Governors and oil industry work palm te forearm ter offshore drilling group, Center for Public Integrity

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Lobbying rock hard, advocacy group did much of the work for coalition of eight state executives

By Nicholas Kusnetz email

Five:00 am, November 24, 2014 Updated: 12:06 pm, November 24, 2014

Ter this May 1, 2009 verkeersopstopping photo, offshore oil drilling toneel ‘Gail’ operated by Venoco, Inc., is shown off the coast of Santa Barbara, California.

The governors coalition is just one of many groups, such spil the American Legislative Exchange Council, that permit powerful corporate interests to build up a meteen line to state policy makers, all under the banner of a generic advocacy organization.

It wasgoed a brisk February morning, and the governors of Alabama, Mississippi, Virginia and North Carolina were seated around a stadionring of tables draped with pleated beige fabric ter the ornate Nest Slagroom of Washington, D.C.’s Willard InterContinental Hotel. Sitting across the tables wasgoed Interior Secretary Sally Jewell, whom the governors had invited so they could make their case for expanding offshore energy production. It wasgoed a long-awaited meeting for the governors, and they’d armed themselves with specific “asks” — that Jewell’s department open access to oil and gas drilling ter the Atlantic, for example, and improve “regulatory certainty” for energy companies operating equipments off the coasts.

The get-together this past winter wasgoed but one petite shove te the type of broader political campaign that occurs every day ter uncountable Washington conference rooms, watering fuckholes and hotel suites. For the past three years, a group of eight, mostly Republican governors from coastal states has bot lobbying the Obama administration to expand access to the nation’s offshore oil and gas deposits, working through an organization called the Outer Continental Shelf Governors Coalition.

While the message from the governors that morning would have come spil no verrassing to Jewell, less clear, perhaps, wasgoed that the governors were drawing on the research and resources of an energy lobbying rock hard acting on behalf of an oil industry-funded advocacy group.

Indeed, the background materials transferred to the governors for the meeting, right down to those specific “asks,” were provided by Natalie Joubert, vice voorzitter for policy at the Houston- and Washington D.C.-based HBW Resources. Joubert helps manage the Consumer Energy Alliance, or CEA, a broad-based industry coalition that HBW Resources has bot hired to run. The appeal for regulatory certainty, for example, came with a note to the governors that Shell, a CEA member, “felt some of the rules of exploration changed” after it began drilling operations te the Arctic.

The governors’ efforts have produced more than just talking points. This summer, the coalition won a major victory when the Interior Department said it would accept applications to probe the Atlantic seabed for oil and gas with seismic tests, a significant step toward permitting drilling off the East Coast — drilling that has bot off-limits for decades. While the federal government ultimately controls where offshore drilling is permitted, the Obama administration has made clear it will permit production where the public — and public officials — support development.

And so it emerges spil if CEA’s considerable investment of time and resources has paid off. Indeed, a review of thousands of pages of public documents, obtained by the Center for Public Integrity through records requests, shows that much of the governors coalition work has bot carried out by HBW Resources and CEA, a group that’s channeled millions te corporate funding to become a leading advocate at the state level for drilling.

Screenshot from a Southern States Energy Houtvezelplaat meeting on Outer Continental Shelf Energy Development featuring Governor Sean Parnell (Ak.), Governor Patstelling McCrory (N.C.) and Governor Phil Bryant (Miss.).

Youtube/ Southern States Energy Houtvezelplaat

The governors coalition is just one of many groups, such spil the American Legislative Exchange Council (ter which CEA is actively involved), that permit powerful corporate interests to build up a ongezouten line to state policy makers not available to common citizens or other stakeholders, all under the banner of a generic advocacy organization.

“It would be alarming I think for many people if they found out that some of the largest polluters were running a governors group, but less so if it’s a nonprofit,” said Nick Surgey, director of research at the Center for Media and Democracy, a liberal advocacy group. “That one step eliminated stops the noodsignaal bells going off, but it should indeed concern people.”

