Steven Griles, Big Oil’s Inside Man


Steven Griles is finally on the run. Griles is Interior Gale Norton’s top lieutenant, the man who holds the keys to the nation’s oil and mineral reserves. For the past two years, he’s used those keys to unlock nearly every legal barrier to exploitation, opening the public lands to a carnival of corporate plunder. He became the toast of Texas. But now Griles is hiding out from reporters and congressional investigators after accounts of his ongoing sleazy relationships with his former associates in big oil have begun to ooze out into the open.

Griles’s recent misfortunes are scarcely a surprise. From the time he took his oath of office, Griles was a congressional investigation waiting to happen. The former coal industry flack was one of Bush’s most outrageous appointments, an arrogant booster of the very energy cartel he was meant to regulate. His track record could not be given even the slightest green gloss. A veteran of the Reagan administration, Griles schemed closely with disgraced Interior Secretary James Watt to open the public lands of the West to unfettered access by oil and mining companies, many of whom funded Watt’s strange outpost of divinely-inspired environmental exploitation, the Mountain States Legal Center.

As Deputy Director of Surface Mining, Griles gutted strip-mining regulations and was a relentless booster of the oil-shale scheme, one of the most outlandish giveaways and environmental blunders of the last century. He also pushed to overturn the popular moratorium on off shore oil drilling on the Pacific Coast, a move of such extreme zealotry in the service of big oil that it even caught Reagan off guard.

After leaving public office, Griles quickly cashed in on his iniquitous tenure in government by launching a DC lobbying firm called J. Stephen Griles and Associations. He soon drummed up a list of clients including Arch Coal, the American Gas Association, National Mining Association, Occidental Petroleum, Pittston Coal and more than 40 other gas, mining and energy concerns, big and small, foreign and domestic.

Then Griles was tapped as Norton’s chief deputy. After contentious senate hearings that exposed his various and lucrative entanglements with the oil and gas industry, Griles was finally confirmed to office on July 7, 2001. He later signed two separate statements agreeing to recuse himself from direct involvement any Interior Deparment matters that might involve his former clients. He has since flouted both of those agreements, as disclosed by his own calendar of meetings, liberated through a Freedom of Information Act filing made by Friends of the Earth.

As the calendar and meeting notes reveal, Griles has used the cover of the 9/11 attacks and the war on Iraq to advance his wholesale looting of the public domain for the benefit of some of his former clients and business cronies. He has pushed rollbacks in environmental standards for air and water; advocated increased oil and gas drilling on public lands; tried to exempt the oil industry from royalty payments; and sought to create new loopholes in regulations governing stripmining.

Griles wasted no time compiling a wish list from his pals. Within days of assuming office, Griles convened a series of parleys between his former clients and Interior Department officials to chart a gameplan for accelerating mining, oil leasing and coal-methane extraction from public lands. Between August of 2001 and January of this year, Griles met at least 7 times with former clients; 15 times with companies represented by his former client the National Mining Association; on at least 16 occasions he arranged meetings between himself, former clients, and other administration officials to discuss rollback of air pollution standards for power plants, oil refineries and industrial boilers; on 12 occasions he arranged similar meetings between regulators and former clients regarding coal mining.

In the early days of his tenure, Griles huddled on at least three occasions with Harold Quinn, Jr., a chief lobbyist with the National Mining Association. Quinn and his association are Griles’ former clients.

Quinn had business that needed urgent attention. He prodded Griles to move quickly to loosen restrictions on the most environmentally malign form of coal mining, the aptly-named mountaintop removal method, where entire streams and valleys are buried in mining waste. Although both the Clinton and Bush administrations saw nothing wrong with the practice, a federal judge though it was going too far and ordered an injunction on this kind of mining. Griles agreed to do what he could to overturn the ban, a move that would accrue to the benefit of one of his former clients, Arch Coal.

At another meeting, Quinn also reminded Griles of Bush’s pledge to preserve the archaic 1872 Mining Law, which gives away gold-rich public lands for as little as $2.50 an acre. The giveaway law had come under attack even from Republicans.

Griles also convened a meeting on September 10, 2001 with a dozen top executives from the Edison Electric Institute, another former client of his lobbyshop. The energy bosses came to congratulate Griles on Bush’s plans to scale-back enforcement actions on filthy and aging coal-fired power plants. But they also came to gripe. They were unhappy with Bush’s pledge to toughen-up emission standards on sulfur dioxide, nitrogen oxide and mercury. Griles, who was then the Bush administration’s point man on the financial impacts of air quality rules on the energy industry, bent a sympathetic ear.

