Report: A year of energy industry influence and access at Interior
Background
On March 28, 2017, President Donald Trump signed an Executive Order on Promoting Energy Independence. The following day Interior Secretary Ryan Zinke issued a Secretarial Order on “American Energy Independence, which “revoked” Interior’s “policy on offsetting the development impacts on natural resources and ordered a review of all its rules on climate change, mitigation and energy development.”
On March 28, 2017, President Donald Trump signed an Executive Order “on Promoting Energy Independence and Economic Growth,” an executive order to “nullify President Barack Obama’s climate change efforts and revive the coal industry.” [“Presidential Executive Order on Promoting Energy Independence and Economic Growth,” White House, 03/28/17; Coral Davenport and Alissa J. Rubin, “Trump Signs Executive Order Unwinding Obama Climate Policies,” New York Times, 03/28/17]
Interior Secretary Ryan Zinke was quick to praise President Trump’s Energy Independence Executive Order. The next day, on March 29, 2017, Secretary Zinke issued Secretarial Order No. 3349, a Secretarial Order on “American Energy Independence,” intended to “implement” President Trump’s Executive Order. Secretary Zinke’s S.O. 3349 “revoked the department’s policy on offsetting the development impacts on natural resources and ordered a review of all its rules on climate change, mitigation and energy development.” [Press Release, Department of the Interior, 03/28/17; Corbin Hiar, “Zinke kills mitigation policy, orders review of energy rules,” Energy & Environment, 03/29/17]
Secretary Zinke’s Industry Meetings
According to an analysis of publicly available records, Interior Secretary Ryan Zinke met with extractive industry executives at least 33 times in the ten months he was Interior Secretary in 2017, averaging at least 3.3 meetings per month.
According to Interior Secretary Ryan Zinke’s calendars that are publicly available on the Department of the Interior’s website, he had at least 27 extractive-industry related meetings, either with energy executives, or addressing industry groups, between March 1, 2017 and December 31, 2017. [Secretary Zinke’s Calendars from March 2017-December 2017, Department of the Interior]
Additionally, based on Secretary Zinke’s more detailed travel schedules that are also available on the Department of the Interior’s website, Secretary Zinke either met with energy executives or toured energy facilities at least an additional six times between March 1 and December 31, 2017. [17-00658ch, Department of the Interior; 2017 Secretary Zinke Travel, Department of the Interior]
Of these total 33 encounters, ten of them, nearly one third, happened in the first two months that Secretary Zinke was at Interior. [Secretary Zinke’s Calendars from March 2017-December 2017, Department of the Interior; 17-00658ch, Department of the Interior; 2017 Secretary Zinke Travel, Department of the Interior]
Eni Petroleum
In November 2017, the Bureau of Safety and Environmental Enforcement (BSEE) approved Eni Petroleum’s application to drill in the Arctic, making Eni the first company to get approval for drilling in federal Arctic waters since 2015. Coincidentally, Eni is one of the companies Interior Deputy Secretary David Bernhardt has had to recuse himself from interacting until August 2019. In December 2017, two BSEE employees worked over Christmas to get an exploratory well for Eni permitted. Interior Press Secretary Heather Swift boasted that, with the BSEE staff working over the holiday, Eni could have a “nice Christmas present” as the well “could raise millions.” BSEE Director Scott Angelle personally thanked the employees for working over the holiday and in an internal email with other Interior staff praised their efforts, saying “24 /7 /365. Energy dominance lives here!”
Interior Deputy Secretary David Bernhardt, on August 15, 2017, wrote in his Ethics Recusal that he would “not participate personally and substantially in any particular matter in which” he knew that he had “a financial interest directly and predictably affected by the matter” or in which he knew “that a person whose interests are imputed to me has a financial interest directly and predictably affected by the matter, unless I first obtain a written waiver.”
