Attorney General files first lawsuits regarding 2021 winter storm gas prices
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OKLAHOMA CITY (KFOR) – Attorney General Gentner Drummond has filed litigation against multiple companies regarding natural gas prices during 2021’s Winter Storm Uri.
According to the Oklahoma Attorney General’s Office, Drummond is filing lawsuits against Enable entities (ET Gathering & Processing successor by merger to Enable Midstream Partners, Enable Oklahoma Intrastate Transmission, Enable Gas Transmission and Enable Energy Resources) and Symmetry Energy Solutions LLC.
During Winter Storm Uri, officials say both Enable and Symmetry promoted natural gas and handled intrastate pipelines in Oklahoma. One of their customers was the Grand River Dam Authority (GRDA).
The A.G.’s Office says GRDA is Oklahoma’s biggest public power utility and that many of the state’s public schools, cities, counties and hospitals get natural gas from Symmetry.
Although the Federal Energy Regulatory Commission keeps interstate pipeline workers from owning the product they market, intrastate pipelines don’t have the same rules. Many states have certain restrictions on intrastate pipeline owners to match federal rules, but Oklahoma does not, according to Drummond.
According to the lawsuit, the companies used “a variety of tactics to drive up the index prices, including reduction of supply and submitting trades at unconscionable price levels” to charge GRDA exorbitant fees “dictated by the artificially inflated index prices.”
“I believe the level of fraud perpetrated on Oklahomans during Winter Storm Uri is both staggering and unconscionable,” said A.G. Drummond. “While many companies conducted themselves above board during that trying time, our analysis indicates that some bad actors reaped billions of dollars in ill-gotten gains. It is important that we do everything in our power to hold bad actors accountable for their actions.”
RELATED STORY: Oklahoma AG launches Winter Storm Uri tipline
Winter Storm Uri made its way though the state in February 2021. Before it left the continental U.S., it broke records with snow, ice and frigid temperatures and caused destruction in the southern part of the country. It also raised the need for natural gas.
The lawsuits alleges that Enable and Symmetry relied on the higher demand during Winter Storm Uri and planned to artificially reduce supply.
“They knew that it would bring sustained below-freezing temperatures, and that it would increase demand for natural gas. Armed with this knowledge, Defendants used that time to prepare, but not in the way that was rightfully expected from them,” the lawsuits say.
“Instead of ensuring adequate natural gas supplies to GRDA, upon information and belief Defendants spent the weeks and days before Winter Storm Uri’s arrival in Oklahoma taking deliberate steps, which continued after Winter Storm Uri’s arrival, to reduce the availability of natural gas in Oklahoma. They did so with the objective of driving natural gas prices — and their resulting profits — exponentially higher, to the detriment of GRDA and everyone else in Oklahoma.”
The companies “reaped billions of dollars in extra profit from their wrongful conduct and the resulting surge in prices during the storm,” according to the lawsuits.
According to the A.G.’s Office, the litigation against ET Gathering & Processing, Enable Oklahoma Intrastate Transmission and Enable Energy Resources alleges violations of the Oklahoma Antitrust Reform Act, violations of the Oklahoma Common Carrier statute, breach of contract, unjust enrichment, fraud, constructive fraud, bad faith breach of contract, civil conspiracy and negligence.
Officials say the lawsuit against Symmetry alleges violations of the Oklahoma Antitrust Reform Act, breach of contract, unjust enrichment, fraud, constructive fraud, bad faith breach of contract, negligence, and breach of fiduciary duty.
Symmetry Energy Solutions responded saying,
“Symmetry Energy Solutions is reviewing the lawsuit filed today by the State of Oklahoma. Symmetry, like many others, suffered the adverse effects of Winter Storm Uri and adamantly denies the unfounded allegations in the lawsuit, which it will vigorously defend.”
Symmetry spokesperson
AARP Oklahoma State Director Sean Voskuhl in response to Attorney General Drummond’s investigation into artificially inflated natural gas prices during Winter Storm Uri responded saying,
“This is welcome news from Attorney General Drummond for Oklahomans struggling with higher utility costs. The companies who reaped billions of dollars on the backs of hard-working Oklahomans during Winter Storm Uri must be held accountable. Frustrated utility customers have been demanding to know why they are paying for a “once-in-a-generation” storm for decades. Oklahomans are relieved action is being taken against the companies who bilked customers out of billions of dollars in a matter of days. They further demand the recovered funds are returned to the utility customers immediately.”
AARP Oklahoma State Director Sean Voskuhl
Corporation Commissioner Kim David today released a statement following the announcement from Attorney General Gentner Drummond that he filed lawsuits on behalf of the Grand River Dam Authority, against Enable entities and Symmetry Energy Solutions, as a result of his investigation of artificially inflated natural gas prices during Winter Storm Uri.
“Shortly after joining the Corporation Commission, I formally asked Attorney General Gentner Drummond to investigate possible wrongdoing by natural gas marketers and pipeline operators during Winter Storm Uri. After heeding my request, the Attorney General, as the state’s chief prosecutor, opened an investigation and determined that a lawsuit is necessary to protect Oklahoma ratepayers.
While these lawsuits were filed on behalf of the Grand River Dam Authority, I am hopeful that the Attorney General will pursue additional litigation against other companies so that all determined overpayments may be returned to Oklahoma ratepayers. I appreciate today’s announcement and will monitor these lawsuits as they move forward.”
Commissioner Bob Anthony released the following statement about 2021 Winter Storm lawsuits:
I am thankful the AG says he “will pursue additional litigation against other … bad actors [who] reaped billions of dollars in ill-gotten gains” from the February 2021 Winter Storm. Hopefully the beneficiaries of his next actions will include the residential retail customers of the state’s largest monopoly public utilities – customers victimized not only by “market manipulation” during the storm but by an unnecessary ratepayer-backed bond financing scheme fraught with hiring irregularities, cost discrepancies, apparent overpayments, and a billion-dollar cost overrun.
The petitions filed in Osage County District Court can be found here and here.
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