Denver, CO – This week, as the top five oil companies announce their first quarter profits, the Checks and Balances Project conducted an analysis of the money oil and gas corporations spent in 2010 on campaign contributions and Congressional lobbyists. The numbers tell the story that oil companies’ armies of lobbyists and contributing power give them a louder voice than American families. For example, the House of Representatives voted in March to protect Big Oil’s multi-billion dollar tax breaks and government subsidies, in spite of polling that shows Americans want them eliminated.
According to Public Campaign, the Political Action Committees for BP, Chevron, ConocoPhillips and ExxonMobil donated $285,500 to elected officials and political parties in the first quarter of 2011.
“These profit reports show Big Oil is making big bucks from high gas prices at the pump,” said Checks and Balances Deputy Director Matt Garrington. “Big Oil spent $63 million lobbying Congress and $2 million in campaign contributions last year so politicians would hand out $4 billion every year in taxpayer-funded subsidies.”
Public pressure is starting to sway GOP members of Congress. Speaker John Boehner, Denny Rehberg, Sam Graves, Mick Mulvaney, and Paul Ryan are all on record, stating the need to end oil and gas subsidies.
On the other hand, oil and gas money recipients, including Natural Resources Committee Chairman Doc Hastings (R-WA-04) and Subcommittee Chairman Doug Lamborn (R-CO-05), recently voted against ending “royalty relief” for offshore drilling companies. Hastings and Lamborn are also leading the charge to open up even more Western lands drilling despite the fact that Big Oil and Gas has failed to develop 57 percent of public lands leased for drilling.
“If Congress is serious about addressing high gas prices, throwing taxpayer money and opening up public lands to drilling speculation won’t work,” said Garrington.
The US Department of Energy reports $3.88 is the average price of a gallon of gas. This week, the “Big Five” oil companies – Exxon Mobil, Chevron, Royal Dutch Shell, ConocoPhillips and BP – reported an average 35.6% increase in profits over first quarter 2010.
The nonprofit Checks and Balances Project today released an analysis of the skyrocketing profits of the nation’s top five oil and gas companies in the wake of near-record gas prices and compared those profits to lobbying expenditures and political contributions in 2010.
ExxonMobil reported first quarter 2011 profits of $10.7 billion compared to $6.3 billion in 2010, a 69.8-percent increase. The nation’s largest oil and gas company spent $12.45 million on lobbying in 2010 and made $928,959 in political contributions to Republicans and $109,500 to Democrats.
Chevron, which reported Q1 profits of $6.2 billion in 2011 compared to $4.55 billion in 2010, spent more on lobbying in 2010 ($12.89 million) but less on political contributions ($473,000 to Republicans and $122,000 to Democrats).
The price at the pump is hovering around $4/gallon, while oil and gas companies are reporting billions in first quarter profits. So wasn’t a complete shock when Speaker John Boehner said, earlier this week, that Congress should look at ending the fossil fuel industry’s multi-billion dollar tax breaks.
After all, how does Congress plan to explain to American families facing escalating energy prices that BP – responsible for the worst spill in American history – made $7.1 billion in profits in the first three months of 2011, but still needs taxpayer dollars to stay in business.
Some politicians are trying to say that ending the decade-old tax breaks will only increase the price of fuel. But without their taxpayer-funded safety net, oil and gas companies would have to compete more rigorously for consumers, which is likely to drive down prices.
The fact is that American families can’t afford to keep propping up Exxon, Chevron, Shell and other oil and gas companies. The question is whether Speaker Boehner sees that.
If Speaker Boehner agrees the time has come to end oil and gas industry welfare, it’s a drastic change in course for the House Republican conference. Representative Paul Ryan’s 2012 budget, submitted less than two weeks ago, keeps intact $40 billion in oil subsidies.
Weeks before, in early March, House Republicans voted unanimously against ending tens of billions in taxpayer subsidies to the five largest oil companies.
See what Montana Congressman Dennis Rehberg has to say.
