Fracking Company Paid Texas Professor Behind Water Contamination Study

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July 23, 2012 | 1:08 PM

By Terrence Henry

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Earlier this year, a study led by Dr. Charles “Chip” Groat for the Energy Institute at the University of Texas at Austin made headlines for saying there was no link between fracking and groundwater contamination. (When we reported on the study in February, we noted that the study also found some serious issues around the safety and regulation of fracking that weren’t getting much press coverage.)

But according to a new report out today by the Public Accountablitiy Initiative (PAI), a nonprofit watchdog group, the conclusions in Groat’s report aren’t as clear cut as initially reported. And Groat himself did not disclose significant financial ties to the fracking industry.

Groat, a former Director of the U.S. Geological Survey and professor at the Jackson School of Geosciences at the University of Texas at Austin, also sits on the board of Plains Exploration and Production Company, a Houston-based company that conducts drilling and fracking in Texas and other parts of the country. According to the new report (and a review of the company’s financial reports by Bloomberg) Groat received more than $400,000 from the drilling company last year alone, more than double his salary at the University. And one of the shales examined in Groat’s fracking study is currently being drilled by the company, the report says.

Since 2007, Groat has received over $1.5 million in cash and stock awards from the company, and he currently holds over $1.6 million in company stock, according to the PAI report. (Update: we clarified with PAI, and that $1.6 million in stock comes from the stock awards over the years. PAI says Groat’s total compensation from the company is close to $2 million.)

Aside from Groat’s financial ties to a fracking company, Public Accountability Initiative also found issues with the fracking study itself. While the report’s release was promoted heavily by the University of Texas at Austin, PAI alleges that “two of the report’s main sections are marked as rough drafts.” It also alleges that the study used “industry-friendly” language, made claims of peer review that don’t appear to be substantiated, and that the report’s findings had an “extreme disconnect” with what was in the press release accompanying the study.

And while Groat made a big claim that the study was independent of industry or environmental interests, saying that it was “completely funded by the university,” the discovery of Groat’s significant financial ties to drilling undercuts that. His stake in Plains Exploration and Production wasn’t disclosed in the Energy Institute’s fracking study, Public Accountability Initiative says, nor was it “on the Institute’s website, or in the various presentations Groat gave on the study.” And it’s not on his three-page resume at the University of Texas website, either, though PAI notes that may be because it’s out of date.

And Bloomberg reports that Groat’s boss at the Energy Institute, Ray Orbach, was unaware of Groat’s ties to the company. He only learned about it when Bloomberg asked him about it, and agreed that it was an issue. “To be honest, we had no idea,” Orbach told the news site. “In the future we should have an asterisk or something that would indicate his presence on the board.” He later emailed Bloomberg to say that “while I believe this should have been disclosed when the study was released, I do not believe his service on the board had any impact at all on the findings.”

The study was Groat’s idea, Bloomberg says, “to help state regulators manage shale gas issues,” and he chose the researchers himself.

And what is Groat’s response to all of this?

“The study results were determined by the individual investigators,” Groat said in an e-mail to Bloomberg. “I made no modifications or alterations of their findings, some of which were not particularly pleasing to the shale-gas industry. Disclosing my Plains board position would not have served any meaningful purpose relevant to this study.”

(StateImpact Texas has reached out to Groat, his director at the Energy Institute, Ray Orbach, and a fellow author of the original fracking study, Ian Duncan. If and when we hear back from them, we’ll update here.) Update: We have spoken with Groat and others about the revelations. You can read our new report here.

The report also notes that of the sixteen members of the Energy Institute’s advisory board, thirteen have “strong ties to the oil and gas industry,” and that the Institute recently received $1.5 million from ConocoPhillips to support a case study of fracking in the Barnett Shale in Fort Worth, Texas.

And this spring the University announced several donations from the oil and gas industry: $1.19 million from ExxonMobil given to the University; $6 million from oil and gas man Jon Brumley; and $1.7 million from oilfield services company Baker Hughes for drilling technology.

This isn’t the first time that academic studies of drilling have been called into question because of industry ties. In an earlier report on a State University of New York at Buffalo study on fracking’s environmental risks, Public Accountability Initiative found that it “suffered a number of critical shortcomings” and the “report’s authors had strong industry ties.”

And in today’s investigation from Bloomberg, they found other instances of industry influence and financial ties at Pennsylvania State University and University of Wyoming.

Further Reading: Texas Professor on the Defensive Over Fracking Money

Read the full report by the Public Accountability Initiative:

Disclosure: StateImpact Texas is part of KUT Austin, a unit of the University of Texas at Austin.