It remains to be seen or admitted by Oklahoma Attorney General Gentner Drummond what really prompted him to suddenly expand his investigation into the market manipulation of natural gas prices during the 2021 winter storm Yuri.
Drummond isn’t talking about any details regarding the subpoena he issued to the Oklahoma Corporation Commission. The agency reportedly complied with the subpoena on Monday’s deadline, although no public information has been provided regarding just how much documentation was given the Attorney General.
The Attorney General is also not discussing any details of what prompted him to issue the subpoena in early November. There is a belief it might have been in response to Corporation Commissioner Kim David’s letter asking for an investigation into the historic high gas prices from the winter storm.
However, that was in March of this year when she urged Drummond to do the same kind of investigation that Kansas Attorney General Kris Kobach did.
“I believe that you should conduct a similar investigation. Should you determine that wrongdoing occurred, it is my hope that any overpayments can be returned to Oklahoma ratepayers in compliance with the February 2021 Regulated Utility Consumer Protection Act,” wrote Commissioner David.
If Drummond’s expansion of his probe was a result of David’s letter, why did he wait so long? He’s not discussing the matter.
There is further speculation that perhaps Drummond finally responded to the allegations made by Corporation Commissioner Bob Anthony, a regulator who has stubbornly fought the securitization and bonds used by utilities in putting the natural gas costs on the backs of ratepayers for nearly the next 25 years.
He laid out his allegations in numerous public filings, including one made in September where he raised alarming questions regarding the actions of the State Treasurer’s office and how they added to the ratepayers’ cost of the bond payments. He complained that the bill enacted by the state legislature that allowed the securitization process and bonding use by utilities was not transparent and exempted the hiring of advisors and consultants from the transparency and accountability that would have been required by the Central Purchasing Act.
“Instead the Securitization Law made such hires subject to “review” by one single person – the Deputy Treasurer for Policy and Debt Management (“the Deputy Treasurer”),” wrote Anthony in his dissenting opinion.
He further claimed that “recently obtained communication records” revealed the Deputy Treasurer didn’t just “review” the hiring of the OCC’s financial advisor, but “actively interfered at the behest of and on behalf of a regulated public utility with hundres of millions at stake—namely OG&E.”
Anthony raised his claims a step further by claiming the Deputy Treasurer “also engaged in problematic communications, before and/or during the RFP process for the ODFA’s financial advisor, with Hilltopo Securities, Inc.”. It was the firm that eventually won contracts worth millions of dollars to advise the corporation commission and the Oklahoma Development Finance Authority.
Did those claims prompt the Attorney General to take the steps he did in expanding his market manipulation investigation?
What is known is this. Former Attorney General Mike Hunter started an investigation into the winter storm natural gas prices and even contracted with a Dallas law firm to look at the price gouging allegations shortly after the storm. But he resigned from office when it was revealed he had a romantic affair outside his marriage.
The man who succeeded him, John O’Connor didn’t pick up the ball and run with it. He sat on the bench and the investigation went nowhere. His lack of action even caught the attention of the Oklahoma Supreme Court which criticized him for not taking part in a legal challenge to the Securities Act.
Drummond entered the picture last year and won election. He took office in January 2023 and did so as Kansas Attorney General Kris Kobach was in the middle of his lawsuit against Houston-based Macquarie Energy, a firm that supplied natural gas to utilities in Kansas and Oklahoma during the storm.
His lawsuit accused the company of buying gas at artificially inflated prices to increase profits.
“On the basis of currently available and partial data … Macquarie’s misconduct was responsible for illegitimately causing more than $50 million of Kansans’ Excess Costs” in Winter Storm Uri,” Kobach claimed.