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Energy in Depth (EID) is a gas drilling industry front group formed by the American Petroleum Institute, the Independent Petroleum Association of America (IPAA) and dozens of additional industryorganizations. Energy in Depth is funded by the El Paso Corporation,XTO Energy, Occidental Petroleum, BP, Anadarko, Marathon,EnCana, Chevron, Talisman, Shell, API, the Independent Petroleum Association of America, Halliburton, Schlumberger and the Ohio Oiland Gas Association to counteract the efforts of grass rootsopposition to fracking shale.

Quiénes son Energy In Depth?????

Gráficos extraídos de: TXSHARON

Energy-in-Depth (EID):  The “GAS”roots

”Men stumble over the truth from time to time, but most pick themselves up and hurry off as if nothing happened.”– Winston Churchill

On January 6, 2012 a Fracking and Nuisance Litigation meeting took place in Montrose, Pennsylvania.

Energy-In-Depth’s (EID) – Northeast Marcellus Initiative Field Directors Bill desRosiers and Nicole Jacobs, along with Helen Humphries, Senior Corporate Communications Specialists for the Williams Company, attempted to attend the meeting.  They were asked to leave, as the purpose was to meet with people seeking information regarding nuisance litigation against Natural Gas Corporations, and the presence of representatives from the Natural Gas Industry would chill candid discussions about available legal remedies, according to a Responsible Drilling Alliance spokesperson.
The following day, “Bill” desRosiers published a blog entry on the EID-Northeast Marcellus Initiative website entitled “You’re Not Welcome Here” – This Is Transparency?”.

An article appeared on the We Are Powershift website, entitled “From Township Planning Consultant to Fracker: Tom Shepstone” by Alexander Lotorto.   EID-Northeast Marcellus Initiative followed up immediately with  “Who Is Alex Lotorto, Well Street Occupier?” by Giles Howard, a Guest Blogger.

I would not be surprised to find an EID blog entry entitled “Who is Dory Hippauf?”  to appear within hours of publication.   Who is Dory Hippauf?  I’m a 56yr old woman, I moved to a small town in the Back Mountain area of Northeast Pennsylvania about 14 years ago from Massachusetts.   I am the Research Committee Chair for the Gas Drilling Awareness Coalition of Luzerne County.   I hold no degrees in economics, the corporate world, or politics.   I have an AA in Graphic Design, and an AS in CAD drafting.  I am currently employed as a CAD Drafter.   I have a great deal of curiosity in how corporations have influenced our government and our lives, and this led me to start “Connecting the Dots”.    All the information I have and will present is easily found on the internet using Google, and I do cite my sources.

In the interest of transparency, Part 3 of the Connecting the Dots series will be asking “Who Is EID”.

According to SourceWatch “Energy in Depth (EID) is a pro-oil-and-gas drilling industry front group formed by the American Petroleum Institute, the Independent Petroleum Association of America (IPAA) and dozens of additional industry organizations for the purpose of denouncing legislation proposed by Colorado U.S. Rep. Diana DeGette to regulate underground hydraulic fracturing fluids.”

In 2009, EID mounted a fierce “rebuttal” campaign against the documentary film, GASLAND, by Josh Fox.  EID sent a letter to the Academy of Motion Picture Arts and Sciences stating Gasland should be ineligible for nomination because it was based on inaccuracies.   EID also published several blog entries “debunking” the film.

The funding sources for EID include: Anadarko, BP, Chevron, El Paso Corporation, EnCana, Halliburton, Marathon, Occidental Petroleum, Schlumberger, Shell API, Talisman and XTO Energy.

EID has two satellite branches:  EID-Northeast Marcellus Initiative which covers Pennsylvania and New York area, and EID- The Ohio Project which focuses on gas/oil drilling in Ohio.  If you have clicked on these links, you will see nice profile pictures, each person’s EID Title, and a “hometown”.   The purpose of this is to make you feel more connected to EID, especially if you recognize the hometown, as in “Gee, these are nice people, they are from my home town.”  This is a time honored public relations tactic, used by many ad agencies to sell you products, and politicians to make them seem more “likeable”.  Public Relation firms know you will be more apt to believe someone who appears to have a connection to you, as opposed to someone you don’t know.

The “grassroots” initiative was launched around May 2011 by EID.  According to the website Marcellus Drilling News: “EID has also launched a major new grassroots initiative now spreading from county to county in the region.”

