The Checks and Balances Project

Welcome to Frackademia 101

May 21, 2013 by Checks And Balances Project Leave a comment

This month, the Western Congressional Caucus held their first “class” for their sham oil and gas PR effort dubbed the ‘Western Caucus University.’ The amount of oil and gas contributions to caucus members is stunning. No wonder this “Frackademia” appears to have curriculum based on industry talking points.

Below were some of the lowlights and our grades for their content.

This is the first in a series of report cards we’ll be doing on “Frackademia.” It’s a shame taxpayer dollars are being used to push blatant industry talking points.

Western Caucus University Academic Credibility Report Card
WCU Claim	Accuracy Grade	Fact
“Federal lands contain 46% of the proved crude reserves in the United States.”	F	Currently, 93% of all shale oil and mixed plays – which are the most viable and actively sought resources by industry – are located on non-federal lands. Even in the Rocky Mountain West, where more federal land is located, there are just 11% of all shale oil and mixed oil and gas plays on federal lands.
“The amount of time it takes to process a permit to drill on federal lands increased from 212 days to 228 days between 2008-2012.”	D	What the Western Congressional Caucus fails to mention is that oil and gas companies are the hold up on drill permits. According to a recent Congressional Research Service report, it took industry an average of 236 days to process an application to drill permit on federal lands, while it took the Bureau of Land Management just 71 days.
“Local governments in the West miss out on substantial tax revenues from potential energy extraction, mining, timber harvesting and other forms of economic development.”	F	A recent economic study found that western non-metropolitan counties with more than 30 percent of their land in federal protected status such as national parks, monuments and wilderness increased jobs by 345 percent over the last 40 years. By comparison, similar counties with no protected federal public lands increased employment by only 83 percent. In 2010, per capita income in western non-metropolitan counties with 100,000 acres of protected public lands was on average $4,360 higher than per-capita income in similar counties with no protected public lands.In 2012, the outdoor recreation industry alone accounted for $646 billion in annual spending and nearly $80 billion in local, state and federal tax revenues in the United States

Filed under Blog Tagged with frackademia, Oil and Gas, Western Congressional Caucus

Gov. Hickenlooper’s ‘order’ to oil and gas commission to review fines an empty gesture

May 10, 2013 by Checks And Balances Project Leave a comment

Recently, Gov. Hickenlooper put on a masterful show of playing a politician who cares about Coloradans. Unfortunately, it was just an act to distract from the fact that Gov. Hickenlooper successfully killed efforts to set mandatory minimum fines and increase caps on fines for oil and gas companies that pollute.

After killing these measures, aimed at holding polluters accountable, Gov. Hickenlooper put out a press release ordering his oil and gas commission to ‘review enforcement, fines.’ In other words, he directed his commission to take a look into their abysmal record and get back to him. That’s not leadership, it was an empty gesture to cover his tracks.

Gov. Hickenlooper’s press release doesn’t do anything to strengthen Colorado’s woefully outdated laws, which include the lowest fines in the nation for polluters. And it’s doubtful that the governor’s oil and gas commission, which includes oil and gas industry employees, will suddenly become competent at holding oil and gas polluters accountable. An analysis by the Denver Post found that Colorado rarely fines oil and gas companies who pollute. According to the Coloradoan, less than 7 percent of industry violations since 1996 have resulted in fines.

Site of Parachute spill
Source: ecoflight

Last year, the industry reported 402 spills, of which 20 percent contaminated water. Six companies alone accounted for 85 percent of all the spills that contaminated groundwater – Anadarko, Noble Energy, Encana, PDC Energy, WPX Energy and Pioneer Natural Resources.

Not only are polluters not held accountable, but Gov. Hickenlooper has routinely rewarded some of the biggest oil and gas polluters in the state. In 2010 and 2011, Noble Energy caused more spills than any other operator in Colorado – 126. Yet, Hickenlooper’s oil and gas commission gave Noble an ‘Outstanding Operator’ award.

Gov. Hickenlooper also gave Anadarko an ‘Outstanding Operator’ award in 2011, while last year, Anadarko subsidy Kerr-McGee was linked to 70 spills – more than any other operator – of which, 38 percent resulted in water contamination. With these awards, Gov. Hickenlooper has once again made it clear that he isn’t that interested in holding oil and gas companies accountable when they pollute.

Gov. Hickenlooper used the power of his office to kill stronger standards that would have held the oil and gas industry accountable when they pollute. He chose to put the interests of the industry ahead of what’s best for Colorado families and that’s a shame. Now, Gov. Hickenlooper is insulting Coloradans by acting as the concerned politician.

Filed under Colorado, Fracking Tagged with Energy, Governor Hickenlooper, Oil and Gas

ALEC’s Most Wanted: Exposing a front group for fossil fuel interests (and other corporations)

May 10, 2013 by gabrielelsner 1 Comment

The Center for Media and Democracy’s (CMD) Brendan Fischer and Nick Surgey uncovered an internal document from the American Legislative Exchange Council (ALEC) at the controversial organization’s meeting last week in Oklahoma City. The document entitled “OKC anti-ALEC photos” featured the headshots of eight reporters and public interest advocates that have written about ALEC or been critical of ALEC’s activities (as a front group working on behalf of its corporate membership).

CMD’s Surgey attempted to attend the keynote address by Oklahoma Governor Mary Fallin, which was billed as open to the press. After registering for press credentials at the ALEC registration desk, Mr. Surgey ascended the escalator towards the keynote speech, but was confronted by ALEC staff members and then approached by a uniformed Oklahoma City police officer.

Mr. Fischer and Surgey recount the exchange in which Surgey had his credentials revoked and was ejected from the ALEC meeting. From PR Watch:

“I need those credentials,” the officer said.

“I registered,” Surgey replied.

“No, you didn’t,” said a female ALEC staffer, who was accompanying the officer.

“I did, downstairs,” he said.

“It was… you shouldn’t have been able to.”

The reason Surgey shouldn’t have been allowed to register, according to the ALEC staffer: “Because we know who you are.

Surgey asked the ALEC staffer for her name as she asserted that he had to leave:

Can I ask your name?” Surgey asked the ALEC staffer who challenged his press credentials.

“Erm, why?” she replied.

“Is there any reason you wouldn’t want to tell me your name?”

“Yeah, because I know who you are,” she said.

The staffer — whose organization had developed talking points claiming to support the First Amendment, which protects a free and vibrant press — added: “Because you’re going to write an article about it.”

Less than 10 minutes after registering as press, Surgey had his credentials revoked and was ejected from the ALEC meeting by a police officer. As he was escorted away, the ALEC staffer repeated: “We know exactly who you are.”

As Director of the Checks & Balances Project, I was one of the eight people featured on the “ALEC Most Wanted” document alongside other reporters and public interest advocates who have criticized ALEC’s efforts to influence state legislators on behalf of special interests. Fischer and Surgey write:

The page featured pictures and names of eight people, four of whom work with CMD, including Surgey, CMD’s general counsel Brendan Fischer and its Executive Director Lisa Graves, as well as CMD contributor Beau Hodai.

It is not known whether the photo array of people who have reported on or criticized ALEC was distributed to ALEC members or shared with Oklahoma City law enforcement.

Other targets on the document included The Nation‘s Lee Fang, who has written articles critical of ALEC, and Sabrina Stevens, an education activist who spoke out in an ALEC task force meeting last November. Also featured were Calvin Sloan of People for the American Way and Gabe Elsner of Checks and Balances Project, both of whom are ALEC detractors.

The name of ALEC Events Director Sarah McManamon was in the top corner, indicating the document was printed from her Google account.

As Fischer and Surgey point out, ALEC claims to support the freedom of the press. But in practice, the organization seems reluctant to provide transparency and access required for a free press to be functional. Instead, “ALEC assembled a dossier of disfavored reporters and activists,” and “kicked reporters out of its conference who might write unfavorable stories…”

ALEC’s sensitivity to transparency shows that the accountability work by C&BP, CMD, People for the American Way and others is working. A free society can’t work unless there is some check on the concentration of power. Now, more than ever, society needs more of the most powerful check on concentrations of power – public scrutiny. Most recently, C&BP has worked to expose ALEC’s efforts to eliminate clean energy laws in states across the country and bring to light that these attacks are being driven by powerful special interests.

ALEC exemplifies how fossil fuel corporations and other special interests have an oversized influence in our public process. And, C&BP is proud to be part of the effort to expose ALEC, fossil fuel-funded front groups and other fossil fuel interests using their power and resources to attack clean energy policies — even if it lands us on ALEC’s Most Wanted list.

Filed under ALEC Tagged with 1st Amendment, ALEC, ALEC Most Wanted, American Electric Power, American Legislative Exchange Council, Beau Hodai, Big Gas, Big Oil, BP, Brendan Fischer, Calvin Sloan, Center for Media and Democracy, Checks and Balances Project, Chevron, CMD, Duke Energy, Energy, ExxonMobil, Fracking, Freedom of the Press, Front Group, gas, Industry, Koch Brothers, Koch Industries, Lee Fang, Lisa Graves, Most Wanted, natural gas, Nick Surgey, Oklahoma City, People for the American Way, politics, Progress Energy, Sabrina Stevens, Sarah McManamon, Shell, State Legislators, State Legislatures, The Nation

Group’s new oil shale report contains wildly inaccurate claims

May 9, 2013 by Checks And Balances Project Leave a comment

The Institute for Energy Research (IER), recently posted a blog about oil shale that doesn’t have its facts straight.

The IER blog falsely claims that the federal government put oil shale resources ‘under lock and key’. Oil shale companies have been awarded billions in taxpayer-funded subsidies and received research, development, and demonstration (RD&D) leases on publicly owned lands that don’t require the payment of bonuses, rents, or royalties.

Despite more than a century of failed oil shale projects and billions of dollars risked, taxpayers are still subsidizing oil shale research and development. Currently, there are seven such RD&D leases being pursued in Colorado and Utah. The companies include: Shell, American Shale Oil (AMSO), Enefit, ExxonMobil, and Natural Soda Holdings.

Chevron also had an RD&D holding, but abandoned it last February in order to focus on viable energy sources – hardly the first oil shale experiment to go

bust. On Black Sunday, Exxon closed its Colony oil shale project, which put more than 2,000 out of work and devastated the economy of Colorado’s western slope for years.

Arial photo of a pile of oil shale ‘ash’ in Estonia. Source: EcoCrete Project.

In their blog, IER also highlights Estonia, considered the world leader in oil shale, as the prime example of successful oil shale development – but that’s no

t factual either. Oil shale isn’t economically viable in Estonia, has caused significant water, air and land pollution, and is highly controversial.

The head of Estonia’s biggest oil shale company, Eestia Energia – known as Enefit in the U.S. – has admitted that oil shale is not profitable without large taxpayer subsidies. Underscoring this point was Moody’s recent move downgrading Enefit’s credit rating to negative, over concerns that they can’t make oil shale profitable.

In addition, oil shale is a dirty, polluting fossil fuel that’s responsible for 80 percent of all of Estonia’s pollution. Enefit’s track record includes contaminated groundwater, creating 600-foot high mountains of oil shale waste that spontaneously ignite, and causing the emission of “lots of carbon dioxide.”

IER’s blog also boasts that there are huge oil shale deposits in the U.S. But these projections are irrelevant because oil shale isn’t a viable energy source and fails the basic economic test. In other words, the return on oil shale doesn’t outweigh the investment. The amount of energy and water that it takes to superheat, mine and process oil shale – which is actually fossilized algae – is more than the energy that oil shale provides. If you need more evidence just look to the billion dollar oil and gas industry, which has almost limitless resources, and has 100 plus years of failed oil shale experiments to show for their efforts.

The IER can spin oil shale all day, but it won’t change the cold hard fact that oil shale isn’t ready for prime time.

Filed under Eyes On Enefit, oil shale, Permitting Tagged with estonia, Institute for Energy Research, Oil Shale, Public Lands, water

Five things Gov. Hickenlooper did to put oil & gas industry ahead of Colorado’s health and water

May 8, 2013 by Checks And Balances Project Leave a comment

Governor Hickenlooper likes to paint himself as an outsider, unfamiliar with the political process. But his recent actions to undermine public health, water safety – and basic common sense – have proven that Gov. Hickenlooper has become the ultimate insider – adept at helping his billion dollar oil and gas industry boosters cheat the rules, while playing the role of concerned official.

While Governor Hickenlooper has said the he’ll increase fines and hold polluters accountable, behind closed doors he’s actually been working hard to kill or weaken legislation aimed at doing just that.

Case in point: Governor Hickenlooper announces both his campaign for Colorado to be the healthiest state and safe drinking water week, then days later he successfully killed legislation to help protect water from toxic oil and gas spills.

Here’s are the FIVE THINGS Gov. Hickenlooper did to put the public health and water of Coloradans at risk and to make it easier for oil and gas companies to pollute.

Issued the weakest water testing rules for oil and gas operations in the nation…with huge carve out for Anadarko and Noble.
In January, Governor Hickenlooper’s oil and gas commission put forth weakest in the nation water testing rules –which included the Anadarko-Noble loophole for two of the biggest oil and gas operators in Colorado and Weld County – and two of the state’s biggest oil and gas polluters.
The Anadarko-Noble loophole makes it easier for billion dollar oil and gas companies to pollute water in an area in Northern Colorado that’s home to more than 25 percent of Colorado’s oil and gas wells and more than half of the most recent spills reported.
The result is that it’ll be harder to detect water contamination and to figure out which well(s) are the source of contamination in the region that needs these public safety standards the most. In 2012, industry reported 402 spills in state, of which 20 percent resulted in water contamination, and just last month, a huge spill near Parachute creek contaminated nearby soil and water with cancer causing benzene.
Lobbied against efforts to hold oil and gas companies responsible when they pollute Colorado communities and water with toxins, waste.
Governor Hickenlooper sent his lobbyists to the Capitol to weaken fines for oil and gas companies who pollute, despite the fact that Colorado has the lowest in the nation fines and a well-documented problem of spills and water contamination. In 2012, 20 percent of all reported oil and gas spills resulted in water contamination and just six companies were responsible for more than 85 percent of all spills. And the Parachute spill – which has contaminated nearby water and soil with cancer causing benzene is now being investigated by the EPA’s criminal investigations division.
Turned down money to increase the number of state oil and gas inspectors.
Governor Hickenlooper’s Department of Natural Resources agency joined up with the oil and gas industry in opposition to additional resources to help making oil and gas drilling safer by turning down money to increase the number of inspectors, from sixteen to twenty-four, for the state’s more than 52,000 wells. That’s despite the state already being short-staffed on inspectors.
Successfully blocked reform efforts to make the actions of the Colorado oil and gas commission more transparent.
Governor Hickenlooper, along with the oil and gas industry, opposed legislation that would have made important systemic changes to Colorado’s oil and gas commission – the Natural Resources Department testified against the bill. Oil and gas companies currently serve on the commission, which regulates their activities, a direct conflict of interest.
Worked to defeat public health study to see if fracking is making Coloradans sick.
Governor Hickenlooper’s chief of public health and the environment, Dr. Chris Urbina, testified against a health study – supported by local residents and medical professionals – that would help figure out if Coloradans who live near fracking are getting sicker than those who don’t live near fracking.

Filed under Fracking

Western Energy Alliance wants taxpayers to front $44 billion in handouts to most profitable companies in the U.S. – billion dollar oil and gas industry

May 6, 2013 by Checks And Balances Project Leave a comment

The Western Energy Alliance has once again proved that they’ll go to any length to increase the profit margins of the billion-dollar oil & gas industry. Now they’re lobbying for $44 billion dollars in taxpayer-funded handouts over the next 10 years, despite the fact that the oil and gas companies are some of the most profitable in the U.S.

ExxonMobil and Chevron topped the Fortune’s rankings of the world’s most profitable companies in 2012. In fact, four of the top ten companies on the Fortune 500 list were oil and gas companies. And the big five oil companies, BP, Chevron, ConocoPhillips, ExxonMobil and Shell, made a combined profit of $118 billion dollars last year and $137 billion in 2011.

The oil and gas industry has more than proven that they don’t need these excessive, wasteful subsidies – they’re making billion dollar profits while American taxpayers are paying more at the pump.

Unfortunately, this is just the latest example of Western Energy Alliance putting profit margins of a billion dollar industry ahead of what’s best for Westerners.

Filed under Gas Prices

The Maine Players Attacking Renewable Energy: The Koch Brothers

May 3, 2013 by gabrielelsner Leave a comment

In a new report, the Maine Conservation Alliance asks: are we debating renewable energy, or the Koch brothers’ profits?”

Maine’s renewable energy standards have been the prime target of the Koch Machine – front groups, think tanks, and legislators with financial ties to Koch Industries and its two billionaire owners: the Koch brothers.

The Renewable Portfolio Standard, which requires utilities to provide 30% of their energy through renewable sources, has led to $2 billion in investment and over 2500 local jobs. It has proven to be great for Maine’s economy – but it threatens the profit margins of fossil fuel companies like Koch Industries, which pumps 300 million tons of carbon into the atmosphere every year.

