For many candidates in energy-boom states, support for increased oil and gas drilling isn’t just sound policy — it’s also good for their personal business.
A sampling by The Washington Times of Senate hopefuls in major oil- and gas-producing states — including Pennsylvania, North Dakota and Texas — found that the vast majority have personal investments in the industry.
Although there is nothing illegal about the holdings, critics say the candidates, along with many lawmakers with similar assets, have crossed an ethical line by standing to profit from policies that they will have a hand in crafting.
“It’s a huge conflict of interest that [members of Congress and candidates] are allowed to hold stock in the very industries they regulate,” said Melanie Sloan, executive director of the watchdog group Citizens for Responsibility and Ethics in Washington. “You also might have inside information that you’re receiving about a company” as a result of the investments.
In Ohio, Democrats have pounced on Republican Senate hopeful Josh Mandel’s $79,000 in oil and gas holdings. Mr. Mandel’s portfolio includes at least $15,000 in assets with Exxon Mobil Corp., in addition to investments in Genesis Energy Partnership, ConocoPhillips, Plains All American Pipeline and Western Gas Partners LP.
Those companies, along with many others across the U.S., have benefited greatly from the nation’s ongoing natural gas boom.
Many Republicans, including Mr. Mandel, support increased domestic oil and gas drilling as the surest way to free the U.S. from foreign fuels.
“When it comes to a policy that could generate profit for him personally, [Mr. Mandel] is 100 percent in favor,” Matt Thornton, a spokesman for the American Bridge 21st Century super PAC that backs incumbent Sen. Sherrod Brown, Ohio Democrat, recently told the state’s Bucyrus Telegraph Forum newspaper.
Mr. Mandel’s spokesman, Travis Considine, called those accusations “ridiculous” and “a red herring” and stressed that the candidate’s support for increased gas drilling is driven solely by the desire to create jobs and make the nation more energy-independent.
Mr. Mandel certainly isn’t alone. Tom Smith, a Republican challenging Sen. Robert Casey in Pennsylvania, holds at least $15,000 in stock with a gas drilling firm. Mr. Smith is also the sole member of Northern Elk Development, a “coal royalty override company” worth up to $5 million.
In addition, he owns land hosting a natural gas well worth at least $100,000, financial disclosure reports show.
David Dewhurst, a Texas Republican seeking an open Senate seat, has at least $50,000 invested with Calpine Corp., which owns and leases natural gas and geothermal power plants.
He also has at least $50,000 invested in Oilwell Varco Inc., which makes components for offshore drilling rigs. Records show Mr. Dewhurst made at least $15,000 off of that investment last year, in addition to other profitable investments.
When questioned about the holdings, both campaigns redirected their attention toward U.S. energy policy, which they would be in positions to influence if elected.
“David Dewhurst has been proud to work in the energy industry and create jobs in the energy industry across America,” campaign spokesman Enrique Marquez said in a statement. “As a U.S. senator, he will continue to cut down on regulation that is suffocating the energy industry and get Americans back to work.”
Mr. Smith’s campaign took a similar tack.
“What’s shocking isn’t that Tom Smith is for common-sense, pro-American energy policies, rather that [Sen.] Casey has supported the Obama administration’s war on American-made energy,” spokeswoman Megan Piwowar said.
In North Dakota, Heidi Heitkamp, a Democratic candidate for Senate, has at least $100,000 in Vanguard Energy, a mutual fund invested in energy producers that netted her at least $5,000 in dividends last year, records show.
She also received nearly $20,000 in compensation last year as a board member of the Dakota Gasification Co.
Tens of thousands of jobs have been created in North Dakota, much like Pennsylvania, in recent years because of an explosion in shale drilling, placing it on the forefront of the nation’s energy boom.
Ms. Heitkamp’s opponent, Republican Rick Berg, also holds at least $36,000 in energy investments, including stock with Hess Corp. and Occidental Petroleum Corp.
Many others — such as Senate hopeful Bob Kerrey of Nebraska and Republican Ted Cruz, who will face Mr. Dewhurst in a July 31 runoff election in Texas — also have thousands of dollars in the fossil-fuels sector.
In West Virginia, the U.S. Senate race is between two men who have made fortunes largely through the energy industry. Incumbent Joe Manchin, a Democrat, has a stake of between $1 million and $5 million in Enersystems Inc., a coal company he used to run. His son now controls the company, but it still paid Mr. Manchin at least $800,000 last year, records show.
His Republican opponent, John R. Raese, made more than $1.5 million last year at Greer Industries, a company with interests in coal, lime and a variety of other ventures. He also holds tens of thousands of dollars in investments related to gold and other mined minerals.
There are, however, a few notable exceptions to the trend. Republican Deb Fischer, who will face off against Mr. Kerrey in Nebraska, holds no energy investments. Neither does Mr. Brown of Ohio.
While it’s difficult to know whether their personal finances would directly influence decision-making, Mrs. Sloan said, the cross-section of bank accounts and policymaking justifiably erodes the public’s trust in their elected officials.
“The appearance [of impropriety] is bad enough,” she said.