Marcellus Drilling News further states “The program, known as EID’s “Northeast Marcellus Initiative,” calls for the hiring of several full-time organizers charged with engaging and educating the region’s many supporters of the Mighty Marcellus, and providing them with the tools they need to act. Led on the ground by campaign manager and well-known local natural gas advocate Tom Shepstone, the initiative is already up-and-running in several counties across the region, with field organizers now in place in Luzerne, Lycoming and Wayne Counties, Pa. – all with reach into New York State.” (emphasis added)

EID is not grassroots.  EID’s “GAS”roots extend from the front groups, Corporations, Public Relations, to the halls of Congress.

There are 3 main “DOTS” of intersection with EID where multiple people have multiple “dots” in common:

  • Independent Petroleum Association of America
  • FTI Consulting
  • U.S. House of Representatives

The GASroots Echo Chamber Singers:

  • Institute for Energy Research
  • American Energy Alliance
  • ShaleNet (Pennsylvania College of Technology, a Penn State Affiliate)
  • Responsible Resources
  • Marcellus Shale Coalition
  • Mackinac Center for Public Policy
  • Ohio Oil and Gas Energy Education Program (OOGEEP)
  • Ohio Oil and Gas Association (OOGA)
  • Interstate Oil & Gas Compact

The following is going to be eerily reminiscence of the “Begat” from the Book of Genesis, however this format is the most expedient and concise manner to present the information.

EID Players:

“Talk to anyone in PR and they will admit that increasingly clients suggest ideas which are straight from the astroturf. Often they seek to utilise the power of the internet with extensive, but spurious, social media campaigns. But Tim Pinto, a specialist in media and advertising law with Taylor Wessing, cautions that the law can bite, and bite hard, if an astroturfer is exposed: “It’s a wrong to think that the law lags behind here. The Consumer Protection from Unfair Trading Regulations 2008 provide for a criminal offence for traders who falsely represent themselves as a consumer or engage in misleading marketing.” Good and bad reviews: The ethical debate over ‘astroturfing’ There’s a fine line between telling the truth well and lying.


Lee Fuller is the Executive Director of EID, he is also the Vice President of Government Relations for the Independent Petroleum Association of America.  According to Open Secrets, the top industry represented by Mr. Fuller was Oil & Gas.

Regarding Gasland, “The filmmaker alternates between misstating and outright ignoring basic and verifiable facts related to the impact of these activities on the health and welfare of humans, wildlife and the environment,” said Lee Fuller, executive director of Energy in Depth (EID), in a letter (pdf) today to the academy.

Jeffery “Jeff” Eschelman is listed as Executive Vice President at EID.  In addition to his position at EID he is the Vice President of Public Affairs & Communication at the Independent Petroleum Association of America and former employee of Dittus Communications.

Julia Bell: Researcher at EID, and Public Affairs & Communications Coordinator for the Independent Petroleum Association of America.

Chris Tucker: EID Team Lead, Spokesperson, and Advisor for – you guessed it – the Independent Petroleum Association of America.  Mr. Tucker is more closely associated with the EID-Marcellus Initiative branch as Team Leader and Blogger.

$10,300: Devonian Resources (Energy Conservation and Management                                                        Consultants) Top Single Contributor

$35,500: Oil & Gas Top Industry Sector Contributor

  • Former Communications Advisor for House Minority Whip Rep Roy Blunt R-MO, (elected as Senator in 2008).

2008 Senate Campaign:

$23,300: Chevron, 2nd highest individual contributor

$128,250: Oil & Gas, 3rd highest industry sector contributor

2010 Senate Campaign:

$32,173: Murray Energy, 15th highest individual contributor

$29,200: Koch Industries, 16th highest individual contributor

$28,800: Exxon Mobil, 17th highest individual contributor

$342,050: Oil & Gas, 7th highest industry sector contributor

At a conference in Houston Texas, on November 1, 2011, Chris Tucker gave a presentation entitled “Understanding, Responding to, and Working with Environmental NGOs“   (NGOs are Non Government Organizations.)

This was the same conference where Matt Pizarella, Range Resources Communications Director advocated using “Psy Ops” to “overcome stakeholder concerns” .

The presentation divides “Environmental NGOs” into two categories:

Ones oriented toward solutions (most of the time), which include Worldwatch Institute, Sierra Club, CleanAir Task Force, Environmental Defense Fund, and the Nature Conservancy.  I assume the “ones oriented toward solutions” means these NGOs are the easiest working partners for the gas & oil industry.

Others Driven by Ideological Attachment – NRDC,, Oil & Gas Accountability Project, Friends of Earth, Riverkeeper, Food&Water Watch.

The presentation continues with how to support and push the message: “Anatomy of a “Movement”: Start with $$$.  The slide shows the “splash page” for the Park Foundation.