To dismantle the RPS, the Koch brothers have been extending influence through a legislative front group – the American Legislative Executive Council (ALEC). ALEC has contributed over $750,000 to political action committees, candidates, and parties in Maine. Senator Mike Thibodeau, one of the anti-RPS bill’s co-sponsors, has received over $15,000 from ALEC-affiliated organizations.

It is the civic duty of Mainers to decide for themselves what is best for the state’s environment and economy, not an out-of-state corporate interest. The Maine Conservation Alliance affirms that the economy is not for sale.

Filed under Uncategorized Tagged with ALEC, American Legislative Exchange Council, clean energy, electricity, Energy, Fossil Fuels, gas, Koch, Koch Brothers, Koch Industries, Maine, oil, Renewable Energy, Renewable Energy Standard, Renewables, RPS

Gov. Hickenlooper working overtime to bring toxic waste and pollution to your neighborhood!

May 2, 2013 by Checks And Balances Project Leave a comment

A lot’s changed since 1955 when a gallon of gas was about 29 cents. One thing that hasn’t changed are Colorado’s fines for oil and gas drilling violations – despite a huge drilling boom and large increase in spills over the past several years. Under current law, most violations can’t be fined more than a $1,000 per day, with an overall cap of $10,000.

And it turns out that the state rarely enforces these laws. Analyses by the Denver Post and Fort Collins Coloradoan found that that state regulators rarely fine violators who pollute, and less than 7 percent of industry violations since 1996 have resulted in fines.

The Parachute Creek spill, caused by Williams, has polluted soil and water with cancer causing benzene and yet 56 days later, Williams has yet to be fined for polluting and risking public health.

Despite all of this, not only has Governor Hickenlooper failed to stand up for Colorado families and protect public health, but he’s actually working overtime to help make it easier for the oil and gas industry to pollute your water and communities.

According to a new report from the Center for Western Priorities, six oil and gas companies were responsible for 85 percent of all the spills that resulted in water contamination last year. Turns out that Governor Hickenlooper’s ‘besties’ Anadarko Petroleum subsidiary and Noble Energy, Inc. (of the Anadarko-Noble loophole) were two of the six big polluters.

Earlier this week, Fox 31 Denver reported that Gov. Hickenlooper watered down legislation to protect public health and water by strengthening oil and gas drilling violation fines.

Apparently, these laws just aren’t lax enough for Governor Hickenlooper and his oil and gas industry boosters. According to the Fox 31’s news coverage:

“Andy White, the governor’s [Hickenlooper] lobbyist on all oil and gas-related legislation…sided Friday with Republicans on the Appropriations Committee and stripped those provisions — the minimum daily fine and the removal of an overall cap on fees — from the bill before sending it to the Senate floor.”

Now the question is: Will the state legislature do the right thing – protect public health and water- by holding the oil and gas companies responsible when they pollute or will Gov. Hickenpuppet continue doing the bidding of the oil and gas industry to the detriment to Colorado families and communities?

Filed under Blog, Colorado, Fracking

Western Energy Alliance brazenly flubs facts in new poll

May 2, 2013 by Checks And Balances Project Leave a comment

Western Energy Alliance is hard at work spinning their new survey, which underscores the lengths to which they’ll go to increase the profit margins of the billion dollar oil and gas industry – even when that means putting water, public health, and local communities at risk.

WEA announced their new poll a month ago, but just released the results today. Was it because they needed all that time to figure out how to spin the poll?

Unfortunately for WEA, since they included so many factually incorrect statements in the poll, they won’t be able to use their results for much other than spin sessions. And, this isn’t the first time that WEA and their vice president for government affairs, Kathleen Sgamma, haven’t been able to keep their facts straight or master basic grade school multiplication skills.

While WEA’s poll also spins that the public supports hydraulic fracturing, there are already 351 towns and cities across the U.S. that have taken action to limit or ban fracking within their borders.

Here’s a look at some of the most glaring factual errors from the WEA poll materials:

WEA claim #1: “The government has prevented oil and natural gas development on federal lands, even though less than one-tenth of 1% of public lands is being used for oil and natural gas today.”

Facts: Both the federal government and industry has aggressively pushed to increase drilling activity on public lands. According to the U.S. Energy Information Administration, production of crude oil is at its highest level since 2002, and data from the Department of Interior show that oil production on federal lands was up 7 percent in 2012. This is despite the fact that nearly 21 million of the almost 39 million acres of public lands leased to the oil and gas industry sit idle.

WEA claim #2: The oil and gas industry do such a great job cleaning up lands where they’ve drilled that they’re considered wilderness, or pristine areas, post-clean up.

Drilling infrastructure in Wyoming. Source: EcoFlight

Facts: Reports on reclamation efforts in Utah, Wyoming and New York have shown that:

restoration attempts often fail and create long-lasting problems that threaten western wildlife;
companies fail to provide adequately funded bonding, leaving behind billions in clean-up costs for states such as Wyoming; and
the oil and gas industry often fails to plug depleted wells – industry neglected to plug 89 percent of wells in New York.

In fact, a recent Government Accountability Office (GAO) analysis pointed to a highly inadequate system for funding clean-up of oil and gas wells on public lands.

WEA claim #3: “Increased energy production of American energy from public lands will lead to lower energy costs for consumers.”

Fact: Unfortunately for WEA’s spin team, experts agree – from BusinessWeek to the Energy Security Leadership Council – that the global market actually drives consumer oil prices, not U.S. production levels, so increased U.S. drilling doesn’t lead to lower energy prices.

Polls are only worth the paper they’re printed on if they fail to relay facts in a straightforward and honest way. Clearly, Western Energy Alliance and the companies they represent such as Anadarko and Noble care more about spin than they do about facts.

Filed under Fracking

Former park rangers launch group to protect America’s national parks from irresponsible oil & gas drilling

May 1, 2013 by Checks And Balances Project Leave a comment

Former park rangers have launched a new group, Park Rangers for Our Lands, to provide solutions to irresponsible plans to drill near America’s national parks.

The former park rangers are advocating for a balance between energy development and conservation, just at a time when Colorado Bureau of Land Management (BLM) Director Helen Hankins has tried to push forward widely-criticized plans to drill next to Dinosaur National Monument and near Mesa Verde National Park. These are two areas of primary concern for the group.

According to Richard Ellis, who spearheaded the formation of Park Rangers for Our Lands:

“Our parks are under siege. Oil and gas drilling is encroaching our public lands from all sides…We need the BLM to work with its neighbors at the National Park Service and come up with common sense ways to protect the parks, the air quality in the region, and keep the West a beautiful place to visit.”

Director Hankins has come under fire, numerous times, for her oil and gas leasing plans next to Dinosaur Monument’s visitor center, near Mesa Verde National Park, perilously close to Denver’s drinking water supplies, and in the agricultural heart of North Fork Valley.

Unfortunately, this hasn’t stopped Dir. Hankins from continuing to push to open these areas for oil and gas drilling (see graphic) – despite the risks to our water, public health, farms and economies. It’s time for Director Hankins to adopt a common sense approach to oil and gas leasing that includes up to date analysis, implementing national BLM reforms – to cut down on Colorado’s highest in the region lease protests- and taking into effect the concerns of local businesses, landowners and the National Parks Service.

Filed under Colorado, In The News, Permitting

Industry presentation on energy development misses a few facts

April 26, 2013 by Checks And Balances Project Leave a comment

Yesterday, we attended an industry webinar about the future of Bureau of Land Management (BLM) energy development on publicly owned lands – Master Leasing Plans (MLPs). The intent of MLPs is to reform BLM oil & gas leasing in order to ensure smart energy development by reducing red tape for industry and proactively protecting the mountains, forests and waterways critical to western economies and communities.

The presenting lawyers were from law firm Beatty and Wozniak, P.C., whose CEO has been appointed to the serve on at least three oil & gas company boards (Storm Cat Energy, MarkWest Hydrocarbon and Denbury Resources). So, it wasn’t too surprising that the presenters’ comments about MLPs weren’t too favorable. After all, the oil and gas industry has made no secret of wanting a blank check for drilling on our publicly owned lands. But, the presenting attorneys made two glaring inaccuracies that are worth addressing:

All oil and gas leases on public lands since 2008 have been protested. FALSE

There is so much evidence to the contrary, we could be here all day. We’ll keep it simple and just point to recent testimony from former Interior Sec. Salazar on how just 18 percent of all leases offered were protested in 2012:

“Onshore oil and gas leasing reforms put in place in 2010 resulted in fewer protests; less than 18 percent of 2,064 parcels offered in fiscal year 2012 were protested, the lowest since fiscal year 2003, reducing costs and speeding development.”

BLM doesn’t have the legal authority to carry out MLPs because they aren’t in Mineral Leasing Act. FALSE

The implication here seems to be that since MLPs weren’t explicitly written into statute then BLM doesn’t have the authority to implement them. This line of reasoning doesn’t hold water as all regulating agencies, including BLM, develop specific rules for legislation passed by Congress which enable them carry out the law. BLM even has a link to the laws that apply to BLM-managed lands and the corresponding rules and regulations.

Let’s hope that next time our industry friends don’t let their oil and gas connections skew the facts.

Filed under Blog, Permitting

Rep. Hullinghorst working to end Hickenlooper Anadarko-Noble loophole- which puts Colorado’s water at risk

April 25, 2013 by Checks And Balances Project Leave a comment

Gov. Hickenlooper likes to tout Colorado’s oil and gas rules as a national model, saying that the state has found the middle ground on development. Unfortunately, his administration’s Anadarko-Noble loophole is another example of Gov. Hickenlooper putting the profits of the oil and gas industry ahead of Coloradans. The good news is that champions for local communities, like Rep. Dickey Lee Hullinghorst, are stepping in to try and fix problems like the loophole.

The Anadarko-Noble loophole provides an industry exemption from state water testing rules – already criticized as weakest in the nation – in northern Colorado, despite the fact that this is where some of the most intensive oil and gas drilling operations are located.

The loophole weakens state water testing rules in the Greater Wattenberg Area – near homes and farms in Adams, Boulder, Larimer, and Weld counties - which is home to more than 25 percent of Colorado’s oil and gas wells and some of the most intense growth in drilling activity.

As a result, it will be harder to detect water contamination and to figure out which well(s) are the source of contamination in the very region that needs these public safety standards the most. That’s not good news for Coloradans. In 2012, industry reported 402 spills in state, of which 20 percent resulted in water contamination, and just last month, a huge spill near Parachute creek contaminated nearby soil and water with cancer causing benzene.

The Anadarko-Noble loophole is part of a disturbing pattern by Gov. Hickenlooper of putting oil and gas industry profits ahead of what’s best for Coloradans. Remember the industry paid-for-ad in which Gov. Hickenlooper claimed that Colorado hadn’t had a single instance of ground water contamination from oil and gas drilling, despite evidence to the contrary (58 cases of groundwater contamination in 2011 alone)? Or how Gov. Hickenlooper said his hands were tied for suing Longmont for protecting the health of its residents from fracking?

Today the Colorado House Health, Insurance & Environment Committee will consider HB 1316, legislation that would close the Anadarko-Noble loophole and take a step in the right direction towards protecting our water and our communities. Let’s hope that the committee members will be representing the Coloradans they were elected to serve and not Big Oil and Gas when they vote on HB 1316.

Filed under Colorado, Fracking

Fracking New York with Another Conflict of Interest: Ecology and Environment’s Frackonomics

April 25, 2013 by Checks And Balances Project Leave a comment

A major player in New York’s fracking debate has been exposed as a member of one of the largest oil and gas lobby groups in New York. Ecology and Environment Inc. was hired as an “independent consultant” by the Cuomo Administration to assess the economic impacts of fracking in New York.

On Earth Day 2013, a letter revealed Ecology and Environment to be a member of the Independent Oil and Gas Association, a pro-fracking lobbying group. This conflict of interest calls into question the integrity of the economic assessment completed for the state in 2011.

The Cuomo Administration hired Ecology and Environment Inc. to perform an economic analysis as part of the Supplemental Generic Environmental Impact Statement (SGEIS). According to the Democrat and Chronicle, “The DEC at the time said it had not done enough to study the economic impacts of fracking and said it had decided to engage ‘independent consultants to thoroughly research these types of effects.’”

As it turns out, Ecology and Environment Inc. was anything but “independent.” The company’s 2011 assessment raised eyebrows due to its surprisingly sunny economic outlook for fracking. Anti-fracking groups criticized the results because the assessment didn’t include local economic costs on roads or hospitals. DEC commissioner Joe Martens responded, saying he would ask Ecology and Environment to expand the study – but that work was never publicly completed

IOGA Executive Director Brad Gill wrote in the letter to Cuomo, “The public can be assured that exploration for natural gas in New York is—and has been—safe, good for our environment and for our economy. Our New ‘New’ York must now join the nation and embrace the expansion of responsible natural gas development. We need your help.”

At the time the SGEIS was released, many were concerned that Ecology and Environment’s ties to the energy industry might have influenced their assessment. Adrienne Esposito, executive director of Citizens Campaign for the Environment, said “This is not an objective analysis done in the public interest. They went to someone with whom they have a work relationship and that also does work for energy interests.”

This letter proves the worries were not unfounded.

As a member of an active pro-fracking lobby organization, Ecology and Environment does not have an objective view towards fracking and should never have been hired to contribute to the SGEIS.

New Yorkers Against Fracking is calling for Governor Cuomo to throw out the SGEIS, due to this and other conflicts of interest. They are asking for a “new, truly independent study that regains the public’s trust and ensures science and facts drive your decision.”

Getty Images / Kris Radder

Filed under Blog, Fracking, Uncategorized Tagged with Conflict of Interest, Cuomo, ecology and environment, Fracking, gas, IOGA, New York, oil, sgeis

Oil & gas public lands management 101: How to put our farms, water, and national parks at risk

April 24, 2013 by Checks And Balances Project Leave a comment

Bureau of Land Management (BLM) Colorado State Director Helen Hankins has developed a pattern of offering controversial drilling plans, which when met with widespread public outcry are temporarily halted, only to be re-offered after the furor has died down.

In 2011 Dir. Hankins proposed oil and gas leasing in Park County at South Park, home to several large reservoirs for metro Denver, Colorado’s drinking water, serving over two million people.

When the City of Aurora raised serious concerns about the sale, including a lease parcel located within ¼ mile of the high water mark of a city reservoir, Hankins temporarily halted the lease plan. Unfortunately, in 2012, Hankins revived plans to lease South Park for oil and gas drilling. True to form, Hankins temporarily halted the oil and gas lease plans again after local elected officials, sportsmen and others raised significant concerns about the plans, including impacts to water quality, wildlife habitat and tourism.

In early 2012, Colorado BLM proposed drilling next to vineyards, orchards, organic farms and a dairy in the North Fork Valley. When local farmers, ranchers, businesses and residents overwhelmingly opposed the plan, Hankins, again, temporarily halted BLM’s plans to lease the area for oil and gas drilling.

Fast forward to the end of 2012, and Hankins – predictably – offered a similar plan that still threatened the Valley’s local economy and water supplies, and even included leasing land for oil and gas drilling near a public school. Residents, local business owners and others once again opposed the controversial plan, and widely criticized Hankins for basing her plan on outdated analysis and failing to pursue a balanced approach to energy development. In early February 2013, Hankins again temporarily halted drilling plans in North Fork Valley.

Name this tune: In late 2012, Colorado BLM announced plans to lease land for oil and gas drilling next to Dinosaur National Monument’s visitor center and along its southern entrance, as well as near Mesa Verde National Park. BLM’s proposal would mean that visitors could see drill rigs along with 149 million year old fossils, and create more air quality problems for Mesa Verde National Park – which is already beset with pollution problems. This time, the former Superintendent of Dinosaur National Monument, National Parks Service, and La Plata County joined the chorus of locals who raised serious concerns the drilling proposals. And, once again, Hankins halted the lease plans.

Unfortunately, since then, statements from Dir. Hankins’ staff indicate that this stoppage is temporary. In March, the local Colorado BLM assistant field manager said that the drilling leases near Mesa Verde National Park could be back on the auction block as early as this summer.

Dir. Hankins needs to end this contentious cycle of offering controversial oil and gas drilling leases, deferring them when locals rise up, and then trying to drive them back through later when protests have died down.

Dir. Hankins needs to adopt a new curriculum. She needs a smart-from-the-start approach that addresses the concerns of local residents, business owners, and the many industries that drive Colorado’s economy. She needs to adopt a balanced approach that protects the state’s drinking water, farms and national parks.

Filed under Blog, Fracking Tagged with BLM, Checks and Balances Project, Department of Interior, Fracking, hankins, Industry, Public Lands, water

In other frackademia news, Congressional Western Caucus starts a “university”

April 16, 2013 by Checks And Balances Project Leave a comment

The Congressional Western Caucus announced last week it will launch an online, Western Caucus University. The caucus claims the point of the new website is to educate the public on “what it means to live and work in the West.” Since the western caucus is comprised of oil- and gas-funded members of Congress who commonly advocate for the oil and gas industry, it’s likely this university’s “curriculum” will include whitewashed information about drilling and fracking.