In his recusal, David Bernhardt includes a “list of recusals” in which “absent a waiver” until August 3, 2019, he pledges to be “recused from particular matters involving specific parties in which any of the following entities either is a party or represents a party to the matter.” One of the entities he includes in this list is Eni Petroleum, North America. Eni U.S. Operating Co. Inc is the North American subsidiary of Eni Petroleum Co. Inc. [David Bernhardt Ethics Recusal, Department of the Interior, 08/15/17; “Company Overview of Eni US Operating Co. Inc,” Bloomberg, accessed 12/21/17]
In November 2017, Interior’s Bureau of Safety and Environmental Enforcement (BSEE) “approved an application Eni U.S. Operating Co. Inc. to drill exploratory wells in the Beaufort Sea,” in what was the approval of “the first in federal Arctic waters” since 2015. Environmental groups are “strongly opposed to Arctic Ocean drilling.” [Dan Joling, “Eni receives federal permit for U.S. Arctic offshore drilling,” Associated Press, 11/28/17]
On December 24, 2017, Interior Press Secretary Heather Swift boasted in an email to Nathaniel Herz, a reporter for the Anchorage Daily News, that Interior had a couple BSEE employees “working through Christmas to get Eni permitted” for an exploratory well in the Beaufort Sea, and that, “Eni could be ready to go as early as Tuesday with the [BSEE] guys working through Christmas.” Swift continued, saying that the well “could raise millions,” adding, “Wouldn’t that be a nice Christmas present!?!?” [2017-07-007, Department of the Interior Page 6600]
BSEE official Mark Fesmire, on December 23, 2017, emailed BSEE Director Scott Angelle and other Interior staff an email titled “BSEE Arctic Inspector’s Christmas plans.” Parts of the email have been redacted, but it seems that Fesmire wanted to inform Angelle that the two BSEE employees would be working on the Eni well over the holiday. Fesmire wrote, “There are no ‘show stoppers’ so far and our guys are anticipating being able to come back on the day after Christmas.” Interior staffer Stephen Wackowski then responded to the email, in an email that has been mostly redacted, saying “See Below, great positive social media opportunity here.” It appears that he retitled the email ” Christmas social media oppurtunity.” Director Angelle responded, “24 /7 /365. Energy dominance lives here!” [2017-07-007, Department of the Interior, Page 6598 and 6599]
The next day, December 24, 2017, Director Angelle emailed the group again, saying “Just FYI I personally spoke to the 2 BSEE employees at this facility earlier today. They were appreciative that someone from Washington knew they existed and aware of their holiday efforts. I thanked them on behalf of secretary zinke and wished them a merry Christmas!” [2017-07-007, Department of the Interior, Page 6595]
Western Energy Alliance
In August 2016, the Western Energy Alliance (WEA) sued the Obama administration for “failing to hold quarterly oil and gas lease sales.” Interior officials in the Trump administration met with WEA in winter 2017 to “discuss possible settlement conditions.” On January 31, 2018, the Bureau of Land Management (BLM) issued an Instruction Memorandum (IM) directing “its field offices ‘to simplify and streamline the leasing process.'” Among other provisions, the IM eliminated Master Leasing Plans and shortened the protest period for finalized leases. The day after BLM issued this IM, WEA dropped two of their three counts in their complaint against Interior.
