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US government staff ‘had sex and drugs with energy firm employees’

Daily Telegraph

US government staff ‘had sex and drugs with energy firm employees’

Staff of a US government agency that oversees oil drilling on federal land are alleged to have had sex and shared illegal drugs with employees of the energy companies they were policing, according to an official report.

By Tom Leonard in New York 
Department of the Interior's inspector general Earl Devaney

Earl Devaney’s report said nearly one-third of the MMS staff received gifts from energy companies Photo: Bloomberg News

The 19 former and current workers at the Minerals Management Service broke government rules and created a “culture of ethical failure”, accepting a “wide array of gifts and gratuities” including skiing and golf trips from oil and gas companies, according to the US Interior Department’s inspector general.

Earl Devaney said the staff, some of whom are accused of rigging contracts and working part-time as private oil consultants, did not even show any remorse when confronted with their activities.

The oil companies named in his report to Congress included a US arm of Royal Dutch Shell. The company said it would be premature to comment on the report until it could review its content.

The alleged “culture of substance abuse and promiscuity” was discovered at the Denver and Washington offices of the MMS, which last year collected more than $11 billion in royalties from oil and gas companies.

The staff concerned were involved between 2002 and 2006 in a programme that collects and sells oil and gas passed on by the energy companies as a royalty-in-kind.

Some allegedly drank so much at oil industry functions that, rather than drive, they were put up for the night by the energy companies.

Workers also used cocaine and marijuana with industry contacts, as well as having sex with them even though “sexual relationships with prohibited sources cannot, by definition, be arms-length”, said Mr Devaney.

He said one supervisor engaged in illegal drug use and had sex with subordinates. Several staff admitted to illegal drug use and “illicit sexual encounters”, he added.

Mr Devaney said many of the employees did not believe federal government ethics standards and department policies applied to them because of their “unique” role.

“Employees said they felt that in order to effectively perform their official duties, they needed to interact in social settings with industry representatives to obtain “market intelligence,” he said.

The report coincided with Congress considering legislation to expand offshore oil drilling, a priority of the Bush administration which is being fought by environmental campaigners.

“It just underlies the fact that we shouldn’t be putting the future of our coasts and beaches in the hands of people who obviously care nothing about the public,” said Anna Aurilio, Washington office director for Environment America.

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