How One Firm Drove Influence Campaigns Nationwide for Big Oil

Source: By Hiroko Tabuchi, New York Times • Posted: Thursday, November 12, 2020

FTI, a global consulting firm, helped design, staff and run organizations and websites funded by energy companies that can appear to represent grass-roots support for fossil-fuel initiatives.

The headquarters of FTI, which has a prominent role in influence campaigns supporting fossil fuels, in Washington.
Stefani Reynolds for The New York Times

In early 2017, the Texans for Natural Gas website went live to urge voters to “thank a roughneck” and support fracking. Around the same time, the Arctic Energy Center ramped up its advocacy for drilling in Alaskan waters and in a vast Arctic wildlife refuge. The next year, the Main Street Investors Coalition warned that climate activism doesn’t help mom-and-pop investors in the stock market.

All three appeared to be separate efforts to amplify local voices or speak up for regular people.

On closer look, however, the groups had something in common: They were part of a network of corporate influence campaigns designed, staffed and at times run by FTI Consulting, which had been hired by some of the largest oil and gas companies in the world to help them promote fossil fuels.

An examination of FTI’s work provides an anatomy of the oil industry’s efforts to influence public opinion in the face of increasing political pressure over climate change, an issue likely to grow in prominence, given President-elect Joseph R. Biden Jr.’s pledge to pursue bolder climate regulations. The campaigns often obscure the industry’s role, portraying pro-petroleum groups as grass-roots movements.

As part of its services to the industry, FTI monitored environmental activists online, and in one instance an employee created a fake Facebook persona — an imaginary, middle-aged Texas woman with a dog — to help keep tabs on protesters. Former FTI employees say they studied other online influence campaigns and compiled strategies for affecting public discourse. They helped run a campaign that sought a securities rule change, described as protecting the interests of mom-and-pop investors, that aimed to protect oil and gas companies from shareholder pressure to address climate and other concerns.

FTI employees also staffed two news and information sites, Energy In Depth and Western Wire, writing pro-industry articles on fracking, climate lawsuits and other hot-button issues. Former employees familiar with Energy In Depth said the site’s content had direction from Exxon Mobil, one of the major clients of the FTI division that worked on these oil and gas campaigns.

The Energy In Depth website notes its affiliation with an energy trade group that Exxon is a member of, though not Exxon’s role in directing content that the site published.

This article is based on interviews with a dozen former FTI employees, including former managing directors, a review of hundreds of internal FTI documents and an examination of the digital trail of domain-name registrations and other details left by the creation of the websites. In all, FTI has been involved in the operations of at least 15 current and past influence campaigns promoting fossil-fuel interests in addition to its direct work for oil and gas clients.

Matthew Bashalany, an FTI spokesman, disputed the idea that FTI worked behind the scenes for these groups. “We hide behind no one,” he said.

“We summarily reject as false, misleading and defamatory the general narrative and specific claims,” he said. “We hold ourselves to the highest professional and ethical standards of conduct; when and where shortfalls are identified in this regard, they are addressed appropriately.”

An Exxon spokesman, Casey Norton, said he would not comment on the findings because he considered the reporter to be biased against the fossil fuel industry. Kathleen Sgamma, a spokeswoman for the Western Energy Alliance, which funds Western Wire, said her group had been open about its partnership with FTI and about its approach to fracking.

FTI’s corporate website

The business of corporate consulting and public relations is vast, and countless companies routinely provide media outreach, public messaging, crisis management and other services. FTI is among them, and it has taken up an important role in helping promote the messages of the fossil fuel industry.

Those messages have sometimes run counter to the scientific consensus that the world must burn less oil and gas to avoid the worst effects of global warming. Texans for Natural Gas, for example, has downplayed the magnitude of emissions of methane, the prime component of natural gas and a potent greenhouse gas, from oil and gas production.

FTI’s work is the latest chapter in a long history of campaigns by the fossil fuel industry, political strategists and public relations professionals to influence climate policy. The industry has faced tough headwinds this year, in particular, as demand for oil and gas has tumbled amid the pandemic.

Founded in 1982 in Annapolis, Md., as a firm that provided expert witnesses and presentations for litigation, FTI has grown into a multinational firm that employs almost 5,000 people in 28 countries. Its business spans a wide range of services, from business consulting to crisis communications.

One of FTI’s largest shareholders, the investment firm BlackRock, won kudos this year for saying it would put environmental sustainability at the center of its investment approach. Main Street Investors, one of FTI’s projects, has spoken out against shareholders who press corporations on climate and other issues — an effort that would seem to be in conflict with BlackRock’s stance.

