Archive for December, 2006

HAPPY NEW YEAR 2007!!!!!!

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U.S. Official Overseeing Oil Program Faces Inquiry

WASHINGTON, Dec. 29 — The Justice Department is investigating whether the director of a multibillion-dollar oil-trading program at the Interior Department has been paid as a consultant for oil companies hoping for contracts.

The director of the program and three subordinates, all based in Denver, have been transferred to different jobs and have been ordered to cease all contacts with the oil industry until the investigation is completed some time next spring, according to officials involved.

The officials, who spoke on condition of anonymity because the investigation had not been announced publicly, said investigators were worried that senior government officials had been steering huge oil-trading contracts to favored companies.

Any such favoritism would probably reduce the money that the federal government receives on nearly $4 billion worth of oil and gas, because it would reduce competition among companies that compete to sell the fuel on behalf of the government.

If the allegations prove correct, they would constitute a major new blot on the Interior Department’s much-criticized effort to properly collect royalties on vast amounts of oil and gas produced on land or in coastal waters.

The Interior Department’s Minerals Management Service, which oversees royalty collections, is now the target of multiple investigations by Congress and the Interior Department’s inspector general.

Those investigations are focused on allegations that the agency ordered its own auditors to abandon claims of cheating by large oil companies; that the agency’s arcane rules for calculating sales value and royalties make it easier for companies to understate their obligations; and that the agency’s basic sources of data are riddled with inaccuracies and are unreliable.

Interior officials have promoted “royalties in kind” as a much simpler and more efficient way for the government to get its proper share, because it eliminates much of the arcane accounting and reduces the opportunities for sleight-of-hand bookkeeping.

About a quarter of all oil and gas produced in the United States comes from federal property, and the Interior Department collected about $10 billion in royalties last year on about $60 billion in oil and gas.

At issue is the “royalty in kind” program, a fast-growing program under which companies pay their royalties in the form oil or gas rather than in the traditional form of cash.

For the 12 months ending last April, the government collected about $3.7 billion in oil and gas. Until recently, most of the oil simply went to the government’s Strategic Petroleum Reserve. But the strategic reserve was essentially filled this year, so the Interior Department hires private companies to resell the fuel on the open market.

To ensure that it gets the best price, the Interior Department takes bids for contracts in which companies typically offer to pay a specific premium over the daily spot-market prices quoted on the Nymex commodity exchange. The companies offering the biggest premium over the spot market get the contracts.
People familiar with the investigation said it had begun several months ago, but had picked up speed in the last few weeks.

The most prominent figure in the inquiry is Gregory W. Smith, who was director of the royalty-in-kind program at the Minerals Management Service in Denver. Mr. Smith oversaw the entire program, which now covers 75 percent of royalties for all oil and 30 percent of royalties for all natural gas produced in the Gulf of Mexico.

One person familiar with the investigation said it originally had focused on potentially improper social ties between some of Mr. Smith’s subordinates and executives at companies vying for contracts. The subordinates include two women, including one who is said to be in charge of oil marketing, and a second man.

All four people were transferred out of the royalty-in-kind office several weeks ago. Mr. Smith was reassigned as a “special assistant” to Lucy Querques Dennett, associate director of the Mineral Management Service in Washington. He was given strict orders to avoid any contact with industry executives, according to one official.

One official said investigators were now looking at possible consulting arrangements between the Denver officials and oil companies. The official said the most recent information had, if anything, hardened the suspicions of investigators, and said the potential ramifications could turn out to be far-reaching.

Mr. Smith did not return calls to his office in Denver. Spokesmen for the Interior Department in Washington as well as in the inspector general’s office, which began the investigation before referring the matter to the Justice Department, refused to comment on the matter.


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Democrats vow to restore political integrity

WASHINGTON (AP) — A California Democrat newly elected to Congress promised Saturday that his party will restore integrity and civility to the House when it assumes control in January.

“In this election, the American people clearly called for change,” Rep.-elect Jerry McNerney said in the Democrats’ weekly radio address. “As our first responsibility in fulfilling the mandate of this critical election, House Democrats will restore integrity and civility in Washington in order to earn the public trust.”

The effort to build that trust will include bans on gifts from lobbyists, lobbyist-funded travel and use of corporate jets, McNerney said.

The incoming congressman also promised “a new direction in Iraq” and said Democrats would resist any plan to deploy more U.S. troops there. “The Iraqis need to understand that the responsibility for the future of that country is theirs,” he said.

McNerney also said Democrats would work to reduce U.S. dependence on foreign oil “while creating jobs, prosperity and a healthy environment with a new energy technology, including renewable energy and biofuels.”

Before running for office, McNerney worked as a wind-energy engineer and consultant. In November, he defeated incumbent Republican Richard Pombo, whose efforts to rewrite the endangered species law and open public lands to energy drilling were frequently criticized by environmentalists when he chaired the House Resources Committee.