Park Foundation Environmental Grants

Public Policy is focused on efforts to advocate for strong and enforced water policies and increased public investment in sustainable water infrastructure at state and federal levels. Support is primarily targeted to organizations with national policy agendas and New York and North Carolina programs. The Foundation has developed a specific policy interest in addressing concerns about hydraulic fracturing and gas drilling activities proposed for New York State. (emphasis added)

I wonder if the specific policy interest puts the Park Foundation in the “Solutions Oriented (most of the time) or the “Driven by Ideological Attachment” category?

The next 3 slides are called “PLANT YOUR SEEDS“, and lists:

    • $150,000 – American University for Josh Fox “investigative workshop” Series
    • $150,000 – American Rivers
    • $100,000 – Environmental Work Group (EWG)
    • $100,000 – Natural Resources Defense Council (NRDC)
    • $100,000 – National Public Radio (NPR)
    • $  95,000 – Environmental Advocates of NY
    • $  75,000 – Earth Justice
    • $  70,000 – OGAP, described as Anti-Marcellus organizer for PA/NY
    • $  70,000 – Democracy Now, Shaleshock, SourceWatch, Media Matters, and As You Sow

It appears this is the money that has been spent or will be spent to disrupt, discredit and/or debunk those who are “Driven by Ideological Attachment”.

The presentation goes on to tell the audience to “Manufacture Your Studies“.

This is a very nice “HEADS UP” from EID to let us know the studies that will be coming from the Gas Industry will be Manufactured.

The section of the presentation ends with “And Finally, Mobilize Your Attack“.

Psy Ops?

The Talking Points are still focusing on “the shiney” in “The Way Forward” section:

  • Going above & Beyond on the ground: HSE, community engagement
  • Maximize local opportunities: jobs, revenue, cost savings
  • Revitalization of the middle-class
  • Reintroduction of great industries of the past – Rail, Steel, Manufacturing

The choreography will include:

  • EID/trade groups well-equipped engage ideological opponents
  • Reorientation of communications approach – General public our new “landowners”, “regulators”
  • Blocking and tackling: accept every invitation, get as many folks to rig sites as possible, respond in a straightforward, expeditious manner


Dana Bohan: EID Staff Geologist

Junior Associate – Strategic Communications – Energy Sector: FTI Consulting

Steven “Steve” Everly: EID Spokesperson

Assistant Vice President: FTI Consulting Financial Dynamics

                        The strategic communication division of FTI Consulting, Financial Dynamics                                     helps ensure that its clients’ brand, reputation and market valuation reflect the                                     true worth of their businesses.


Steve Everley is Manager of Policy Research at American Solutions and a                                     contributing author to To Save America: Stopping Obama’s Secular-                                                Socialist Machine by Newt Gingrich. Prior to joining American                                                             Solutions, Everley worked as a research assistant at the American                                                             Enterprise Institute. He graduated summa cum laude from the University                                                 of Kansas and attended graduate school at the University of Southern                                                 California. (emphasis added)

Nicole Jacobs: EID- Northeast Marcellus Initiative Field Organizer.

Independent Consultant – Shalenet

Shalenet operates through a grant from Department of Labor, Employment and                                     Training Administration to provide the gas industry with a local workforce.  Key                                     partners include 15 Workforce Investment areas (not named), focusing on                                                 Pennsylvania, West Virginia, Ohio, and New York, PA Independent Oil an Gas                                     Association, Pennsylvania Independent Oil & Gas Association (PIOGA) the                                     Veterans Administration, Allegheny Conference on Community Development,                                     Broome Community College, Eastern Gateway Community College,                                                 Pennsylvania College of Technology,  West Virginia Northern Community                                                 College and Westmoreland County Community College.

ShaleNet operates out of Pennsylvania College of Technology which is affiliated             with Penn State.

Brian Kennedy Per: NATURAL GAS: BP, others push against federal regulation of fracturing, Brian Kennedy is cited as a spokesman for Energy In Depth. (emphasis added)

Although, Mr. Kennedy is cited as spokesman in this and others articles, there is no sign of him the Energy In Depth websites.

“This language seems to be a restatement and endorsement of policies and procedures             the industry has been following for decades, as mandated by federal, state and local             laws,” said Brian Kennedy, a spokesman for Energy In Depth. “To the extent the             language helps clarify the existing framework and highlight its overwhelming success to             date, it could be a valuable educational tool moving forward.” (emphasis added)

Rep. Richard Pombo lost his re-election bid in 2006 to Jerry McNerney.
“Rep. Richard Pombo’s loss represents the most significant electoral                                                 victory the environmental movement has seen in decades,” said Rodger                                                 Schlickeisen, president of Defenders of Wildlife Action Fund. “It should                                                 now be clear to all that we have the political strength to take on and defeat                                     extreme anti-environmental politicians.”