Mr. Bashalany, the FTI spokesman, said the firm’s work “in no way contravenes — nor is it misaligned with” BlackRock’s statement. BlackRock declined to comment.

‘Do something big’

On a clear day in July, a plane soared over America’s biggest oil and gas field with a banner trailing behind it that read: “Thank you essential oil and gas workers.”

“We wanted to do something big, and what’s bigger than an airplane with a banner?” Elizabeth Caldwell of Texans for Natural Gas said in a statement. The group, which describes itself as a local organization representing “citizens and officeholders, business owners and students” with more than 400,000 supporters, is funded by oil and gas companies including XTO Energy, an Exxon subsidiary, according to its website.

The statement identifies Ms. Caldwell as “a spokeswoman for the grass-roots organization.” She is also a director at FTI, according to her LinkedIn page. (There was nothing unusual about an organization receiving corporate support and public relations help, FTI’s spokesman said.)

Acting as Texans for Natural Gas representatives, FTI employees have launched pro-industry petitions, produced videosand reports on the importance of the Permian Basin oil field, and written opinion pieces for local newspapers supporting fossil fuels. The site features testimonials from three women, two of whom are represented with stock photos and one with a photo used without permission from the Flickr page of a photographer in the Philippines.

FTI’s Mr. Bashalany acknowledged the use of the stock photos and said adjustments would be made to avoid confusion. He said the supporters and testimonials were real.

Texans for Natural Gas has also shared misleading information about greenhouse gas emissions. In 2018, it issued a study inaccurately claiming that emissions of methane had decreased significantly in the heart of Texas oil country at the height of the fracking boom.

To arrive at that conclusion, scientists say, the report tallied data from the Environmental Protection Agency that the agency itself states does not represent overall emissions: The numbers, which are reported by the energy industry about a limited number of compressor stations and other facilities, do not include emissions from the area’s thousands of wells. The data are “too low by at least a factor of two, and quite likely more,” said Robert W. Howarth, a professor at Cornell University who has researched methane emissions.

FTI stood by the report, calling its findings “on track with broader trends in Texas’ oil fields.”

Texans for Natural Gas is just one campaign run with the help of FTI employees. Others include: Citizens to Protect PA Jobs, New Mexicans for Economic Prosperity, the Liberty Energy Project and the Arctic Energy Center, according to interviews, internal documents and an examination of the digital trail of domain-name registrations and other details left by the creation of the websites.

Another such organization, the Marcellus Shale Coalition, said of FTI in a statement: “We are proud to have them as a contract partner, especially when it comes to direct and transparent media support.”

‘Susan,’ the fake Facebook user

Within FTI, a group called StratCom, short for Strategic Communications, focuses on industry messaging campaigns. In the United States, the group is led by Brian Kennedy, former press secretary for the office of the House minority leader and a former spokesman for Transocean, the drilling contractor involved in the 2010 BP oil spill in the Gulf of Mexico.

The StratCom group studied environmental protesters on behalf of the driller Apache Energy. Apache was seeking to drill near Balmorhea State Park in Texas and was concerned that protesters were planning camps similar to those set up to oppose the Dakota Access Pipeline, according to two people with direct knowledge of the work.

One FTI document prepared for Apache, dated Jan. 25, 2017, included a link to a list of groceries and camp supplies compiled by organizers, which the document said provided a hint of the proposed camp’s size.

The fictitious Facebook profile — of a Texas woman named Susan McDonald who likes ice cream, the movie “Annie” and her local farmers’ market — was also intended to help FTI keep tabs on activists, former FTI employees said. The “friends” list on the fake profile, which remained present on Facebook as of Wednesday, includes one current and one former FTI employee.

Mr. Bashalany of FTI said, “A Facebook profile was created by a former employee to monitor social media anonymously. This was wrong, and it is against our policy.”

Apache declined to comment on the substance of the reporting.

StratCom employees also studied and developed strategies designed to influence public discourse, according to five former employees. An internal document dated Nov. 20, 2015, laid out various techniques. The “Semantic Nitpicker,” the document explained, “asks an endless series of questions.” The “Dog Typing on a Keyboard” uses “very poor grammar, spelling and punctuation and posts frequently to clutter up the thread and make it hard to read.”

A successful effort, the document advised, might use several commenters, “each with an assigned role.”