The documents suggest that CEA staff attended the February meeting with Jewell, but Interior Department spokeswoman Jessica Kershaw did not react to a question asking whether Jewell knew of CEA’s involvement, telling only that the department speaks with “a broad group of stakeholders,” and considers “all points of view.” She said Jewell told the governors that the department “is committed to working with them and their participation ter the programma process is fundamental for any kleuter of coastal development.”

The Center requested interviews with staff of each of the governors — extra coalition members include the chief executives of Alaska, Texas, South Carolina and Louisiana — but none made anyone available, tho’ Alaska responded to questions te writing.

There’s bot little effort to explain CEA’s relationship with the coalition, which is presently chaired by North Carolina Gov. Patstelling McCrory. The coalition’s webstek made no mention of CEA until recently, when one pagina wasgoed edited — after the Center began reporting this article — to acknowledge the organization provides “information and administrative support.” Ter March, when the Center very first asked who staffs the coalition, Ryan Tronovich, a spokesman for McCrory, said the governors provide the staff (records vertoning Tronovich actually consulted with CEA to reaction the Center’s questions). When the Center asked again after learning of CEA’s involvement, Tronovich said ter an email that he “should have bot more clear,” and compared CEA’s help to that given by an inwendig. (The Republic Report, an investigative news webstek, very first reported a possible connection with CEA te February when it noted that a coalition letterteken appeared to have bot written by Joubert.)

Ter an vraaggesprek, David Holt, voorzitter of CEA and managing fucking partner of HBW Resources, said CEA provides assistance to the coalition at the governors’ request. He said both the coalition and CEA have an “all-of-the-above” energy policy that supports renewable spil well spil fossil fuels. He also characterized his organization’s role spil supportive of the coalition te the same way any number of stakeholders may be.

Governor Patstelling McCrory at the Fayetteville Regional Airport te Fayetteville, N.C., ter September 2014.

Andrew Craft/AP/The Fayetteville Observer

But there’s no evidence that any other group has played a substantive role te the coalition, or that environmental organizations have bot invited to any of its meetings. Earlier this month, the McCrory administration organized a meeting with federal officials to discuss Atlantic drilling, no other governors were there, but staff indicating the governors of South Carolina and Virginia did attend. McCrory administration staffers told journalists and environmental organizations that the meeting wasgoed closed to rente groups so spil not to “allow for the potential of the appearance of influence.” Te fact, CEA and other industry groups did attend the meeting. Nadia Luhr, the legislative counsel for the North Carolina Conservation Network, wrote a letterteken to the administration protesting the circumstances of the meeting. She had not previously bot aware of CEA’s role ter the coalition, but indicated she wasn’t astonished.

“It’s just another example,” she said, “of industry having a voice where no one else does.”

Each May, ems of thousands of people gather ter Houston for the Offshore Technology Conference, the industry’s premier event, and ter 2011 they were looking for a fresh embark. A year earlier, the Deepwater Horizon equipment had exploded ter the Gulf of Mexico just weeks before the conference, killing 11 people and leading to the largest oil spill te the nation’s history. Te the aftermath, Obama placed a moratorium on deep-water drilling and canceled plans to permit drilling ter the waters off Virginia.

Nevertheless, the 2011 conference wasgoed thicker than everzwijn, with exhibit booths displaying the latest te drilling technology sprawling overheen almost 600,000 square feet of Houston’s Reliant Park sophisticated, which encompasses a cavernous exhibition center, an indoor strijdperk that seats almost 6,000 people, and covered outdoor booths. There were policy discussions and technical events with titles like “Active Heating for Life of Field Flow Assurance.” The very first day kicked off with a panel hosted by Holt and an executive with Noble Energy that featured officials from the five inaugural states of the coalition — Texas, Alaska, Virginia, Mississippi and Louisiana — who decried the federal government for standing te the way of development.

It wasgoed there that the governors of those five states announced their coalition, with a stated purpose of improving dialogue inbetween the states and the federal government. The coalition’s very first chairman wasgoed Louisiana Gov. Bobby Jindal, who spil a congressman ter 2006 sponsored a bill that would have eliminated the federal moratoriums on drilling ter the Atlantic and Eastern Gulf. Te 2010, spil governor, Jindal railed against Obama’s deep-water moratorium — a moratorium that had bot lifted by the time the 2011 conference wasgoed held. The governor has bot a reliable friend to the oil industry, which has contributed more money to his campaigns than any other sector — more than $1.Four million overheen the past decade, according to the Center for Responsive Politics and the National Institute on Money ter State Politics.