                                    Environmentalists opposed Pombo for efforts to rewrite species                                                             protections and increase oil drilling in Alaska and off-shore while                                                             fundraising from industry groups. He also faced questions about ties to                                                 disgraced lobbyist Jack Abramoff, who pleaded guilty in a congressional                                                 influence peddling scandal.

2006 Campaign:

$34,800: Chevron, 2nd highest individual contributor

$197,648: Oil & Gas, 4th highest industry sector contributor

Campaign 2010:

$58,100: Murray Energy, 2nd highest individual contributor

$47,800: FirstEnergy Corp, 3rd highest individual contributor

$369,772: Electric Utilities, 4th highest industry sector contributor

$185,650: Oil & Gas, 14th highest industry sector contributor

The Speaker’s Pipe Dreams: Big Oil Investments Muddy

 Boehner’s Message On Keystone XL

January 18, 2012 11:25 am ET

Shortly after the Keystone XL pipeline permit process started gaining steam in Canada and the American Midwest, Rep. John Boehner (R-OH) began investing significantly in companies tied to the project. In addition, since 2008 a number of companies that stand to benefit from Keystone XL have donated thousands of dollars to Boehner since 2008. As approval has floundered, Boehner has used his clout as Speaker of the House to try to push the project through in the name of “jobs.”


According to public financial disclosure statements published by the Center for Responsive Politics, in 2009 Boehner invested $15,001-$50,000 in each of a number of companies that stand to benefit from the Keystone project (documents for 2008-2010 provided for comparison).


Boehner Invested Between $15,001-$50,000 In BP In 2009. [Boehner 2009 Financial Disclosure, 5/14/10, via see bottom of page 13]

Rhonda Reda: EID – The Ohio Project, Executive Director

Ms. Reda currently serves on the Public Outreach Committee of the Interstate                         Oil and Gas Compact Commission (IOGCC) and the Colonial Drake Well                                     Historical “Oil150” Steering Committee. She is an active member of the                                                 Independent Petroleum Association of America, the Society of Petroleum                                     Engineers and the Ohio Geological Society. Recently, Ms. Reda served on                                     the White House Task Force on Energy Education, and has received                                                 numerous state and national awards for OOGEEP’s efforts including: AAPG                                     Eastern Section’s Presidential Award for Public Outreach, Friend of Science                                     Award from the Science Council of Ohio, EPA’s Ohio Environmental Education                                     Award for Outstanding Program, World Oil Runner Up for Best Public Outreach                                     Program, Ohio Department of Natural Resources’ Minerals Education Award,                                     and the Interstate Oil and Gas Compact Commission’s Public Outreach                                                 Stewardship Award. Ms. Reda is a graduate of both Ohio University and Edison                                     State College. (emphasis added)

Thomas Stewart: EID – The Ohio Project, Executive Vice President

Travis Windle : EID Presenter.  Although Travis Windle’s name does not appear on any of the EID websites, he was cited as a presenter on a powerpoint presentation: THE MARCELLUS SHALE: Powering America’s Future,Thanks to Hydraulic Fracturing, dated October 14, 2010, and the email cited is for Mr. Windle at EID.

More recently, Mr. Windle has been cited as Spokesman for the Marcellus Shale Coalition:
Likewise, Marcellus Shale Coalition Spokesman Travis Windle said the closure of any one             well will have little to no impact on those using it for waste disposal.”

Rep. Melissa Hart 2006 Campaign:

$17,938: K&L Gates, 4th Highest Individual Contributor.

K&L Gates represents leading global corporations, growth and                                                             middle-market companies, capital markets participants and                                                                         entrepreneurs in every major industry group as well as public sector                                                 entities, educational institutions, philanthropic organizations and                                                             individuals.

Committee Assignments:

Education and Labor Transportation and Infrastructure

Leadership PAC: Badger Fund



The Public Relations:

“Some are born great, some achieve greatness, and some hire public relations officers”. ~ Daniel J. Boorstin


To recap EID staff, 6 are employed by FTI Consulting, 3 are former US House of  Representative aides, and 4 are also part of Oil & Gas Industry organizations.


FTI Consulting:

The registrant information for the EID website is listed as FD Dittus Communications.  

