Inside Climate News has revealed that a key leader of oil and gas industry front groups that oppose new fracking regulations may have been playing both sides of the issue. In an investigation into the funding of the Environmental Defense Fund's (EDF) work on oil and gas regulation, Inside Climate News discovered that a key EDF funder had hired FTI Consulting's David Blackmon to promote fracking regulations. Unbeknownst to his employer, Blackmon is a longtime oil industry consultant who is paid to oppose regulation of the fracking industry.
The Cynthia and George Mitchell Foundation
The funder in question is the Cynthia and George Mitchell Foundation, established by the late George Mitchell, known as the "father of fracking." George Mitchell owned and operated Mitchell Energy, the first company to combine horizontal drilling and hydraulic fracturing in the Barnett shale, which sparked the "shale revolution." Mitchell created the foundation with part of the $3.5 billion sale of Mitchell Energy to Devon Energy. The Mitchell Foundation describes itself as "a grantmaking foundation that seeks innovative, sustainable solutions for human and environmental problems." While its goals seem noble, the fortunes of the foundation and the people who run it continue to be inexorably linked to the success of the oil and gas industry. The foundation itself has more than $38 million in stock in Devon Energy. Three of George Mitchell's beneficiaries own over $21 million of Devon Energy apiece. Altogether the Mitchell Foundation and the Mitchell heirs own over one fifth of Devon Energy. One such heir is Todd Mitchell, who sat on the foundation's board for years and worked for Devon Energy for a decade. He currently runs oil and gas production companies and an investment business built on the assumption that gas will provide the baseload for electricity generation around the globe. The Cynthia and George Mitchell Foundation has funded a series of greenwashing efforts that have portrayed the shale and fracking industry as safe, clean, and reliable. These efforts include an online-based "virtual reality" well pad that makes no mention of water or air quality concerns. In fact, the "virtual well pad" does not mention any of the environmental or social impacts that communities near shale drilling experience. However, the Mitchell Foundation has also dedicated millions of dollars to groups that are trying to "green" the shale industry, like the Environmental Defense Fund. Since 2012 the foundation has given over $1 million to EDF. The funding was for studies of methane emissions from the fracking industry. These studies, which have been criticized as incomplete, are built on a base assumption that the drilling can be done "right." They have also led to some of the first federal regulations on the shale industry, including the methane regulations announced by the Obama administration in early 2015. The foundation also gives to a range of environmental groups, some of which are strongly opposed to fracking and oil and gas development, like the Tides Foundation and the Sierra Club.
David Blackmon and FTI Consulting's Conflicts of Interest
While the Mitchell family's finances are tied to the success of the gas industry in general, the foundation's funding of efforts to limit pollution from fracking appears genuine. That is what makes the Mitchell Foundation's hiring of David Blackmon and FTI Consulting so peculiar. In 2012 the Mitchell Foundation selected Blackmon of FTI Consulting to run the foundation's gas strategy. FTI Consulting is a PR firm that has worked with the shale and fracking industry to limit shale regulations by attacking journalists and community groups. FTI Consulting runs Energy in Depth, an oil and gas industry front group that maintains a hard line of attack against those who would regulate or criticize its corporate funders. The Mitchell Foundation paid FTI Consulting $120,000 to "start a dialogue between fossil fuel concerns and environmentalists around natural gas." Blackmon himself has long been a power player in the world of pro-fracking PR. Blackmon started his career as an oil industry flack, doing communications work and lobbying for Shell, Tesoro, and various other oil and gas companies. More recently, he has had top positions with nearly every major pro-fracking front group, including the Consumer Energy Alliance, Energy in Depth, and the industry's biggest lobbying arm, America's Natural Gas Alliance. That Blackmon was in charge of the Mitchell Foundation's gas strategy is troubling. His career has been dedicated to obstructing and delaying regulation on the oil and gas industry, especially in regard to fracking. While working for Mitchell, he led industry-funded groups that opposed the very methane regulations he was hired by Mitchell to promote. It is also troubling because of Blackmon's personal denial of the science of climate change, and his aggressive denial of the environmental and health impacts of fracking, which he called an "attention-grabbing boogeyman for all manner of nutcases, chicken littles and radicalized environmental organizations." Tweets from Blackmon's Twitter account reinforce the fact that he denies some of the basic pieces of climate-change science:
Fracking has been shown to pose a serious threat to the climate, given that methane, natural gas' primary component, traps 86 times more heat in the atmosphere than CO2 does. Blackmon and FTI Consulting's anti-regulatory and pro-fracking work constitute a potentially major undisclosed conflict of interest. Marilou Hastings, the communications manager for the Mitchell Foundation, admitted to Inside Climate that before settling on FTI, she approached and was turned down by "more than a dozen consulting firms" due to conflicts of interest. When she approached FTI Consulting and Blackmon, they not only accepted the job but failed to reveal their anti-regulatory work to Hastings. Inside Climate News writes that Hastings "didn't know of FTI Consulting's ties to anti-regulatory efforts." Furthermore, at the same time that Blackmon was being paid by the Mitchell Foundation, Energy in Depth, which is run by FTI Consulting and boasts Blackmon as a "field director," attacked the very studies Blackmon was paid to promote. All the while, Blackmon was using his position as a contributor to Forbes to promote the Mitchell Foundation's work without disclosing his financial incentives. This potentially violated Forbes' conflicts of interest clause. This raises the question: Did David Blackmon use his position with the Mitchell Foundation, in which he was tasked with promoting regulation, to feed information to his colleagues at FTI Consulting, which is paid to oppose regulation?
