Environmental group seeks investigation of Denver oil company’s political donations by Greg Avery, Aug 9, 2021, Denver Business Journal
U.S. and Canadian branches of an environmental group are asking the Colorado Attorney General to investigate political contributions made by a Denver-based oil company, alleging the contributions ran afoul of state law barring foreign involvement.
Friends of the Earth Canada and Friends of the Earth U.S. says it is filing a complaint to Colorado Attorney General Phil Weiser that $600,000 in political campaign donations by privately-held Crestone Peak Resources are problematic because the Canadian Pension Plan Investment Board owns 96% of the oil company, which the environment group alleges makes Crestone Peak a foreign-controlled subsidiary.
“We hope the Office of the Attorney General can investigate the questionable financial donations made by Crestone Peak Resources and take actions to prevent further illegal donations,” said the letter, sent by Hallie Templeton, Friends of the Earth legal director in the U.S. and a Canadian colleague.
Colorado law bars foreign citizens or companies formed under foreign countries’ laws from donating to political committees involved in state elections.
The Colorado Attorney General’s office hadn’t seen the Friends of the Earth complaint Monday and declined to comment on it.
Crestone Peak donated to groups opposed to anti-oil and gas ballot measures in 2018 and to the GOP-connected Senate Majority Fund that year.
The company, while owned by CPPIB, is formed as a Delaware corporation under U.S. law, said Jason Oates, spokesman for Crestone Peak Resources.
Activists concerned about the pensions of Canada’s public employees being invested in the oil business have tried without success to raise similar issues about Crestone Peak before, Oates said.
The $300,000 donated in 2018 to the Senate Majority Fund, which supported GOP candidates for state senate; $200,000 to Better Colorado Now; and $100,000 to Protect Colorado.
All the groups opposed tighter regulations on oil and gas in the state, including the hotly contested ballot initiative, called Proposition 118, that sought to impose larger setbacks on new oil well locations.
Such donations weren’t partisan, but supported issues that no Democrats were backing, he said.
“We didn’t seek to support Republicans. We sought to support issues and to protect our business and our industry,” Oates said.
Crestone Peak Resources was among many Colorado oil and gas producers that donated to defeat Prop 118, which the industry saw as a potential existential threat.
Companies collectively funded a war chest of $41 million to defeat the ballot initiative.
Crestone Peak Resources is merging with two other Colorado oil and gas companies.
Denver-based Extraction Oil & Gas, during its Chapter 11 bankruptcy reorganization last year, faced brief scrutiny of its political donations. Lawyers for the U.S. Public Trustee tried but failed to convince a bankruptcy court judge that the company should identify to whom it made $10 million in contributions between 2018 and 2020.
The issue of Crestone Peak Resource’s political involvement may not disappear if the merger of the three companies to create Civitas Resources closes as expected this fall.
The CPPIB is expected to remain a significant investor in Civitas and have a presence on its board of directors.
Refer also to:
2015: Last Chance before losing the federal electcion? Is Harper stealing from Canadians to give Encana & frac industry two billion dollars from pensioners before Harper’s law-violating Gang get punted?
2015: Does it get any more terrifying than this? Encana dumping frac water wars on Canadian pensioners? Encana sells troubled Colorado assets for nearly $1 Billion US to entity 95% owned by Canada Pension Plan Investment Board
2017: Why commit to spend a billion to take on $billions in US Oilfield liabilities? Destroy the retirement of hardworking Canadians, burden us with US oilfield’s toxic legacy? Canada Pension Plan arm commits up to $1 billion to buy oil assets in U.S.
… It began in October 2015, when the Canada Pension Plan Investment Board (CPPIB), the $368 billion behemoth that invests payroll withholding taxes from Canada’s workers on behalf of 20 million contributors, announced a $609 million USD deal to purchase all of the oil and gas assets in the Denver-Julesburg Basin owned by Canadian oil and gas giant Encana.
Many of Encana’s holdings were located in rapidly growing suburban areas near homes and schools north of Denver astride the Interstate 25 corridor between Colorado’s capital and its fourth-largest city, Fort Collins. Others were in communities that had banned hydraulic fracturing, or fracking, such as Broomfield and Boulder counties. The oil and gas industry challenged those bans, and the legal fight reached the Colorado Supreme Court as the Encana deal was being negotiated. The fracking bans were overturned, and when the dust settled, CPPIB had picked up a chunk of sub-surface Colorado real estate and wells producing approximately 30 per cent less than had been announced just months earlier. …
It may simply be that the CPPIB was willing to go where other companies wouldn’t – the pension board thought they scored a deal from a distressed seller that would yield strong long-term results for their beneficiaries.
The fact that the CPPIB created a new oil and gas company in Colorado, the CPPIB-registered Crestone Peak Resources LLC, rather than simply investing in an existing Canadian-owned one added another quizzical twist to the deal.
… ‘I have to wonder if the beneficiaries of the pension fund’s investments understand what they’re investing in,’ says Boulder County Commissioner Elise Jones. As far as she knows, virtually every elected official in the county – including those from its municipalities – as well as the overwhelming majority of people who live here, oppose the kind of residential drilling plans Crestone is proposing.