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Saddam Hussein put to death

Refusing to have his face covered and uttering curses upon his perceived foes, condemned Iraqi ex-dictator Saddam Hussein was executed by hanging early Saturday morning in a Baghdad square outside the Green Zone.

The Associated Press reports that Hussein’s half-brother, Ibrahim Barzan al-Tikriti, and the former Revolutionary Court chief justice, Awad Hamed al-Bandar, were also to be hanged, though the exact times for each was unclear.

The deposed strongman’s execution, just before 6 AM Baghdad time, came as the Muslim feast of Eid ul-Adha began.

CNN reported “celebratory gunfire” in the Iraqi capital and showed footage of Iraqis in Dearborn, Michigan cheering the demise of the 69-year-old Hussein, who was put to death for the 1982 massacre of 182 Iraqi Shi’ites. There was also a report that Iraqis at Hussein’s execution site “were dancing around his body.”

Small protests were held by supporters of the former Iraq leader in his hometown of Tikrit, according to Deutsche Presse Agentur.

The White House released a written statement by President Bush in which he said that the death of Hussein “comes at the end of a difficult year for the Iraqi people and for our troops.” He acknowledged that “bringing Saddam Hussein to justice will not end the violence in Iraq, but it is an important milestone on Iraq’s course to becoming a democracy…”

Reuters reported that the President, vacationing in Crawford, Texas, was asleep at the time of Hussein’s execution and was not awakened. He had been informed by his staff earlier in the evening that “the execution would take place in a few hours.”

Buildup to dictator’s demise

Earlier, the Associated Press reported that U.S. authorities were “maintaining physical custody of Saddam to prevent him from being humiliated before his execution,” and will “try to prevent the mutilation of his corpse.”

Iraq’s national security adviser told CNN’s Anderson Cooper that Hussein’s body would be prepared according to traditional Muslim rituals, and, despite an expressed desire by his daughter to have him laid to rest in Yemen, could “absolutely” be buried in Iraq if his family requests it, saying “we can agree on the whereabouts.”

McClatchy Newspapers said that Hussein was in a “state of shock” and had “come apart” after realizing “he couldn’t escape this,” according to an Iraqi parliament member present at Friday meetings concerning Hussein’s execution. Later, United Press International quoted an Iraqi official who witnessed the execution as saying the deposed dictator was “quiet and obedient” as the noose was placed around his neck. “We were astonished,” the official said. “It was strange. He just gave up.”

Rumors had flown into the night about the timing of Hussein’s hanging, with news agencies reporting conflicting details.

Late Friday evening, the Associated Press reported that the Iraqi government had prepared all necessary documents for the hanging to commence, “including a ‘red card’ – an execution order introduced during Saddam’s dictatorship.”

Iraqis gathered in throngs during the early morning leadup to the execution, reports said. Reuters reported that some in the Kurd region of Iraq awaited Hussein’s death with “grim satisfaction.”

Some U.S. embassies around the world warned American travelers of potential “problems” they might encounter due to Hussein’s hanging. The Pentagon stated that U.S. troops were prepared to deal with any increase in violence that could follow the execution.


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Earlier reports from various news organs that deposed Iraqi leader Saddam Hussein has been transferred from US custody to Iraqi control have now been cast into doubt, according to reports from Agence France Presse and Reuters.

Speculation continued on the timing of the execution, with some sources reporting that Iraq’s Prime Minister was seeking a judgment from Shi’ite clerics on when the hanging could go forward.

A breaking report at Reuters said that the deposed Iraqi dictator remained in US custody in Baghdad. Agence France Press also reported that the State Department had announced there was “no change in [Hussein’s] status.” The news followed up on reports from a variety of sources that Hussein had left US custody and been handed over to Iraqi control. The move would be a prelude to Saddam’s hanging by Iraqi authorities.

The most recent report from Reuters has suggested that Saddam’s execution may depend on a judgment by Shi’ite clerics. Tomorrow marks the beginning of the Muslim holiday of Eid Al-Adha, a week-long celebration of the beginning of the Hajj in Mecca, which may require delay of the execution. A Shi’ite politican said that Iraq’s Prime Minister Nuri al-Maliki “had asked Shi’ite religious leaders and clerics from Saddam’s Sunni Arab minority whether Saddam could be executed immediately. He told Reuters they may approve a hanging before noon (0900 GMT), when the festival formally begins, or say it should be delayed.”

Saddam Hussein is drawn from the country’s Sunni Arab minority, and there has been much speculation that this segment of Iraq’s population will be greatly angered by the execution of the country’s former dictator.

A senior Bush administration official said earlier that “Hussein’s execution by hanging isn’t expected to happen in the next 24 hours, though it may take place in the days that follow, the official told reporters yesterday,” according to Bloomberg News. Agence France Presse also quoted the official as speculating that it might take another day for an execution order to be carried out.

Meanwhile, according to AFP, an anonymous lawyer for Saddam was now claiming Hussein will be executed on Saturday at dawn.


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Five years after the Sept. 11 attacks, Osama bin Laden is still at large — but that’s not a failure of White House policy, says Frances Fragos Townsend.