FD Dittus Communications became known as FD Americas Public Affairs, and later FD Americas was rebranded as FTI Consulting.

FD Americas: A unit of UK-based strategic and financial communications consultancy             FD, FD Americas Public Affairs (formerly Dittus Communications) offers public relations, marketing communications, and issue advocacy services. The firm provides the usual corporate services (media relations, corporate communications, and crisis management) plus public affairs services (issues management, legislative strategy, grassroots organizing and coalition building) as well as marketing, creative, and design services. Clients have included Kraft Foods, Dell, the US Department of Energy, and International Paper. The firm was founded in 1993. 

FTI Consulting: global business advisory firm             dedicated to helping organizations protect and enhance their enterprise value, today announced that Financial Dynamics             (FD), the Strategic Communications practice of FTI Consulting, has adopted the FTI             Consulting brand globally. FD now will be known as the Strategic Communications practice of FTI Consulting.

Side Note:

The original founder and CEO of Dittus Communications is Gloria Dittus, who later became CEO and President of FD Dittus-Strategic Communications.  


Ms. Dittus is now the founder and CEO of Story Partners.

Our Story:  a public affairs firm focused on helping trade associations, corporations and coalitions amplify their story through carefully aligned online and offline campaigns designed to drive public policy debates. (emphasis added)

Our principals have an extensive history of developing and executing strategies that make a difference – whether our clients are trying to influence a public debate, define and dominate a market, or successfully position an executive team.

Our philosophy is simple: leverage your story through compelling messages, amplify your story through an echo chamber of friends and allies, and broadcast your story through every communications channel available.

The GASroots Echo Chamber Singers

“When you’re singing you can hear the echo of people in the audience singing every single word with you, and that was that big dream that I had for myself. It’s happening.”  ~Taylor Swift


These are companion organization which will “amplify the story through an echo chamber”.  In conjunction with the main “GAS”roots,  the echo chamber repeats the talking points, industry approved “buzz words” and keeps repeating them as often as possible across all media, internet platforms and legislatures.

The Institute for Energy Research (IER)

Per SOURCEWATCH: founded in 1989 from a predecessor non-profit organization,                         advocates positions on environmental issues including deregulation of utilities, climate             change denial, and claims that conventional energy sources are virtually limitless. It is a             member of the Sustainable Development Network.

Robert L. Bradley Jr:  Chief Executive Officer and President.

Currently a member of the International             Association for Energy Economics, the                                     American Economic Association, Southern Economic Association, and the                                     American Historical Association, and a former Director of Public Relations Policy                                     at Enron.


In 2009 IER ran a campaign on “green jobs” attacking the expansion of             renewables energies. IER commissioned three studies on renewable energies and green jobs in Denmark, Germany and Spain. These studies by different think            tanks were than promoted by IER and other free market think tanks in the US but also used in Europe.

            Robert P Murphy:              Senior Fellow

Robert P. Murphy is an economist with IER specializing in climate                                                             change. His research focuses on the proper discount rate to be                                                             used in cost-benefit analyses and the implications of structural                                                             uncertainty for policy solutions.
Robert Murphy is also a columnist at

Board of Scholars: Mackinac Center for Public Policy

Per SOURCEWATCH: The Mackinac Center for Public Policy is a                                                             state-level conservative policy think tank in Michigan. Founded in                                                             1987, it is the largest state-level think tank in the nation. It was                                                             established by the state’s leading conservative activists to promote                                                             free market, pro-business policies. The Center voices its policy                                                             positions though publications and has moved beyond Michigan by                                                             helping the leaders of similar conservative institutions to improve                                                             their operations in many other states and countries around the                                                             world.

Richard StroupBoard of Directors

Former Director: Responsible Resources

The Best Environment Money Can Buy

Submitted by Diane Farsetta on March 6, 2008 – 12:08pm

Former Republican staffers of the U.S. House Committee on Natural Resources have formed a new group, Responsible Resources, to impact “the perennial debate over energy production and environmental protection.” The group’s first ad campaign criticizes “efforts to raise taxes on energy companies,” reports The Hill. Responsible Resources is not a lobbying group and will “not take any corporate donations,” according to its co-founder, Brian Kennedy. He described the group as “an educational resource principally for members of Congress and their aides with the ultimate goal of growing large enough to influence the debate beyond the Beltway.” The House recently passed a bill that would repeal tax credits for the oil industry and use the revenue to fund renewable energy resources. Responsible Resources claims that “taxes on energy companies are a threat to affordable and reliable energy.” Kennedy said, “A clean environment is a luxury that only the wealthiest countries can afford.” (emphasis added)

NOTE: There is no website for Responsible Resources.  It’s unknown, at this time, if Responsible Resources has “closed up shop” or was absorbed by another “GAS”roots organization.