So what’s the answer Mr. Speaker? Are you and your colleagues finally changing your minds about billion dollar tax breaks for an industry making billions in profits?
The man tasked with overseeing the oil and gas industry in Colorado continues to say that groundwater contamination is not an issue when it comes to hydraulic fracturing in the state.
David Neslin (pictured), Director of the Colorado Oil and Gas Conservation Commission (COGCC) , told a federal forum this week that the COGCC has investigated hundreds of complaints about water contamination related to hydraulic fracturing, “and to date we’ve not found any instances of groundwater contamination.” Neslin reportedly did not offer any comments about the operations associated with fracking that are vital to the practice.
These operations include mixing, transporting and injecting millions of gallons of toxic fracking fluid into the ground, through aquifers via cement casings. Gas companies must also safely dispose of the wastewater produced by fracking that is laced with toxic chemicals and radioactivity.
Neslin has repeatedly omitted these essential processes from of his discussions of hydraulic fracturing and water contamination. Following his testimony at a congressional hearing in the nation’s capitol earlier this month, Neslin spoke on camera to the Checks and Balances Project and said that cracked pipe casings and leaky wastewater pit liners were not considered part of hydraulic fracturing process that he had just promoted to the senators. During the hearing, like yesterday’s BLM meeting in Golden, Colorado, Neslin repeated that the COGCC had no “verifiable evidence” that fracking has lead to ground water contamination in Colorado.
MORE:
-To see the Checks and Balances report on David Neslin’s definition of hydraulic fracturing click here.
-Read the Greeley Tribune’s report on the federal fracking forum in Colorado this week by clicking here.
-To read about Chesapeake Electric’s suspension of fracking in Pennsylvania after a fracking explosion sent chemicals into nearby waterways click here.
Media Contact:
Matt Garrington, Deputy Director
matthew@checksandbalancesproject.org
(303) 454-3376
Washington, DC – This week, Big Oil will announce record profits at a time when Americans are suffering at the gas pump. In the first quarter of 2011, ExxonMobil is expected to post a gain of 50 percent while a 33 percent bump is expected for both Chevron Corp. and ConocoPhillips.
“While Americans are feeling the pain of high gas prices, Big Oil is to announce record profits for the first quarter of 2011,” said Matt Garrington, Deputy Director of the Checks and Balances Project.
“These dirty energy corporations skirt their obligations and get billions in taxpayer funded subsidies, while they gouge Americans at the pump. The industry continues to demonstrate an abusive of the federal tax system. Speaker Boehner should stand by his words and make sure Big Oil pays their ‘fair share” of taxes,” continued Garrington.
According to Politico, the announcement schedule is:
These announcements come after Halliburton reported last week that its first quarter revenue set a company record at $5.3 billion, which is up from $3.8 billion in the first quarter of 2010. First quarter profits were up 148 percent from $206 million in 2010 to $511 million in 2011.
Halliburton cited increased U.S. onshore drilling activity as the reason for its success, with Chairman Dave Lesar stating, “North America delivered strong performance as margins progressed due to increased activity while Eastern Hemisphere operating income was significantly impacted by geopolitical events in North Africa, delays in Iraq, and typical seasonality.”
A simple analysis by the Checks and Balances Project of 10 years’ worth of industry profits and pump prices demonstrate that oil companies profit the greatest when Americans pay the most at the pump.
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The Checks and Balances Project’s mission is to investigate how and why decisions are made that affect taxpayers and consumers. The project is focused on holding government officials, lobbyists, and corporate management accountable for their actions related to energy, government spending, public health, and the environment.
Our weekly update to unravel the industry and political spin around the energy debate
IN CASE YOU MISSED IT
WE’RE IN THE WRONG LINE OF WORK
While Americans are suffering from pain at the pump, Halliburton reported last week that its first quarter revenue set a company record at $5.3 billion, which is up from $3.8 billion in the first quarter of 2010. First quarter profits were up 148 percent from $206 million in 2010 to $511 million in 2011.