Wake up and smell the frack fluid! But don't ask what's in it, at least not in Ohio, cause it's still not your right to know.
Ohio is in the final stages of making an Exxon trojan horse on hydrofracking into state law, and it appears that the American Legislative Exchange Council (ALEC) connected Exxon's lawyers with co-sponsors of Ohio Senate Bill 315: at least 33 of the 45 Ohio legislators who co-sponsored SB 315 are ALEC members, and language from portions of the state Senate bill is similar to ALEC's "Disclosure of Hydraulic Fracturing Fluid Composition Act."
...disclosure of fracking fluids? On behalf of ExxonMobil?!
Frack fluids include unknown chemicals that gas drillers mix with sand and large amounts of water. The mixture is pumped underground at high pressure in order to retrieve gas and oil by fracturing shale formations. These are the chemicals that have caused widespread concern among residents near gas fracking operations, concerns echoed by doctors who don't know how to treat patients harmed by exposure to chemicals that oil companies keep secret. Oil companies like XTO Energy, a subsidiary of ExxonMobil, the first company lined up to drill in Ohio's Utica shale.
Concern over unconventional energy like gas fracking may be the reason by Ohio SB 315 also addresses clean energy standards and drilling regulations. While the new law will allow doctors to obtain disclosure of fracking chemicals, it places a gag order on them...meaning some chemicals aren't disclosed to the public at all (Cleveland Plain Dealer). Instead, chemicals that subsidiaries of Big Oil use during fracking can remain exempt from public disclosure as "trade secrets," mirroring language of ALEC's model law.
What's most suspicious is that seven of the ten Ohio Senators co-sponsoring SB 315 are ALEC members, as are 26 of the 35 co-sponsoring Representatives.*
Among the co-sponsors are Ohio Senate President Tom Niehaus and state Senator Troy Balderson. Senators Niehaus and Balderson are members of ALEC's Energy, Environment and Agriculture task force, which approved the fracking "disclosure" bill internally sponsored by ExxonMobil, modeled after a Texas bill (see New York Times and ProPublica).**
Four of the co-sponsors of SB 315 attended ALEC's meeting in Scottsdale, AZ, although it is unclear which (if any) of them may have been inside the EEA task force meeting the day that the fracking chemical loophole bill was discussed and approved:***
- Rep. Cheryl Grossman
- Rep. Casey Kozlowski
- Rep. Louis Terhar
- Rep. Andrew Thompson
Some co-sponsors became ALEC members in the lead up to ALEC's late 2011 meeting in Scottsdale, AZ, where the fracking disclosure loophole model bill was finalized by ALEC's Energy, Environmental and Agriculture task force. Emails between representatives of ALEC, the Ohio state government and Time Warner Cable's Ed Kozelek show that last-minute recruitment of new ALEC members before the Scottsdale meeting brought in three state legislators who ended out co-sponsoring SB 315 (PDF pp. 71-76): Rep. Lou Terhar, Rep. Brian Hill and Sen. Bob Peterson (who was appointed to the Ohio Senate in 2012).
Head spinning yet? Let's summarize:
- Exxon pushed the fracking loophole bill through ALEC's [anti]environment task force,
- A couple of key Ohio legislators directly involved in that task force brought the bill back home...