Concerns range from the planned drilling around homes and schools, to negative health effects from the industrial facilities’ emissions, to the oil and gas industry’s impact on the Denver metropolitan area’s persistently poor air quality.
FOLLOWING THE MONEY
Along with its purchase of these controversial assets, Crestone was also invested in Colorado’s 2018 election.
Oil and gas issues figured prominently up and down the ballot, from the governor’s race to several ballot initiatives. And Crestone contributed $607,500 to support groups that directly or indirectly opposed Proposition 112, the failed initiative that would have required new oil and gas development to be placed at least 2,500 feet from homes and schools.
Crestone, for example, donated to the pro-industry group Protect Colorado, which campaigned to defeat 112, and other political groups backing Republican state legislature candidates that unswervingly support the oil and gas industry.
Austin Graham, legal counsel for the Campaign Legal Center in Washington, DC, reviewed Crestone’s contributions for their legality.
Federal law requires that foreign-owned companies’ contributions to state campaigns meet a two-part test: the contributions must be drawn from money made from U.S. operations; and the person making the decision to donate must be a U.S. citizen.
But since Crestone is a privately held, Canadian-owned company, it is not obvious where the money came from or who made the decision to contribute to the election.
Crestone states in an email that it follows all state and federal laws, and as a company operating in Colorado, ‘Crestone allocates a certain amount of funds each year to dedicate to organizations and initiatives that are important to our team. Crestone leadership ultimately makes the decision on which organizations these funds are donated to.’
Those organizations include ‘independent expenditure committees,’ which are also allowed to receive contributions from foreign-owned corporations.
‘Regardless of whether any laws were broken,’ says Graham, the CPPIB ‘spent a substantial amount of money trying to influence Colorado voters.’
… Erie’s experience with Crestone isn’t isolated. More than 1,000 complaints against Crestone’s operations were filed with the COGCC between November 2016 and February 2019 – almost twice as many as the next five oil and gas companies conducting business in Colorado combined. Crestone operates just like Encana/Ovintiv, and likely is Encana/Ovintiv in hanky panky disguise.
… One flurry of complaints came after Crestone’s operations caused a release of toxic gases at a site in Erie just 25 yards from the Aspen Ridge Preparatory School playground in September 2017. Crestone was plugging and abandoning a set of wells, and had been venting large quantities of volatile organic compounds before a resident smelled noxious fumes and complained to the COGCC. Those toxic emissions wafted directly onto the school playground of the Kiddie Academy Childcare Center and the elementary school, according to the COGCC’s report on the incident.
… Crestone continues to face legal challenges that are increasing the cost of doing business in Colorado. The company has been involved in lawsuits, protests, leaks and alleged violations of state regulations in multiple communities. Crestone, in turn, has sued the state and at least one other oil and gas company, alleging interference in its operations.
While Crestone is private, there are several clues that the CPPIB’s Colorado investment may be problematic. As of last month, the CPPIB’s website stated that the value of the investment had dropped to $543 million from the purchase price of $609 million. …
2020: Law-violating, aquifer-frac’er bully Ovintiv/Encana/(Cenovus spawned after Ernst lawsuit filed): “New York-based investor considers Ovintiv…to be the poster child for all that ails the North American exploration and production sector…. The sector as a whole is rife with excessive compensation and a lack of accountability”
… Civitas will purchase carbon-offset credits to achieve that goal, Being allowed to harm life, water, environment by buying carbon offets needs to be criminalized, just like settle and gags (non disclosure agreements). But, oil, gas and frac companies get away with breaking the law all the time, so that won’t do much good. Mr. Greager said in an investor call earlier this week, without disclosing how much will be needed to achieve it. “We’re intent on doing absolutely everything we can to reduce operational emissions,” he said. “But even when you’ve gotten as far … as you can possibly go, our business has a carbon footprint.”
The deal values Crestone at US$1.3-billion, including US$250-million in bank debt. Bonanza Creek will first acquire Extraction, which emerged from a seven-month bankruptcy process in January. Then the combined company, newly dubbed Civitas, will acquire Crestone. The companies hope to close the deal by year-end; the CPPIB will place one person on the nine-member board. Civitas is expected to list on the New York Stock Exchange. What a stupid name, just like Ovintiv. Sure smells like Encana/Ovintiv has it’s filthy frac fingers in these deals. Shame on CPPIB for financing this sleazy frac crap, since it first bailed Encana out to the tune of near a $billion of Canada pension funds.
… That has led to controversy for Crestone. In 2020, The Globe and Mail detailed citizen unhappiness with a number of Crestone safety incidents, including a well-venting accident in September, 2017, that sent gases into a playground, and a fire in December, 2019, that sent seven workers to the hospital.
2021: CPP & AIMCo gave Bolsonaro $1Billion to privatize water. Just how dirty is CPP Investment Board (Hanky Pankied with Aquifer Frac’er Encana)? We know how dirty AIMCo is by the millions it gives bankrupt frac’ers and other law-violating big polluters