Lisa Wallace: Senior Vice President Operations and Development

Senior Vice President Operations and Development: American Energy Alliance

Former US House Aide: Rep. Richard Pombo (R-CA)

(Side Note: Former House Resources Committee Chairman Richard Pombo has joined a lobbying and public relations firm which backed his attempts to rework the Endangered Species Act and open the Arctic National Wildlife Reserve to oil drilling.

Co-Founder: Responsible Resources

            Robert Testwide III: Board of Directors

Former Director: Responsible Resources

Thomas Pyle: President

Previously, Mr. Pyle was the founder of his own consulting firm, Pyle Consulting, Inc., an active public affairs consulting firm with a wide range of private and not-for-profit customers. Prior to starting his own firm, Pyle served as vice president of the Rhoads Group in Washington, DC where he represented and advised a variety of association and corporate clients in meeting their strategic public policy goals and priorities. Additionally, he also served as director of federal affairs for a major integrated manufacturing and services company focusing on energy, environment, regulatory and transportation issues.  Before coming to the private sector, Pyle held numerous positions on Capitol Hill including serving a policy analyst for the Majority Whip (Rep Tom Delay R-TX) of the U.S. House of Representatives and as staff director for the Congressional Western Caucus, as well as other legislative staff positions.

Mr. Pyle was also a lobbyist for the Koch Brothers.

Founder: American Energy Alliance is a “partner” of Institute for Energy.                                      Relations and the same people work for both.

The American Energy Alliance (AEA) was founded in 2008 by                                                             Thomas Pyle.

The Podium:

A neutral expert sends an informative message to an uninformed voter. An interested party can pay a cost to replace the expert’s message with its own. The more informed is the expert, the greater is the interested party’s incentive to replace the expert’s message. In equilibrium, making the expert more informed has no effect on the voter’s beliefs and strictly reduces social welfare. The model thus implies an endogenous limit on how credible a purported expert can be. ~ Abstract: On the Limits of Expert Credibility: Theory and an Application to Climate Change

EID often cites Professor Terry Engelder as an expert on the Marcellus Shale.  Professor Engelder is their local “go to” expert on all things Marcellus.  Use of academia to tell a story is a vital tool for any Public Relations campaign.   By virtue of their position within a respected educational institution, the “Professor” is ready made with a cloak of credibility and public acceptance.

Professor Terry Engelder
: Professor of Geosciences, Penn State University, Department of Geosciences.

Committee Member: Marcellus Shale Advisory Commission

Co-Founder/Co-Owner: Appalachian Fracture Systems Inc.

Engelder has an ownership stake in Appalachian Fracture Systems Inc., a consulting firm that has done work on Marcellus Shale. Gary Lash, Professor of Geosciences at SUNY Fredonia, is also Co-Founder/Co-Owner.

The Marcellus Boom / Origins: the story of a professor, a gas driller

and Wall Street

Sunday, March 20, 2011

By Jonathan D. Silver, Pittsburgh Post-Gazette

EXCERPT: By the time Mr. Engelder was hired by Penn State in 1985, he had been doing research on gas shales since the 1970s and was knowledgeable about fracturing in the shale.


That background set the stage for his long association with the petroleum industry. Shortly after Mr. Engelder arrived in State College, oil giant Shell approached him and offered to subsidize research by some of his students into fracturing and gas shales.


Shell’s offer, Mr. Engelder said, must be seen in a broader context. Penn State prides itself, he said, on broad collaborations on research with industry, which contributes roughly $100 million a year to the university.


A long line of other petroleum companies, including Chevron, ConocoPhillips, Dominion, Range Resources and Texaco — would eventually help fund research at Penn State through Mr. Engelder’ s lab.


Mr. Engelder estimated that over his career his research has benefited from at least $6 million in grants from industry and $8 million from government.


“There is a symbiosis between academic research, and by that I mean big-time research of the type that Penn State does, and industry. Industry really does benefit from this. There is a reason that industry contributes very handsomely to the academic world.”


For instance, Mr. Engelder  said Range and Chesapeake Energy Corp., both major players in Marcellus, are collaborating with Penn State to solve problems involving hydraulic fracturing.


One of the contracts involves the federal government putting up $3 million, which is matched by $2.4 million from industry.

Penn State is playing a central role in the Marcellus Shale in the form of “research” for the industry.  How much Penn State has received from the gas industry and for what is unknown, there is a serious lack of transparency.

