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World

Perry would Bring Oil Industry Ties to Energy Department

Perry might also face questions about his 2014 indictment by a grand jury in Travis County, Texas, on corruption-related charges

Former Texas Gov. Rick Perry smiles as he leaves Trump Tower, photo: AP/Kathy Willens
9 months ago

Rick Perry, President-elect Donald Trump’s choice for energy secretary, has close ties to the Texas oil industry and corporate roles in two petroleum companies pushing for government approval of the proposed 1,200-mile crude oil pipeline that has stoked mass protests in North Dakota.

Perry’s current position as board director at Energy Transfer Partners LP and also at Sunoco Logistics Partners LP, which jointly developed the controversial Dakota Access Pipeline project, is a strong indicator of the pro-oil industry sentiment that will likely take root at the Energy Department under his oversight. The former Texas governor is close to Texas energy industry executives, and his political campaigns, including two failed presidential bids, benefited substantially from their donations.

Perry would not have authority to intervene directly after the U.S. Army Corps of Engineers’ decision last month to delay the pipeline to allow talks with the Standing Rock Sioux and other project opponents. The Army will decide whether to grant an easement near the Sioux reservation in North Dakota, and the departments of Energy, Interior and Justice and the Environmental Protection Agency have had lesser supporting roles.

Trump announced his choice of Perry on Wednesday, calling him “one of the most successful governors in modern history, having led Texas through a sustained period of economic growth and prosperity by developing the state’s energy resources and infrastructure.”

Perry’s close relations with energy executives and his long-time dependence on them for political contributions signal an abrupt change of course at the Energy Department. Perry is expected to welcome the four-state pipeline and similar projects and set an open-door policy for oil industry interests.

During his unsuccessful 2012 run for the presidency, Perry proposed eliminating the Energy Department altogether. As secretary, he would be involved in policy decisions on nuclear security, increasing the nation’s domestic supply of oil and investments in oil exploration research and technology.

The department maintains and secures U.S. nuclear weapons and plays a major regulatory role in overseeing nuclear power and natural gas. It also manages 17 national labs charged with developing science and technology to further the nation’s energy sector.

Perry’s involvement in the Dakota Access Pipeline began when he joined as a director of Energy Transfer Partners in February 2015, and its general partner, Sunoco Logistics, one month later. Energy Transfer Partners is owned by Kelcy Warren, a Dallas billionaire who donated $500,000 to the Opportunity and Freedom super political action committee backing Perry’s run for the White House. The oil and gas industry was Perry’s largest donor, giving more than $1.6 million.

Perry’s net worth of about $3 million does not compare to the fortunes of Trump and other corporate leaders named to Cabinet positions in his administration. But he could face similar questions about potential ethics conflicts unless he divests his assets into a government-approved blind trust.

Energy Transfer’s 2016 annual report showed that Perry owned $154,000 worth of partnership units. At Sunoco Logistics, Perry was awarded units worth about $101,000, according to the firm’s 2015 annual report.

Perry’s wife, Anita, also owned up to $15,000 in shares in Warren’s flagship firm, Energy Transfer Equity LP, and a similar amount in Sunoco Logistics, according to Perry’s 2015 presidential financial disclosure. The couple also reported owning two other energy-related investments worth as much as $150,000.

The incoming Trump administration has said it plans to approve the controversial pipeline project, which was stalled in recent months by defiant protests by Native American and environmental opponents. The Army Corps ruled last month that it was delaying a decision on an easement for the project near the Sioux reservation in North Dakota. The decision quickly spurred legal complaints against the Army Corps by the pipeline project’s developers.

Emails and phone calls to the Trump transition team and Energy Transfer Partners for comment were not returned. A spokesman for Sunoco Logistics referred questions to Energy Transfer Partners, saying that the partner firm appoints the Sunoco Logistics board.

Perry’s 2015 disclosure also reported $250,000 in income during that period from Holt Texas Ltd., an equipment firm headed by Peter Holt, a long-time political donor to Perry’s campaigns. Holt’s San Antonio firm, known as Holt Cat, sells and rents Caterpillar equipment, including heavy-duty engines for oil exploration. Holt, who also owns the San Antonio Spurs, has donated more than $600,000 to Perry’s campaigns since 2000.

Perry might also face questions about his 2014 indictment by a grand jury in Travis County, Texas, on corruption-related charges. Perry was cleared of the charges in 2015, but not before he had to defend himself in a messy public case that shadowed his 2016 presidential run.

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