Oklahoma Attorney General Gentner Drummond may bring a natural gas market manipulation case related to the 2021 winter storm that drove energy prices to record highs and left millions of people in the dark.
(Bloomberg) — Oklahoma Attorney General Gentner Drummond may bring a natural gas market manipulation case related to the 2021 winter storm that drove energy prices to record highs and left millions of people in the dark.
Drummond held a news conference on Tuesday morning in Oklahoma City and said he plans to retain outside counsel to pursue a possible lawsuit. He indicated that natural gas marketers are a likely target.
“It will probably be the most significant lawsuit filed by the state of Oklahoma in its history,” Drummond said. “Broadly, there are no parameters on the scope of the investigation.”
After Kansas became the first state to file a lawsuit alleging natural gas market manipulation during Winter Storm Uri, Drummond announced in March that he was reviewing whether similar circumstances existed in Oklahoma. In the Kansas case, state Attorney General Kris Kobach’s office is accusing Macquarie Energy LLC of buying next-day gas at a key midcontinent hub at “irrational” prices during the storm — a move the suit says artificially inflated prices by “hundreds of dollars” per million British thermal units. The case was moved from a state district court to a federal court in May.
Read More: Kansas AG Says Macquarie Rigged Gas Market During 2021 Freeze
When asked whether Macquarie would be involved in the Oklahoma case, Drummond said that “generally, most of the companies that manipulated the marketing price are outside Oklahoma.”
“If you follow the data, it appears as thought there was a short squeeze,” Drummond said. “Certainly, natural gas marketers could do it again, and I will sue them.”
Macquarie has previously said it doesn’t comment on active litigation.
Drummond, a Republican who took office earlier this year, is Oklahoma’s third attorney general since Uri. Mike Hunter, who held the position during the storm, announced an investigation in the days after natural gas prices soared to all-time highs. He abruptly resigned just a few months later and was replaced by John O’Connor, who warned he would file multiple lawsuits against oil and gas companies, but later walked that back.
Following the storm, Oklahoma paved the way for utilities to issue billions in ratepayer-backed bonds in order to spread out the costs incurred due to all-time high energy prices. Drummond said Tuesday that if a lawsuit is successful he would work to make sure any recovery is seen by consumers. He also noted that the bonds include so-called claw back provisions.
Texas Attorney General Ken Paxton, who’s facing an impeachment trial, also announced an investigation into potential natural gas market manipulation following the storm, but hasn’t brought a case. On Tuesday, Drummond said he would be “happy to partner” with his counterparts in Texas and Kansas.
“I am aware of what Texas and Kansas are doing,” he said. “I think that we will do it better.”
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