Oklahoma Attorney General Announces Possible Legal Action in Connection With 2021 Winter Storm
KOKH - July 19, 2023 7:28 am
In this Monday, Jan. 9, 2023 photo, Oklahoma Attorney General Gentner Drummond arrives for inauguration ceremonies in Oklahoma City. Drummond is seeking to slow the state's pace of carrying out an execution roughly every 30 days, citing the burden the pace is having on Oklahoma's prison personnel. (AP Photo/Sue Ogrocki)
OKLAHOMA CITY (KOKH) — Attorney General Gentner Drummond announced on Tuesday that he may take legal action against various entities he believes is responsible for market manipulation and other unlawful conduct related to a winter storm in 2021.
Drummond said a review that he ordered found that many companies used the storm to bring in billions of dollars in “ill-gotten gains.”
“As a result of the careful and diligent review of conduct during Winter Storm Uri, I discovered that several companies reaped billions of dollars at the expense of businesses and individuals who were suffering from the crippling effects of the storm,” Drummond said. “The magnitude of this scheme is staggering and unconscionable. Oklahomans can rest assured that I will do everything in my power as Attorney General to return what was taken and hold accountable those responsible.”
The February 2021 storm was responsible for hundreds of deaths and more than $200 billion in damages by the time it exited the continental United States.
Drummond said he plans to seek proposals from outside law firms as he pursues litigation.
“I have been strongly critical of past attorneys general engaged in no-bid, no cap contingency fee arrangements,” Drummond said. “I plan to issue an RFP to seek the most qualified legal counsel that provides the best possible value to my client: the People of Oklahoma.”
Drummond also stressed that the Oklahoma oil and gas industry isn’t at fault.
“While we are not yet prepared to name potential defendants, it is important to understand that Oklahoma’s oil and gas industry is not the culprit,” Drummond said. “At the appropriate time, if we determine that litigation is in the best interests of Oklahoma ratepayers, our complaint will detail each company and individual we believe to be responsible. Until then, I want the People of Oklahoma to remain proud of our oil and gas producers, who are vital partners in the prosperity of our State.”
While he isn’t pointing fingers at the oil and gas companies or the utilities that provide gas to consumers, he is concerned about the middleman.
“We do have entities such as natural gas marketers that appear if you follow the data, it appears as though there was a short squeeze prior to Uri in which the supply was restricted when the demand was the greatest,” AG Drummond said.
The natural gas marketers are the ones who buy from oil and gas companies and then sell to utilities.
Though the AG won’t mention which marketers he’s going after, according to the Corporation Commission, during the 2021 winter storm some of the top marketers that sold gas to Oklahoma utility companies were Nextera, Tenaska Marketing Ventures, Macquarie and SW Energy.
“Those who supply the gas manipulated the supply to reduce it in anticipation of our greatest need, Uri. So certainly natural gas marketers can do it again, and I will sue them,” AG Drummond said.
The AG added that although most of the companies are based outside Oklahoma, some even outside the U.S., but no one is beyond the scope of the law.
“We appreciate Attorney General Drummond’s thorough review of possible market manipulation during Winter Storm Uri. We support any effort by the Attorney General to claw back costs charged to OG&E and its customers by any natural gas marketers who he finds exploited the situation and return those funds to customers. The Oklahoma Corporation Commission has found OG&E’s 2021 operations and costs from Winter Storm Uri to be reasonable and prudent. Uri was a once-in-a-generation winter storm, and we are proud that we preserved customer health and safety by keeping the heat and lights on. To protect our customers from natural gas price volatility to the extent we can, OG&E continues to source fuel at the lowest available cost for our customers.”
AARP Oklahoma Statement
“Attorney General Drummond’s intention to take potential legal action over alleged market manipulation during Winter Storm Uri is welcome news for utility customers and AARP members in Oklahoma. Frustrated utility customers are demanding to know why they are paying for a “once-in-a-generation” storm for decades. The companies who reaped billions of dollars on the backs on hard-working Oklahomans must be held accountable. Oklahoma utility customers want action to be taken against the companies who bilked customers out of billions of dollars in a matter of days during Winter Storm Uri and further demand the recovered funds are returned to customers immediately.”