How Big Oil Got Expedited Permits To Frack Public Lands
The U.S. Senate has voted 89-11 to approve the Defense Authorization Act of 2015, following the December 4 U.S.House of Representatives’ 300-119 up-vote and now awaits President Barack Obama’s signature.
The 1,616-page piece of pork barrel legislation contains a provision — among other controversial measures — to streamline permitting for hydraulic fracturing (“fracking”) on U.S. public lands overseen by the Bureau of Land Management (BLM), a unit of the U.S. Department of Interior.
Buried on page 1,156 of the bill as Section 3021 and subtitled “Bureau of Land Management Permit Processing,” the bill’s passage has won praise from both the American Petroleum Institute (API) and the Independent Petroleum Association of America (IPAA) and comes on the heels of countries from around the world coming to a preliminary deal at the United Nations climate summit in Lima, Peru, to cap greenhouse gas emissions.
Alluding to the bottoming out of the global price of oil, Naatz further stated, “In these uncertain times of price volatility, it’s encouraging for America’s job creators to have regulatory certainty through a streamlined permitting process.”
Streamlined permitting means faster turn-around times for the industry’s application process to drill on public lands, bringing with it all of the air,groundwater and climate change issues that encompass the shale production process.
At the bottom of the same press release, IPAA boasted of its ability to get the legislative proposal introduced initially by U.S. Sen. Tom Udall (D-NM) as the BLMPermit Processing Improvement Act of 2014 after holding an “educational meeting” with Udall’s staffers. Endorsed by some major U.S. environmental groups, Udall took more than $191,000 from the oil and gas industry during his successful 2014 re-election campaign.
IPAA‘s publicly admitted influence-peddling efforts are but the tip of the iceberg for how Big Oil managed to stuff expedited permitting for fracking on U.S. public lands into the National Defense Authorization Act of 2015.
IPAA, API Lobbying Blitz
According to Open Secrets, IPAA, API, ExxonMobil, America’s Natural Gas Alliance (ANGA), ConocoPhillips and private equity firm KKR — employer of former head of the CIA David Petraeus — all deployed lobbyists to ensure passage of the BLMPermit Processing Improvement Act, now Section 3021 in the NDAA of 2015.
In quarter two and three, KKR deployed Akin Gump’s Ryan Thompson, chief-of-staff for climate change denier U.S. Sen. James Inhofe (R-OK) between 2002-2010, to lobby for the bill. A self-described ”mini oil and gas company,” the New York City-headquartered KKR owns numerous oil and gas assets in North Dakota’sBakken Shale basin.
Warren Buffett‘s Berkshire Hathaway Energy, formerly known as MidAmerican Energy Holdings Company and owned by his holding company Berkshire Hathaway, also lobbied for the bill. Burlington Northern Santa Fe (BNSF), owned by Berkshire Hathaway, is a major carrier of Bakken crude-by-rail.
Pilot Project Lifts Off
One of the original Senate-side co-sponsors of the BLM Permit Processing Improvement Act was U.S. Sen. John Hoeven (R-ND), who has also also served as a ringleader of other efforts to expedite permitting for fracking on public lands. First elected to the Senate in 2010, before which he was the Governor of North Dakota, the oil and gas industry has given Hoeven close to $325,000 in contributions since his preliminary Senate run.
In 2013, a bill he sponsored — the BLM Streamlining Act — passed by Congress with only one dissenting vote between both chambers combined. It was signed into law by President Obama on the day after Christmas.
That Streamlining Act created a pilot project for expedited permitting of fracking on public lands in the Bakken Shale. It was lobbied for by ExxonMobil, KKR,Marathon Oil, Chesapeake Energy and IPAA, among others.
By comparison, the BLM Permit Processing Improvement Act of 2014 and now its equivalent Section 3021 in the National Defense Authorization Act of 2015, expedites permitting of fracking on all public lands.
Image Credit: U.S. Government Printing Office
Hoeven had previously attempted to pass a bill to streamline fracking permitting on BLM public lands and “recognize the primacy of States,” calling it the Empower States Act of 2013. That bill was lobbied for by both ExxonMobil and API.