Indications are already present that the website will be used to promote government handouts of public lands – national parks, monuments, forests, and wildlife areas – to the oil and gas industry, at the expense of agricultural, outdoor recreation, and tourism industries that are economic drivers in the West. Here’s some information we’re willing to bet won’t make it onto the site:

U.S. oil production has surged to a 20 year high.

The combination of profit, geology and technology are driving oil and gas drilling to private land. 93% of all onshore shale oil and mixed oil and gas plays – the source of the recent oil boom – are found under nonfederal lands. Even in the Rocky Mountain West, where more federal land is located, 89% of the shale oil and mixed oil and gas plays are under nonfederal lands.

The Obama Administration has leased 2.5 times more public lands to oil and gas companies than it has protected.
- In the West, where most federal lands are located, the areas with more than 30% protected federal lands increased jobs by 345%, from 1970 to 2010, compared to 83% job growth in counties with no protected lands.

The outdoor recreation industry, which relies heavily on protected lands like national parks, generates $646 billion in spending each year and 6.1 million American jobs.

The Government Accounting Office and industry experts have said oil shale could use up to 140 percent of what Denver Water provides its customers, today.

Big Oil was the top campaign contributor to the Congressional Western Caucus co-chairs Rep. Cynthia Lummis ($108,050 – more than double the next biggest contributing industry) and Rep. Steve Pearce ($206,100 – also more than double).

Two questions for Congressional Western Caucus members:

Is this online advocacy paid for with taxpayer dollars?

How much input will oil and gas lobbyists have into what is included in the website?

Filed under Uncategorized

Oil and Gas Real Estate Agent Helen Hankins at it Again in Thompson Divide

April 9, 2013 by Checks And Balances Project Leave a comment

Today, the Colorado Bureau of Land Management State Director Helen Hankins’ office announced it will extend the life of about two dozen oil and gas leases acquired by SG Interests and Ursa Resources Group in Colorado’s Thompson Divide area. These leases were set to expire this year because leaseholders had failed to conduct any meaningful development in 10 years. Dir. Hankins’ move runs contrary to stated goals by the Obama administration that oil and gas companies develop leases or that land be returned to the public. SG Interests and Ursa did not have to pay for the lease extension and continue to hold the leases for speculative purposes.

Ellynne Bannon, The Checks and Balances Project western energy lands program manager released the following statement:

“Once again, Colorado BLM Director Hankins is showing what a great real estate agent she is for oil and gas companies She’s ignoring the will of the communities around Thompson Divide and putting drinking water, farming and ranching businesses at risk in order to provide another freebie to oil and gas companies. Hankins’ actions represent exactly what she shouldn’t do as a steward of the public’s land and water.”

Background facts:

Director Hankins has a long track record of ignoring public concerns and putting communities at risk. Earlier this year, Hankins proposed drilling right next to Mesa Verde National Park and Dinosaur National Monument – including parcels next to a visitor center and park entrances. Hankins also re-offered highly controversial drilling leases in the midst of Denver Metro’s drinking water supplies and the agricultural North Fork Valley.
Director Hankins’ actions are out of step with President Obama and the Department of Interior’s policy on leases not in production – which is essentially “use it or lose it.” Currently, 21 million of the total 37 million acres in federal BLM lands leased for oil and gas drilling are not in production or exploration. The oil and gas industry also holds 7,000 idle drilling permits on federal lands.
A 2012 analysis found that that hunting, fishing, grazing, and recreation activities in the Thompson Divide support nearly 300 jobs and $30 million a year in economic value. Yet, Dir. Hankins seems intent on jeopardizing these jobs and revenue stream by extending controversial leases in the Divide, where a large local constituency relies upon recreation, ranching and hunting – and clean water and air – for their livelihoods.

Filed under Blog, Permitting, Statements

C&BP Calls for State Dept. Investigation into Keystone XL Consultant’s Conflicts of Interest

April 9, 2013 by Checks And Balances Project Leave a comment

Letter to Secretary of State John Kerry and State Dept. Deputy Inspector General Harold Geisel

Yesterday, Checks & Balances Project and 11 environmental, faith-based and public interest organizations called on Secretary of State John Kerry and the State Department Deputy Inspector General Harold Geisel to investigate whether Environmental Resources Management (ERM) hid conflicts of interest which might have excluded it from performing the Keystone XL environmental assessment and how State Department officials failed to flag inconsistencies in ERM’s proposal. Tom Zeller, Senior Writer at The Huffington Post, wrote an article highlighting the letter callings for an investigation.

Early last month, the State Department released a 2,000 page environmental impact study for the Keystone XL pipeline claiming that the pipeline would not have major impact on the environment. But, Environmental Resources Management (ERM), the consulting firm hired to perform the “draft supplemental environmental impact statement (SEIS),” has ties to fossil fuel companies with major stakes in the Alberta Tar Sands. This conflict of interest was not accurately disclosed in ERM’s answers on a State Department questionnaire. Checks & Balances Project considers ERM’s responses in its proposal to be intentionally misleading statements.

Unredacted Documents Uncover Conflicts of Interest
Last week, Mother Jones released unredacted versions of the ERM proposal, showing that three experts “had done consulting work for TransCanada and other oil companies with a stake in the Keystone’s approval.”

The unredacted biographies show that ERM’s employees have an existing relationship with ExxonMobil and worked for TransCanada within the last three years among other companies involved in the Canadian tar sands.

Here’s more from Mother Jones’ Andy Kroll:

“ERM’s second-in-command on the Keystone report, Andrew Bielakowski, had worked on three previous pipeline projects for TransCanada over seven years as an outside consultant. He also consulted on projects for ExxonMobil, BP, and ConocoPhillips, three of the Big Five oil companies that could benefit from the Keystone XL project and increased extraction of heavy crude oil taken from the Canadian tar sands.

Another ERM employee who contributed to State’s Keystone report — and whose prior work history was also redacted — previously worked for Shell Oil; a third worked as a consultant for Koch Gateway Pipeline Company, a subsidiary of Koch Industries. Shell and Koch have a significant financial interest in the construction of the Keystone XL pipeline. ERM itself has worked for Chevron, which has invested in Canadian tar-sands extraction, according to its website.”

When asked about who at the State Department decided to redact ERM’s biographies, a State Department spokesperson said “ERM proposed redactions of some information in the administrative documents that they considered business confidential.” Disclosing past clients may be business confidential information, but from what the biographies show, ERM may have recommended the redactions to hide conflicts of interest from public disclosure.

Problem with ERM Answers on Conflict of Interest Questionnaire

ERM’s Proposal to the State Department

The biographies on ERM’s proposal show that the company has had direct relationships with multiple business entities that could be affected by the proposed work in the past three years.

In the “Organizational Conflict of Interest Questionnaire,” the State Department asks (page 42), “Within the past three years, have you (or your organization) had a direct or indirect relationship (financial, organizational, contractual or otherwise) with any business entity that could be affected in any way by the proposed work?“ ERM’s Project Manager, Steve Koster, checked “No” but appears to have added to the Yes/No questionnaire that, “ERM has no existing contract or working relationship with TransCanada.”

Regardless of the addendum Koster added, he still submitted an incomplete statement when checking “No” to the specific question above. Simply put, the information provided by Mr. Koster was an incomplete statement if one simply reviews the biographies of ERM’s employees for the project.

The State Department Contracting Officer should have flagged this inconsistency when reviewing the staff biographies. ERM’s answers did not properly reveal in the Yes/No questionnaire that ERM did have a current “direct relationship” with a business enetity that could be affected by the proposed work and a relationship in the past three years with TransCanada, the company building the pipeline.

Koster’s incomplete statement on direct business relationships is not the only odd statement in ERM’s proposal. ERM also answered “No” to the question, “Are you (or your organization) an ‘energy concern?’” which the State Department defines (in part) as: “Any person — (1) significantly engaged in the business of conducting research…related to an activity described in paragraphs (i) through (v).” Paragraph (i) states: “Any person significantly engaged in the business of developing, extracting, producing, refining, transporting by pipeline, converting into synthetic fuel, distributing, or selling minerals for use as an energy source…” ERM as a research firm working for fossil fuel companies is, unequivocally, an energy interest.

So the question must be asked: If ERM is unable to accurately fill out a simple questionnaire regarding conflicts of interest, how can we trust the company to perform an unbiased environmental assessment of a 1,179 mile-long pipeline cutting through the American heartland? And, why did the State Department’s Contracting Officer not flag the inconsistencies in ERM’s Conflict of Interest Questionnaire when reviewing the proposals?

Intentions of State Department and ERM in Question

The Federal Government has strict ethics rules to prevent Organizational Conflicts of Interest (OCIs) from impacting the impartiality of government contracts and to prevent hiring contractors who cannot provide independent and unbiased services to the government.

According to a white paper from the Congressional Research Service, before the State Department could choose ERM as the contractor, the “Contracting Officer” had to make an “affirmative determination of responsibility.” All government contractors (including ERM) must be deemed responsible, in part by meeting strict ethics guidelines, known as “collateral requirements.”

According to current collateral requirements, contractors must be found “nonresponsible” when there are unavoidable and unmitigated OCIs. Checks & Balances Project believes that the Contracting Officer should have deemed ERM “nonresponsible” because the company serves as a contractor for major fossil fuel companies that have a stake in the Keystone XL pipeline. If ERM were “nonresponsible”, the company would have been ineligible to perform the environmental impact review of the Keystone XL pipeline.

These potential material incomplete statements on a Federal Government proposal calls into question the integrity of ERM and threatens millions in government contracts.

If ERM were determined to be “nonresponsible” or “excluded” because of these incomplete statements, it could jeopardize ERM’s ability to perform any work for the Federal Government. Again, according to the Congressional Research Service:

“Decisions to exclude are made by agency heads or their designees (above the contracting officer’s level) based upon evidence that contractors have committed certain integrity offenses, including any “offenses indicating a lack of business integrity or honesty that seriously affect the present responsibility of a contractor.””

Certainly these incomplete statements call into question both the independence of ERM and the judgement of the Contracting Officer in making the “affirmative determination of responsibility.” This proposal process should be investigated by the State Department Inspector General to determine if ERM’s statements are cause for exclusion.

Groups Calling for Inspector General Investigation

We believe ERM used multiple material incomplete statements and had clear conflicts of interest as shown in the unredacted documents. So, why was ERM hired by the State Department?

Checks & Balances Project asked a State Department spokesperson about the conflicts of interest and the spokesperson said: “Based on a thorough consideration of all of the information presented, including the work histories of team members, the Department concluded that ERM has no financial or other interest in the outcome of the project that would constitute a conflict of interest.” Perhaps the State Department’s Contracting Offier made the decision to hire ERM because of the company’s incomplete statements on the conflict of interest questionnaire.

Harold Geisel, Deputy Inspector General, U.S. State Department

Checks & Balances Project along with 11 other groups (Better Future Project, Center for Biological Diversity, Chesapeake Climate Action Network, DeSmogBlog, Forecast the Facts, Friends of the Earth, Greenpeace, NC WARN, Oil Change International, Public Citizen’s Energy Program and Unitarian Universalist Ministry for Earth) sent a letter to Secretary of State John Kerry and the State Department Deputy Inspector General Harold Geisel calling for an investigation into the matter. These incomplete statements and the determination by the Contracting Officer that ERM did not have any conflicts of interest, despite clear evidence to the contrary, are grounds for further investigation.

Filed under KeystoneXL Tagged with Andrew Bielakowski, Andy Kroll, Better Future Project, Big Oil, BP, Center for Biological Diversity, Checks and Balances Project, Chesapeake Climate Action Network, Chevron, Conflict of Interest, Conflicts of Interest, Congressional Research Service, ConocoPhillips, DeSmogBlog, Disclosure, Energy, Environment, Environmental Resources Management, ERM, ExxonMobil, Federal Acquisition Regulation, Federal Government, Forecast the Facts, Friends of the Earth, Greenpeace, Harold Geisel, Huffington Post, Industry, John Kerry, Keystone XL, Koch Gateway Pipeline Company, Koch Industries, KXL, lobbying, Mother Jones, NC WARN, Oil Change International, politics, Public Citizen's Energy Program, Shell, State Department, Steve Koster, Tar Sands, Tom Zeller, TransCanada, Unitarian Universalist Ministry for Earth

Oil shale causes 80 percent of Estonia’s pollution

April 8, 2013 by Checks And Balances Project Leave a comment

The hits just keep coming against Estonian oil shale. A new story from Estonian Public Broadcasting sheds more light on the devastating environmental impact oil shale has on the small, European nation.

“The oil shale industry, which produces the bulk of Estonia’s energy, is responsible for about 80 percent of the pollution and carbon emissions produced by Estonia, as well as nearly all of the sulfur emissions. Quarries and landfills have also spoiled around 15 percent of Ida-Viru County’s territory, as 150 square kilometers of land has sunk or become unstable.”

Just the week before, Estonia’s Environmental Minister said that the country has maxed out on oil shale due to high water use and pollution.

Oil shale waste piles are also prone to catching fire. Last week the Estonian government had to allocate 38 million Euros [$4.9 million according to today’s conversion rate] to extinguish a fourteen-acre fire at an oil shale site.

If these problems weren’t enough, the Estonian Economy Minister is under fire for a sour investment it made with Eestia Energia, known as Enefit in the U.S., to build a new controversial oil shale plant – which has since been abandoned. A majority of Estonians surveyed want to see the Minister resign over this deal and other questionable decisions.

Thankfully, on this side of the Atlantic, Interior Secretary Ken Salazar recently finalized a smart approach to costly oil shale speculation that should help the United States avoid Estonia’s problems. The Salazar plan requires companies to prove they’ve developed oil shale technology that works, is commercially viable and won’t deplete our scarce water resources or harm our air, land and wildlife, before any commercial leases are considered.

The environmental devastation and questionable investments from Estonian oil shale are good examples of why we need Sec. Salazar’s common sense oil shale plan.

Filed under Blog, In The News, oil shale Tagged with Department of Interior, Energy, estonia, Oil Shale, water contamination

Western Energy Alliance spokesperson wins this week’s Pinocchio Award

April 5, 2013 by Checks And Balances Project Leave a comment

The oil industry is once again trying to re-write history. Kathleen Sgamma, spokesperson for industry mouthpiece Western Energy Alliance, claimed in a news story that more lands were put under protection than drilled, during President George W. Bush’s Administration.

A quick review of the amount of lands leased for drilling compared to the amount of lands permanently protected under President George W. Bush’s Administration shows that Sgamma’s claim is false. The Bush administration opened roughly 29 million acres, an area the size of Ohio, to the oil and gas industry for lease. On the other hand, the administration only permanently protected 746,373 acres from drilling.

Kathleen – If you do the math, that means nearly 39 times more land was opened to oil and gas drilling than was protected, during the protected by the Bush (43) Administration. Even if you add in land protected by Congress during this time, his administration still opened up 7.5 times more land to oil and gas drilling than it protected.

Source: Center for American Progress

Filed under Blog, News, Permitting

Drilling and fracking threaten iconic U.S. national park, and Teddy Roosevelt’s conservation legacy

April 2, 2013 by Checks And Balances Project Leave a comment

A new, compelling video from the Center for American Progress shows how drilling and fracking are encroaching on Theodore Roosevelt National Park. It’s an eye-opening look at how North Dakota’s industrial scale oil boom is wreaking havoc on the park and asks the question: How much are we willing to sacrifice?

Here in Colorado, just one month after deferring controversial oil and gas leases next to Dinosaur National Monument and Mesa Verde National Park, Colorado BLM Director Helen Hankins’ and her staff showed signs that Hankins may welch on her office’s commitment to protect our national parks.

Energy development and land conservation are out of balance on our public lands, and are out of balance with Western values.

The Obama Administration has leased 2.5 times more public lands to oil & gas companies than it has protected. Yet, 9 out of 10 western voters believe national parks, forests, monuments, and wildlife areas are an essential part of their state’s economy. While, 59 percent want to ensure strong standards are in place and that drilling is not allowed in critical locations near recreation areas, water sources, and wildlife.

It’s time for the BLM and the Obama administration to prioritize policies that protect our public lands and national parks.

Filed under Blog, Fracking Tagged with Big Oil, center for american progress, Department of Interior, drilling, Energy, Fracking, national parks, Public Lands

Americans for Tax Reform and Grover Norquist’s Deceptive Campaigns for Dirty Energy and Big Tobacco

April 1, 2013 by Checks And Balances Project Leave a comment

JIM WATSON/AFP/Getty Images

Grover Norquist is a familiar player in Washington debates, renowned for convincing nearly every Republican in Congress to sign a pledge to not raise taxes. But Norquist’s main job is not as a principled advocate for his brand of limited government but functioning as a paid lobbyist for whatever corporate interests are ready to write him a check. Norquist is a prominent pundit for Big Pharma and Big Tobacco, and now, he’s also batting for Big Oil.

