Of that, MRM collected $5.8 billion for all federal offshore drilling of oil and gas.

$5.8 billion for exposing an ecosystem like the Gulf to the risk of the catastrophe that is now playing out. BP will pay more in liability or cleanup than that.

Of the $5.8 billion MMS brought in from offshore oil and gas drilling, $3.1 billion appears to come from oil, which is our share of the $23.5 billion in revenues for 425,199,067 BBL of oil drilled off shore.

Do the math. If I’m doing my math correctly, that means we’re getting less than $7.60/BBL for royalties the oil. That’s not all the money we get, mind you. There’s the actual bonus bid for the drilling rights and rent up until oil starts flowing; BP paid $34 million to the rights to this particular site. And starting in 2008, royalty percentages for Gulf leases were raised to 18.75%, but a lot of those leases aren’t producing yet. But using the $7.60 we’ve been getting for oil, taking the highest estimates for the rate of spill–70,000 BBL/day–and assuming it will spill for a total of 90 days, taxpayers would get less than $48 million in oil revenues for all that oil, enough to ruin the Gulf ecosystem for a generation, not to mention the serious damage to the fishing and tourist industries. While not all of the fishing and tourist industries will be destroyed, in 2008 all Gulf states brought in over $1 billion in fish, shrimp, and oysters, and $20 billion in tourism.

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