Corporate funding of Marcellus Shale studies at universities raises alarms

Drilling on Campus: the second of two parts

Monday, November 07, 2011

By Reid R. Frazier, The Allegheny Front; and Olivia Garber, PublicSource

EXCERPT: At Penn State, the percentage is even higher. The school ranks fourth in the country in corporate research support, behind Duke University, Ohio State University and the Massachusetts Institute of Technology. For decades, it has maintained research relationships with companies such as Bayer, Dow and ConocoPhillips.


“Penn State maintains its distinction as one of the nation’s top universities in industry-sponsored research,” said Henry C. Foley, Penn State’s vice president for research, in a year-end university report.

If you combine the lack of transparency and the advice given by Chris Tucker to “MANUFACTURE STUDIES”…..  well, it kind of makes you wonder, doesn’t it?



Chesapeake Energy Update:


“It is essential that the activities of corporate executives are under constant, vigorous and public scrutiny, because those activities are crucial to the economic well-being of society. If anything, developments both locally and internationally during 2001 have emphasized the need to continuously update and upgrade corporate governance standards.“ ~ Ann Crotty (Business Day)

Origins Of The Marcellus Natural Gas Boom


By Jonathan D. Silver


In October 2007, Engelder was named a distinguished lecturer for the American Association of Petroleum Geologists. That position brought him to the attention of Chandra, the investment banker.


Wall Street’s interest had already been piqued by the success of the Barnett Shale in Texas, but analysts thought it was a unique formation.


Just as Zagorski had realized, Chandra grew to understand that Barnett and Marcellus bore intriguing similarities. What investment firm Jefferies Group needed was someone who knew the rock.


“We looked around and Terry seemed at the time to be a geologist focused specifically in Pennsylvania or the Appalachian region,’’ Chandra said.

Jefferies Energy Investment Banking is part of the Jefferies Group.  Ralph Eads III is the President of Jefferies Energy Investment Banking Group, and often cited as a source by EID.

Small Player on Wall Street Carves Out a Niche

November 22, 2010, 7:20 pm Mergers & Acquisitions | Investment Banking


EXCERPT: Alongside these global giants in oil and natural gas has been an investment bank that is only middling among merger advisers: Jefferies & Company. Yet the bank has managed to broker nearly every single major deal in shale.


Indeed, nine of the 10 biggest shale transaction in the last three years — including Exxon Mobil’s $31 billion acquisition of XTO Energy last December and Chevron’s $3.2 billion purchase of Atlas Energy announced Nov. 9 — have included Jefferies as an adviser, bringing no small amount of attention to a bank that is ranked 16th in Thomson Reuters’ merger advising standings.


Jefferies could not have scripted it any better. While bigger banks pare back their business, Jefferies is in the midst of a hiring spree aimed at bolstering the stature of its investment banking arm.


Shale deals have garnered some of the biggest doses of public relations. They have been brokered by an investment banker and former natural-gas executive, Ralph Eads III, who joined Jefferies in 2005, when the bank bought the oil and gas advisory firm Randall & Dewey.


Mr. Eads stands out as a star in the increasingly prominent deal advisory business at Jefferies, which was founded in 1962 with a focus on block trading and did not even get into the investment banking business until the 1990s. (emphasis added)


Between 2010-2011 Jefferies Energy Investment Banking assisted Chesapeake Energy with at least 8 business transactions:

  • April 2011- Acquisition of Bronco Drilling Company, Inc.
  • Feb 2011 – Sale of Fayetteville Shale assets to BHP Billiton Limited
  • Jan 2011 – Niobrara Shale Joint Venture with CNOOC Limited
  • Oct 2010 – Eagle Ford Shale Joint Venture with CNOCC Limited
  • Feb 2010 – Sale of Volumetric Production Payment
  • Feb 2010 – Sale of Volumetric Production Payment
  • Jan 2010 – Barnett Shale Joint Venture with Total E&P USA, Inc.
  • May 2010 – Convertible Preferred Stock Offering

In addition to being President of the Jefferies Energy Investment Banking Group, he is on the Board of Trustees for Duke University, and on the Board of Trustees for American Clean Skies Foundation.

American Clean Skies Foundation is a front group for Chesapeake Energy.

Washington D.C. based 501(c)3 non-profit group — states on its website that it “was formed in 2007 to provide all the facts on clean energy — particularly natural gas and other clean fuels such as wind and solar — and about the need for greater energy efficiency.” The organization was founded by Aubrey K. McClendon, the billionaire CEO of Oklahoma City-based Chesapeake Energy Corp., one of the country’s top sellers of natural gas.