Norquist, President of Americans for Tax Reform (ATR), is at the forefront of the latest fight against renewable energy in the United States.

Conservative front groups and fossil fuel interests are attacking renewable energy standards in a coordinated assault to protect profits generated from fossil fuel-based electricity. Twenty-nine states have renewable energy standards and twenty-two of those have become fierce battlegrounds.

This coordinated attack on clean energy bears resemblance to the effort by Big Tobacco to prevent public health laws from impacting the profitability of tobacco companies. And it turns out, a lot of people working to dismantle renewable energy laws are deeply connected to Big Tobacco. Some, like Grover Norquist, even worked with Big Tobacco on their misinformation campaigns and are now turning their lobbying power to attack state clean energy policies.

The attacks on the Renewable Portfolio Standards (RPS) originated primarily from the American Legislative Exchange Council (ALEC), whose energy task force is comprised of fossil fuel companies and front groups members like ATR. In late February, several ALEC groups including ATR attempted to convince Kansas legislators to weaken their renewable energy law, which would require renewable energy to make up at least 20% of their energy portfolio.Norquist himself testified to the Kansas legislature to roll-back the RPS.

Americans for Tax Reform has received $525,000 from the American Petroleum Institute between 2008 and 2011 and $60,000 from foundations connected to Koch Industries between 2003 and 2011.

Fighting against renewable energy in the states isn’t Norquist’s only project working to protect fossil fuel interests. ATR is part of a Tea-Party “last stand” seeking to derail the U.S. Environmental Protection Agency’s effort to regulate carbon dioxide emissions. Last year, Norquist also made a public statement that there was “no conceivable way” he could support a carbon tax aimed at slowing global warming and pollution.

Norquist has a track record of defending industries engaged in massive denial of scientific knowledge. The dirty energy industries that fund ATR pretend that the climate change science is inconclusive despite broad scientific consensus. But that approach is not new – it was refined through millions of dollars in lobbying, public relations and front groups by the tobacco industry, which denied the harms caused by smoking.

Americans for Tax Reform, run under Norquist, has been a longtime ally of the U.S. tobacco industry and a major player in pro-tobacco tax policies. ATR’s history with Big Tobacco was pulled from hundreds of documents that live in the Tobacco Archives and documented by SourceWatch.

1990s: Big Tobacco Loses Public Opinion, Calls on Third Party Support

In the early 1990s, the government started increasing tobacco regulation via taxes and bans to compensate for the health costs of smoking. Philip Morris President Roy Marden wrote an internal memo calling attention to the need to “regain the upper hand” on public opinion of tobacco. In 1992, RJ Reynolds documented a campaign plan to “move public opinion in the right direction” – in order to weaken tobacco regulation.

One aspect of the plan was third-party coalition work, with ATR listed as a likely coalition partner. The reason: “Credible, non-tobacco voice for hearings and for generating information on issue to media, op-eds, letters, etc.” The draft plan also mentions Norquist specifically, noting, “Tim Hyde to work with Grover Norquist for possible by-line piece.”

The following year, ATR’s pro-tobacco campaign began. With the help of focus groups from eight different cities, ATR launched an advertisement in 152 newspapers targeting 51 Members of Congress. Their success was documented by Philip Morris, and used for even further campaigning.

ATR continued to campaign against tobacco taxes, so much that they were described in an internal Philip Morris review as a “staunch ally of PM for a number of years in many tax battles.”

Along with coalition support came monetary support. Philip Morris contributed $30,000 to the ATR Foundation in 1994, according to internal documents. The R.J. Reynolds Tobacco Company contributed $100,000 to ATR two years later and ATR received additional money from RJR in 1997 to continue PR support of lobbying activities, one month before Norquist went on the road to speak out against cigarette tax increases.

1999: Litigation against Big Tobacco Begins, Norquist and ATR continue support

President Bill Clinton announced that “the Justice Department [was] preparing a litigation plan to take the tobacco companies to court, and with the funds [they] recover, to strengthen Medicare” in his 1999 State of the Union Address. Less than one month after Clinton’s speech, Norquist had published a media release and letters to radio show hosts complaining about the litigation – without disclosing his own financial ties to tobacco. Weeks later, Norquist wrote a letter to Kirk Blalock of Philip Morris requesting $200,000 in continued support.

Norquist and ATR spent the next few years continuing to campaign against the litigation efforts, writing letters to warn Congressmen of dire consequences.

ATR continued to receive monetary support from Philip Morris, but Norquist campaigned for even more money from a coalition of tobacco groups. He sent a proposal to Lorillard and Philip Morris titled “No taxation through litigation – stopping the federal Medicare suit.” The proposal was seeking $582,672.

What came of the proposal was undocumented, but ATR has continued to lobby on behalf of the tobacco industry. They organized an anti-tobacco tax rally in 2010, using an email list paid for by Philip Morris. They list several appeals to oppose bills that would raise tobacco taxes on their website, including a 2011 Louisiana bill and an Arkansas House Bill. In early 2012 they campaigned against California’s Proposition 29, another tobacco tax increase. Sacramento Bee editor Dan Morain asked Patrick Gleason, a Norquist aide, whether Americans for Tax Reform still accepted tobacco money, to no response.

A 2006 ruling by U.S. District Judge Gladys Kessler concluded that the tobacco industry has “lied, misrepresented and deceived the American public, including smokers and the young people they avidly sought as ‘replacement’ smokers, about the devastating health effects of smoking and environmental tobacco smoke.”

The lies and deception continue with climate change denial and attacks against renewable energy standards on behalf of the fossil fuel industry. It seems Grover Norquist and Americans for Tax Reform will campaign for anything, for the right price.

Filed under Tobacco Profiles Tagged with ALEC, American Legislative Exchange Council, American Petroleum Institute, Americans for Tax Reform, Big Oil, Big Pharma, Big Tobacco, Checks and Balances Project, clean energy, Clean Energy Standards, climate change, Energy, Grover Norquist, Kansas, Koch Brothers, Koch Industries, Norquist, Philip Morris, politics, Proposition 29, R.J. Reynolds, renewable energy standards, RPS, taxes, tobacco

Keystone XL Environmental Impact Consultant’s Cozy Relationships with Fossil Fuel Interests

March 31, 2013 by gabrielelsner Leave a comment

Environmental Resources Management (ERM), the consulting firm hired to perform the supplemental environmental analysis of the Keystone XL pipeline works for and has worked for fossil fuel companies with a stake in the Canadian Tar Sands. Mother Jones’ Andy Kroll exposed the conflicts of interest in an exclusive story, which included unredacted documents that show the recent work history of ERM’s consultants.

It’s no surprise that ERM painted a rosy picture of Keystone XL’s environmental impact. Their business depends on it. ERM’s major clients in the fossil fuel industry would steer clear of an environmental consulting company that determines fossil fuel projects are not environmentally responsible. ERM claimed in the report that the Keystone
XL pipeline would not lead to an increase in greenhouse gas emissions or significantly impact the environment along its route.

Last week, Steve Horn from DeSmogBlog documented major problems with another pipeline (the 1,300 mile-long Baku–Tbilisi–Ceyhan (BTC)) determined by an ERM environmental assessment to be “environmentally and socio-economically sound.” Horn wrote, “An Aug. 2008 Wikileaks cable discusses a BTC explosion in a mountainous area of eastern Turkey …which spewed 70,000 barrels of oil into the surrounding area.” The BTC
pipeline caused enormous environmental damage and failed to live up to the jobs hype created by the project developers, which included BP, State Oil Company of Azerbaijan (SOCAR), Chevron, ConocoPhillips, Eni and Total.

Horn goes on to quote Mik Minio-Paluello, co-author of The Oil Road - a new book documenting the slew of destructive impacts of BTC saying, “Supposedly an environmental consultancy, in practice ERM operated more like aPR firm representing BP and now they’re fulfilling a similar role for TransCanada.”

So why does ERM operate more like a PR firm than an environmental consultancy?

Let’s say ERM provided a review claiming a fossil fuel project was skirting safety precautions or moving too quickly to ensure quality seals on the pipeline (see Keystone XL’s faulty welding here). Would a fossil fuel company, whose financial interest is building more fossil fuel infrastructure, want to hire a consultant that results in delays and increased costs for developing that infrastructure?

Checks & Balances Project contacted ERM’s Global Head of Communications Simon Garcia multiple times over the past week without any response. We requested comment on the following question: Has ERM ever determined that a proposed fossil fuel project was not “environmentally sound” in an assessment?

The answer is probably “no.”

Filed under KeystoneXL Tagged with Andy Kroll, Baku-Tbilisi-Ceyhan Pipeline, Big Oil, Checks and Balances Project, Conflict of Interest, Contractors, Energy, Environmental Resources Management, ERM, ExxonMobil, Keystone XL, Mik Minio-Paluello, Mother Jones, oil, Oil & Gas, Oil and Gas, Oil Spill, politics, PR, Simon Garcia, State Department, Tar Sands, The Oil Road, TransCanada

Big Oil’s API insatiable lust for taxpayer handouts continues; Industry group demands that U.S. double down on failed oil shale experiments

March 27, 2013 by Checks And Balances Project Leave a comment

**UPDATE** API’s Erik Milito may want to check with Estonian Environment Minister Keit Pentus-Rosimannus before continuing to pressure President Obama to double down on costly oil shale speculation. In an article in today’s Postimees, Minister Pentus-Rosimannus said,

“Eighty percent of our waste, water use and greenhouse gas emissions are connected with the oil shale industry. We must think together how to reduce the negative impact. With that as bottom line, I do not consider it possible for the annual extraction volume of oil shale to grow in the future.”

Estonian oil shale giant Eesti Energia’s U.S. arm, Enefit, is one of the companies trying to develop oil shale in Utah. For more on that, see our recent series Eyes on Enefit.**UPDATE**

The American Petroleum Institute (API) – see: Big Oil – called on President Obama, today, to double down on a century of failed oil shale experiments and risk western water supplies.

API’s response to outgoing Interior Sec. Ken Salazar’s smart oil shale plan was shameless, but predictable (for more on the Salazar Plan, see articles in the SL Tribune, Denver Business Journal and an editorial in the Grand Junction Daily Sentinel). Sec. Salazar adopted a reasonable approach that requires oil companies to prove any oil shale technology they might develop is commercially viable and won’t devastate water resources and air quality in the West.

The Government Accounting Office and industry experts have said oil shale could use up to 140 percent of what Denver Water provides its customers, today.

It turns out that common sense and good business practice aren’t slowing down API’s insatiable lust for taxpayer handouts. API wants to double down on 100 plus years of abject oil shale failure, despite the huge risks to the West’s scarce water supplies.

Erik Milito, API’s director of upstream and industry operations, claims that ensuring the safety of western water might delay investment in the development of oil shale technology. He ignores the fact that oil shale speculators have failed for over a century to develop any such technology, despite the billions in taxpayer subsidies – and private investments – already risked.

Western families, farmers, ranchers and business owners, already in year two of the worst drought in a decade, can’t afford to have any more of their water risked on costly oil shale speculation. We need President Obama to put the security and safety of the West’s water and communities before Big Oil’s hunger for more taxpayer handouts.

Filed under Blog, In The News, oil shale Tagged with Colorado, Department of Interior, Oil Shale, Public Lands, water

Doc Hastings defends fantasy jobs, leaves western water in the dust

March 27, 2013 by Checks And Balances Project Leave a comment

House Natural Resource Committee Chairman Doc Hastings proved again last week that he’s more interested in protecting Big Oil subsidies than taking a smart approach to energy that protects western water.

On Friday, the Department of Interior finalized a smart, balanced approach for oil shale on public lands that helps to ensure drought-stricken communities aren’t put in further jeopardy. Since that approach means fewer handouts for oil companies, Chairman Hastings was quick to respond with a ridiculously inaccurate statement about oil shale. Hastings said that the decision “sends oil shale jobs overseas.”

First off: What jobs? There is no oil shale industry. Despite 100 years of trying, and billions risked in taxpayer-funded subsidies, oil shale has never been successfully commercialized in the U.S.

Second: How can the U.S. ship jobs – that don’t even exist in the first place – overseas? Will they go to imaginary foreign workers?

Oil shale isn’t a job creator or a viable energy source. In 2012, only days after Speaker Boehner (R-OH) and Rep. Doug Lamborn (R-Colo.) finished pushing a new oil shale boondoggle through the U.S. House, oil giant Chevron closed down what was supposed to be a lucrative oil shale experiment on Colorado’s West Slope. Chevron then reassigned all three full-time workers it had on the project.

Until Rep. Hastings gets his facts straight on oil shale, he should be careful what he says. It might save him some embarrassment, and being more informed might help him protect more American communities.

Filed under Uncategorized

Tobacco, Tea Party, and Dirty Energy: Lobbyist C. Boyden Gray

March 25, 2013 by Checks And Balances Project Leave a comment

As someone with deep ties to right-wing political circles, and strong financial ties to the tobacco industry, C. Boyden Gray fits the bill as the ideal lobbyist for the dirty energy industry. Dirty energy in many ways is the successor to the tobacco industry, given how it uses front groups and pundits to avoid public health regulations.

With impending EPA regulations for coal and gas, Gray and other lobbyists are getting busy trying to block progress on rules that would curb pollution and global warming.

C. Boyden Gray is an heir to the RJ Reynolds tobacco fortune – his grandfather was CEO of the company – and the co-chair and board member of the Tea Party powerhouse FreedomWorks Foundation. Gray is also a lobbyist for one of the worst coal corporations in America – FirstEnergy – and an outspoken critic of reforms that would reduce greenhouse gas emissions and global warming.

Those three groups – tobacco, tea party, and dirty energy – have become inextricably tied together. Through fossil fuel-funded front groups, the dirty energy industry has copied tactics from Big Tobacco’s infamous operations to manufacture doubt about clear scientific evidence, with pundits and lobbyists like Gray fueling climate change denial and attacking environmental and health regulations.

Gray is a founding partner of the lobbying firm Boyden Gray & Associates, where he advocates for the fossil fuel corporation FirstEnergy Corp., named one of the top 10 worst corporations in America in 2006, among others. Prior to the founding of his firm, he was a lawyer and lobbyist at Wilmer, Cutler and Pickering (now WilmerHale), where he represented clients facing federal sanctions for violating environmental laws. Many of his clients faced significant federal criminal prosecutions under the Clean Water Act. He counseled the Trans-Alaska Pipeline Liability Fund in litigation from the Exxon Valdez and American Trader oil spills, and he lobbied against the REACH bill, which required manufacturers to test industrial chemicals and to gather health and safety data.

Gray’s influence on environmental regulations extends beyond his days as a lobbyist. Gray served as legal counsel to Vice President Bush from 1981-1988 and White House Counsel in the Bush’s presidential administration from 1989-1993.

His position in the White House, and later as chairman of Citizens for a Sound Economy (CSE – predecessor to FreedomWorks), gave him power and influence, which he put to work for Big Tobacco.

In a letter found on the Tobacco Archives, Horace Kornegay of the Tobacco Institute wrote a hand-signed letter to Gray in 1981, asking for regulatory relief from “wasteful programs such as the annual reports on cigarettes and cigarette advertising.” Kornegay also urged Gray to “deal with” problems they were facing with antitrust litigation. Kornegay wrote to Gray again in 1982 to thank him for his advisement on the progress of the Presidential Task Force on Residential Relief.

In 1995, the Federal Drug Administration (FDA) began drafting legislation for the “FDA Rule” – proposed tobacco regulations to prevent and reduce tobacco use by children. The intended regulations, finalized in 1996, would have been the strongest tobacco controls to date. The proposed controls included prohibiting non-face-to-face sales of tobacco products, prohibiting outdoor advertising of tobacco products near schools or playgrounds, imposing more stringent advertising regulations, and prohibiting brand name sponsorships.

During that year, Gray, as a Wilmer Cutler lawyer, testified on behalf of CSE to attack increased funding for the FDA before the Treasury, Postal Service, and General Government Subcommittee of the House Committee on Appropriations. Consequently, CSE lobbied hard against the FDA, calling Congressmen, meeting with allies, and advertising aggressively to emphasize problems with the FDA. Full-page ads were placed in the Washington Times and the Congressional Monitor, among other outlets.

Ultimately, the Supreme Court ruled that the FDA needed authority from Congress to pass the tobacco control bill, which didn’t become law until 2009, when President Obama finally signed the Tobacco Control Act.

After long partnership and deeply embedded ties with Big Tobacco, Gray has certainly picked up a few tactics on manufacturing doubt at the expense of the public welfare.

Currently, Gray writes a monthly column in The Washington Times, which he has used as an outlet to criticize environmental regulations, e.g. “Reducing Ozone Could Kill Jobs.” And, he recently warned of dire consequences in the case of stronger clean air regulations.

C. Boyden Gray, coal lobbyist and Tea Partier with Big Tobacco roots, is not alone. A recent academic study from UCSF confirms the connection between Big Tobacco and the Tea Party. The Tea Party’s anti-tax movements were traced back to the 1980s, when the tobacco industry fought taxes and regulation by way of third parties, such as CSE.

