U.S. Energy Secretary Nominee Has Ties to Government, Oil Industry Consultancy

--Ernest Moniz, ICF International director, would step down if confirmed

--Watchdog group: Moniz downplayed industry connections

--Moniz backers say his work has been unbiased

 
   By Ryan Tracy 
 

WASHINGTON--President Barack Obama's pick for energy secretary owned shares in an energy consultancy that has worked for government agencies and the oil and gas industry, according to financial filings.

Ernest Moniz, a nuclear physicist who is Mr. Obama's nominee to head the Department of Energy, sits on the board of directors of ICF International Inc. (ICFI), which consulted for the department on the potential of energy-efficient technologies and did a study measuring the benefits of exporting U.S. natural gas for the American Petroleum Institute, an oil and gas industry group.

Mr. Moniz's favorable view of natural gas has made some environmental watchdogs skeptical of his nomination, though a number of environmental groups have praised the choice. His views on natural gas also may help him gain support from lawmakers who support drilling, and his position on the issue fits with that of Mr. Obama, who has touted the newfound U.S. supply of gas as an economic boon.

As of June 1 last year, Mr. Moniz owned more than 10,000 shares of ICF, a Securities and Exchange Commission filing shows. The shares would be worth about $277,000 at Thursday's midday price of about $27. Roughly half of the shares vest later this year, the filing said, meaning Mr. Moniz won't be able to sell them until then.

An Obama administration official said Mr. Moniz will follow the path of other cabinet nominees in resigning from the ICF board upon confirmation by the Senate and forfeiting or divesting the shares he owns. He would recuse himself from dealings with ICF, the official said.

The Public Accountability Initiative, a nonprofit critical of the natural-gas-drilling industry, issued a report Wednesday saying Mr. Moniz should have more publicly disclosed his and other researchers' ties to the oil and gas industry as part of the rollout of a 2011 Massachusetts Institute of Technology report entitled "The Future of Natural Gas." Mr. Moniz oversaw the report as director of MIT's Energy Initiative.

After taking the position on ICF's board in June 2011, Mr. Moniz presented the findings of the report to Congress the following month with a statement that didn't mention funding from the oil and gas industry. The report endorsed unfettered exports of natural gas and said the environmental impacts of extracting gas "are challenging but manageable."

The Public Accountability Initiative said the MIT report "was far from being independent of industry," pointing out that oil and gas companies helped fund the MIT office that wrote it.

Two other academics who participated in the MIT study served in prominent industry roles: MIT Professor John Deutch sits on the board of natural-gas exporter Cheniere Energy Inc. (LNG), and Tony Meggs, an engineer who helped oversee the report, was recently an executive at natural-gas driller Talisman Energy Inc. (TLM, TLM.T).

"It appears that Moniz did nothing to manage or disclose these conflicts of interest, and that says a lot about the way he handles industry relationships," said Kevin Connor, a spokesman for the Public Accountability Initiative.

Mr. Meggs couldn't be reached for comment, and Mr. Moniz and Mr. Deutch weren't available.

Victoria Ekstrom, a spokeswoman for the MIT Energy Initiative, said, "The notion that these findings are developed based on anything other than the unbiased research of MIT researchers is false." She said the MIT report also called for the gas industry to be transparent about its drilling practices and noted that MIT Energy Initiative researchers are also studying nuclear and solar power.

A statement from Clark Stevens, a White House spokesman, said Mr. Moniz's work at MIT "demonstrates his ability to work collaboratively with a wide spectrum of stakeholders on a broad range of energy issues." The statement also cited "his work to examine the role a range of energy sources and technologies can play in solving our energy and climate challenges" as evidence that he is the "right candidate" for the energy secretary job.

As energy secretary, Mr. Moniz would oversee federal research programs and nuclear-weapon stockpiles. He would have a prominent voice in setting the administration's energy policies.

Regulation of natural-gas drilling is under the purview of other agencies, including the Environmental Protection Agency and the Department of the Interior.

Write to Ryan Tracy at [e-mail]

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