An oil industry analyst says the Environmental Protection Agency colluded with environmental activists to go after a Texas natural gas firm, and the agency's inspector general whitewashed the issue in its report.
The EPA's Office of the Inspector General last month cleared former regional administrator Al Armendariz of wrongdoing in the case involving a 2010 emergency order to natural gas firm Range Resources after it found elevated levels of methane and benzene -- a carcinogen -- in residential water. The EPA later settled with the company.
But oil industry analyst Steve Everley, who works for Energy in Depth, a public education project of the Independent Petroleum Association of America, said the EPA's watchdog ignored “the evidence that would suggest any wrongdoing on the part of EPA.”
Everley said Armendariz, who resigned in April 2012 under GOP pressure after being quoted as saying he would "crucify" companies that run afoul of environmental laws, colluded with activists on the order against Range Resources.
The IG report said Armendariz “informed environmental and citizen groups of the order and the Associated Press release after the [EPA regional office] issued the two documents.”
However, in a Dec. 7, 2010 email -- sent the same day the order went out -- Armendariz told activists the agency was “about to make a lot of news.” Armendariz informed activists that a news story had already been printed, but that there would be “an official press release in a few minutes.” He also told them to “Tivo channel 8.”
Channel 8 — Dallas-Fort Worth's WFAA-TV — published the original blurb about the order on its website 18 minutes before Armendariz sent the email saying the official press release would be issued “in a few minutes.” The original article on WFAA's website did not include the text of the press release, since it hadn’t been officially released.
A longer article about the order appeared on the website at 9:58 p.m. that day, more than five hours after the first blurb went out, indicating Armendariz did not wait until after the region released the order and the press release to inform activists.
“How could EPA’s inspector general claim that the collusion with activists happened ‘after the region issued its press release’ when the communication itself proves that the press release had not yet been issued?” Everley asked.
Beyond the timing of the email, Armendariz, who now works for the Sierra Club, reminisced about seeing the activists' investigations and thanked them for “helping to educate me on the public's perspective of these issues.” He also thanked them for their “continued support and friendship.”
There's also the question of whether the EPA had enough evidence to issue the order in the first place. It needed to have information showing that a water supply was contaminated and might pose a danger to public health, along with a belief that state and local authorities would not act to protect public health from that contaminant.
The IG report said the agency had "enough evidence and support to enforce the order," despite an EPA scientist saying there was "not conclusive evidence" that contamination had taken place.
But the IG report also showed the Railroad Commission of Texas, which regulates the state's oil and gas industry and actively assisted the EPA in its investigation, came to different a conclusion about whether the gas company was responsible for the contamination and danger to public health.
Former RRC Chairman Victor Carillo responded to Armendariz’s email about the press release by saying “thanks for the notice but as I have said repeatedly — it is a premature action while we continue to investigate.”
It was not that the RRC refused to protect the public; the commission didn't agree with the EPA that a public health scare and shaming of a company was necessary.
The IG report, however, cited the original law granting the EPA power to issue endangerment orders, which said the agency "needs neither proof that contamination has already occurred nor proof that the recipient of the order is responsible for the contamination."
Fifteen months after the order was issued, the EPA withdrew it because the agency believed the risk was lower to homeowners living in the vicinity of the contaminated wells. The IG report also said the EPA settled the case “because it was more complicated than [the agency] had anticipated.”
The court trying the case wanted additional evidence beyond what the EPA originally provided, prompting the EPA to claim that evidence would come at an additional cost. The EPA’s Office of Enforcement and Compliance Assurance officials said that "was not an efficient use of agency resources,” and without that additional evidence, the case would be weaker.
This meant a judge could rule against the EPA, which could result in “establishing case law that could weaken the EPA’s ability to enforce ... emergency orders in the future,” according to the IG report.
The EPA thought it better to withdraw than risk such a precedent.
“To sum up, the EPA was able to ‘crucify’ an oil and gas operator in Texas without evidence, and the entity whose job is to keep EPA in check determined the agency did nothing wrong,” Everley said. “In order to arrive at that determination, the watchdog not only had to rewrite history, but also affirmed that the EPA does not need proof to accuse oil and gas operators of wrongdoing.”
An EPA spokesman, when asked to comment on Everley's accusation, referred questions to the IG report.
Update, 4:45 p.m., Jan. 10: The IG now claims that despite Armendariz's email saying a press release would come "in minutes," the release was sent at 4:43 p.m. on Dec. 7, 2010, 11 minutes before Armendariz sent his email.