FOIA request for MOU rejected by State of WV

From an Article by Ken Ward, Jr., Charleston Gazette-Mail, June 15, 2018

PHOTO: Then-West Virginia Commerce Secretary Woody Thrasher (seated at left of table) meets last November in Beijing with China Energy President Ling Wen (seated at right of table) in front of President Donald Trump and Chinese President Xi Jinping. From: W.Va. Department of Commerce

A member of West Virginia’s negotiating team on the $80 billion natural gas investment deal with China was asked to repay $23,000 in travel expenses after the Justice administration raised questions about a potential conflict of interest, the governor revealed Friday.

Last November, President Donald Trump and Chinese President Xi Jinping looked on in Beijing as officials from the Mountain State and a Chinese energy company signed what was hailed as a landmark deal for West Virginia.

Under the deal, China Energy Investment Corp. would invest more than $80 billion over the next 20 years in West Virginia’s natural gas industry.

Gov. Jim Justice and other state leaders have been banking on the China deal, predicting it will create tens of thousands of additional jobs in the state. It also was described as a victory for Trump, the largest in a series of Chinese investments in the United States that totaled $250 billion.

But on Friday, Justice revealed an ethical cloud over the China deal: At least one member of the state’s trade delegation — an industry executive — was also working to help his private company.

Brian Abraham, the governor’s general counsel, said the state was “using someone who probably shouldn’t have been involved in the negotiations” as part of its trade delegation.

“People that were there in China maybe representing their own special interests, we didn’t think was right,” the governor added.

West Virginia officials are eager to see the fruits of the China Energy investment, as a cornerstone to the natural gas industry’s continued growth in the state. But along the way, some lawmakers and watchdogs are questioning whether the state is putting the industry’s interests ahead of the public concerns about broadening the state’s economic base. This year, ProPublica is partnering with the Charleston Gazette-Mail to examine those issues.

At a news conference Friday, neither Justice nor Abraham would name the individual or his company. In an interview later, Abraham confirmed that the man was Steven B. Hedrick, who is CEO of Appalachia Development Group LLC and also CEO of the Mid-Atlantic Technology, Research and Innovation Center, or MATRIC, a nonprofit that partners with industry on various research and development efforts.

Appalachia Development Group has been seeking a loan guarantee from the U.S. Department of Energy as part of an effort to build a natural gas “storage hub” for various natural gas liquid byproducts that can be used in a wide variety of manufacturing.

Abraham said the state Commerce Department paid for Hedrick’s travel for the China negotiations because it considered him acting as a state official, part of a special Commerce Department program in which certain executives are “loaned” to the state.

The Governor’s Office, though, discovered later that Hedrick had not joined the program and when asked to do so after the trip, he declined, Abraham said. Had he joined the program, Hedrick would have been required to sign an agreement to abide by the state ethics law’s prohibition on using public office for private gain.

“Why is this person behind the curtain at Commerce if they’re an individual on the outside?” Abraham said. “That created an ethical dilemma.”

Also, Abraham cited an incident in which state officials were later told that Hedrick asked China Energy officials to specifically target some of their investment in his company’s natural gas storage hub. Abraham said that, on one trip, Hedrick stayed an extra day to pitch his project.

Abraham said Hedrick was asked to repay the state $23,000 in travel expenses and that the repayment had been made.

A spokeswoman for Hedrick said he was not available for comment, but she issued a short email statement that said Hedrick was “grateful to respond to the request of the state of West Virginia to support the Commerce Department’s mission to attract business to the state.”

The statement said MATRIC “promptly paid any expenses invoiced by the state.”

Although officials signed a memorandum of understanding in China, the state has refused to release the text of the agreement and few details have been made public. The China deal and the natural gas storage hub are considered by many state officials as key and related economic development projects for West Virginia’s future.

The state’s natural gas industry has already greatly expanded, and backers of the China deal say it will provide huge amounts of capital that could fund processing plants, pipelines and other facilities that will turn natural gas byproducts into crucial ingredients for a wide variety of plastics manufacturers. These kinds of “downstream” developments will allow West Virginia to capture far more jobs and economic growth than just drilling for gas and shipping it out of state.

The revelations about the China deal came just one day after Justice asked for and received the resignation of Commerce Secretary Woody Thrasher, whose agency bungled the state’s implementation of a federally funded flood-relief program.