On August 11, 2016, the Western Energy Alliance (WEA) sued Interior Secretary Sally Jewell and the Bureau of Land Management “for failing to hold quarterly oil and gas lease sales, as required by the Mineral Leasing Act.” [Ellen M. Gilmer, “Industry lawsuit targets ‘keep it in the ground,'” Energy & Environment, 08/11/16; Western Energy Alliance v. Jewell et. al., Case No. 1:16-cv-00912-WJ-KBM]
On January 24, 2017, then-Acting Interior Secretary Kevin “Jack” Haugrud forwarded Daniel Jorjani an email titled “Re: Western Energy Alliance v. Jewell, 1:16-cv-00912-WJ-KBM (D.N.M.).” Haugrud wrote, “Here’s the item we briefly discussed, Dan, for which we need to develop a position (please see email string below).” Jorjani responded that the email was “much appreciated.” The original email has been completely redated. [17-00434cc, Department of the Interior, Page 1264]
On February 14, 2017, Kathleen Benedetto emailed James Cason, informing him that “BLM & Solicitor’s Office, had a preliminary discussion on possible settlement conditions with the Western Energy Alliance (WEA) who is suing the BLM for not following (in their mind) the Mineral Leasing Act requirements for the oil and gas leasing program.” Benedetto reported that WEA wanted to meet with Interior to “discuss settlement options.” [17-00434cc, Department of the Interior, Page 1260]
Interior officials appear to have met with Western Energy Alliance representatives to discuss settlement options on either February 28, 2017, or March 1, 2017. [17-00434cc, Department of the Interior, Pages 1258 and 1260]
On January 31, 2018, the Bureau of Land Management issued Instruction Memorandum 2018-034, directing “its field offices ‘to simplify and streamline the leasing process’ so that federal leases to the oil and gas industry can be expedited ‘to ensure quarterly oil and gas lease sales are consistently held,'” and requiring “the Bureau of Land Management to process a proposed lease within six months.” Additionally, under the new IM, “Once-mandatory public participation in safety reviews is now left to the discretion of the agency’s field representatives. Public protests of finalized leases will be shortened to 10 days, and a sale can move forward even if disputes are unresolved, according to the memo.” The IM also ended Master Leasing Plans, which had been “implemented under the Obama administration to give hunters, anglers and groups hoping to protect cultural artifacts a voice in how public land should be managed when parcels are proposed for leasing.” [Darryl Fears, “Trump administration tears down regulations to speed drilling on public land,” Washington Post, 02/01/18; IM 2018-034, Bureau of Land Management, 01/31/18]
The following day, Western Energy Alliance dropped two of their three counts against the Interior Department. Because of the issuance of the new Instructional Memorandum 2018-034, WEA dropped their count that “BLM’s Leasing Policies and Practices Violate the Mineral Leasing Act” and their count that “BLM’s Action is Contrary to Law.” [Western Energy Alliance v. Zinke et. al., Case No. 1:16-cv-00912-WJ-KBM, Stipulation of Partial Dismissal]
Interior Secretary Ryan Zinke met with the Western Energy Alliance in April 2017. The briefing summary that Secretary Zinke received ahead of his meeting with WEA encouraged him to remind WEA that Interior “welcome[d] any ideas/feedback” on regulations that WEA wanted repealed. The briefing summary also reminded Secretary Zinke to tell WEA and the other oil and gas representatives in the meeting that Interior was establishing the Royalty Policy Committee as “WEA may be interested in submitting nominations” to serve on the Committee. Two of the attendees in the April 2017 meeting with Secretary Zinke now represent energy interests on Interior’s Royalty Policy Committee.
