Fair Political Practices Commission Investigates Two Oil Regulators For Conflict Of Interest After Consumer Watchdog Complaint

Newsom Oil Well Approval Rate Still Greater Than Brown's

Regulators reported owning up to $100,000 of stock in Chevron and Exxon

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Sep 16, 2019, 15:31 ET

LOS ANGELES, Sept. 16, 2019 /PRNewswire/ -- The Fair Political Practices Commission is investigating two regulators at the Division of Oil, Gas, and Geothermal Resources for conflicts of interests raised in a July complaint by Consumer Watchdog.

In letters to Consumer Watchdog, the FPPC stated its intent to conduct an investigation on David Gutierrez and Thomas Goeres, who made decisions about Chevron and Exxon's operations while they each reporting owning up to $100,000 of stock in the companies. David Gutierrez is DOGGR's Deputy Director and Thomas Goeres is a Senior Oil & Gas Engineer Supervisor.

"Californians deserve to know their regulators don't hold stock in the companies they regulate," said Jamie Court, president of Consumer Watchdog. "By opening this investigation, the FPPC is sending an important message to all state regulators that the decisions they make cannot impact their stock portfolio.

"Governor Newsom should heed the agency's warning and freeze all new oil well permits until a full conflict review of the agency has been completed," said Kyle Ferrar, Western Regional Coordinator for FracTracker Alliance.

In July, Consumer Watchdog and FracTracker Alliance revealed several DOGGR regulators owned stock in oil companies while the department accelerated its rate of permit approvals for new oil wells and fracking. In response Governor Newsom fired DOGGR supervisor Ken Harris, but did not answer the groups' call to freeze all new oil well permits.

New state data, analyzed by FracTracker Alliance, shows that as of September 2, 2019 the issuance of new drilling permits in 2019 has slowed slightly but still remains substantially above Brown Administration rates in 2018.

	Drilling Permits			Rework Permits
Time Period	Jan 1 - Sept. 2, 2019	Jan 1 - Sept 2, 2018	2018	Jan 1 - Sept. 2, 2019	Jan 1 - Sept 2, 2018	2018
Total	1,748	1,220	2,124	1,609	1,524	2,245
Oil and Gas Production	570	471	686	889	1,061	1,525
EOR and Support wells*	1,178	749	1,438	720	463	720
*Includes cyclic steam, steam flood, water flood, observation, injection, and storage wells

FracTracker Alliance reports the Newsom Administration has issued permits at a rate 21.0% greater for oil and gas production wells and 57.3% greater permits for enhanced oil recovery (EOR) and other supports wells than the Brown Administration in 2018. In addition to the many environmental, climate, and public health risks associated with production wells, EOR wells also elevate the risk for surface expressions, as was the case with Chevron's recent 800,000 gallon oil spill, as well as other more deadly consequences of subsurface liquefaction.

However, DOGGR regulators have not issued any additional fracking permits since July 9^th, when the groups pointed out the well approval rates and DOGGR conflicts to Newsom. This is a drastic change in policy considering there have already been more fracking permits issued in 2019 (234) than were issued in all of 2018 (223).

"When the initial report was published on July 9th, the permit count for new oil and gas production wells was up 42.7% as compared to the same period in 2018," said Ferrar. "Drilling new enhanced oil recovery (EOR) and other types of support wells was up 121.3%. Well stimulation permits had reached a count of 234, a 110% increase from 2018. As of September, the issuance of new drilling permits in 2019 has slowed slightly but still remains substantially elevated."

SOURCE Consumer Watchdog