Halliburton cited increased U.S. onshore drilling activity as the reason for its success, with Chairman Dave Lesar stating, “North America delivered strong performance as margins progressed due to increased activity while Eastern Hemisphere operating income was significantly impacted by geopolitical events in North Africa, delays in Iraq, and typical seasonality.”
ANOTHER EARTH DAY, ANOTHER SPILL
A Chesapeake Energy Corp. well blowout occurred in Northern Pennsylvania Tuesday, spilling up to tens of thousands of gallons of toxic, chemical-laden fluid onto area residential land and contaminating a tributary of the Susquehanna River. The incident may be the most serious fracking accident in the history of the commonwealth’s Marcellus Shale development. DeSmogBlog has the story.
WORD GAMES
Last week, Colorado Oil and Gas Conservation Commission Director David Neslin testified before a Senate committee looking into hydraulic fracturing’s less than spotless track record on safety. Contrary to his testimony, where he asserted that groundwater contamination from fracking has never occurred, Neslin told The Checks and Balances Project immediately following the hearing that oil and gas production in Colorado had indeed led to contamination. Most drilling is fracking, so to say fracking does not cause groundwater contamination is disingenuous at best. Watch how Neslin and industry representatives use rhetorical tactics to excuse corporate responsibility for toxic fracking fluid casing leaks and pit overflows.
PRICE, NOT POLICY, DETERMINES HEALTH OF WESTERN ENERGY DEVELOPMENT
Headwater Economics on Tuesday released a report analyzing the relative success of states and communities to maximize energy development’s benefits and minimize its costs. The report concludes with a series of policy recommendations for communities trying to achieve that goal. In five Rocky Mountain, energy-producing states – Colorado, Montana, New Mexico, Utah, and Wyoming – Headwater Economics discovered that common sense standards and protections did not hamper energy production. Price was the ultimate factor in determining whether energy development occurs. Read the full report.
DID WE LEARN OUR LESSON FROM THE GULF OIL SPILL DISASTER?
Checks and Balances Deputy Director Matt Garrington asks that question in his guest-commentary piece for Sunday’s Denver Post. Give it a read and let us know what you think.
DID YOU KNOW?
OIL & GAS NY LOBBY FUNDS UP 400 PERCENT IN TWO YEARS In New York State last year, the oil and gas industry spent $1.6 million on lobbying to fight common sense protections from oil & gas fracking impacts, up from $400,000 in 2008.
COMING UP THIS WEEK
BLM TO REVIEW COMMERCIAL OIL SHALE LEASING PROGRAM
The Department of the Interior Bureau of Land Management will host public hearings in three Western states – Colorado, Utah and Wyoming – beginning today to gather input from residents and experts as they review the federal oil shale leasing program. Find out more about the hearings.
Now that gas prices are hovering around $4 per gallon, risky schemes like oil shale are back in the national debate. Oil shale is pure science fiction, as companies have failed to produce commercial oil from oil shale despite a hundred years of experimentation.
Chairman Doc Hastings (R-WA), Subcommittee Chairman Lamborn (R-CO), Rep. Scott Tipton (R-CO) and Rep. Rob Bishop (R-UT) have all been throwing about this fantastic tale. Compare what politicians are saying to those in the oil and gas industry, who believe viable oil shale is a decade out or more.
Furthermore, oil shale today is being conflated with shale gas and shale oil, giving the false impression that oil shale is ready for prime time. This has led to inaccurate rhetoric, and it has the potential to mislead investors, policymakers and other Americans interested in real energy solutions.
Compare what politicians are saying to those in the oil and gas industry, who believe viable oil shale is a decade out or more: Oil Shale Quotes – Congress v Industry
Matt Garrington | April 24, 2011 | Reposted from The Denver Post
On April 20, 2010, Americans were reminded, in living color, of the dangers inherent in letting oil companies go unchecked. We sat glued to our televisions and computers, watching the Deepwater Horizon rig burn in the Gulf of Mexico. Observers and pundits immediately began to make comparisons to the last, great American oil spill, the Exxon Valdez disaster.