Secretary Ryan Zinke met with Western Energy Alliance on April 25, 2017. In addition to representatives from Western Energy Alliance, representatives from Great Western Oil and Gas, Halliburton, Ultra Petroleum, BP, and QEP Resources were also in the meeting. [Secretary Ryan Zinke April 2017 Calendar, Department of the Interior]
Secretary Zinke’s “Daily Briefing Summary,” compiled by Interior staff and given to him prior to his meeting with WEA, was one and a half pages long—longer than many of his briefing summaries. In the brief, one of the sections was “Next Steps.” The brief told Secretary Zinke that the “public notice on reestablishment of the Royalty Policy Committee and inviting nominations for the committee was published April 3, 2017,” and informed him that “WEA may be interested in submitting nominations through this public process.” [17-00371cl, Department of the Interior, Page 255]
According to the Secretary Zinke’s briefing materials that are publicly available on the Department of the Interior’s Freedom of Information Act (FOIA) Library, the April 25th 2017 WEA meeting was the only time his briefing summary reminded him to remind an organization about submitting nominations for Interior’s Royalty Policy Committee. [OS FOIA Library, Department of the Interior, accessed 03/27/18]
Secretary Zinke later appointed two of the attendees in the April 25th WEA meeting, WEA President Kathleen Sgamma, and Gabrielle Gerholt, who at the time was representing QEP Resources but now works for Concho Resources, as alternate members to Interior’s Royalty Policy Committee. Sgamma and Gerholt both represent “Mineral/Energy Stakeholders” on the Committee. [Press Release, Department of the Interior, 09/01/17]
The other “next step” listed for Secretary Zinke to discuss in the April 2017 meeting was that it “may be useful to remind WEA attendees of the Office of Management and Budget’s (OMB) 2 for 1 regulatory requirement – for every new rulemaking, an agency must identify two existing rules to rescind.” The brief instructed Secretary Zinke that “we welcome any ideas/feedback they would like to share on potential rules and regulations that [WEA] would like to see rescinded or revised.” [17-00371cl, Department of the Interior, Page 255]
American Petroleum Institute
American Petroleum Institute arranged a meeting with Interior Associate Deputy Secretary James Cason and other high-level Interior officials to discuss energy issues in February 2017. API sent a list of 53 rules they identified as areas for concern. A “priority target for repeal” was the Methane and Waste Prevention rule, which Interior is now revising.
Holly Hopkins of American Petroleum Institute, (API) on February 3, 2017, emailed James Cason requesting a meeting with Cason “and other appropriate DOI political staff” to discuss “issues and opportunities for the Trump Administration.” Cason later emailed his assistant, Gareth Rees, and asked Rees, “Have you worked out a meeting time for API? Didn’t want it to fall through the cracks.” [17-00434cc, Department of the Interior, Pages 739 – 768]
On February 27, 2017, James Cason, and other Interior officials Micah Chambers, Lori Mashburn, Downey Magallanes, Melissa Simpson, Natalie Davis, Gareth Rees, Daniel Jorjani, Nancy Guiden, Timothy Williams, Amanda Kaster, Scott Hommel, and Douglas Domenech met with API to discuss “Energy Issues.” [James Cason February 2017 Calendar, Department of the Interior]
In her initial email to Cason, Hopkins attached a document that detailed API’s Energy Policy priorities. In particular, the memo said, “Executive agencies should implement policies that: 1. Promote access to domestic oil and gas resources; 2. Ensure the development of energy infrastructure; 3. Ensure streamlined, timely planning, permitting and project review.”
Hopkins also attached a list of 53 “Rule[s] or Polic[ies] of Concern.” Of the many rules on this list, the first on the list in the “Priorities for Immediate Action” category was “BLM Waste Prevention, Production Subject to Royalties, and Resource Conservation,” also known as the Methane and Waste Prevention rule, which API described as a “priority target for repeal.” After delaying many of the requirements in the Methane and Waste Prevention rule in December 2017, Interior is now in the process of revising the rule. [17-00434cc, Department of the Interior, Pages 739 – 768; Pamela King and Ellen Gilmer, “BLM finalizes delay for methane rule,” Energy & Environment, 12/07/17; “Waste Prevention, Production Subject to Royalties, and Resource Conservation; Rescission or Revision of Certain Requirements,” Federal Register, 02/22/18]
ConocoPhillips
After contacting high-level Interior officials about wanting to move forward on drilling in the National Petroleum Reserve in Alaska (NPR-A), ConocoPhillips was able to persuade the Bureau of Land Management to release “a draft environmental impact statement (EIS) that analyzes an application for oil and gas development of the Greater Mooses Tooth 2 (GMT2) production pad” in the NPR-A. In the timeframe that ConocoPhillips was pushing to drill in the NPR-A, ConocoPhillips CEO Ryan Lance invited Ryan and Lola Zinke to a dinner at Charlie Palmer, a Washington DC steakhouse, with ConocoPhillips SVP Andrew Lundquist, as well as the Ford Theatre Reception at the U.S. Capitol.
