GOP Energy Bill Authors Stand to Profit From Oil and Gas Stocks
Republican lawmakers who wrote bills that were wrapped into the H.R. 1 energy package own stock in Marathon Oil, Chevron, and family-held oil and gas drilling operations.
Several Republican House members who sponsored energy deregulation bills that House Speaker Kevin McCarthy has included in his debt ceiling bill could personally profit if McCarthy’s package is signed into law.
McCarthy has included H.R. 1, titled the Lower Energy Costs Act, in his debt ceiling proposal, which is expected to be voted on by the House later this week. The bill consists of dozens of measures put forth by House Republicans that would expand oil and gas drilling on public lands, repeal clean energy investments passed into law last year, undo a methane fee set to apply to energy facilities, and speed up exports of liquid natural gas, among other things.
Nearly a dozen of the House GOP members who introduced legislation that is now in H.R. 1 and McCarthy’s debt ceiling bill own fossil fuel industry assets in their household portfolios, with several of the bills’ authors holding hundreds of thousands of dollars worth and one holding millions of dollars in oil wells.
If provisions of H.R. 1 are signed into law as part of a debt ceiling agreement, fossil fuel companies could benefit through limited environmental reviews, waivers issued for energy facilities, and more. As the House Energy and Commerce Committee was developing the bill, the oil and gas industry’s top lobbying group, the American Petroleum Association (API), sent a letter to the committee’s leaders expressing its support for the individual bills that were being rolled into it, and the group applauded the House in March for passing the bill. API represents many of the companies in whose stocks the H.R. 1 bill sponsors are invested.
The government faces a deadline of sometime this summer to agree on a bill raising the debt ceiling so the Treasury can continue making payments on its obligations.
One of the Republicans’ primary focuses with H.R. 1 is accelerating the permitting process for energy projects through steps such as prohibiting federal agencies from considering indirect and cumulative environmental effects under the National Environmental Policy Act (NEPA) and limiting judicial actions to 120 days after an environmental review’s completion. Environmental groups argue that these steps would allow fossil fuel corporations to effectively rubber-stamp proposals.
In response to H.R. 1, some environmentally-focused House Democrats have proposed a plan that would accelerate the permitting process for clean energy projects incentivized in the Inflation Reduction Act, aiming to keep the country’s emissions reductions in line with international climate goals.
The measures of H.R. 1 were criticized for their environmental impacts during a February hearing of two House energy subcommittees by witnesses Raul Garcia, legislative director for healthy communities at Earthjustice, and Tyson Slocum, director of the Energy Program at Public Citizen. Garcia’s testimony noted that while the bills in H.R. 1 undermine bedrock environmental laws like the Clean Air Act by waiving requirements for “critical energy resources,” the legislation does not define what can be labeled as such, leaving it up to the decision of whoever heads the Department of Energy at the time.
Legislation That Went Into H.R. 1
In February, Rep. Greg Pence of Indiana introduced a bill, H.R. 1140, that would authorize the administrator of the Environmental Protection Agency (EPA) to waive requirements for energy facilities under the Clean Air Act if it determines a certain energy resource is needed to “meet the national security or energy security needs of the United States.” Pence’s bill was included in H.R. 1.
According to his most recent financial disclosure report, as of the end of 2021, Pence’s spouse holds stock in Marathon Oil Corporation, a Houston-based oil and gas exploration and production company, valued at between $250,001 and $500,000, providing dividend income of between $5,000 and $15,000 that year. The brother of the former vice president, Greg Pence formerly worked for Marathon Oil and petroleum exploration company Unocal Corporation before becoming vice president of Kiel Brothers Oil Company, a family-held business of gas stations and convenience stores.
Another member of the Subcommittee on Energy, Climate, & Grid Security, Rep. August Pfluger of Texas, got a bill added to H.R. 1 called the Natural Gas Tax Repeal Act. The bill would repeal a provision of the Inflation Reduction Act that would tax oil and gas facilities for methane emissions beginning in 2024, the first such tax of its kind on the potent greenhouse gas.
Representing the Permian Basin region of West Texas, a region where environmental groups are warning of unpermitted methane flares amid a fracking boom, Pfluger’s family owns the Gentry Creek Ranch. August Pfluger is a member manager and director of Gentry Creek Energy LLC in San Angelo, Texas, which he describes in his latest financial disclosure as a pipeline and infrastructure company. The company provided Pfluger with between $50,000 and $100,000 worth of partnership income in 2021 and between $100,000 and $250,000 in income the year before.
Pfluger also holds up to $15,000 worth of stock in pipeline giant Enterprise Product Partners, a member of dozens of industry trade associations that cheered H.R. 1’s passage including API and the American Fuel & Petrochemical Manufacturers. Enterprise owns the huge Sea Port Oil Terminal (SPOT) project located off the coast of Texas to export crude oil that was approved in November 2022 by the U.S. Department of Transportation and is now the subject of a lawsuit by environmental and community groups including the Center for Biological Diversity.