As she explained to CNN’s White House correspondent Ed Henry last night:

HENRY: You know, going back to September 2001, the president said, dead or alive, we’re going to get him. Still don’t have him. I know you are saying there’s successes on the war on terror, and there have been. That’s a failure.

TOWNSEND: Well, I’m not sure — it’s a success that hasn’t occurred yet. I don’t know that I view that as a failure.


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Many soldiers say troop surge a bad idea

BAGHDAD, Iraq – Many of the American soldiers trying to quell sectarian killings in Baghdad don’t appear to be looking for reinforcements. They say the temporary surge in troop levels some people are calling for is a bad idea.

President Bush is considering increasing the number of troops in Iraq and embedding more U.S. advisers in Iraqi units. White House advisers have indicated Bush will announce his new plan for the war before his State of the Union address Jan. 23.

In dozens of interviews with soldiers of the Army’s 5th Battalion, 20th Infantry Regiment as they patrolled the streets of eastern Baghdad, many said the Iraqi capital is embroiled in civil warfare between majority Shiite Muslims and Sunni Arabs that no number of American troops can stop.

Others insisted current troop levels are sufficient and said any increase in U.S. presence should focus on training Iraqi forces, not combat.

But their more troubling worry was that dispatching a new wave of soldiers would result in more U.S. casualties, and some questioned whether an increasingly muddled American mission in Baghdad is worth putting more lives on the line.

Spc. Don Roberts, who was stationed in Baghdad in 2004, said the situation had gotten worse because of increasing violence between Shiites and Sunnis.

“I don’t know what could help at this point,” said Roberts, 22, of Paonia, Colo. “What would more guys do? We can’t pick sides. It’s almost like we have to watch them kill each other, then ask questions.”

Based in Fort Lewis, Wash., the battalion is part of the 3rd Stryker Brigade Combat Team of the 2nd Infantry Division. Deployed in June, its men were moved to Baghdad from Mosul in late November to relieve another Stryker battalion that had reached the end of its tour.

“Nothing’s going to help. It’s a religious war, and we’re caught in the middle of it,” said Sgt. Josh Keim, a native of Canton, Ohio, who is on his second tour in Iraq. “It’s hard to be somewhere where there’s no mission and we just drive around.”

Capt. Matt James, commander of the battalion’s Company B, was careful in how he described the unit’s impact since arriving in Baghdad.
“The idea in calling us in was to make things better here, but it’s very complicated and complex,” he said.
But James said more troops in combat would likely not have the desired effect.
“The more guys we have training the Iraqi army the better,” he said. “I would like to see a surge there.”

During a recent interview, Lt. Gen. Nasier Abadi, deputy chief of staff for the Iraqi army, said that instead of sending more U.S. soldiers, Washington should focus on furnishing his men with better equipment.
“We are hoping 2007 will be the year of supplies,” he said.

Some in the 5th Battalion don’t think training will ever get the Iraqi forces up to American standards.

“They’re never going to be as effective as us,” said 1st Lt. Sean McCaffrey, 24, of Shelton, Conn. “They don’t have enough training or equipment or expertise.”
McCaffrey does support a temporary surge in troop numbers, however, arguing that flooding Baghdad with more soldiers could “crush enemy forces all over the city instead of just pushing them from one area to another.”

Pfc. Richard Grieco said it’s hard to see how daily missions in Baghdad make a difference.
“If there’s a plan to sweep through Baghdad and clear it, (more troops) could make a difference,” said the 19-year-old from Slidell, La. “But if we just dump troops in here like we’ve been doing, it’s just going to make for more targets.”

Sgt. James Simons, 24, of Tacoma, Wash., said Baghdad is so dangerous that U.S. forces spend much of their time in combat instead of training Iraqis.
“Baghdad is still like it was at the start of the war. We still have to knock out insurgents because things are too dangerous for us to train the Iraqis,” he said.

Staff Sgt. Anthony Handly disagreed, saying Baghdad has made improvements many Americans aren’t aware of.
“People think everything is so bad and so violent, but it’s really not,” said Handly, 30, of Bellingham, Wash. “A lot of people are getting jobs they didn’t have before and they’re doing it on their own. We just provide a stabilizing effect.”

Staff Sgt. Lee Knapp, 28, of Mobile, Ala., also supported a temporary troop surge, saying it could keep morale up by reducing the need to extend units past the Army’s standard tour of one year in Iraq.
“It could help alleviate some stress on the smaller units,” he said. “It could help Baghdad, but things are already getting better.”

Sgt. Justin Thompson, a San Antonio native, said he signed up for delayed enlistment before the Sept. 11 terror attacks, then was forced to go to a war he didn’t agree with.
A troop surge is “not going to stop the hatred between Shia and Sunni,” said Thompson, who is especially bitter because his 4-year contract was involuntarily extended in June. “This is a civil war, and we’re just making things worse. We’re losing. I’m not afraid to say it.”


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