On February 13, 2017, “BLM-Alaska leadership and project staff” met “with ConocoPhillips to update them on permitting for the Greater Mooses Tooth 2 (GMT2), a Federal Oil & Gas Greater unit project within the National Petroleum Reserve in Alaska.” [17-00434cb, Department of the Interior, Page 429]
On Friday, March 3, 2017, Kjersten Drager of ConocoPhillips emailed high-level Interior officials Doug Domenech, James Cason, Kathleen Benedetto, and Katherine MacGregor, and wrote: “Given our recent discussions about our ConocoPhillips projects in NPR-A, our Willow discovery and the development potential that exists in the NPR-A overall and on the N. Slope of Alaska, I wanted to flag this article for you in the event you’ve not seen it. This is fairly accurate reporting (for a change) and gives a pretty good overview. Doug and Jim – we’re working on the follow-up information that you asked for from us and will be sending that very soon.” Katherine MacGregor responded, “Thx for sharing.” [17-00434cb, Department of the Interior, Page 1011]
On March 22, 2018, the Bureau of Land Management announced they were “releasing a draft environmental impact statement (EIS) that analyzes an application for oil and gas development of the Greater Mooses Tooth 2 (GMT2) production pad in the National Petroleum Reserve in Alaska (NPR-A),” after the original “Application for Permit to Drill was submitted by ConocoPhillips, Alaska, Inc. in August 2015.” [Press Release, Bureau of Land Management, 03/22/18]
Before BLM issued this decision, on May 8, 2017, ConocoPhillips CEO Ryan Lance invited Secretary Zinke and his wife Lola to a dinner on June 3, 2017 at Charlie Palmer Steak, a Washington DC steakhouse, with ConocoPhillips SVP Andrew Lundquist, as well as the “Ford Theatre’s Reception scheduled for 8:00 PM at the U.S. Capitol.” Lance had previously tried to sit down with Zinke during the 2017 Offshore Technology Conference in May. [2017-07-007, Department of the Interior, Page 1710]
Secretary Zinke appears not to have attended this event as, according to his travel schedule, he was in Santa Barbara, California on personal travel on June 3, 2017. [17-00658ch, Department of the Interior]
However, Secretary Zinke did participate in a roundtable discussion with ConocoPhillips and other oil companies on May 1, 2017, and also met with John Faraci, the Director of ConocoPhillips, on September 26, 2017. [17-00658ch, Department of the Interior; Secretary Ryan Zinke September 2017 Calendar, Department of the Interior]
Encana Oil and Gas
The Bureau of Land Management, while it was being lobbied by Encana in September 2017, reinstated two of the company’s oil and gas leases that were canceled in 2014 for failure to pay annual rent. It appears that reinstatements of canceled leases are rare, but because of BLM’s database deficiencies, it is difficult to say with certainty.
The Bureau of Land Management, on September 12, 2017, decided to reinstate two of Encana’s oil and gas leases in Uintah County, Utah totaling 320 acres. The lease serial numbers are UTU74837 and UTU75675. The leases were terminated on October 1, 2014. [“Notice of Proposed Class II Reinstatement of Terminated Oil and Gas Leases,” Federal Register, 09/12/17]
Leases UTU74837 and UTU75675 were terminated on October 1, 2014 for “failure to pay annual rent.” [“Determination of NEPA Adequacy,” BLM, February 2016]
Encana lobbied Bureau of Land Management in the third and fourth quarters of 2017. [“Search results for ‘Government Entity Contacted: BLM,” Senate Lobbying Disclosure Database, accessed 03/27/18]
At the end of 2016, there were a total of 40,143 BLM oil and gas leases “in effect.” A search of the Federal Register shows that notices of proposed reinstatements of oil and gas leases have only been published eight times in the last year. [Federal Register search, accessed 03/12/18]
It is difficult to determine statistics for canceled BLM oil and gas leases because “BLM’s database does not identify the number for onshore determinations.” [“Oil and Gas Production on Federal Leases: No Simple Answer,” Office of the DOI Inspector General,” February 2009]