Climate change deniers and fossil fuel advocates are not only using the same tactics as Big Tobacco to promote skepticism, in many cases, like C. Boyden Gray, they are same people. These pundits and lobbyists know how to manufacture doubt around scientific consensus and convince Americans that public health protections are unnecessary. And when it comes to climate change, there’s no time to wait. Every delay makes it harder to prevent catastrophe.

Filed under Blog, Uncategorized Tagged with Big Tobacco, Boyden Gray, C. Boyden Gray, Koch, lobbyist, profile, tea party, tobacco

Colorado oil production up nearly 50 percent since 2010

March 18, 2013 by Checks And Balances Project Leave a comment

According to the Colorado Oil and Gas Conservation Commission (COGCC) oil production exceeded 48 million barrels in 2012, a 49 percent increase over 2010 levels.

The 2012 oil production levels are the highest since 1961 and are in increase of 24 percent over 2011 levels.

According to COGCC gas production reached its highest level since 1952.

Filed under News, Uncategorized Tagged with Department of Interior, Energy Production, gas, oil

Colorado BLM using stalling tactic at Mesa Verde, new drilling proposals could come back this summer

March 15, 2013 by Checks And Balances Project Leave a comment

Is Colorado BLM Director Helen Hankins backpedaling on decisions to halt controversial drilling plans next to Mesa Verde National Park, Dinosaur National Monument, and in North Fork Valley?

Barely a month after deferring oil and gas leasing decisions, Dir. Hankins’ staff are showing signs she is planning to welch on her office’s commitment to protect national parks and the heart of North Fork’s economic and agricultural center.

Earlier this week, the Durango Herald reported that:

[Connie] Clementson [Field Manager of the BLM Tres Rios office] made clear that the decision to defer the leases in Southwest Colorado does not take that land off the table for future development. After the BLM answers all the protests received about the lease sale, the land could be renominated for leasing as soon as August or November, Clementson said.

The Tres Rios field office manages lands near Mesa Verde National Park. The National Park Service criticized Dir. Hankins plans to offer leases for drilling on these lands and cited the lack of coordination by her staff.

When BLM announced the oil and gas deferrals near North Fork’s agricultural community, the Montrose Daily Press reported the following comments by Colorado BLM Communications Director Stephen Hall:

The deferral is not permanent, but the parcels won’t be offered for lease any time soon, said Steve Hall, communications director for the BLM in Colorado. “We didn’t put a timeframe on it. It’s safe to say we aren’t going to have them up (for bid) in the near future,” he said. “But we didn’t do what some had asked, which is defer them until the new resource management plan.”

Dir. Hankins already deferred those North Fork leases earlier in 2012, then reinstated most of them after the public scrutiny died down. Is that what she’s doing now? And does Dir. Hankins plan to reoffer these same, heavily protested leases based on 30-year-old data? Instead of being a real estate agent for Big Oil and driving-up speculation on public lands, Hankins should do the right thing and put our national parks, water and local economies on equal ground with oil and gas development.

Filed under Uncategorized

Wall Street Journal Editorial Twists CRS Report Like a Drill Bit

March 13, 2013 by Checks And Balances Project Leave a comment

In an editorial today, the Wall Street Journal claimed a “sharp drop in production on federal lands is the direct result of Obama Administration policies.” They cherry pick statements from a Congressional Research Service (CRS) report to try and support their claim, but ignore sections of the report that directly refute them. The CRS report actually shows that outside factors such as price and geology are driving industry to drill on nonfederal lands, where the most lucrative plays exist.

If you read the CRS report, you learn that:

“Any increase in production of natural gas on federal lands is likely to be easily outpaced by increases on non-federal lands, particularly because shale plays are primarily situated on nonfederal lands and is where most of the growth in production is projected to occur.” (Pg. 3, 1^st and 2^nd paragraph)

“The big shale gas plays are primarily on non-federal lands and are attracting a significant portion of investment for natural gas development.” (Pg. 1, 2^nd paragraph)

“But having more lands accessible may not translate into higher levels of production on federal lands, as industry seeks out the most promising prospects and highest returns.” (Pg. 2, 3^rd paragraph)

Filed under In The News, Permitting Tagged with Big Oil, Checks and Balances Project, drilling, Public Lands

Eyes on Enefit: Financially unstable and unprofitable, and not ready for prime time

March 12, 2013 by Checks And Balances Project Leave a comment

Over the past few weeks, we’ve examined Estonian oil shale company, Eesti Energia, known as Enefit in the U.S., to find out the real story on Estonian oil shale and how it could affect the American West. The outlook is grim.

Even though Eesti Energia is widely considered the world’s leading oil shale firm and is the largest company in the world working with oil shale, it is in a financially vulnerable position. The company has made a number of poor investments, including a new bloc for an Estonian oil shale plant – an investment the Estonian State Audit Office found to be legally questionable and “not economically feasible.” Less than a year after breaking ground on the plant, Eesti Energia abandoned the project.

Things have gotten so bad for Eesti Energia that credit benchmark Moody’s has downgraded the company’s credit rating (now rated negative) twice in the past 15 months.

Even Eesti Energia’s CEO admits that oil shale is not profitable without government subsidies. The reason is simple: oil shale fails the basic economic test. In other words, the return on oil shale doesn’t outweigh the investment.

Over here in the United States, we found Enefit has run into trouble trying to commercially develop oil shale. Despite the company’s claims that extracting Utah oil shale is a “simple mining project,” Enefit has experienced significant problems. Tests show that Enefit hasn’t been able extract oil from the oil shale ore mined in Utah as easily as executives had hoped and promised, and that it requires more energy to process Utah oil shale than expected, which results in higher carbon dioxide emissions. An internal company document called the Utah test results “not promising.” And, despite all the “around the corner” rhetoric we hear from oil shale supporters, at least one Estonian expert thinks that a method for viably extracting Utah oil shale is decades away.

Company dismissals of these concerns are, as one Colorado columnist put it: “reminiscent of previous failures to extract commercial quantities of petroleum from [oil] shale.”

Even when Eesti Energia has been able to produce subsidized energy from oil shale in Estonia, the environmental impact has been disastrous. The company’s Estonian operations have contaminated groundwater, created 600-foot high mountains of oil shale waste that spontaneously ignite, and caused the emission of “lots of carbon dioxide.” A former executive at Red Leaf Resources testified before Congress that Eesti Energia’s Estonian operations were a “nasty business.”

Given this web of problems, it shouldn’t be surprising that company officials can’t seem to keep their stories straight. What is said in the U.S. often doesn’t match up to what is said in Estonia.

Oil shale – a rock that actually contains no oil – has a 100-year track record of failure in the U.S. despite the billions in taxpayer dollars that have been risked on failed oil shale experiments.

The facts from our Eyes on Enefit series argue for taking a cautious, balanced approach to oil shale. Companies like Enefit should not be given more federal land or money for oil shale experiments until they can prove that they are able to develop oil from oil shale in a commercially and environmentally sound way.

This blog is a summation of our series about Enefit, known at home in Estonia as Eesti Energia, covering the company’s financial outlook, background and status of its Utah project.

Filed under Blog, Eyes On Enefit, oil shale Tagged with Checks and Balances Project, enefit, Oil Shale, Public Lands, water

Senators get it wrong on oil & gas production at Jewell nomination hearing; Industry is following the oil to nonfederal lands

March 8, 2013 by Checks And Balances Project Leave a comment

The Senate Energy and Natural Resources convened, Thursday, to question President Obama’s Interior Sec. nominee, REI Chief Executive Officer Sally Jewell. The three-hour hearing was generally friendly, but some Senators couldn’t pass up the chance to repeat oil and gas industry talking points, rather than deal in facts.

The Checks and Balances Project watched the hearing and used Twitter to fact check senators. Sen. Lisa Murkowski (R-AK), Sen. Joe Manchin (D-WV) and Sen. Tim Scott (R-SC) all ignored the facts about western land use and energy development at various points during the hearing.

Here are five statements from the hearing where senators got it wrong on U.S. oil and gas production^*:

“They’ve driven us backward on the development of nearly a trillion barrels of oil shale in the Green River formation in Colorado, Utah, and Wyoming.”

– Sen. Tim Scott (1:29:38 – 1:30:05)

The facts: BLM released a revised PEIS late in 2012 that gave oil shale speculators access to 600,000 acres of public lands. For more than a century, people have tried and failed to make oil shale – a rock that doesn’t actually contain oil – a viable energy source. Along the way, billions of American taxpayer dollars have been risked, with nothing to show for it. According to Taxpayers for Common Sense, the federal government awarded nearly $7 billion in the 1980’s (over $12 billion adjusted for inflation) on oil shale loan and price guarantees.

Being from South Carolina, Sen. Scott may not know all this about oil shale, since they don’t have any. We suggest he reads our Century of Failure report, and visits No More Empty Promises, to learn more.

* * *

“If you look at the amount of production we have off of federal lands, that you would be responsible for, has declined, when private land production has increased. So it looks like the Department of Interior was going a different direction when the economy and the market was driving it – in the private sector – in a complete different direction.”

– Sen. Joe Manchin (54:20 – 54:45)

The facts: Earlier this week the Salt Lake Tribune ran a story on a new report which shows that price and geology are the reason there’s more drilling on private lands today:

Overproduction of U.S. natural gas, not burdensome drilling regulations, is driving energy developers from western public mineral leases to non-federal lands rich in oil to the east…According to the new report, 89 percent of shale oil and mixed oil and gas in the Intermountain West occupy non-federal deposits even though the feds control much of the region’s lands.

Phil Taylor at Greenwire also wrote on oil shale production on federal lands, showing that it’s actually on the rise.

* * *

“Despite tremendous resources on federal lands, nearly all gains in energy production have occurred on State and private lands.”

– Sen. Lisa Murkowski (Opening statement)

The facts: In 2011 the Bureau of Land Management held three of its five largest-ever lease sales for the rights to drill on public land for oil and gas. Those are just some of the 6,314,914 acres of public land the Obama Administration has leased to oil and gas companies – nearly 2.5 times as much as the Administration has permanently protected. A Denver Post story, U.S. oil and gas drilling moving to private land where the shale is, cited a new report from the Center for Western Priorities on the industry’s shift to drilling on nonfederal lands, saying that:

…nationally 93 percent of the shale oil and mixed oil-gas plays and 90 percent of the pure shale natural gas plays were not on federal land.

Oil and gas companies have plenty of public land – so much that 20 million acres of leased lands and nearly 7,000 approved drilling permits lay idle. The most valuable commodities are on private lands, so that’s where industry is drilling.

* * *

“It seems the President’s ‘all of the above’ strategy has not included public land very much. It seems like our success has been on private lands, state lands, but not on public lands, federally owned.”

– Sen. Tim Scott (1:31:08 – 1:31:20)

The facts: Obviously, Sen. Scott also needs to get up to speed on basic facts on U.S. oil and gas production. If CWP’s report isn’t enough, Sen. Scott should read a recent Congressional Research Service report that stated:

Any increase in production of natural gas on federal lands is likely to be easily outpaced by increases on non-federal lands, particularly because shale plays are primarily situated on nonfederal lands and is where most of the growth in production is projected to occur.

Sen. Scott may also want to check out a report (pg. 22) from the Bipartisan Policy Center that states:

This shift [in drilling location] generally reflects a coincidence of geography. The large shale formations that have attracted most of the recent development activity are located in parts of the country where the federal government simply does not have large land holdings (including notably the Bakken, Barnett, Haynesville, Marcellus, and Fayetteville plays).

* * *

“This administration has obstructed access to billions of barrels of oil in ANWR, off our Atlantic, Pacific, and Gulf coasts, and on federal lands out west.”

– Sen. Tim Scott (1:29:38 – 1:30:05)

The facts: The oil and gas industry are sitting on 7,000 idle, green lighted drilling permits, and the federal government consistently approves drilling permits faster than industry can drill new oil and gas wells. Any delays in the permitting process are largely attributable to industry, and not the federal government.

If Sen. Scott would like to come visit the West to see this all for himself, we’d be happy to show him around.

^*Transcribed by Checks and Balances Project from Energy and Natural Resources Committee Archived Webcast,

Filed under Blog, In The News Tagged with Congress, drilling, Energy Production, jewell, politics, Public Lands, senate, Senate Energy and Natural Resources Committee

Denver Post Looks at Public vs. Private Lands Drilling

March 8, 2013 by Checks And Balances Project Leave a comment

In a post on his “Balance Sheet” blog, Mark Jaffe at the Denver Post wades in to the debate about drilling on public lands. He writes:

When Willie Sutton was asked why he robbed banks, he replied, or at least is said to have replied: “Because that’s where the money is.”

And so it is with oil and gas, operators are drilling where the money is and that the Center for Western Priorities says just happens to be on land not overseen by federal agencies.

In the piece, he quotes industry representatives who claim that bureaucracy is holding back drilling on federal lands. In fact, as a report by the Congressional Research Service found that industry, not the government is taking longer to approve permits:

“After a lease has been obtained, either competitively or non-competitively, an application for a permit to drill (APD) must be approved for each oil and gas well…in 2006 it took the BLM an average of 127 days to process an APD, while in 2011 it took BLM 71 days. In 2006, the industry took an average of 91 days to complete an APD, but in 2011, industry took 236 days.” – pg. 8

You can read Jaffe’s full blog post here.

Filed under Uncategorized

Industry and allies twist facts on U.S. oil and gas production report

March 6, 2013 by Checks And Balances Project Leave a comment

Price and geology have incentivized oil and gas companies to drill on nonfederal lands in recent years. Yet this fact hasn’t stopped industry group Western Energy Alliance (WEA) and Congressmen Ed Whitfield (R-KY.), who chairs the House Energy and Commerce Subcommittee on Energy and Power, from mischaracterizing a recent Congressional Research Service (CRS) report on fuel production.

“Once again, House Republicans are spinning tall tales about oil and gas production. Technology, geology and price are the big drivers that determine where and how much industry drills. The industry is following the oil and no amount of rhetoric changes that fact.” said the Checks and Balances Project’s Ellynne Bannon.

Key facts from the recent CRS report that refute claims made by House Republicans and Western Energy Alliance:

“Any increase in production of natural gas on federal lands is likely to be easily outpaced by increases on non-federal lands, particularly because shale plays are primarily situated on nonfederal lands and is where most of the growth in production is projected to occur.”

“The big shale gas plays are primarily on non-federal lands and are attracting a significant portion of investment for natural gas development.” – pg. 1

“But having more lands accessible may not translate into higher levels of production on federal lands, as industry seeks out the most promising prospects and highest returns.” – Pg. 3

“After a lease has been obtained, either competitively or non-competitively, an application for a permit to drill (APD) must be approved for each oil and gas well…in 2006 it took the BLM an average of 127 days to process an APD, while in 2011 it took BLM 71 days. In 2006, the industry took an average of 91 days to complete an APD, but in 2011, industry took 236 days. – Pg. 8

Filed under Blog, News, Permitting

New Report: Drilling Rigs Following the Oil to Nonfederal Lands

March 5, 2013 by Checks And Balances Project Leave a comment

The Center for Western Priorities released its new Follow the Oil report today. CWP Policy Director, and report author, Greg Zimmerman used GIS mapping technology, EIA data, and other information to show that economic, technological and geological forces are moving drillers to private land. The report includes great infographics, and pretty much flies in the face of many industry claims that they’re being forced off federal lands. (The industry’s 7,0000 idle drilling permits and 20 million idle leased acres don’t help their argument either.)

Here’s an excerpt from the report’s executive summary:

“A combination of low natural gas prices and new shale extraction techniques inspired industry to look toward a more profitable commodity: shale oil. As a result, oil and gas companies moved their operations to areas where shale oil was abundant and offer the greatest potential profit.

The large majority of shale oil plays exist under nonfederal lands. Even in the Rocky Mountain West, where more federal land is located, 89 percent of the shale oil and mixed oil and gas plays are under nonfederal lands.”

Read the complete report.

Filed under Uncategorized

Eyes on Enefit: Conflicting Claims

March 5, 2013 by Checks And Balances Project Leave a comment

For over a century, conflicting claims have surrounded the rock called oil shale. Estonian oil shale company Eesti Energia, and its U.S. arm, Enefit, are no exception to this rule. Whether it’s company executives, other oil executives or financial experts, we’ve seen numerous inconsistencies about Enefit’s financial health, technological capability, impact on the environment, and its Utah project.

