Interior sex-for-oil scandal: Please no jokes about Drill, Baby, Drill or Bush Energy Policy!

Just when you think the two oil-men in the White House can’t top themselves for corruption metaphors:

Government officials handling billions of dollars in oil royalties engaged in illicit sex with employees of energy companies they were dealing with and received numerous gifts from them, federal investigators said Wednesday.

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The alleged transgressions involve 13 Interior Department employees in Denver and Washington. Their alleged improprieties include rigging contracts, working part-time as private oil consultants, and having sexual relationships with — and accepting golf and ski trips and dinners from — oil company employees, according to three reports released Wednesday by the Interior Department’s inspector general [Earl Devaney].

And the winner of the best line ever to appear in an Interior Department Inspector General (IG) report:

“These same … marketers also engaged in brief sexual relations with industry contacts,” Devaney wrote. “Sexual relationships with prohibited sources cannot, by definition, be arms-length.”

Guess, the IG never had sex with my ex-wife. Rimshot [technically, a sting].

[It’s just a joke, people.]

But wait, there’s more:

The investigations reveal a “culture of substance abuse and promiscuity” by a small group of individuals “wholly lacking in acceptance of or adherence to government ethical standards,” wrote Inspector General Earl E. Devaney.

The reports describe a fraternity house atmosphere inside the Denver Minerals Management Service office responsible for marketing the oil and gas that energy companies barter to the government instead of making cash royalty payments for drilling on federal lands. The government received $4.3 billion in such Royalty-in-Kind payments last year. The oil is then resold to energy companies or put in the nation’s emergency stockpile.

Between 2002 and 2006, nearly a third of the 55-person staff in the Denver office received gifts and gratuities from oil and gas companies, the investigators found.

Devaney said the former head of the Denver Royalty-in-Kind office, Gregory W. Smith, used illegal drugs and had sex with subordinates. The report said Smith also steered government contracts to a consulting business that was employing him part-time.

When reached for comment, President Bush said, “Heck of a job, Smithie!”

UPDATE #1: From Think Progress: “Official increased employee’s ‘performance award’ for providing him with cocaine.

UPDATE #2: Also from TP: “Oil reps and government employees joked about bubble baths, bringing ‘the meat to the table.’