The Hill offices of Pence and Pfluger did not respond to requests for comment.
One of the House members with the most fossil fuel industry assets is third-term Rep. Kelly Armstrong, whose family business owns hundreds of oil and gas wells around Dickinson, North Dakota. Armstrong introduced a bill in February, H.R. 1058, that would remove the presidential permit requirement for oil and gas pipelines and electric transmission facilities that cross international borders, authorizing the Federal Energy Regulatory Commission (FERC) to review applications for cross-border pipelines and the Department of Energy (DOE) for those for electricity transmission. The bill was included in H.R. 1. One upshot of his bill, Armstrong said in a statement, would be to prevent a future president from blocking a cross-border pipeline, as President Obama decided to do with the KeystoneXL project. Sludge previously reported that Armstrong’s oil and gas assets in his 2020 annual disclosure report were valued as worth between $3 million and $10.6 million, with income of up to $1.5 million from them that year. In addition to serving on the Subcommittee on Energy, Armstrong is a member of the Conservative Climate Caucus, a House group that defends the use of fossil fuels in the energy grid.
In March, Wyoming Rep. Harriet Hageman introduced a bill that got wrapped into H.R. 1 called the COAL Act that seeks to speed the leasing process under the Mineral Leasing Act for sites administered by the Bureau of Land Management. The freshman Hageman’s financial disclosure for 2021 lists an interest in “land/oil and mineral rights” in Converse County worth between $5,000 and $15,000, with income of up to $5,000 that year. In town halls this month, Hageman said she hopes to keep the burning of coal in the energy grid and accelerate coal and mineral leases.
Other Republican representatives who introduced bills that were incorporated into H.R. 1 hold stock in the fossil fuel industry: Rep. John Curtis (Utah), in Chevron, ConocoPhillips, and Valero Energy; and Rep. Larry Bucshon (Ind.), in an energy exchange-traded fund that includes ExxonMobil, Chevron, ConocoPhillips, and oilfield services company Schlumberger. Rep. John Joyce of Pennyslvania, who introduced a bill that the House Speaker’s office said would “cut red tape for critical energy resource facilities,” owns ownership interest in Pittsburgh-based gas drilling company 3RC/Sun Energy, LLC that was valued at between $50,000 and $100,000 as of the end of 2021, according to his disclosure.
Amendments to H.R. 1
As part of the amendment process to H.R. 1 the day before its passage on March 30, Rep. Chip Roy of Texas introduced an amendment, agreed-to by voice vote, that would direct FERC to withdraw two policy statements that would integrate climate considerations—such as greenhouse gas emissions from pipelines—into its public interest determinations.
Roy’s most recent annual financial disclosure for 2021 shows his household owns between $15,000 and $50,000 worth of stock in Chevron, a member of trade association API and others, as well as up to $15,000 worth of stock each in pipeline companies Energy Transfer, Kinder Morgan, NuStar Energy, and oil major ExxonMobil.
Another amendment, agreed-to by a recorded vote of 228 – 206, was introduced by Rep. Kevin Hern of Oklahoma, expressing the sense of Congress in “disapproving of the proposed tax hikes on the oil and natural gas industry” by the Biden administration.
Through a family foundation and trust, as of the end of 2021 Hern owned between $275,000 and $550,000 worth of stock in gas transmission and pipeline giant Williams Companies, as well as between $50,000 and $100,000 worth of stock in ExxonMobil. Hern’s funds have continued trading fossil fuel industry stocks in recent months, according to periodic transaction reports, including purchasing between $16,000 and $65,000 worth of stock in oil and gas exploration company Devon Energy the day after H.R. 1 passed the House. Hern’s stock purchases this year have included Pioneer Natural Resources, Magellan Midstream Partners, ONEOK gas transmission company, and utilities such as NextEra Energy. Last year, a Hern spokesperson told the New York Times that the congressman does not have control over the investment funds’ transactions. Hern receives millions of dollars in annual income from his stock holdings, with tens of thousands of dollars in income attributed to the Williams Companies assets.
The Hill offices of Roy and Hern did not respond to requests for comment.
Rep. Ronny Jackson of Texas, who introduced an amendment to H.R. 1 requiring the EPA to report on existing regulations that have “negatively affected domestic energy independence and increased energy cost for Americans,” owns up to $15,000 worth of stock in each of ConocoPhillips and ExxonMobil.