Dec. 29, 2011: Analysts at Jefferies & Co Defend “BUY” rating for Chesapeake Energy…. I wonder why?

On Dec, 29, 2011, Reuters reported on Chesapeake’s “shell” company:

Special Report: Energy giant hid behind shells in “land grab”


Excerpt: That’s because the company rejecting their leases hadn’t signed them to begin with. In fact, the company issuing the rejections wasn’t much of a business at all. It was a shell company – a paper-only firm with no real operations – called Northern Michigan Exploration LLC.


One jilted land owner, Eric Boyer-Lashuay, called to complain to the broker who had handled his lease. Northern, he recalls saying, is “a shell company … a blank door with no one behind it.”


Today, he puts it this way: “It was all a fake, all a scam.”


Northern has voided hundreds of land deals, and was indeed a facade – a shell company created so that one of America’s largest energy companies could conceal its role in the leasing spree, a Reuters investigation has found. Oklahoma-based Chesapeake Energy Corp., the nation’s second-largest gas driller, was behind the entire operation.


Chesapeake had created one shell company that set up another, Northern Michigan Exploration. Next, Northern hired brokers who signed leases with residents such as Boyer-Lashuay. And those brokers were under strict orders not to divulge Chesapeake’s role, records reviewed by Reuters show.

The appearance of a “shell company”, although not surprising, did pique my curiosity.   I stumbled across a document: CHESAPEAKE ENERGY CORPORATION and the Subsidiary Guarantors named herein 6.875% SENIOR NOTES DUE 2018 AND 6.625% SENIOR NOTES DUE 2020  FOURTH SUPPLEMENTAL INDENTURE


Of particular interest is Page 4, where Jennifer M. Grigsby is listed as Senior Vice President, Treasurer & Corporate Secretary of the Company and of the Subsidiaries :

  • Carmen Acquisition, L.L.C.
  • Chesapeake Aez Exploration, L.L.C.
  • Chesapeake Appalachia, L.L.C.
  • Chesapeake Energy Corporation
  • Chesapeake Energy Louisiana Corporation
  • Chesapeake Energy Marketing, Inc.
  • Chesapeake Exploration, L.L.C.
  • Chesapeake Land Development Company,L.L.C.
  • Chesapeake Louisiana, L.P.
  • Chesapeake Operating, Inc.
  • Chesapeake Plaza, L.L.C.
  • Chesapeake Royalty, L.L.C.
  • Chesapeake Vrt, L.L.C.
  • Chesapeake-Clements Acquisition, L.L.C.
  • Chk Holdings, L.L.C.,
  • Compass Manufacturing, L.L.C.
  • Diamond Y Enterprise, Incorporated
  • Emlp, L.L.C.,
  • Empress, L.L.C.
  • Gene D. Yost & Son, Inc.
  • Gothic Production, L.L.C.
  • Great Plains Oilfield Rental, L.L.C.
  • Hawg Hauling & Disposal, LLC
  • Hodges Trucking Company, L.L.C.
  • La Land Acquisition Corporation
  • Mc Louisiana Minerals, L.L.C.
  • Mc Mineral Company, L.L.C.
  • Midcon Compression, L.L.C.
  • Nomac Drilling, L.L.C.
  • Northern Michigan Exploration Company,L.L.C.
  • Ventura Refining And Transmission, LLC
  • Winter Moon Energy Company, L.L.C.
  • EMLP, L.L.C. , On behalf of itself, and as general partner of the following limited partnership: EMPRESS LOUISIANA PROPERTIES, L.P.
  • Chesapeake Energy Corporation

How many of these companies are real and how many are shells?  It’s on my list to connect the dots and find out.

The industry continues to create front groups which begat astro-turf groups and all stand before you as a big booming chorus singing the same song.  With the entrance of the “SUPER-PACs” into the political arena, expect to see a great number of groups to quickly appear and most will disappear at the end of the campaign season.  They will be focused on a candidate or issue.

One such group that has entered the arena early is VOTE 4 ENERGY  It proclaims:.

“A Vote 4 Energy is a vote for more jobs, higher government revenues and greater energy security.”

Vote4Energy is a project of the American Petroleum Institute representing more than 490 oil and natural gas companies, leaders of a technology-driven industry

Vote 4 energy won’t be the last ad campaign you will see between now and November.  Pay attention to the small print on the ads, the “sponsors” and do a bit of connecting the dots on your own.  You know I will be doing it.

“In a time of universal deceit, telling the truth is a revolutionary act.” –George Orwell