Technology

What Enefit says in the U.S.	What Enefit says in Estonia
“And most importantly for our project in Utah, and for our activities here in the U.S., we also have demonstrated proven commercial shale oil production. We have our own proprietary technology. We have our own operating plants. And we’ve been operating those plants for more than 30 years. And we produce about 1 million barrels a year.” - Rikki Hrenko, CEO of Enefit America Oil. Transcript of API/Colorado School of Mines Briefing. June 19, 2012.	“But it is not a big surprise that a new technology [Enefit 280] does not work right away.” - Sandor Liive CEO, Eesti Energia. BBC Monitoring Europe, Text of report by private Estonian newspaper Postimees. November 30, 2012.
The company’s technology “does not need to be proven,” says [Enefit] Chairman Harri Mikk, who points out that Enefit has successfully operated an oil shale plant in Estonia for decades. - Utah Business. August 1, 2011. +Note Mikk has since resigned from Enefit’s Board Chair	“According to [Sandor] Liive, [oil] shale has so far been produced in Estonia by employing the trial and error method. The old Eesti Energia production plant is a proof of that – over the years, the solutions used there have been almost completely changed. - BBC Monitoring Europe, via Postimees. May 4, 2010.
	“The tests are not promising,” - Eesti Energia internal document obtained by Eesti Ekspress. Estonian Public Broadcasting. January 24, 2013.

Utah Project

What Enefit says in the U.S.	What Enefit says in Estonia
“And most importantly for our project in Utah, and for our activities here in the U.S., we also have demonstrated proven commercial shale oil production. We have our own proprietary technology. We have our own operating plants. And we’ve been operating those plants for more than 30 years. And we produce about 1 million barrels a year.” - Rikki Hrenko, CEO of Enefit America Oil. Transcript of API/Colorado School of Mines Briefing. June 19, 2012.	“The [Utah] tests are not promising,” - Eesti Energia internal document obtained by Eesti Ekspress. Estonian Public Broadcasting. January 24, 2013.
“This is a simple mining project. The mining component is nothing unique to oil shale. This is a simple mineral processing project.” - Rikki Hrenko, CEO of Enefit America Oil. Transcript of API/Colorado School of Mines Briefing. June 19, 2012.	The Salt Lake Tribune recently reported that Enefit is experiencing difficulties applying its technology to Utah oil shale deposits, and specifically that the company hasn’t been able extract oil from the oil shale ore mined in Utah as easily as executives had hoped and promised. - Utah oil shale becomes political punching bag in Estonia. Salt Lake Tribune. January 25, 2013.
	Ingo Valgma, director of the Department of Mining at the Tallinn University of Technology in Estonia, said that he believes oil production from Utah shale is not a matter of five to six years, as Enefit predicts, but more a question of decades. - Utah oil shale becomes political punching bag in Estonia. Salt Lake Tribune. January 25, 2013.
	Eesti Energia’s spokesperson says that the applied development technology needs enhancing. Eesti Energia has invested EUR 33.3mn [$43.1 million] in the Utah project since 2011, including EUR 29.6mn [$38.6 million] in the acquisition of the Utah-based oil shale exploration and development company. Eesti Energia is projecting an additional EUR 37mn [$48.2 million] investment in the Utah shale oil project by 2016. - Esmerk. January 18, 2013.

Environment

What Enefit says in the U.S.	What Enefit says in Estonia and what oil executives say
“A proven, efficient and environmentally sound means to help Utah become energy independent while providing long-term jobs for local families.” – Enefit Utah website.	“I worked in Estonia for several years. You’re exactly right. The old antiquated surface retorts that they use there are pretty nasty business. They produce a lot of semicoke. You know, they call them the Estonian Alps…. you would never want the retorts that are operating — operating in Estonia to come to the United States.” – Anton Dammer, NOSA Board Member and former Senior Vice President of Red Leaf. CQ Transcript—House Committee on Science, Space and Technology, Subcommittee on Energy and Environment. May 10, 2012
“[Oil shale is] commercially viable… And it can be done in an environmentally responsible manner.” - Rikki Hrenko, CEO of Enefit America Oil. Transcript of API/Colorado School of Mines Briefing. June 19, 2012.	“…our production involves the emission of lots of carbon dioxide.” – Sandor Liive, CEO, Eesti Energia. Interview Eesti Paevaleht website via BBC Monitoring Europe. July 4, 2011.

Commercial Viability

What Enefit says in the U.S.	What Enefit says in Estonia and what Moody’s says
“[Oil shale is] commercially viable. It is proven. We’re doing it on a large scale commercial production basis in Estonia and have been for decades. And it can be done in an environmentally responsible manner. “ - Rikki Hrenko, CEO of Enefit America Oil. Transcript of API/Colorado School of Mines Briefing. June 19, 2012.	“True, most of the investments are made under various subsidy schemes because even current free market prices are not high enough to make investments financially profitable.” - Sandor Liive, CEO, Eesti Energia. Interview, Eesti Paevaleht website via BBC Monitoring Europe. July 4, 2011.
“And most importantly for our project in Utah, and for our activities here in the U.S., we also have demonstrated proven commercial shale oil production.” - Rikki Hrenko, CEO of Enefit America Oil. Transcript of API/Colorado School of Mines Briefing. June 19, 2012.	In January 2013, Moody’s credit agency downgraded Eesti Energia’s bonds to negative, citing the evolving “business risk profile” of the company, and its inability to maintain profitability “given CO2-intensive oil-shale based generation assets.” - Moody’s changes outlook on Eesti Energia’s Baa1/P-2 ratings to negative. January 8, 2013.

Not even Enefit’s executives can agree whether or not oil shale is ready for prime time in the U.S. Oil shale companies like Enefit must prove they viable commercial technology that won’t harm our water or communities before they get any more public land.

This blog is part of a series about Enefit, known at home in Estonia as Eesti Energia, covering the company’s financial outlook, background and status of its Utah project.

Filed under Blog, Eyes On Enefit, oil shale Tagged with Checks and Balances Project, enefit, Energy, Oil Shale

Another Friday News Dump: State Department Paves Way for Keystone XL Approval

March 1, 2013 by Checks And Balances Project Leave a comment

State Department releases Keystone XL environmental impact statement, ignores reality of climate change impacts

This afternoon, the State Department released its Supplementary Environmental Impact Statement (SEIS) on the controversial Keystone XL (KXL) pipeline, claiming that the pipeline will “not likely result in significant adverse environmental effects.” The SEIS paves the way for President Obama’s approval of the pipeline despite widespread concern over the climate impacts of tar sands oil.
The State Department assessment does acknowledge that excavation of the Canadian tar sands oil would result in 17% more climate change emissions than the average barrel of heavy crude oil. But the report continues to say that the KXL pipeline would have no adverse impact on climate change because if the pipeline were not approved, companies would ship tar sands oil via railroad.

In reality, the Keystone XL pipeline is a “fundamental element in the oil industry’s plan to triple production of tar sands oil from 2 million barrels per day (bpd) to 6 million bpd by 2030″ (and eventually to 9 million bpd), according to a whitepaper (PDF) from the Natural Resources Defense Council (NRDC). The NRDC whitepaper quotes Andrew Potter, a Managing Director at CIBC World Markets, an investment banking subsidiary of the Canadian Imperial Bank of Commerce, as saying “Even if you build every single pipe that’s on the table right now… you’re still short pipeline capacity…For the growth to continue, all the proposed export pipeline capacity and more will need to be built, and soon.”

With other options for transporting tar sands oil facing significant opposition, Keystone XL is the path for tar sands industry growth. The Obama Administration just released a report that positions the President to greenlight the project. So as the President goes to make his decision in the coming weeks, let’s hope he remembers his lofty words from his inaugural address: “We, the people, still believe that our obligations as Americans are not just to ourselves but to all posterity. We will respond to the threat of climate change, knowing that the failure to do so would betray our children and future generations.”

For more breaking news on the Keystone XL decision, see DeSmogBlog’s live blog here.

Filed under Uncategorized Tagged with climate change, Keystone XL, KXL, NRDC, Obama, oil, State Department, Tar Sands

Conservation group sends BLM Director Hankins a sign

February 28, 2013 by Checks And Balances Project Leave a comment

This week, Alan Prendergast wrote in Westword about a new Environment Colorado campaign to protect Colorado’s national parks from drilling:

“When you’re a bureaucrat under fire, accused of being a tool of Big Oil, there’s nothing like a big, wet kiss from your critics to let you know you’re being watched — closely. Particularly if that greeting takes the form of a giant billboard on I-70 in Golden, not far from the Bureau of Land Management office where Colorado director Helen Hankins ponders oil and gas leases on public lands and other weighty matters.”

Since assuming her post in 2010, Dir. Hankins has executed her job as if she were a real estate agent for oil and gas companies. She has proposed allowing drilling on lands near national parks, Denver’s watershed in South Park, agricultural communities… anywhere that industry asked for it.

After a year of public outcry – that was heard all the way to the Department of Interior in Washington, D.C. – she deferred many of those leases, but that’s not a permanent solution. Environment Colorado’s roadside message to Dir. Hankins should be seen as a reminder – Do your job the way it’s supposed to be done.

Billboard on I-70

It’s time conservation be put on equal ground with oil and gas drilling.

Filed under Blog, Permitting

Eyes on Enefit: Under fire for risky investments

February 27, 2013 by Checks And Balances Project Leave a comment

Eesti Energia, known as Enefit in the U.S., has been under fire from both the Estonian press and high-level Estonian officials for its poor investment record. As Raimo Poom, a columnist for Estonian publication Eesti Paevaleht wrote:

“Eesti Energia’s plan to build up a huge shale oil industry raises a lot of questions; financing the plan is the most questionable decision taken by the government lately.”
– Raimo Poom, Columnist, Eesti Paevaleht, May 22, 2010 via BBC Monitoring Europe

According to the former deputy CEO of a subsidiary of Eesti Energia’s biggest oil shale processor:

“Eesti Energia’s activities largely look like an unplanned adventure, and this type of export of oil shale-related know-how is simply adventurism.”

– Mati Pallasma, former deputy of VKG OIL AS, subsidiary of VKG, Postimees, April 8, 2011 via BBC Worldwide Monitoring

Even Eesti Energia itself acknowledged that the present time is “financially, the most complicated period of time for us… [and] will be the most difficult time.”

Photo of Narva Power Plant. Source: The Baltic Course

Here are a few examples of Eesti Energia’s questionable investment strategies and what opinion leaders and financial experts inside and outside of Estonia had to say about them.

Eesti Energia and Estonian government are accused of pushing through a large investment based on “legally questionable basis”

Eyewitness, an Estonian investigative journalism show, accused Eesti Energia and the Estonian government of “pushing through” large investments in the new blocs of the Narva power plants, despite the fact it was, “legally incorrect and based on incorrect data.”

State Audit Office chief auditor Tarmo Olgo said building the Narva blocs at a total cost of 1 billion Euros ($1.3 billion U.S. dollars*), “is not necessary as it won’t contribute anything to the market,” and that, “it is not economically feasible…”

So, it’s not surprising then, that Eesti Energia sought in January to abandon operations at the plant, after the company found, “the new station would be unable to produce electricity for a competitive price.”

Eesti Energia abandoned the second phase of the plant – a 400 million euro investment [$522 million U.S. dollars*] less than one year after the cornerstone laying ceremony.

Standard & Poor’s downgrades Eesti Energia’s bonds to negative, while Moody’s raises concerns over risky Lithuanian investment prospects

Eesti Energia’s failed investments aren’t limited to oil shale. The company also considered investment in Lithuanian nuclear power plant, despite credit rating agencies’ reservations.

Standard & Poor’s Rating Services said that [sic] has revised the outlook on…Eesti Energia AS to negative from stable to reflect the risk that the company’s credit quality will weaken due to possible participation in a prospective nuclear power plant in Lithuania.

– Eesti Energia outlook cut to negative on possible nuclear plant investment – S&P, Thomson Financial Super Focus, August 28, 2007

The Moody’s rating agency says in a comment concerning the new nuclear power plant concession bill supported by the government in Lithuania, that proceeding with the plan would jeopardize the power utilities Eesti Energia’s and Latvenergo’s credit ratings.

– NPP Project threat to power utilities’ rating- Moody’s, Esmerk, DELFI.ee, May 14, 2012

Lithuanians back out of deal with Eesti Energia due to company’s debt burden

Eesti Energia’s home government isn’t alone in expressing doubt over the company’s investments. Other governments have shown wariness toward Eesti Energia as well. Lithuania backed out of a privatization deal with Eesti Energia because of the company’s debt burden of one billion litas ($379 million U.S. dollars**).

One more argument against selling RST, a profitable and stable company, to Eesti Energia is the Estonian company’s debt burden of almost a billion litas, which limits its investment possibilities.

– Estonians to seek compensation over aborted sale of Lithuanian power grid, Baltic News Service, March 3, 2004

If a history of failed investment sounds familiar to Eastern Utah and Western Colorado residents, it should. Oil shale development in the region has had a similar track record of failure. Given this shared history, it makes sense for oil shale companies like Enefit to prove they have developed a technically and commercially feasible way to produce oil shale before they are given more access to public lands and resources.

*Calculated using the Euros to U.S. Dollars conversion rate on February 27, 2013

**Calculated using the Litas to U.S. Dollars conversion rate on February 27, 2013

This blog is part of a series about Enefit, known at home in Estonia as Eesti Energia, covering the company’s financial outlook, background and status of its Utah project.

Filed under Blog, Eyes On Enefit, oil shale Tagged with enefit, Energy, Oil Shale

Eyes on Enefit: Oil shale extraction an environmental threat

February 26, 2013 by Checks And Balances Project Leave a comment

Contaminated groundwater, 600-foot high piles of oil shale waste that spontaneously ignite, and the emission of “lots of carbon dioxide”; all of this comes from a company that claims to be “highly dedicated to lessening the environmental impact of our production processes.” A look at the facts reveals that, despite its claims, Estonian oil shale company Eesti Energia’s operations have been anything but environmentally friendly.

For several decades Eesti Energia, an Estonian government-owned corporation, has been extracting oil shale, and using it to generate Estonian electricity at a stunning environmental cost. In the United States, Eesti Energia is known as Enefit. In 2011, Enefit bought the largest privately held oil shale reserve in Utah, and since then it has been experimenting with oil shale found on that land.

Since Eesti Energia has brought its oil shale technology to our shores through Enefit’s Utah project, we think a quick review of the company’s environmental record is in order. That way, Utahns can see what could be in store for them.

A polluted lake near an “ash” mountain in NE Estonia. Source: EcoCrete Project

First off, let’s see what the Estonians think of oil shale. A member of the Estonian Parliament described oil shale waste as a problem “for which there is no solution at present.” Researchers at Estonia’s Tallinn University of Technology and the Estonian Fund for Nature describe the oil shale industry’s environmental impacts as “huge.”

Scientists at Tartu University and the Institute of Ecology even wrote a paper in which they explain how Estonian oil shale’s waste is hazardous.

“[The] Processes of oil shale mining, combustion in power plants, and thermal processing in chemical plants generate a huge amount of solid waste…Semi-coke dumps surrounding the plants of oil shale thermal processing. Semi-coke is a residue classified as environmentally harmful due to its components like sulphides, volatile phenols, benzo(a)pyrene, etc.”

– “Artificial Mountains in North-East Estonia: Monumental Dumps of Ash and Semi-Coke.” Tartu University and the Department of North-East Estonia. 2005.

In fact, these waste products are so unstable, they have been known to spontaneously combust and contaminate groundwater and soil. As of 2005, 27 percent of oil shale landfills in Estonia had self-ignited.

“Observation of groundwater and soil illustrate that the environment close to burning landfills is contaminated with molybdenum, copper, sulphate, arsenic, oil products, and PAHs…”

– “Life Cycle Analysis of the Estonian Oil Shale Industry.” Estonian Fund for Nature and Tallinn University of Technology. 2005.

In spring 2012, The Baltic Course magazine reported that one of these massive oil shale waste piles caught fire during the winter, and still continued to burn. The magazine also noted there is, “no universal solution to extinguish such a fire.”

In addition to water and ground pollution, Eesti Energia’s CEO, Sandor Liive admitted producing energy from oil shale creates significant global warming pollution, or “lots of carbon dioxide,” as he puts it.

“The risk concerning the price of carbon dioxide is relatively high for Eesti Energia because our production involves the emission of lots of carbon dioxide.”

– Sandor Liive, CEO Eesti Energia. Interview with Eesti Paevaleht. BBC Monitoring Europe. 04 July 2011.

Arial photo of a pile of oil shale ‘ash’ in Estonia. Source: EcoCrete Project.

Eesti Energia isn’t the only company experimenting with the rock that admits oil shale has negative environmental impacts. In 2012, Anton Dammer, a former Senior VP at oil shale company Red Leaf Resources, testified to Congress:

“I worked in Estonia for several years…The old antiquated surface retorts that [Eesti Energia] use are pretty nasty business…They produce a lot of semicoke. You know, they call them the Estonian Alps…I can’t tell you exactly all the technical details of it, but it’s – it’s much improved, but you would never want the retorts that are operating – operating in Estonia to come to the United States.”

– Anton Dammer, Senior Vice President of Red Leaf [Resources]. CQ Transcript, House Committee on Science, Space and Technology, Subcommittee on Energy and Environment. 10 May 2012.

Eesti Energia’s environmental track record shows its claims of environmental friendliness ring hollow. Oil shale production’s health and environmental risks present a clear case against allowing oil shale companies increased access to public lands. Until they can prove they have a commercially viable technology that won’t pollute our communities’ air and water supplies with harmful waste, they shouldn’t receive more handouts.