From July 27, 2001 to February 20 of last year, Griles’s logs show that he met on at least 32 occasions with other administration officials to discuss pending regulatory matters that were a concern to his former clients.

These meetings flout federal ethics rules which prohibit executive branch officials from participating in any "particular matter" which could advance their own financial interests or that involves former employers or clients. Griles claims that the meetings were merely social visits, utterly lacking in political intent. "We don’t talk about work," Griles assured the Washington Post last year in an interview. "We’re not allowed. We are all as scrupulous as we can be to assure that I will not be involved in any particular matter that would violate the ethics agreement or even have the appearance of a conflict of interest. The president said he wanted this administration to be held to the highest ethical standards. And I don’t ever want it said that I didn’t."

But it now turns out that not only was Griles shilling for his former clients, he is also pushing policies that will also plump up his own pocketbook. Griles was an ownership partner in a DC lobbying firm called National Environmental Strategies, a polluter’s lobby founded in 1990 by Marc Himmelstein and Haley Barbour. Barbour soon left the firm to become head of the Republican National Committee. Griles moved in.

When he was nominated as deputy secretary of Interior, Griles was forced to sell his interest in the firm for $1.1 million , and he fixed up aq deal with Himmelstein, a friend and Republican powerbroker. Instead of paying Griles off in a lump sum, Himmelstein will pay the Bush official $284,000 each year over the next four years. Griles claims he arranged this kind of payment plan so as not to leave NES "strapped for cash."

But in effect Griles remains financially tied to the health of Himmelstein’s firm. And, in fact, Himmelstein has admitted that over the past two years he and Griles have gotten together several times over beers and dinner.

One of the issues high on the list of priorities for some of NES’s clients was coal-methane gas drilling. In April of 2002, Griles directly intervened in a bitter dispute over the huge deposits of coal methane in Power River Basin in Montana and Wyoming_deposits worth billions of dollars and long craved by the natural gas industry. This looms as the largest energy development project in the country and has been assailedby environmentalists and native groups as an environmental nightmare.

The project, which calls for the development of more than 80,000 coal-methane wells, is so fraught with danger that even the Bush administration’s own EPA issued a report sharply criticizing the environmental consequences of the scheme. Among the findings:

the 80,000 coal methane wells will discharge nearly 20,000 gallons of salty water each day onto the ground surface, fouling the land, creeks and aquatic life; over its lifepsan, the project will deplete the underground aquifer of more than 4 trillion gallons of water, that will take hundreds of years to replenish; full-scale production will also entail 17,000 miles of new roads, 20,000 miles of pipelines and will turn nearly 200,000 acres of rangeland into an industrial zone.

This rare rebuke from the normally supine EPA roused Griles into furious action. On April 12, 2002, Griles sent a scorching memo under his

Department of Interior letterhead chastising the EPA for dragging its feet on the project. He chided the agency of being uncooperative with industry. It turns out that Griles had formerly represented the very companies that he was now accusing the EPA of failing to give proper deference. As a lobbyist, Griles’s clients included the Coal Bed Methane Ad Hoc Committee, Devon Energy, Restone and Western Gas Resources, all companies seeking to gain access to the Powder Basin gas fields. His old firm, NES, also hosted an industry-sponsored tour of Powder Basin for EPA and Interior Department officials. NES also represents Griles’ former

client Devon Energy, which stands to make a killing if the deal is approved.

Griles’s meddling in this matter came to the attention of the Department’s lawyers. On May 8, they forced Griles to sign an agreement disqualifying himself from any further involvement in the coal-methane issue. He later said he did so "for all the world to know that I’m not even going to be talking to anybody about it again."

Now the Inspector General of the Department of Interior has launched an investigation into Griles’s entanglements with his clients and Griles isn’t talking to anybody, especially the press.

But on May 9, reporter Roberta Baskin tracked Griles down at a discreet ribbon-cutting ceremony for the opening of the Meadowood Farm Trail in Lorton, Virginia. Baskin approached Griles with a cameraman and began asking him unsettling questions about Powder Basin. As Baskin zoomed in for the kill, Griles grabbed hold of the nearest object he could find: a 94-year old woman named Gladys Bushrod, a ceremonial guest of the Interior Deparment. Basking Griles used the befuddled Bushrod as "a human shield" to deflect unpleasing questions about his incestuous ties to his friends in big oil until he reached his waiting limo, whereupon he relinquished the woman and made his getaway like Beelzebub amid a puff of dust and hydrocarbons.

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