Jindal’s office did not react to an vraaggesprek request or to questions about the coalition’s formation. Sharon Leighow, a spokeswoman for Alaska Gov. Sean Parnell, the 2nd chairman of the coalition, said te a written response that the founding governors, not CEA, had determined to form the coalition. When asked how CEA got involved, she wrote: “Unknown.” (Parnell recently lost a bid for re-election.)

CEA voorzitter Holt said the governors approached his group because it represents not only energy companies, but also other sectors like airlines, trucking and construction. “They knew of us and asked CEA because wij represent the entire economy,” he said.

Some environmental advocates have a dimmer view of why the group wasgoed formed that May. “The Outer Continental Shelf Governors Coalition is a Trojan pony,” said Richard Chartervliegtuig, who has fought against offshore drilling for decades and is now a senior fellow at the Ocean Foundation, which supports marine conservation. Oil companies and other industry groups, including CEA, began a campaign a decade ago to repeal the Atlantic moratorium by lobbying officials and the public state-by-state, he said, and the coalition is the culmination of that effort. “They want to create the appearance that a bunch of coastal states are clamoring for ‘drill here, drill now.’”

Across its three-and-a-half-year life, the governors coalition has focused on the Interior Department’s “Five-Year Program” — the arcane, bureaucratic process the department uses to project the nation’s offshore drilling regimen — lobbying at each incremental turn for the department to open more areas to drilling and to ease limitations where drilling is underway. The coalition has also shoved for the federal government to share more drilling revenue with the states.

The Center requested documents related to the governors coalition from the three states that have chaired the coalition. Louisiana and Alaska provided thousands of pages, however Alaska’s response wasgoed intensely redacted. North Carolina has yet to react to the request, which wasgoed submitted te April.

Whatever the origins of the coalition, the documents voorstelling that Holt wasgoed an early driving force. Te May 2011, he and his colleagues at CEA designed a logo for the group. Te July, he sent an email to Chip Kline, deputy director of Jindal’s Office of Coastal Activities, congratulating Louisiana on being named the coalition’s very first chair, stressing that the governors would add a “meaningful voice” to the energy debate. When they were programma the coalition’s very first meeting, alongside a Republican Governors Association gathering te Jackson Fuckhole, Wyoming, and RSVPs weren’t coming te spil hoped, Holt fired off a message telling, “REALLY need to have this OCSGC meeting to get things rolling.”

Protesters carry signs and march te vooraanzicht of the Wilmington Convention Center where North Carolina Gov. Patstelling McCrory wasgoed attending the Coastal Energy Summit te Wilmington, N.C. te October 2014.

Mike Spencer/AP/The Star-News

The Consumer Energy Alliance calls itself “The Voice of the Energy Consumer.” The group wasgoed formed te 2006, operating primarily out of a petite office park ter Houston. Its very first houtvezelplaat of directors included executives with Shell, Hess and a wind power company, spil well spil geologists and representatives of “consumer” industries such spil trucking. Also on the houtvezelplaat: Jim Martin, chairman of the 60 Plus Association, which bills itself spil the conservative alternative to the elderly advocacy group AARP, but which is also part of the well-financed political network led by Charles and David Koch, the billionaire industrialists with major stakes ter oil and gas.

Holt, 48, who speaks with folksy Texan charm, has bot the alliance’s only voorzitter. Before beginning CEA, he had worked ter government affairs for Hart Energy, an industry publishing company, and before that, he says, spil legal counsel to the top oil and gas regulator ter Texas.