Mr. Bashalany said senior managers were never aware of the document and it “never informed any activities or approaches to social or digital media engagement of any kind.”

Other campaigns used common techniques, buying social media ads to target people with interests in Alaska and energy and steer them toward the Arctic Energy Center, an industry-funded site that promoted drilling in the waters off Alaska and in the Arctic National Wildlife Refuge.

Exxon was a backer of the Arctic Energy Center, according to documents and people who worked on the project. An FTI presentation prepared for Exxon, dated July 13, 2016, showed Exxon was scheduled to spend $120,000 over six months across social-media platforms, a draft budget dated the previous month shows.

The Arctic Energy Center’s website has since been taken down.

Climate lawsuit spurs action

In 2018, as New York City moved to sue Exxon Mobil and other fossil fuel companies, claiming that the companies had defrauded shareholders by downplaying climate change, a team within FTI’s StratCom group prepared a pushback.

The task at hand was to produce an article and tweets for Energy In Depth, the pro-industry site. The target: Mayor Bill de Blasio of New York, who was under fire at the time for his SUV use.

According to an internal planning calendar, one tweet should show “Bill de Blasio in a giant SUV, wearing shirt that says WAR ON FOSSIL FUELS, or maybe a speech bubble with WAR ON FOSSIL FUELS!”

New York lost that court battle.

According to its website, Energy In Depth is a project of the Independent Petroleum Association of America, a trade organization representing hundreds of mostly smaller oil and gas producers. FTI employees familiar with the project said the site’s content had direction from Exxon. FTI employees also wrote much of the content published on Energy In Depth.

In a statement, an Independent Petroleum Association of America senior vice president, Jeff Eshelman, said “support for Energy In Depth comes from a wide segment of industry.”

Mr. Bashalany, the FTI spokesman, said, “Any contention that it is supported in whole or even substantially in part by one company is categorically false.” He said FTI staff members reach out to companies, academics and others for input, “not the other way around.”

Energy In Depth, along with the other industry-funded site that FTI helps run, Western Wire, has been central to the fossil fuel industry’s championing of fracking. Both sites, staffed by FTI writers, have pushed back against the #ExxonKnew campaign waged by environmental activists, which claims that the company knew about climate change for decades yet blocked action to confront it.

Tamir Kalifa for The New York Times

‘This is really fishy’

In spring 2018, Nell Minow noticed a tweet from a new group, one she had never heard of, seeming to support small investors. Ms. Minow, vice chair of ValueEdge, a firm that advises investors, and a longtime advocate for mom-and-pop investors, was excited.

“I thought, ‘Great, a shareholder group! I need to know about them,’” she said. “Then I started looking into them and thought, this is really fishy.”

Though the group, Main Street Investors, described itself as representing small investors, it was started by a number of industry organizations, including the National Association of Manufacturers. Main Street has criticized the ability of pension funds and other powerful investors to influence companies’ policies on matters like climate and the environment.

Working for the National Association of Manufacturers, FTI produced a study arguing that activist shareholders tend not to help shareholder value. The report’s five authors were employees of the consulting firm Compass Lexecon, a wholly owned FTI subsidiary. The Main Street Investors website is now offline.

FTI also worked with the Independent Petroleum Association of America, the industry group associated with Energy In Depth, to start, which warns that divesting from fossil fuels — a growing trend among university endowments and pension funds — could cost those institutions millions of dollars. At least six academic papers published on were by professors who, in addition to their university jobs, were also working for Compass Lexecon, the FTI subsidiary.

FTI monitored Ms. Minow after she publicly said Main Street Investors was using “inflammatory language, unsupported assertions, and out-and-out falsehoods” to spread its message. Internal memos show FTI employees compiled reports on her background, noting, among other things, that she was once dubbed “the C.E.O. killer” by Fortune magazine for her record of ousting underperforming executives. FTI also tracked her tweets in a spreadsheet.

FTI’s Mr. Bashalany said that no attempt had been made to hide any of the report authors’ affiliation. He said neither FTI through its Compass Lexecon subsidiary nor its clients “had any influence whatsoever over the form or direction” of the reports. FTI staff conducted “some basic biographic research” of Ms. Minow, he said, “but that’s it — we did nothing else.”

This month, the Independent Petroleum Association of America, the oil and gas lobby group, announced it had launched a major initiative to support oil and gas companies looking into adopting environmental, social and governance strategies. In its announcement, the group stressed the importance of efforts that were “authentic and effective.”

Its partner in the endeavor is FTI.