We learned of the 11 men who lost their lives on Horizon that day and the others burned or injured as they escaped the sinking platform. We stood by, helpless, as millions of gallons of crude oil poured into the Gulf, threatening our ocean waters, local tourism and recreation businesses, and those families who depend on the Gulf for their livelihood.
In the year since Horizon, the government has conducted investigations, industry has pointed fingers, and teams continue to work feverishly to minimize the damage. The disaster was a wake-up call for the nation that we need strong oversight of how drilling companies conduct business.
Neslin’s narrow definition of hydraulic fracturing misleads Committee members
**As Pennsylvanians deal with the breaking news that wastewater from a Chesapeake hydraulic fracturing well blowout has entered their drinking supplies, similar stories continue to unfold in Colorado.**
Within minutes after his testimony about the safety of hydraulic fracturing in front of the United States Senate Committee on the Environment and Public Works Committee last week, Colorado Oil and Gas Conservation Commission Director David Neslin said that gas production in Colorado has indeed led to groundwater contamination throughout the state. But when testifying, Neslin repeatedly told members of the committee that he had no “verifiable evidence” that fracking had contaminated groundwater supplies or aquifers in Colorado.
Yes, literally moments after the committee hearing ended, Neslin validated what many Coloradans already know: gas development in the state has contaminated Colorado ground water. In an interview with the Checks and Balances Project, Neslin divulged a few details he left out of his testimony. “We have not found a verifiable instance of hydraulic fracturing contaminating ground water, but oil and gas development has contaminated ground water in other ways. Sometimes a pit leaks, sometimes a pit overflows” (emphasis added).
Neslin justifies the contradiction by adopting a blinkered, compartmentalized definition of hydraulic fracturing. By his definition, pit leaks, overflows and even cracks in concrete pipe casings are not considered part of the fracking process, despite being essential components to gas development in Colorado.
Like Neslin, industry also defines hydraulic fracturing using rhetorical tactics. Speaking in April at a journalism lecture, Chesapeake Energy Corp. CEO Aubrey McClendon told his audience that, “We can tear up a road, we can be noisy, we can create dust, we can hurt somebody, and sometimes there is a lack of transparency about operations. All those are legitimate concerns, but fracking is not the story” (emphasis added).
This type of messaging has even penetrated national politics. On Thursday morning, the day after a the Chesapeake gas well blew out, spilling thousands of gallons of toxic fracking fluid, the same senator Neslin addressed during his meeting, James Inhofe (R-OK) said, on record, that, “[There’s] never been one case — documented case — of groundwater contamination in the history of the thousands and thousands of hydraulic fracturing” (emphasis added).
It’s true that states vary in how they deal with waste fracking fluid. The state of Pennsylvania, for example, has tried and failed to process its fracking wastewater safely in public water treatment facilities. The failure of treatment plants to remove carcinogens from wastewater and the admission by industry that those toxins had entered drinking supplies has led the state’s governor to order a stoppage to treating the wastewater at public works facilities immediately.
Meanwhile, Colorado stores its waste frack fluid in concrete containment casings and storage pits. Neslin does not consider the disposal of waste produced by fracking a part of the fracking process.
Neslin’s comments raise two questions. First, there is the obvious question of whether or not he was being completely forthright with the Senate committee when he characterized fracking as having never contaminated water supplies. Even if he honestly believes that fracking is not contaminating groundwater supplies, why didn’t the officer tasked with overseeing oil and gas production in Colorado tell the Environment and Public Works Committee that contamination had happened, even if it was, as he suggested, tangentially related to the process.
The second question surrounds his frequent use of the term “verifiable evidence,” when saying that groundwater contamination has not been caused by hydraulic fracturing. Just like his statements about groundwater contamination, Neslin’s use of “verifiable evidence” seems to fall well short of telling the whole truth about gas production in his state.