The alliance says it seeks to improve understanding of the nation’s energy needs and advocates for lower energy prices through an “all-of-the-above” policy of enlargened domestic energy production. Overheen the past eight years, the group’s membership has grown to about 240 corporate entities, including groups from “energy consuming” industries like transportation and construction, spil well spil energy companies. CEA also claims to have some 400,000 individual members who have signed petitions or taken other deeds that are described on its webstek. (Te October, however, Wisconsin regulators rejected a petition CEA had filed te an tens unit rate case there after an investigation by the Madison Capital Times exposed that some of the Two,500 people whose names had bot used were unaware they appeared on the petition, and actually opposed CEA’s stance. CEA said it stood by the Two,500 signatures, but had actually requested that the petition be withdrawn before it wasgoed rejected.)

Te 2011, the year the governors coalition wasgoed formed, CEA’s annual revenue ballooned to $Trio.8 million from just $737,000 the previous year, and it’s remained above $Three million since then. Holt says the majority of CEA’s members are from “consuming” sectors and that its funding comes from all members. He wouldn’t say who pays what, however, and tax records demonstrate that te 2011 and 2012, the most latest years available, at least 30 procent of the money came from just three entities: the American Petroleum Institute, the American Fuel and Petrochemical Manufacturers and America’s Natural Gas Alliance, each a vooraanstaand oil and gas industry group.

More than $1 million of that revenue goes spil a management toverfee to HBW Resources, an energy-focused lobbying and consulting rock-hard that Holt formed ter 2008 along with Michael Whatley — a former chief of staff for Sen. Elizabeth Dole — and Andrew Browning, who had worked spil a lobbyist and te the Department of Energy. With the exception of a few regional directors, CEA’s staff is comprised of HBW staff, and to the layman, it’s hard to tell the difference inbetween the two.

HBW’s Washington, D.C., office sits te a giant truncated pyramid of a building, with sloped outer walls, that overlooks Farragut Square on the city’s lobbyist-dense K Street. The rigid has offices te five other cities ter the U.S. and Canada and has its fingers ter many pies. Its Legitimate employees manage not only CEA, but also the Energy Producing States Coalition, a group of state lawmakers that work on energy policy, and the National Ocean Policy Coalition, a collection of energy companies, commercial fishing organizations and other business interests that opposes the Obama administration’s oceans policy. Whatley is also the vice voorzitter of Nebraskans for Jobs and Energy Independence, ostensibly a group of Nebraskans who support the construction of the Keystone XL pipeline. The hard lobbies on behalf of just a handful of clients, including Noble Energy and The Babcock and Wilcox Company, which makes nuclear reactors and other industrial power equipment.

HBW employees have contributed ems of thousands of dollars to dozens of political campaigns. Notably, they talent $1,600 to Democrat Terry McAuliffe — who, following his election spil governor of Virginia last year, joined the governors coalition after Whatley and Joubert made a rechtstreeks appeal to one of his senior advisers during a December meeting. They also talent more than $8,300 to Gov. Nikki Haley of South Carolina within a day of a coalition meeting that Haley attended, te Houston ter 2013.

One of the firm’s very first major campaigns began te late 2009, when Whatley worked with a Canadian diplomat to help block state and federal attempts te the U.S. to pass low-carbon fuel standards, which could have threatened imports from Canada’s tar sands oil deposits.

The effort previewed what would become a recurring strategy for Whatley and his colleagues: pairing a public advocacy campaign with rechtstreeks, behind-the-scenes appeals to elected officials, urging them to make similar public comments te their own voices. More recently, CEA has worked through the American Legislative Exchange Council, the conservative state legislators group, to oppose a fresh federal rule limiting greenhouse gas emissions.

Holt says his organization supports all forms of energy production and is directed by its houtvezelplaat, which no longer includes energy companies. “We are a consumer managed and a consumer funded and a consumer predominated organization,” he said.

Most of its campaigns and communications concentrate on oil and gas, however. That, coupled with what’s known about its funding, has led some advocacy groups to view CEA spil a gevelbreedte group for energy companies, an entity created to give the appearance of an independent and broad-based voice. To thesis advocacy groups, the governors coalition is just another player ter the larger spel. “This is a purposed campaign to mislead the public,” said Claire Douglass, campaign director for climate and energy at Oceana, an environmental group that opposes offshore drilling. “The politicians are now doing industry business, not being public servants.”

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