Interstate Oil and Gas Compact Commission
Founded by Oklahoma Governor E.W. Marland in 1935, the commission embodies the “deep state,” bringing regulators, industry lobbyists and executives all under the same tent with a key shared mission: maximize oil and gas production.
At the industry-sponsored 2014 Interstate Oil and Gas Compact Commissionannual meeting in Columbus, Ohio that I attended, the commission’s resolutions committee deliberated upon a model resolution to expedite permitting of oil and gas drilling on BLM public lands in the spirit of Section 3021.
Sitting to my left in the small room was Tom Yarnick, environmental and regulatory advisor for XTO Energy, an ExxonMobil subsidiary.
According to a conference attendance roster obtained by DeSmogBlog, Yarnick was one of 70 industry representatives present in Columbus out of 179 total registrants, equaling 46 percent of attendees.
Due to some legal complications and hang-ups in nuances in the resolution’s language, it was tabled until IOGCC‘s 2015 Annual Business Meeting scheduled in May and set to take place in Salt Lake City, Utah.
Lynn Helms, a resolutions committee member and director of the North Dakota Industrial Commission, told the committee that Hoeven was working on legislation aiming for a similar outcome.
Helms — who used to work for the oil company Hess Corporation — was likely referring to the BLM Permit Processing Improvement Act of 2014, which Hoevenco-sponsored and had passed unanimously in the Senate just a month earlier. Helms told his IOGCC colleagues that he was in touch with Ryan Bernstein, Hoeven’s legal counsel and chief-of-staff, on the issue.
Carol Booth, communications manager for IOGCC, confirmed in an interview with DeSmogBlog at the Columbus meeting that Helms — in his IOGCC capacity — is working with Hoeven’s office to push for a “states first” approach for BLMpermitting of fracking. Booth also spoke to the importance of IOGCC model resolutions at-large.
“Those usually start as the process for somewhere else we need to go,” she said. “Lynn Helms is taking that resolution to Senator Hoeven and Senator Hoeven will look at it and it’s kind of us urging Congress [to do something] and we will write the bill or work with his staff to write a bill to introduce.”
IOGCC, which also runs the States First Initiative, was also a major behind-the-scenes player behind the push for the passage of the Protecting States’ Rights to Promote American Energy Security Act. The bill mandated fast-tracked permitting for fracking by essentially removing the federal government from the process altogether.
Image Credit: U.S. Government Printing Office
Passed by the House in a 235-187 vote, the bill failed to make it out of the Senate. Numerous industry interest groups lobbied on behalf of the bill, including Marathon Oil, Chevron, Devon Energy, Chesapeake Energy, API, ANGA, ExxonMobil and many others.
E-mails obtained via the North Dakota Open Records Statute from the North Dakota Industrial Commission reveal IOGCC coordinated with the office of U.S.House Majority Leader John Boehner (R-OH) to gather signatures from state-level regulatory commissions in support the bill’s passage.
“I would sincerely appreciate your help with obtaining state oil and gas commission letters of support for H.R. 2728,” reads an e-mail from Maryam Brown — top energy policy advisor to Boehner and former public policy manager for ConocoPhillips — written to Carl Michael Smith, IOGCC‘s executive director.
“Attached is the bill, as amended in committee,” Brown’s e-mail to Smith continues. “Also attached is a one pager developed by the committee as well as letters of support from the Governor of Utah, [U.S.] Chamber [of Commerce], [National Association of Manufacturers], [Association of Corporate Counsel], [American Energy Alliance] and [American Fuel & Petrochemical Manufacturers]. While there is a strong energy industry support, as you can see, there is a great deal of manufacturing support as well.”
Smith, former secretary of energy in Oklahoma and assistant secretary of energy for fossil energy under the George W. Bush Administration, then forwarded the email query from Brown to a dozen and a half state-level regulators.
“As noted in Maryam’s email below the Act has already received a lot of broad support,” wrote Smith. “As also noted, she is requesting your support as a state regulator…If you are able to send a letter you might consider the language in the others attached, and please send me a copy for our files.”
In between working for the U.S. Department of Energy and the IOGCC, Smith worked at The Abraham Group. The Abraham Group is a lobbying firm founded by Spencer Abraham — Secretary of Energy under George W. Bush and current chairman and CEO of the firm — which has played an influential role in expediting permitting for fracked gas exports.
