Royal Dutch Shell Group .com Rotating Header Image

Houston Chronicle: ELECTION 2006: THE AFTERMATH: Road may be rough for oil industry: Energy companies have put weight behind Republicans

John Hofmeister: “Playing both sides”

Copyright 2006 Houston Chronicle Washington Bureau

WASHINGTON — Energy companies had thrown in their lot — lock, stock and oil barrel — with the Republicans.

Now they face a Democratically controlled House, and perhaps Senate, whose leaders have vowed to take aim at Big Oil within the first 100 hours of a new Congress.

“The oil industry should be worried,” noted Massie Ritsch, a spokesman for the Washington-based Center for Responsive Politics, a campaign finance watchdog group. “The Democrats have already signaled that they’re not going to be nearly as friendly to the industry as the Republicans have been.”

And the industry has not laid the political groundwork to handle such a shift.

Democrats on Capitol Hill have called for the rollback of tax breaks and incentives handed out to the industry that they estimate are worth $33 billion.

As part of that effort, Democrats may take another look at the flawed offshore lease agreements signed with oil and gas producers in 1998 and 1999, noted Rep. John Dingell, D-Mich., who will take over the gavel on the House Energy and Commerce Committee.

Those agreements omitted price triggers that would have required producers to pay billions more in federal royalties.

“If you lift the lid on that, you’ll probably find some bad smells,” Dingell said.

Democrats on the Energy and Commerce Committee also want to know more about Vice President Dick Cheney’s energy task force, which sought oil companies’ views in Bush’s first term but largely froze out environmentalists.

Throughout the campaign, Democrats have been attacking the oil companies, which in the wake of this year’s painfully high gasoline prices were reporting lofty profits.

On Tuesday, Democrats were able to take out one of the oil and gas industry’s staunchest allies, House Resources Committee Chairman Richard Pombo, R-Calif.

Pombo has pushed for greater access for energy companies to drill offshore.

Environmental victory

His defeat, argued Rodger Schlickeisen, president of the Defenders of Wildlife Action Fund, was “the most significant electoral victory the environmental movement has seen in decades.”

Both Rep. Henry Waxman of California, in line to assume the chairmanship of the House Government Reform Committee, and Sen. Byron Dorgan, D-N.D., head of the Senate Democratic Policy Committee, have been dogged in their efforts to pry out information about Houston-based military contractor and oil-field-services giant Halliburton Co.

Whether they will use the subpoena power at the disposal of the majority to pursue those investigations even more aggressively remained unclear today.

“Rep. Waxman hasn’t set out his agenda yet,” said Karen Lightfoot, a spokeswoman for the Democrats on the Government Reform Committee.

Corporate America has traditionally tried to navigate the choppy waters of Washington politics by contributing to both parties.

Playing both sides

Shell Oil Co. President John Hofmeister, for instance, speaking to a Washington luncheon crowd last month, said he ensures his contributions are “fully bipartisan, 50-50.”

Hofmeister gave $1,000 in May to Pombo and then another $1,000 in July to Sen. Hillary Clinton, D-N.Y., Center for Responsive Politics records show.

But Hofmeister is an exception in his industry.

Individuals and political action committees tied to the oil and gas industry funneled 83 percent of their campaign contributions to Republicans in the current election cycle — more than $11.8 million as of Oct. 10, according to the Center for Responsive Politics.

Democrats garnered only 17 percent, or $2.4 million, in energy sector campaign contributions, the center said.

The energy industry has long sided with the GOP, but not by that magnitude.

Back in the 1994 election cycle, when Republicans grabbed control of the House for the first time in four decades, the oil and gas sector gave roughly one-third to Democrats and two-thirds to Republicans, the center’s campaign contribution numbers show.

“In ’94, you did see a number of industries flip over to start supporting the Republicans who took power,” Ritsch said.

“But in the case of oil, you saw an industry being able to show its true colors. And that color is red.”

Indeed, according to an industry breakdown by Political- MoneyLine, only one group had a more obvious political tilt — union support for Democrats.

This ideological tilt is also a reflection of the nation’s political geography.

“If you look at the oil- and gas-producing states, most of them are substantially Republican states,” noted Lee Fuller, a lobbyist with the Washington-based Independent Petroleum Association of America.

“Where there are Democrats in those states, many are not in the oil- and gas-producing parts of the state.”

Looking for centrists

Fuller expects the industry to seek out more centrist Democrats “willing to listen to the oil and gas industry’s issues.”

Dingell has received more than $22,000 in campaign contributions from the oil and gas sector in this campaign cycle, the Center for Responsive Politics reported.

The senior member of the House of Representatives and a one-time chairman of the Energy and Commerce Committee, Dingell hardly sounded like a radical today.

Many of the issues he wants to address — conservation, energy independence, promoting nuclear energy, leaky underground storage tanks — also have been raised by Republicans.

“I’ve been writing energy bills for about 40 years,” Dingell said. “We have always, where we could, worked with the White House.”

Rep. Joe Barton, R-Ennis, the current chairman of the Energy and Commerce Committee, struck a similarly bipartisan tone today.

“The Energy Policy Act of 2005 began life as a Republican proposal, which drew the usual partisan attacks,” Barton said. “Then something special happened. Republicans sat down with Democrats and produced the first comprehensive energy bill since 1978. That should be the norm rather than the exception.”

[email protected] and its sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

Comments are closed.

%d bloggers like this: