8,600 acres of the Cumberland Forest owned by University of Tennessee-Knoxville will be leased off to the oil and gas industry this August in a new form of "frackademia" — and one of the top financial beneficiaries will be the family of Republican Gov. Bill Haslam, who sits on UT-Knoxville's Board of Trustees.
"Frackademia" is usually thought of as "studies" conducted by university-based "frackademic" researchers and funded by Big Oil, the old "Tobacco Playbook" in action. But UT-Knoxville has taken the game to a whole new level, leasing off land it owns so that it can study "best practices" for fracking in the Volunteer State.
"It would create a rare, controlled environment in which experts could study the environmental impact of the controversial drilling technique, while also generating revenue to finance research," explained a New York Times article on the proposal.
The deal with the oil and gas industry for the acerage includes an initial fee of $300,000, plus $300,000 per year, 15% royalties on any gas sold and a minimum of $35 per acre paid to UT-Knoxville.
The 8,600 acres sits within the Chattanooga Shale basin, a field still untapped by the industry via hydraulic fracturing ("fracking"), the toxic horizontal drilling process through which oil and gas is obtained from shale rock basins. Atlas Energy - purchased as a subsidiary by Chevron in Nov. 2010 — owns 105,000 acres in the Chattanooga, a clear example the industry has its cross-hairs on the untapped Chattanooga basin.
UT-Knoxville's new "leasing agency" program will be run under the auspices of the university's Institute of Agriculture, officially referred to as the UT Institute of Agriculture Gas and Oil Research Initiative and a pre-bid proposal conference for prospective industry partners is set for June 21. Leases will be five years long, with a maximum allowance of three renewals, or 20 years total.
Fracking could become a major source of revenue for UT-Knoxville during a time of severe budget cuts to the UT System. In 2010, the state government slashed $56 million from the UT-Knoxville budget, following another $75 million in budget cuts in 2009 for the UT System at-large.
And one of the top beneficiaries of the fracking frenzy — overlooked thus far — will be the powerful Haslam family.
Haslam Family: Leveraging UT-Knoxville Ties for Fracking Profits
Gov. Haslam, the former Mayor of Knoxville, took $398,110 from the oil and gas industry before his Nov. 2010 gubernatorial race victory.
The Haslam family is an oil and gas family through and through, standing to profit immensely from a fracking boom in Tennessee and nationwide.
In 2012, the Haslam family — owners of Pilot Flying J truck fueling stations, a corporation where Bill Haslem used to serve as president — purchased Western Petroleum and Maxum Petroleum. Both Western and Maxum are major suppliers of fuel and lubricants for fracking operations. Pilot Flying J is the nation's No. 1 retailer of diesel fuel and is the 6th most profitable corporation in the U.S., earning over $29 billion in 2012.
Bill, Jimmy and Jim Haslam stand in front of a Pilot Gas pump in 1977 (Photo Credit: Pilot Corporation)
Pilot Flying J also has 63 of its stations nationwide retrofitted with natural gas pumpsfor 18-wheelers owned by T. Boone Pickens' Clean Energy Fuels Corporation (CEF) as part of CEF's "America's Natural Gas Highway." Some perspective: CEF currently has 67 U.S. fueling stations in total.
Pilot also owns Marathon Petroleum, which it purchased as a wholly-owned subsidiary in Sept. 2008. Marathon owns the Wellsville, Ohio Intermodal Facility, "a terminal capable of loading up to 50,000 [barrels of fracked oil per day via the Utica Shale] onto barges on the Ohio River," according to the Youngstown Business Journal.
Bill Haslam's father, Jim Haslem — a co-chair of Republican presidential candidate Mitt Romney's Tennessee campaign and former member of the UT-Knoxville Board of Trustees — gave a $32.5 million donation to UT-Knoxville in 2006. It was the largest ever private donation to the university from an individual.
“If Tennessee is going to be a leader in the knowledge economy of the 21st century, it must have a great flagship university,” Jim Haslam said in a press release at the time. “We cannot go from good to great without increasing fundraising, and my hope would be that this gift would put the spotlight on philanthropy and the University of Tennessee’s tremendous potential to become a great university.”
Bill's brother Jimmy was the college roommate and one of the "best friends" of climate change "skeptic," U.S. Sen. Bob Corker (R-Tenn.) while attending UT-Knoxville, also serving as Corker's chief fundraiser during his successful 2006 run for the U.S. Senate. Jimmy is also the owner of the Cleveland Browns, which he bought for $1 billion in 2012.
The Haslam family is set to cash in on the arrangement, coinciding (perhaps not coincidentially) with ongoing UT System budget cuts. After all, the cuts doled out by Haslam serve as the rationale for the necessity of new revenue streams like fracking on UT-Knoxville's portion of the Cumberland Forest. A business opportunity, if you will.
Emails Gained From FOIA Reveal Campus Drilling Program's True Nature
In March, the Southern Environmental Law Center (SELC) obtained 273 pages of internal UT-Knoxville communications records via Tennessee's Open Records Act. The records revealed that regardless of the environmental community's stance on the campus drilling proposal, "their actions will not sway the Governor's resolve/support" for fracking the Cumberland Forest.
Given the Haslam family's industry connections, the statement is unsurprising. In addition to the family ties, the emails also show one of the key behind-the-scenes pushers of fracking on UT-Knoxville's Cumberland Forest land was Bryan Kaegl.
Kaegl is a high-level Tennessee GOP campaign consultant who worked on mass mailings for Bill Haslam's 2010 gubernatorial campaign. According to Persuasian Partners, one of his numerous gigs, that mass malling spree "included eleven unique mail pieces that totaled 2,687,748 pieces and 4 phases of robocalls for a total of 504,311 contacts."
Photo Credit: Persuasian Partners
Kaegl was also hired by CONSOL Energy to "shepherd the [UT-Knoxville fracking] proposal through the approval process," according to a story appearing in the Associated Press. CONSOL owns 249,000 acres in the Chattanooga Shale.
Abiding by the "Frackademia Playbook," with a Twist
Speaking at a gas industry public relations conference attended by DeSmogBlog in Houston on Oct 31-Nov. 1, 2011 — the same conference where it was revealed the shale gas industry is employing psychological warfare (PSYOPs) tactics on U.S. citizens — S. Dennis Holbrook of Independent Oil and Gas Association of New York summed up the situation at UT-Knoxville well.
He posited that it's crucial for industry to "seek out academic studies and champion with universities — because that again provides tremendous credibility to the overall process."
What's different about UT-Knoxville, though — laying bare the veneer of "credibility" — is the Haslam family ties to the University, the executive chamber, the U.S Senate, and the industry itself. In other words, it's the "frackademia playbook" with a twist.
This post originally appeared on DeSmogBlog.