Additional e-mails show Gerry Baker, IOGCC associate executive director, also got involved in BLM-related fracking permitting advocacy on behalf of the oil and gas industry. In a May 2013 email, Baker mobilized state-level regulators to write comments to the BLM on its proposed rules for fracking on public lands.
“Please feel free to share your thoughts with other state officials on your evaluation of the proposed rules as time permits,” Baker wrote in the email. “Also, a number of sources have asked for additional time to prepared (sic) comments; however, the granting of these requests cannot be assumed. Let me know if you have any questions.”
IOGCC also made the cut for a small distribution list of a July 2013 letter sent out via email by William Whitsitt, executive vice president for public affairs for Devon, in opposition to the BLM‘s draft rules for fracking on public lands.
Whitsitt e-mailed Devon’s comment to IOGGC‘s Smith and numerous other industry officials, as well as to industry-funded think-tankers and trade association representatives.
He also called on them to support the Federal Land Freedom Act, a billsponsored by Inhofe, co-sponsored by Hoeven, and lobbied for by ExxonMobil,API, IPAA and the industry-funded Heritage Foundation. Throughout his U.S.Senate career, Inhofe has accepted over $1.72 million in campaign contributionsfrom the oil and gas industry.
White House Help: Heather Zichal
The Obama White House has also long shown interest in the expedited permitting approach for fracking, portending a likely looming sign-off on the bill.
Beyond signing the BLM Streamlining Act into law on December 26, 2013,President Obama also authorized Executive Orders in March 2012 and May 2013calling on streamlined permitting of all energy infrastructure projects.
During her time as Obama White House top energy and climate aide, Heather Zichal — now on the Board of Directors for fracked gas exporting company Cheniere — oversaw the signing of an April 2012 Executive Order mandating creation of an interagency working group to streamline regulatory oversight for fracking in the U.S.
Zichal also laid the groundwork for lack of transparency on injection of fracking chemicals into the ground on U.S. public lands, bringing the American Legislative Exchange Council (ALEC) approach for chemical transparency to the BLM. Beforeinserting the provision into the BLM draft rules currently being finalized, Zichal “huddled” with the industry numerous times.
“Zichal met more than 20 times in 2012 with industry groups and company executives lobbying on the proposed rule,” reported EnergyWire. “Among them were the American Petroleum Institute (API) and the Independent Petroleum Association of America (IPAA), along with BP America Inc., Devon Energy Corp. and Exxon Mobil Corp.”
IOGCC‘s Carol Booth told DeSmogBlog that Zichal used to reach out to IOGCC on a regular basis for questions pertaining to fracking.
She “used to reach out to us and we haven’t been contacted since [by the Obama White House],” said Booth. “She reached out to us, especially when it came to FracFocus.”
BLM‘s draft rules for fracking on public lands, which Zichal played a central role in mediating and crafting, chose the IOGCC-run FracFocus as its central repository for disclosure of fracking chemicals.
Brothers & Company, an Oklahoma-based public relations firm, registered the website domain for FracFocus and an archived version of the Brothers website lists IOGCC as a client. Other Brothers clients, both past and present, include Chesapeake Energy, ANGA, American Energy Partners and Devon Energy.
Asked if Zichal’s outreach to IOGCC coincides with BLM‘s choice to streamline fracking permits, Booth responded, “I couldn’t tell you why that is, I really can’t.”
Protect Our Public Lands Act
Despite obvious extreme odds stacked against them, two members of the U.S.House Progressive Caucus — with the support of Food and Water Watch and several other progressive groups — have introduced a bill to ban fracking on U.S.public lands.
Sponsored by U.S. Rep. Mark Pocan (D-WI) and U.S. Rep. Jan Schakowsky (D-IL), the two-page Protect Our Public Lands Act ”prohibit[s] the lessee from conducting any activity under the lease for the purpose of hydraulic fracturing.”
“We owe it to our children and grandchildren, and their children and grandchildren, to ensure the protection of public lands,” said Schakowsky of her support for the legislation. “This bill — in banning fracking on those lands — helps us follow through on that important promise.”
But only one thing can really receive a promise in this case: public interest groups are in a David vs. Goliath fight. And Goliath, clearly, is well-organized and well-mobilized on the issue as 2014 comes to a close.