Dr. Geoffrey Thyne, a geologist tasked with studying contamination in the West Divide Creek in heavily fracked Garfield County, Colorado understands verifiable evidence very well. The geologist is often credited with conducting one of the most conclusive studies connecting ground water contamination with fracking. In fact, Thyne’s West Divide Creek study was deemed so conclusive, and therefore so damning to the gas industry, that many say it led to the loss of his job as a professor at the Colorado School of Mines. Thyne says that gas interests at the university had allegedly pressured Thyne to stop the study. Thyne didn’t stop the study, and he lost his job. But, as Thyne explains in the video below, the verifiable evidence he found while conducting his study suggests that fracking fluids seeped into the West Divide Creek as recently as 2004.
How was Thyne so sure? Just like the situation in Pennsylvania it comes down to salt, which is also found in fracking fluids. When asked about fracking and water contamination during the congressional committee meeting, Neslin did not once bring up the Thyne study.
Despite the contradiction pointed out by the Thyne situation, there still remains the issue of Neslin separating failures in the process associated with fracking from fracking in general. This tactic has become known as compartmentalizing. Community organizer Frank Smith, who advocates for safe drilling procedures in western Colorado happened to be in Washington, D.C. at the same time as Neslin. Smith said Neslin’s selectivity when talking about hydraulic fracking before the Senate committee was a tactic Smith has gotten used to seeing out west. “Too often they don’t want to look holistically at all of it. It’s all one and the same. It’s all part of the same system. If in fact there is a faulty casing, or those fracking chemicals or fluids do in fact end up where they shouldn’t end up that’s all part of the problem,” said Smith.
It should be pointed out that Neslin and all those who answered questions before the Senate Environment and Public Works committee were speaking of their own accord and therefore didn’t have to take an oath before talking. Neslin has returned to Denver where he has been asked to reapply to continue serving as the Director of the Colorado Oil and Gas Conservation Commission.
This 1976 law governs the way the Interior Department’s Bureau of Land Management administers public lands. To date, the bureau has protected just 1 percent of Western public land as wilderness and has leased 42 percent of it to oil and gas companies. The agency is eyeing parts of the remaining 57 percent of the land, which is now categorized as “mixed use.” The map above shows Colorado public lands protected by the bureau.
Our weekly update to unravel the industry and political spin around the energy debate
IN CASE YOU MISSED IT
2010 ONSHORE OIL SPILLS EXXON VALDEZ x3
Last Tuesday, CBS News reported that there were over 6,500 spills, leaks, fires or explosions nationwide at onshore drill sites or pipelines. And, at least 34 million gallons of oil or toxic chemicals were spilled – that’s three times the amount of oil spilled in the Exxon Valdez disaster. Read the story for state-by-state oil spill numbers.
WHAT OIL SPILL?
Rep. Doc Hastings would have you forget about the Gulf spill, even as the 1-year anniversary of the accident nears. Leading into the hearing, Hastings told Politico that it was too soon to consider offshore drilling safety legislation but not too soon to speed-up offshore drilling. Why the rush when drilling companies are sitting on 70 percent of offshore leases as well as 57% of onshore leases and over 7,200 onshore drilling permits.
HISTORY FULL OF GAS
During the Natural Resources committee markup of the offshore bills, Hastings claimed that ending the moratorium on drilling in 2008 was the reason for a drop in gas prices. He seems to have forgotten the worldwide economic recession where oil demand crashed and the price of a barrel of oil plummeted 60 percent. At that same hearing, House Republicans shot down an amendment by Ranking Member Markey to end taxpayer-funded subsidies to Big Oil.
DID YOU KNOW?
OIL SHALE IS AS ENERGETIC AS A POTATO
Oil shale, the “rock that burns,” contains one-tenth the energy of crude oil and has the same energy density as a potato. Read more in energy expert Randy Udall’s piece “The Illusive Bonanza.”
COMING UP THIS WEEK
OUR 1 YEAR ANNIVERSARY WITH DISASTER
April 20th, 2011 marks the one year anniversary of the BP Gulf oil disaster, but it looks like offshore drilling safety legislation and reforms to stop $4 billion-a-year subsidies to Big Oil won’t be going anywhere this month.
The Checks and Balances Project 