Thrasher was the top state official who traveled to China last November as part of the trade delegation.

Justice said Friday that discussions toward realizing the Chinese natural gas investments are ongoing, and repeated his earlier statements that the deal “came into being” because of his personal friendship with Trump.

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The Charleston Gazette-Mail and ProPublica want to tell the story of the changing landscape in West Virginia, and how coal and natural gas are impacting it. West Virginians: Tell us how your community is changing. Call or text us at 347-244-2134, or email us: changing wv@wvgazettemail.com.

Seven (7) new pipelines seeking approval across Delaware River

PennEast natural gas pipeline environmental study firm’s connection to shale coalition is questioned

From an Article by Keith Brown, Times of Trenton, NJ, NJ.com, February 28, 2015

The federal agency tasked with reviewing the proposed $1.2 billion PennEast natural gas pipeline has hired a company that is a paid member of the Marcellus Shale Coalition, which advocates for gas drilling, to conduct the environmental impact study for the project.

Tetra Tech, based in Pasadena, California, is an associate member of the Marcellus Shale Coalition, a trade association of 300 companies organized “to advance responsible shale development,” according to the association’s website.

The proposed 114-mile pipeline would be capable of transporting 1 billion cubic feet of natural gas per day from the Marcellus Shale area of northeastern Pennsylvania to Hopewell Township in Mercer County, New Jersey.

Hopewell Mayor Harvey Lester said the connection between Tetra Tech and Marcellus Shale Coalition has at least the appearance of a conflict of interest and that should be enough to disqualify Tetra Tech from conducting the environmental impact study. “I am concerned about a potential conflict of interest by this environmental consultant performing the PennEast environmental impact statement, whose business interests support pipelines,” Lester said. “I’m concerned we’re not getting a fair shake.”

David Spigelmyer, president of the Marcellus Shale Coalition, has publicly endorsed the PennEast project. “The PennEast Pipeline project further demonstrates the far-reaching regional benefits of shale development,” Spigelmyer is quoted as saying on the PennEast website. “PennEast, led by Pennsylvania and New Jersey consumer-focused companies, will not only create good paying jobs, it will deliver clean energy in a safe, cost-effective and responsible manner.”

The pipeline proposal has drawn criticism for cutting through environmentally sensitive areas as it traverses Hunterdon and Mercer counties. Leaders in every New Jersey town where the PennEast Pipeline would be built have passed resolutions opposing the project.

The only public hearing held by the Federal Energy Regulatory Commission in Mercer County, held Wednesday in Ewing, drew hundreds of residents expressing concerns about environmental and safety aspects of the plan.

PennEast, a consortium of East Coast natural gas providers, submitted the names of at least two companies bidding to produce the environmental study to FERC, which is tasked with reviewing the PennEast application. FERC selected Tetra Tech based on those applications, Teresa Young-Allen, FERC spokeswoman. “It was based on who was best qualified to help us,” she said. Tetra Tech works under the energy commission’s supervision but the company’s bills are paid by PennEast, Young-Allen said.

All applications to the energy commission are set up in this way to avoid the appearance of influence by the company making the application, while also not expending taxpayer money, Young-Allen said. “It’s to keep it as objective as possible,” she said.

As part of submitting the applications, PennEast was required to certify to FERC that the companies being considered were free from direct or indirect conflicts of interest. But the connection between Tetra Tech and the Marcellus Shale Coalition was never revealed to the energy commission because the coalition is a trade association, according to PennEast spokeswoman Patricia Kornick. “Involvement in industry trade groups is not a factor in that decision,” Kornick said. “And there would be no need to disclose that. I know there is some question on this. But no matter what the industry, trade group association is not a factor.”

Jeff Tittel, director of the New Jersey chapter of the Sierra Club, said the connection smacks of impropriety that should bar Tetra Tech from the project. “This is not just the fox guarding the hen house,” he said. “This is the fox doing the (environmental study) on the hen house and saying the hen house is safe.”

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Note: Eleven (11) new pipelines or expansion projects have cut thru the boundaries of the Delaware River watershed since 2011 with seven (7) new ones seeking approval.

See also:  Delaware River Waterkeeper

See also: www.FrackCheckWV.net