This blog is part of a series about Enefit, known at home in Estonia as Eesti Energia, covering the company’s financial outlook, background and status of its Utah project.

Filed under Eyes On Enefit, oil shale Tagged with enefit, estonia, Oil Shale, The Checks and Balances Project, water contamination

The Real Cost of Coal Exports and Fossil Fuels

February 26, 2013 by Checks And Balances Project Leave a comment

With major fossil fuel projects ramping up across the globe, fossil fuel interests are ignoring the catastrophic costs that carbon pollution causes (and will cause) around the world. Meanwhile, critics of clean energy technologies continue to spread disinformation to discredit the emerging sector and promote fossil fuels as the only viable source of energy.

Coal exports are on the rise. U.S. coal exports exceeded the Department of Energy’s projections by 30% in 2012 as reported by Nate Aden, a PhD student from the Energy and Resources Group at the University of California, Berkeley. Coal demand is being driven in part by economic growth in China and other developing countries, but these developing countries are not alone. The World Resources Institute found that 1,100 coal-fired power plants are being proposed around the world. And, according to the U.S. Department of Commerce, countries in Europe were the destination for 45% of U.S. coal exports in 2012.

Australia and Indonesia also have major coal export projects underway. According to the Guardian’s Graham Readfearn, Australia is already the world’s largest exporter of coal, sending twice as much CO2 abroad than it emits at home.

Readfearn writes that exports of carbon fuels will come back to bite Australia in the form of climate disruption. In the past two months, Australia has been ravaged by hundreds of wildfires caused by the “biggest and longest heat wave on record in January.” This type of extreme weather is exactly what 97% of climate scientists have been warning our leaders for over two decades. The New Scientist cited Jon Nott who researches extreme weather events at James Cook University (in Australia) saying, ”The frequency of more intense events is going to increase” as a hotter world becomes the new reality.

The Washington Post reported, “If we want to avoid severe global warming, we’ll have to stay within a strict carbon budget in the decades ahead…” A new report by Greenpeace details the 14 biggest threats to the “climate stabilization budget” with the top three being China’s coal reserves in the western provinces, Arctic oil drilling and Australian coal exports. Coal exports account for three of the 14 fossil fuel projects under development that would “blow past [our strict carbon] budget.”

So, with these identifiable threats to stabilizing the earth’s climate, why aren’t we rapidly decommissioning fossil fuel projects around the world?

One answer lies in the powerful and fossil fuel-funded opposition to clean energy solutions to climate change.

Clean energy opponents argue that clean energy technology is “too expensive” while ignoring the much larger subsidies and externality costs of fossil fuels (for more on these advocacy groups see our report, “Fossil Fuel Front Groups on the Front Page”).

While the argument about clean energy may have been true a decade ago, rapidly falling prices of wind, solar and other clean technologies are rendering that argument obsolete. In January, the International Renewable Energy Agency released a report (PDF) showing that “the rapid growth in the deployment of solar and wind is driving a convergence in electricity generation costs for renewable power generation technologies at low levels.” The report goes on to say that the rapid cost reductions of installed renewable energy technology mean that data one or two years old can significantly overestimate the cost of electricity from renewable energy technology. In other words, cost reductions are making clean energy competitive with fossil fuels around the world.

Moreover, the costs for fossil fuels (including fuels coming from the 14 projects above) do not account for the potential damage their emissions will cause as we drift towards climate disaster. These fossil fuel pollution externalities should be factored into the cost of business. After factoring in the cost of pollution, maybe digging up coal and shipping it across the globe won’t look like such a great investment.

For future generations, let’s hope the real cost of fossil fuels is factored into our calculations soon.

Filed under Uncategorized Tagged with Australia, Berkeley, Cal, China, clean energy, climate change, coal, coal exports, cost of carbon, Energy and Resources Group, Fossil Fuels, global warming, Greenpeace, Guardian, United States, University of California, Washington Post

Eyes on Enefit: Oil shale CEO says investments in oil shale aren’t profitable

February 21, 2013 by Checks And Balances Project Leave a comment

This blog is part of a series about Enefit, and Eesti Energia, covering the company’s financial outlook, background and status of its Utah project.

History has shown that for more for more than a century, oil shale is not a commercially viable energy source in the U.S. Oil shale is actually a rock that doesn’t contain oil at all (pdf). It’s kerogen, or fossilized algae, locked in shale rock. In order to turn oil shale into oil, the rock has to be superheated for months or even years, and then processed. That takes a lot of energy, money and potentially a lot of water

Yet, that hasn’t stopped industry executives and supporters, like ECCOS, from promoting oil shale as being on the verge of economic viability.

So it was surprising to read an interview (pdf) with the CEO of Eesti Energia (parent company to Enefit) which is regarded as the world leader in oil shale, admit that oil shale isn’t profitable.

“True, most of the investments are made under various subsidy schemes because even current free market prices are not high enough to make investments financially profitable.” – Sandor Liive, Esti Energia CEO, Eesti Paevaleht website via BBC Monitoring Europe, July 4, 2011

It’s great to see this type of candor and acknowledgement that Eesti Energia has been able to produce commercial oil shale in Estonia due to significant government subsidies. Now it looks like Eesti Energia is asking for more subsidies. But it turns out that not everyone thinks that’s a good idea, as some elected leaders in Estonia are raising questions about oil shale investments:

“The upcoming sharp increase in the power tariffs will almost double the prices of daily goods and services from January 2013, but this is not enough for Eesti Energia. While this year the company received 150 million euros in state subsidies, it is demanding another 200 million in 2013…Eesti Energia…pay[s] a few tens of millions of euros in oil-shale resource fee every year, but earn hundreds of millions of euros in net profit…benefitting from publicly owned oil-shale.” – Edgar Savisaar, Chairman of Estonian Centre Party, Text of report from Aripaev website via http://www.bbn.ee October 18, 2012

FYI, 200 million euros is the equivalent of approximately $264 million.

You can read previous installment of Checks and Balances Project’s Eyes on Enefit series here.

Filed under Eyes On Enefit, oil shale

Eyes on Enefit: Untested technology, unproven results

February 20, 2013 by Checks And Balances Project Leave a comment

This blog is part of a series about Enefit, and Eesti Energia, covering the company’s financial outlook, background and status of its Utah project.

Despite posturing by Enefit’s corporate officers, internal documents and tests show that the company’s attempts to extract and process oil shale in Utah have run into trouble.

Enefit Chairman Harri Mikk has said that their technology “does not need to be proven.” (ed. note – Harri Mikk resigned from the board 31 Dec. 2012)

This past June, Enefit CEO Rikki Hrenko made the following statement:

“And most importantly for our project in Utah, and for our activities here in the U.S., we also have demonstrated proven commercial shale oil production.”

But Eesti Energia’s CEO, recent test results, and internal documents tell a very different story.

In late 2012, Estonian newspaper Postimees reported that the company had experienced delays and setbacks with its new Enefit 280 technology.

Sandor Liive, chief executive officer of Eesti Energia [Estonian state-owned power company] said that the company has failed to put their new [oil shale] production plant into operation due to technological problems and, therefore, the launch of the plant has been postponed until the new year. – BBC Monitoring Europe, Text of report by private Estonian newspaper Postimees, November 30, 2012

“But it is not a big surprise that a new technology does not work right away,” said Sandor Liive, CEO Eesti Energia – BBC Monitoring Europe, Text of report by private Estonian newspaper Postimees, November 30, 2012

According to the Postimees, the delay puts on hold the company’s plans for similar facilities in the United States and Jordan.

Enefit’s new oil shale technology had only been tested in a lab until recently when, after technical delays, the Enefit 280 plant began producing oil from oil shale in December of 2012.

Back here in the United States, the Salt Lake Tribune reports that Enefit is experiencing difficulties applying its technology to Utah oil shale deposits, and specifically that the company hasn’t been able extract oil from the oil shale ore mined in Utah as easily as executives had hoped and promised. Tests have proven Utah’s oil shale to be “stronger and drier” than Estonian oil shale.

Following the tests, Enefit CEO Hrenko said that “…the results were positive…” yet an internal company document, obtained by an Estonian newspaper, stated that “the tests are not promising.”

The Vernal Express also reported that:

Enefit’s Utah project has proven to be “unexpectedly difficult to do,” and that tests indicate that Utah oil shale requires more energy to break down than expected, resulting in higher carbon dioxide emissions.

What Enefit called, “a simple mining project” has experienced significant delays and requires additional funds. Eesti Energia now projects Enefit’s Utah project will need an additional 37 million Euro in investment. And, Estonian mining experts say oil production from Utah oil shale is still decades away.

The financial and environmental risk posed by this still unproven technology demands that companies like Enefit fully prove the viability of their technologies before they are given access to more public land for oil shale extraction.

Read the first installment of Checks and Balances Project’s Eyes on Enefit series.

Filed under Eyes On Enefit, oil shale

Eyes on Enefit: Moody’s downgrades oil shale “leader” debt rating to negative

February 19, 2013 by Checks And Balances Project Leave a comment

This blog is the first in a series about Enefit, and Eesti Energia, covering the company’s financial outlook, background and status of its Utah project.

Last month, the benchmark credit agency Moody’s downgraded the bond rating of the world’s largest oil shale company Eesti Energia, to negative. The downgrade is the second in just over a year by Moody’s.

For several decades, Eesti Energia, an Estonian government owned corporation has been extracting oil shale and primarily using it to power Estonia’s electricity needs.

Eesti Energia is Estonia’s largest employer and considered a world leader in processing oil shale using a proprietary retorting technology.

According to Moody’s, the most recent downgrade reflected:

The evolving “business risk profile” of the company, and its inability to maintain profitability “given CO2-intensive oil-shale based generation assets.”

In their press release, Moody’s executives wrote:

“An increasing proportion of Eesti Energia’s business comprises [oil shale] activities, which Moody’s considers carry higher risk compared with the group’s core utility services.”

Put bluntly, the credit agency isn’t confident Eesti Energia can make oil shale profitable. This is the same problem that’s defined oil shale for over a century. In December 2011, Moody’s dropped Eesti Energia’s investment grade from to Baa1, from A3 – an action that designated the company a “moderate credit risk”, and placed it at the bottom half of Moody’s investment rating scale.

The downgrade reflects Eesti Energia’s weakening financial profile in the context of an increase in higher risk activities undertaken by the company following the partial opening of the Estonian electricity market.

Enefit, a subsidiary of Eesti Energia, operates in the U.S. and owns the largest privately held oil shale deposit in Utah, where it has been working to extract and process oil shale. Earlier this year, we blogged about how Estonian government investors were starting to express serious concerns at the prospect of losing $100 million from their government’s heavy investment in Enefit’s Utah project.

These serious doubts of oil shale’s viability demonstrate that a responsible approach to oil shale is one that requires oil shale companies, like Enefit, to demonstrate they can safely and responsibly extract energy from oil shale before their industry is given access to more public land. And, from the perspective of the financial markets, Enefit and oil shale have a long way to go.

Filed under Eyes On Enefit, oil shale, Uncategorized

2012 record-breaking year for Colorado oil production; in last nine years, 2,000 new oil and gas wells added per year

February 15, 2013 by Checks And Balances Project Leave a comment

Yet again, the oil and gas industry is crying wolf about stunted energy production. But, as Colorado Oil and Gas Conservation Commission Director, Matthew Lepore testified before a House subcommittee, the industry is achieving record growth in Colorado.

In testimony to the House Committee on Energy and Commerce Subcommittee on Environment and the Economy today, Lepore said:

“We have been adding at least 2,000 new wells per year for the past nine years, and expect 2013 to be similar. 2012 was a record-breaking year for oil production in Colorado; we expect production to top 47 million barrels when final numbers are tallied. We rank fifth in the nation in natural gas production and tenth in oil production.”

These facts haven’t stopped industry from claiming that energy production is stunted. Just last week, in response to the Colorado BLM’s decision to defer controversial drilling plans in North Fork Valley, West Slope COGA Executive Director David Ludlum argued that:

“the decision ‘threatens social justice and economic prosperity,’ by inhibiting energy production…”

But the facts just don’t support COGA’s claim.

Production isn’t just up in Colorado – earlier this week we blogged about how oil and gas production has skyrocketed on public lands. In fact, the oil and gas industry has so much public land that they don’t seem to know what to do with it – one could even compare them to the subjects of A&E’s TV show, “The Hoarders”. Oil and gas companies are sitting on more than 20 million acres of leased public land that they’re not using for production or exploration, and thousands of idle drilling permits.

Filed under Colorado

Donors Trust: The Secret Group Funding Attacks on Clean Energy & Climate Science

February 15, 2013 by Checks And Balances Project Leave a comment

New research shows almost $120 million flowed from two secretive groups, called “Donors Trust” and “Donors Capital” to 102 groups denying climate science and attacking clean energy. The Guardian’s Suzanne Goldenberg reports that “the funds, doled out between 2002 and 2010, helped build a vast network of think tanks and activist groups working to a single purpose: to redefine climate change from neutral scientific fact to a highly polarizing ‘wedge issue’ for hardcore conservatives.”

Greenpeace research (.pdf) into the tax records of these organizations shows that publicly-disclosed funding for climate denial groups from foundations connected to the Koch Brothers began to decrease in 2006. But, funding from Donors Trust and Donors Capital Fund soared from less than $20 million per year to almost $35 million per year from 2006 to 2009. Kert Davies, research director at Greenpeace said to the Guardian, “These groups are increasingly getting money from sources that are anonymous or untraceable. There’s no transparency, no accountability for the money. There is no way to tell who is funding them.”

Many of these organizations funded by Donors Trust and Donors Capital Fund are also working to attack clean energy. Goldenberg notes in a companion article that recipients, including groups like the Heartland Institute and Americans for Prosperity (AFP), have received millions from the two secretive organizations.

AFP, which received $7.6 million from Donors Trust and Donors Capital Fund in 2010 (43% of its budget), drove anti-wind efforts last fall, leading a coalition of fossil fuel-funded groups to write a letter calling on Congress to block tax credits for wind energy. The Washington Post reported in November 2012 that the Heartland Institute, which received $1.6 million from Donors Trust and Donors Capital Fund in 2010 (27% of its budget), joined with the American Legislative Exchange Council (ALEC) to push model legislation to state legislators in an effort to eliminate state clean energy standards across the country. In addition, organizations that are part of the State Policy Network (SPN), which received $4.8 million from Donors Trust in 2010 (36% of its budget), published reports bashing clean energy standards that are now likely being used to attack clean energy policies in states across the country (like Kansas and Ohio).

Furthermore, the Guardian revealed in a third story that Donors Trust bankrolled the Franklin Centre for Government and Public Integrity, a newly established organization founded in 2009, which is running a campaign to “stop state governments moving towards renewable energy.” The Franklin Centre has strong ties to American’s for Prosperity and the Koch Brothers, including former staff members of both AFP and a Koch Family Foundation according to a PR Watch investigation.

Are these attacks ideological? Or are other fossil fuel interests like the Koch Brothers funding these efforts to stop a potential market threat? We know that fossil fuel corporations that have a financial incentive to stop the growth of the clean energy industry and their benefactors and foundations have funded many of these groups over the years. With an ability to hide the money trail through groups like Donors Trust, I would bet fossil fuel interests continue to fund fake grassroots campaigns and front groups to attack clean energy.

Filed under In The News, Pundit Masquerade Tagged with ALEC, American Legislative Exchange Council, Americans For Prosperity, Big Gas, Big Oil, Checks and Balances Project, Donors Capital, Donors Trust, Energy, Environment, Fossil Fuels, Franklin Centre, Greenpeace, Guardian, Kansas, Koch, lobbying, media, Ohio, State Policy Network

Local residents turn out to protest Colorado BLM’s controversial ‘lease first, plan later’ approach

February 14, 2013 by Checks And Balances Project Leave a comment

Wednesday, South Park and the North Fork Valley residents and business owners turned out to protest BLM’s controversial ‘lease first, plan later’ approach to oil and gas drilling at the Colorado BLM Resource Advisory Council (RAC) meetings. The public’s testimony focused on the need for BLM to finish critical planning and studies before they lease lands, in order to protect water supplies, local economies and wildlife.

Colorado Wildlife Federation Executive Director, Suzanne O’Neil, called on Colorado BLM to create a Master Leasing Plan (MLP) before any lease permitting moves forward in South Park.

“…The MLP process equips the BLM and the community and other stakeholders to take a careful look at potential conflicts between oil and gas development and drinking water, gold medal fisheries, wildlife, archeological treasures…[and] will provide certainty for industry by identifying the lands for leasing which have the least amount of conflict. To lease parcels in the interim simply would undercut the ability to apply the MLP tools effectively.”

Representatives from Great Old Broads for Wilderness told Colorado BLM that it’s ‘unacceptable to proceed with business as usual’ on oil & gas leases – calling for a Master Leasing Plan first. They also called on the BLM to protect South Park water, which supplies water for Denver Metro residents.