Pipeline Stock Traders
Rep. Mark Green of Tennessee, chosen this year by his colleagues to chair the House Committee on Homeland Security, has leaned heavily into hundreds of stock trades in pipeline and midstream energy companies over the past few years, with the maximum value of the sales and purchases worth tens of millions of dollars. Most recently, about a week before voting to pass H.R. 1, Green bought up to $250,000 worth of stock in midstream company NGL Energy Partners and sold up to the same amount in Energy Transfer LP, then sold up to $100,000 of stock in the Dallas-headquartered Energy Transfer on April 10.
Rep. Virginia Foxx of North Carolina, the chair of the House Committee on Education and the Workforce, has similarly frequently bought and sold pipeline company stocks in recent years. This year, Foxx’s stock pickups have included liquid natural gas shipping company Flex LNG and electricity and natural gas company Duke Energy, according to periodic transaction reports filed with the Office of the Clerk. In February, Foxx sold between $15,000 and $50,000 worth of stock in Marathon Oil Corporation, and has purchased up to $30,000 worth of stock in coal company Alliance Resource Partners, most recently on March 10. About a week before voting for H.R. 1, Foxx purchased up to $15,000 worth of stock in Plains All-American Pipeline, a stock she also held last year.
Democrats Voting for H.R. 1
When the GOP’s Lower Energy Costs Act passed on March 30 by a vote of 225 to 204 with six members not voting, four Democrats were among those voting “aye.” Two were Texas Reps. Henry Cuellar, nicknamed “Big Oil’s Favorite Democrat” for his pro-industry voting record, and Vicente Gonzalez, who founded the Congressional Oil & Gas Caucus in 2017. Both of their re-election bids benefited last year from supportive campaign spots by a shadowy pop-up group, Better Jobs Together, that Sludge uncovered was funded by API, with its pro-Cuellar spending reaching at least $1.4 million. Gonzalez owns just over $10,000 in Chevron stock, Sludge found by examining the congressman’s scanned banking statements that he attached to his most recent financial disclosure.
Texas Republicans Hold Millions in Oil & Gas Assets
The sweeping measures in the H.R. 1 energy package were a priority for McCarthy’s caucus after the fossil fuel industry dramatically increased its donations to the Congressional Leadership Fund, a McCarthy-endorsed super PAC that spent $227 million to help Republicans retake the House in the 2022 midterms.
A trio of Texas Republicans who voted for H.R. 1 are among the top fossil fuel investors in the House, based on Sludge’s 2021 review of financial disclosures.
Rep. John Curtis, the fifth-ranking member on the House Committee on Appropriations and a subcommittee chair, owns between $2 million and $10 million worth of ExxonMobil stock that provided dividends of between $100,000 and $200,000 in 2021.
The household of Rep. Michael McCaul, chairman of the Foreign Affairs Committee and the former chair of the Homeland Security Committee, owns millions of dollars worth of fossil fuel industry assets, with his spouse purchasing up to $250,000 worth of ConocoPhillips stock in February.
Rep. Roger Williams holds a real property asset, named Quintana Energy Partners, valued at between $250,000 and $500,000, according to his 2021 financial disclosure, and noted as providing partnership income. Quintana Energy Partners is an oil and gas fund managed by the Houston-based private equity firm Quintana Capital Group. Williams also holds up to $100,000 worth of stock in Chevron, with his spouse holding up to $15,000 more, and up to $50,000 worth of stock in oil and gas exploration company Diamondback Energy.
The conflicts of interest posed by federal lawmakers invested in industries they oversee has risen to greater public attention over the past few years, but Democratic leadership in each chamber of the previous Congress did not bring up legislation limiting stock trading or ownership for a vote. Last year, good government and progressive groups urged House leaders in both parties to pass measures that would ban members of Congress and their households from owning or trading individual stocks, noting that two-thirds of voters supported such a ban, according to polls. One previous legislative item that would have barred stock ownership and trading by lawmakers, the TRUST in Congress Act, was co-sponsored in the previous Congress by Roy and a dozen other Republican House members, along with scores of Democrats.
This month, Democratic Senators Jeff Merkley of Oregon and Sherrod Brown of Ohio introduced the Ending Trading and Holdings in Congressional Stocks (ETHICS) Act, which would prohibit ownership of individual securities by a lawmaker and their household. Under the proposal, lawmakers would be required to either divest, diversify into allowable assets like mutual funds, or place assets in a qualified blind trust at the end of their current term in office. The bill has a House companion led by Rep. Raja Krishnamoorthi (D-Ill.) and Michael Cloud (R-Texas), which currently has two other co-sponsors, both Democrats.
Correction: this post originally stated that Rep. John Joyce of Pennsylvania owned stock in pipeline companies Kinder Morgan and TransCanada, when he does not hold those stocks. Those assets are owned by Republican Rep. David Joyce of Ohio.
Featured image of Rep. Greg Pence (R-Ind.) modifies a photo by Scott Olson / Getty Images.
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