- ...and then a pile of Ohio legislators used ALEC's model to mold Exxon's Ohio fracking disclosure loopholes into state law!
Beyond their involvement in these ALEC task force meetings, Exxon and API were involved in the creation of a similar fracking bill through the Council of State Governments before the ALEC model even existed. As if being a Private Empire isn't enough...
ALEC, CSG, OMG!
ALEC isn't the only group that peddles corporate-written state laws, as DeSmogBlog's Steve Horn pointed out in a blog on state fracking bills and the "Council of State Governments." With direct financial support from Exxon, API, TransCanada and others, the Council of State Governments (CSG) drafted a similar fracking chemical "disclosure" bill two months before ALEC's was internally approved, although they both appear to be modeled off of a Texas law.
While one of the co-sponsoring Senators of Ohio SB 315, Troy Balderson, is a member of CSG Midwest's Energy Committee, Ohio politicians aren't part of the Suggested State Legislature (SSL) committee that vetted the Council's version of the fracking bill. Because of that disconnect and the overwhelming influence of ALEC politicians sponsoring SB 315, ALEC appears to be the keeper of Exxon's fracking secrets in Ohio.
Regardless of the varying influence of groups like ALEC and CSG forging Big Business state laws, ExxonMobil is getting what it wants. According to Don't Frack Ohio!--a project of 350:
- Fracking companies can hide which chemicals they use in the fracking process by calling them ‘trade secrets’. That means they are exempt from telling you what they put in your water. What little they do disclose is 60 days after drilling takes place, too late for communities to test to show what was in their water before drilling, rendering the disclosure meaningless.
- The gas industry pays nothing for the mess they create. Gov. Kasich’s minor tax on individual wells is offset by new tax breaks on property taxes and other giveaways, which means the gas industry will pay less in Ohio taxes than they do in any other state in the country.
- No citizen notification or input will be allowed on any part of the fracking industry. There is no public notice, no public comment, and no right to appeal for drill sites, pipelines, or compressor stations.
Ohio Governor John Kasich has numerous ties to ALEC and was "involved with ALEC in its formative years," but he called for SB 315 to include full disclosure of chemicals used in hydraulic fracturing. Senators replaced true disclosure requirements with Exxon's loopholes and ALEC Representatives decided to leave them.
ALEC secrecy in Ohio
ALEC legislators have found ways to make their moves harder to track in light of repeated exposure of ALEC's pollution of democracy in the United States over the last year, and sometimes existing state laws don't help. Ohio's financial disclosure forms for legislators specifically mention that expenses or reimbursements from ALEC conferences do not need to be publicly disclosed. In Ohio and other states, ALEC dodges lobby laws through corporate-funded "scholarship" programs that are thoroughly documented by the Center for Media and Democracy through open records requests.
People for the American Way and Progress Ohio report that ALEC's scholarship fund in Ohio is financed donations from the American Petroleum Institute, Duke Energy, Reynolds Tobacco, and other major corporations interested in buying the loyalty of Ohio lawmakers.
I'm sure you'd understand if you were in the same position. Sometimes steak and cigars are more important than energy that doesn't poison us.
*Cross-referenced between a list of ALEC legislators listed in an Aug. 9, 2011 email from the legislative aid of ALEC's Ohio State Chairman, Rep. John Adams, obtained through a public records request (see PDF pp. 82-84 and PFAW p.12).
**ALEC documents published by Common Cause show that Sen. Balderson was a member of ALEC's EEA task force throughout 2011, although Sen. Balderson did not attend the ALEC task force meeting last December in Pheonix, AZ, according to a staffer at his office over the phone, nor is he listed in emails obtained through a public records request as attending the previous meetings in New Orleans (Aug. 2011) or Cincinnati (Apr. 2011). Ohio Senate President Tom Niehaus was a consistent member of ALEC's [anti]environment task force from August 2010-August 2011, the time period for which ALEC's EEA task force rosters are available. SB 315 co-sponsoring Representatives Carey, Damschroder and Derickson were all listed as members of ALEC's EEA task force as of August, 2011.
***Co-sponsors cross referenced with an email from ALEC Ohio State Chairman John Adams' legislative aid to Emily Petrovich of US Steel, dated 11/22/2011--eight days before the Scottsdale meeting (see PDF p. 138).