Clean Water Action Colorado delivered 2,000 comments from South Park residents calling for BLM to complete a Master Leasing Plan in South Park immediately to protect Denver Metro water.

A Lafayette resident told the BLM “[you should be] ashamed of yourselves” for not taking a more robust stance against fracking. Later one of the Colorado BLM RAC members noted that Governor Hickenlooper might drink fracking fluids, but that he didn’t want to.

A representative from Be the Change, Phil Doe, called out the Colorado BLM for failing to complete a single study on the impacts of fracking on water quality, air quality or wildlife before moving forward with leasing plans in areas where fracking would likely occur- including South Park.

The Colorado BLM deferred parcels in South Park in response to outcry from county commissioners, water experts, residents and sportsmen. The deferred South Park leases were located next to three major water reservoirs that supply the Denver Metro area with drinking water.

Doe also chided the Colorado BLM for rushing leases without proper data and planning, when just 30% of land leased by BLM in the state is actually under production.

Residents from the North Fork Valley took the opportunity to call on Colorado BLM to halt lease decisions until critical planning has been finished. Sarah Souter from the Western Slope Conservation Center delivered 11,586 comments to BLM asking that they plan first and then lease.

Western Slope Cons. Center gives 11,586 sigs to @blmcolorado to ask That they finish plans beforeleasing in North Fork Valley #copolitics

— Checks and Balances (@CandBP) February 13, 2013

Souter called the deferrals a good step but ‘only temporary’. She also called on the Colorado BLM to engage in a meaningful conversation with local residents and business in order to come up with a balanced approach. Presumably her comments were related to Colorado BLM Director Helen Hankins’ previous refusal to meet with local groups or to take questions from residents at public meetings about the oil and gas leasing proposals.

The Colorado BLM meetings continue through the week, though both Senator Udall and Governor Hickenlooper have cancelled their scheduled appearances – leaving us wondering if BLM’s controversial drilling proposals are just too hot to handle these days.

Filed under Uncategorized

Fact Check on #SOTU and Rep. Doc Hastings

February 14, 2013 by Checks And Balances Project Leave a comment

In Tuesday night’s State of the Union address, President Barack Obama stated:

“Now, in the meantime, the natural gas boom has led to cleaner power and greater energy independence. We need to encourage that. That’s why my administration will keep cutting red tape and speeding up new oil and gas permits.”

House Natural Resources Committee Chairman Doc Hastings claimed in a response, yesterday, that Obama administration-created red tape has slowed down energy production.

The truth is that the oil and gas industry already has plenty of land and opportunities to drill. Oil and gas companies are sitting on millions of leased acres of public land that they’re using for production or exploration, and thousands of idle drilling permits. Meanwhile, the United States has seen oil production skyrocket on federal lands. Technology, geology and price determine where and how much industry drills, not red tape.

Instead of worrying about multi-billion dollar oil and gas companies, the Obama Administration needs to adopt a more aggressive policy when it comes to conserving public land. During President Obama’s first term, his administration permanently protected far fewer acres than his immediate four predecessors. The President and Congress need to adopt a more balanced approach to public land use, putting as much effort into protecting lands that are crucial to the nation’s tourism and outdoor recreation industries as they do expanding the oil and gas industries’ already-swollen public land holdings.

A few things Americans need to know about oil and gas production on public lands:

Industry is responsible for the majority of permitting delays. Last year, BLM announced it is moving to an online permitting system that will hopefully help companies cut down the time it takes them to properly file permit applications.

BLM Table of Average Application for Permit to Drill (APD) Approval Timeframes: FY2005 – FY2012

Industry is submitting far fewer permits to drill on public lands because of the shift from public lands’ natural gas resources to private lands’ shale oil deposits, and the federal government can’t approve a permit unless industry submits an application for it. More importantly, the federal government consistently approves drilling permits faster than industry can drill new oil and gas wells. The only thing holding back industry is industry.

BLM Summary of Onshore Oil and Gas Statistics

Industry does not use the drilling permits that have already been issued for oil and gas development. In fact, there are nearly 7,000 unused drilling permits that industry could develop on federal public lands.

BLM Approve Permits – Not Drilled table

According to the Department of Interior’s Oil and Gas Lease Utilization, Onshore and Offshore report, issued May 2012, “As of March 31, 2012, approximately 56 percent (20.8 million acres) of total onshore acres under lease on public lands in the Lower 48 States were conducting neither production nor exploration activities”

DOI Oil and Gas Lease Utilization Report

The latest oil boom in the lower 48 states is due largely to an unconventional resource known as “shale oil,” (oil trapped within shale rock). The vast majority of both “shale oil” and “shale gas” (natural gas trapped within shale rock) is found under private and not public lands. The location of these resources, not safeguards for air and water, explain the shift in drilling from public to private lands.

Adam Sieminski, U.S. House, Subcommittee on Energy and Power Committee on Energy and Commerce, 2 August 2012

Filed under Blog, In The News, Permitting Tagged with Big Gas, Big Oil, BLM, Checks and Balances Project, Congress, drilling, hastings

#NYFrackingScandal Hits Cuomo Administration: Newly Disclosed Documents Show Conflicts of Interest

February 11, 2013 by Checks And Balances Project Leave a comment

Photo from NYPost.com

With only two days before the expected release of New York’s Environmental Impact Assessment on fracking (also known by the industry term hydraulic fracturing), Governor Andrew Cuomo’s administration is at the center of a new conflict of interest scandal regarding two of his top aides. Today, seven groups requested the Albany County District Attorney General David Soares investigate the Cuomo Administration’s conflicts of interest surrounding two staffers that hold “key positions in New York’s decision over whether to allow high-volume hydraulic fracturing.”

There are looming questions on the impartiality of Lawrence Schwartz and Robert Hallman, two top Cuomo Administration officials, who have significant influence on the Governor’s fracking decision. New documents obtained by DeSmogBlog through New York’s Freedom of Information Law (FOIL) show that Mr. Schwartz has significant stock holdings in companies that stand to benefit from fracking in New York state, and that Mr. Hallman failed to make specific financial disclosures, raising questions about his objectivity on the issue.

The two top aides, Lawrence Schwartz, Secretary to Governor Andrew M. Cuomo, and Robert Hallman, Deputy Secretary for Energy and Environment, have significant oversight within the Cuomo Administration on the issue of hydraulic fracturing. According to the groups’ letter, Mr. Schwartz supervises all state deputies and commissioners, including Mr. Hallman and the Commissioner of the New York State Department of Environmental Conservation – the agency that is tasked with studying high-volume hydraulic fracturing and developing the state’s policy regarding this extraction technique. Mr. Hallman is the state’s highest gubernatorial staff member who has oversight over the state Department of Environmental Conservation.

According to financial disclosure documents, Schwartz has substantial holdings in companies engaged in shale gas development, including ConocoPhillips, Occidental Petroleum and ExxonMobil. ExxonMobil alone holds 43,000 acres of leases for fracking in New York under its subsidiary XTO Energy Inc. Schwartz also identified “Williams Co.,” apparently a reference to “The Williams Companies Inc.,” a pipeline company that plans to build a $750 million pipeline through the southern portion of New York.

Mr. Hallman failed to specify his stock holdings in his financial disclosure forms, which seems to violate (at the very least) the spirit of N.Y. Pub. Off. § 73-a. The law states that “Public officials are required to list “EACH SOURCE” of income greater than $1,000 and “the type and market value of securities… from each issuing entity” greater than $1,000,” according to the letter from seven groups to District Attorney General Soares. Instead of disclosing each source, Mr. Hallman listed “various common stock” and “various corporate bonds.” His lack of disclosure should serve as a red flag and calls into question his impartiality on the state’s fracking decision.

Furthermore, records obtained via the FOIL request indicate that fracking companies have recently worked directly with Cuomo Administration officials. XTO Energy Inc, a subsidiary of ExxonMobil, wrote to Mr. Schwartz and Mr. Hallman requesting changes to the state’s draft regulations on fracking in August 2012. And, The Williams Companies communicated with Mr. Hallman regarding natural gas pipelines twice in the summer of 2012.

New York state law states that public officials should avoid personal investments that could “create substantial conflict between his duty in the public interest and his private interest.” Both Mr. Schwartz and Mr. Hallman may have conflicts of interest that violate this standard.

Today during a press conference in Albany, Alex Beauchamp, Food & Water Watch Northeast Region Director, said, “We are outraged to discover that Governor Cuomo’s top aide is so heavily invested in oil and gas companies. And further, that he made these investments during the very timeframe this administration has been considering whether to allow fracking in New York. Clearly, this administration must not allow fracking to move forward under this cloud of scandal.”

Learn more at NYFrackingScandal.com.

Filed under Fracking, New York, News Tagged with Big Gas, Checks and Balances Project, ConocoPhillips, Cuomo, Disclosure, ExxonMobil, FOIL, Fracking, Hallman, hydraulic fracturing, Industry, lobbying, New York, Occidental, politics, Schwartz, water, Williams Co, XTO Energy

Public outcry and action help hold off drilling near Mesa Verde National Park and Dinosaur National Monument

February 8, 2013 by Checks And Balances Project Leave a comment

The Colorado Bureau of Land Management (BLM) has announced that it will defer the sale of eight controversial oil and gas leases (10,839 acres) near Mesa Verde National Park from its upcoming February 14^th lease sale. State Director Helen Hankins has also announced that BLM will defer three leases and portions of two others (2,626 acres) near Dinosaur National Monument from its May 2013 sale. The decisions come just days after the Colorado BLM office deferred oil and gas leases in the North Fork Valley.

“We’re glad to see Colorado BLM finally applying common sense to leasing decisions. But, that doesn’t change the fact that a lot of red tape – to say nothing of residents’ and local business owners’ time and anguish – could have been saved if Dir. Hankins had applied the Department of Interior’s leasing reforms in the first place. These deferrals are a band-aid, not a cure. Dir. Hankins must modernize her leasing policies and include other agencies, like the National Park Service, residents and business owners in her planning as much as oil and gas executives, or we’ll be back to square one for the next lease sale,” said Ellynne Bannon, Checks and Balances Project western energy and lands program manager.

According to a recent analysis by The Wilderness Society, Dir. Hankins’ policies have resulted in protests against 85 percent of Colorado leases in fiscal year 2012, compared to 33 percent throughout the rest of the Rocky Mountain region.

Even after the deferrals, the upcoming February 14^th sale is the biggest lease sale in Colorado under the Obama Administration – at 68,692 acres and 138 parcels.

Deferral of the February and May leases follows former superintendent of Dinosaur National Monument Denny Huffman’s Denver Post column, in which he wrote that Dir. Hankins was promoting “irresponsible” drilling proposals near national parks.

The National Park Service (NPS), Colorado Parks and Wildlife, and La Plata County, in addition to San Juan Citizens Alliance, all raised concerns about the Mesa Verde lease parcels.

Filed under Uncategorized

The Checks and Balances Project praises nomination of Sally Jewell as next Interior Secretary

February 6, 2013 by Checks And Balances Project Leave a comment

Today, President Obama nominated Sally Jewell as the next Secretary of the Interior. Ms. Jewell would bring a diverse and accomplished background to the department. She is well positioned to expand upon the Administration’s balanced approach toward energy development on public lands. This approach is necessary to reign in oil and gas companies that act as if they are the sole owner of our public lands.

“Sally Jewell’s deep knowledge of public lands issues makes her an excellent choice for Secretary of the Interior,” said Ellynne Bannon, western lands program manager for the Checks and Balances Project. “She knows that protecting the public lands that drive tourism, travel, recreation, and agriculture is as important as setting aside lands for energy development. Ms. Jewell has the opportunity to bring more balance to our public lands and ensure that conservation and energy development are on equal ground. Key to finding that balance will be the continued implementation of outgoing Secretary Ken Salazar’s oil and gas leasing reforms.”

The leasing reforms enacted in 2010 help ensure that all stakeholders have a seat at the table and that air quality, water quality, wildlife habitat, and recreational values receive the protections they deserve.

The experience of Colorado demonstrates what happens when oil and gas leasing is allowed to go unchecked without proper public input. Due to Colorado BLM Director Helen Hankins’ failure to implement the leasing reforms, oil and gas protests in Colorado dwarf those in other states. Dir. Hankins has put vital public resources at risk because of a drill first, ask questions later approach to oil and gas leasing.

Ms. Jewell is the CEO of REI, an outdoor retailer, but began her career as an engineer for the oil industry. She serves on the Board of Regents at her alma mater, the University of Washington as well. Ms. Jewell was also key stakeholder in discussions to craft the President’s America’s Great Outdoors program, an agenda for the 21st century to support community-driven conservation and outdoor recreation initiatives.

Ms. Jewell has an excellent opportunity at Interior to remind Congress, as well as the oil and gas industry, that conservation and public lands fuel our economy and create jobs through outdoor recreation and tourism, and cannot be sacrificed for oil and gas companies’ speculative land grabs.

Filed under Blog, In The News

Babbitt lays out vision for balanced approach to energy development and conservation

February 5, 2013 by Checks And Balances Project Leave a comment

Former Interior Secretary Babbitt speaks at the National Press Club outlining a balanced approach to public lands use.

Today Former Secretary of the Interior Bruce Babbitt outlined a vision for balanced public land management in a speech at the National Press Club.

Secretary Babbitt urged President Obama to permanently protect one acre of public lands – potentially as a national park, wilderness area, or national monument – for every one acre of our public lands leased to the oil and gas industry. Doing so places the conservation of our public lands on equal ground with energy development and will address concerns about the economic impact of oil and gas drilling on industries that depend upon public lands.

Ellynne Bannon, western lands program manager for the Checks and Balances Project offered the following comment on Babbitt’s remarks:

“Secretary Babbitt’s speech laid out a common-sense approach for how to use our public lands, one that threads the needle between energy development and conservation. We need state BLM directors to adopt Sec. Babbitt’s suggestions. No state better demonstrates why we need a new vision than Colorado, where State BLM Director Helen Hankins has acted more like a real estate agent for oil and gas companies instead of a responsible land use manager. She’s made decisions that have run roughshod over the concerns and livelihoods of farmers, ranchers, businesses, and land owners with her drill-first, ask questions later approach.”

According to a recent analysis by The Wilderness Society, Dir. Hankins’ policies have resulted in protests against 85 percent of Colorado leases in fiscal year 2012, compared to 33 percent throughout the rest of the Rocky Mountain region.

Regrettably, many in Congress share Hankins’ disregard for the multiple uses of public lands. Here are a few facts about public land use in the United States:

The 112^th Congress was the first since World War II not to protect a single new acre of public land as a park, wilderness area, or national monument.
The United States is losing an area of open space the size of Rhode Island to development every year.
In the past four years, the oil and gas industry has leased more than 6 million acres of public lands, compared with only 2.6 million acres permanently protected.

Secretary Babbitt’s proposal would ensure that our nation’s public lands and the communities that depend on them are protected for generations to come.

Filed under Blog, Permitting, Statements

Gov. Hickenlooper fails to fine company responsible for toxic Parachute spill

May 16, 2013 by Checks And Balances Project Leave a comment

Yesterday, Gov. Hickenlooper’s department of public health and environment (CDPHE) announced that they won’t levy fines against Williams Cos. for spilling 10,000 barrels of natural gas and toxic waste into Parachute Creek and the surrounding area in western Colorado.

Earlier this month, the Governor lobbied to water-down legislation to toughen fines for oil and gas companies who pollute, despite Colorado’s well-documented problems of spills, and lowest in the nation fines. The Governor’s actions ultimately led to the death of the legislation.

The Parachute spill, which occurred in the winter but wasn’t reported until the spring, has polluted water with cancer-causing benzene. In early May, benzene levels in the creek exceeded the federal safe drinking water standard.

In their statement, CDPHE said that they aren’t fining Williams because the spill “was not due to negligence but to accidental equipment failure.” So now Gov. Hickenlooper’s department of public health and environment only “protect[s] and improve[s] the health of Colorado’s people and the quality of its environment” part of the time? We didn’t find that caveat in their mission statement.

This isn’t the first time that the Hickenlooper Administration has failed to hold polluters accountable. A 2011 Suncor spill that polluted the South Platte River is still being cleaned up nearly two years later – and yet Suncor hasn’t been fined for dumping toxic levels of benzene into the river.

Unfortunately, it appears that the Hickenlooper Administration is fine with oil and gas companies polluting our water and communities with waste and toxins – otherwise, why not hold them accountable for polluting by enforcing fines?

Filed under Colorado, Fines, Fracking, Uncategorized Tagged with Governor Hickenlooper, Oil and Gas, Oil and Gas Spills, polluter

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.@DocHastings's bill eliminates integrated activity plan for NPR-A which balances energy dev. w/ habitat & other special area protection 15 minutes ago
.@BLMNational testifying in favor of balanced approach to #PublicLands 18 minutes ago
.@BarackObama's Admin. has leased nearly 2.5x as much #PublicLands to oil, gas as they have permanently protected ow.ly/lhFxQ 19 minutes ago
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