Attorney General Files Lawsuit Against 2 Natural Gas Companies, Alleging Inflated Prices During 2021 Winter Storm

Attorney General Gentner Drummond has filed a lawsuit against two natural gas companies, saying they 'artificially inflated natural gas prices' during a large winter storm in 2021.

Enable entities, which owns ET Gathering & Processing successor by merger to Enable Midstream Partners, Enable Oklahoma Intrastate Transmission, Enable Gas Transmission and Enable Energy Resources, and Symmetry Energy Solutions L.L.C. are named in the lawsuit. A press release from the attorney general's office says these companies supply natural gas to the Grand River Dam Authority and much of Oklahoma's power grid.

The lawsuit claims that Enable violated the Oklahoma Antitrust Reform Act, violated the Oklahoma Common Carrier statute, breach of contract, unjust enrichment, fraud, constructive fraud, bad faith breach of contract, civil conspiracy and negligence. The lawsuit claims that Symmetry violated of the Oklahoma Antitrust Reform Act, breach of contract, unjust enrichment, fraud, constructive fraud, bad faith breach of contract, negligence, and breach of fiduciary duty.

The release notes that Oklahoma does not have restrictions on intrastate pipeline ownership which, "leaves the state ripe for market manipulation and anti-competitive behavior."

Drummond's lawsuit says both Enable and Symmetry drove up prices and charged customers large fees based on the inflated prices.

“While many companies conducted themselves above board during that trying time, our analysis indicates that some bad actors reaped billions of dollars in ill-gotten gains," Drummond said. "It is important that we do everything in our power to hold bad actors accountable for their actions.”

News 9 and Oklahoma Watch conducted an in-depth investigation into utility prices following a large winter storm in 2021, which can be found here. 

At the height of the winter storm in February 2021 natural gas prices on the spot market in the Sooner State soared more than 600 times the typical price before the storm, with Oklahomans paying the highest prices in the nation.

Utilities told us they paid what they had to in order to keep the lights and heat on.

The legislature quickly passed securitization pushing the entire $2.7 billion dollars of debt the utilities had for the gas and an additional $2 billion in interest and fees to the rate payer. The costs, now added to our monthly OG&E and ONG bills for the next 28 years.

“The magnitude of this scheme is staggering and unconscionable,” Drummond said during a press conference in 2023. “The conduct in question is well outside the perimeters and boundaries of ordinary capitalism.”

The full press release from Attorney General Gentner Drummond's office can be read below:

Alleging artificially inflated natural gas prices that preyed on Oklahomans in the wake of Winter Storm Uri, Attorney General Gentner Drummond today filed litigation against Enable entities (ET Gathering & Processing successor by merger to Enable Midstream Partners, Enable Oklahoma Intrastate Transmission, Enable Gas Transmission and Enable Energy Resources) and Symmetry Energy Solutions LLC.

During that devastating 2021 winter storm, Enable and Symmetry marketed natural gas and operated intrastate natural gas pipelines throughout Oklahoma. Among their customers was the Grand River Dam Authority (GRDA), the state’s largest public power utility. Many of Oklahoma’s public schools, cities, counties and hospitals are directly supplied natural gas by Symmetry.

While the Federal Energy Regulatory Commission bars interstate pipeline operators from owning the commodity they transport and sell, there is no such prohibition on intrastate pipelines. Many states have imposed restrictions on intrastate pipeline owners to mirror the federal rules, but Oklahoma is not among them – a circumstance that, according to the lawsuit, leaves the state ripe for market manipulation and anti-competitive behavior.

According to the litigation, Enable and Symmetry employed “a variety of tactics to drive up the index prices, including reduction of supply and submitting trades at unconscionable price levels” to charge GRDA exorbitant fees “dictated by the artificially inflated index prices.”

Drummond said his office will pursue additional litigation against other companies that he said engaged in market manipulation.

“I believe the level of fraud perpetrated on Oklahomans during Winter Storm Uri is both staggering and unconscionable,” said the Attorney General. “While many companies conducted themselves above board during that trying time, our analysis indicates that some bad actors reaped billions of dollars in ill-gotten gains. It is important that we do everything in our power to hold bad actors accountable for their actions.”

Uri roared through Oklahoma in mid-February of 2021. Before it eventually exited the continental United States, the punishing mix of ice, snow and record-breaking cold caused hundreds of deaths and more than $200 billion in damages throughout the southern part of the country.

It also spurred desperate need for additional natural gas.

According to the lawsuits, Enable and Symmetry had counted on higher demand with the arrival of Winter Storm Uri and schemed to artificially reduce supply.

“They knew that it would bring sustained below-freezing temperatures, and that it would increase demand for natural gas. Armed with this knowledge, Defendants used that time to prepare, but not in the way that was rightfully expected from them,” state the lawsuits.

“Instead of ensuring adequate natural gas supplies to GRDA, upon information and belief Defendants spent the weeks and days before Winter Storm Uri’s arrival in Oklahoma taking deliberate steps, which continued after Winter Storm Uri’s arrival, to reduce the availability of natural gas in Oklahoma. They did so with the objective of driving natural gas prices — and their resulting profits — exponentially higher, to the detriment of GRDA and everyone else in Oklahoma.”

Enable and Symmetry “reaped billions of dollars in extra profit from their wrongful conduct and the resulting surge in prices during the storm,” according to the lawsuits filed today in Osage County District Court.

The lawsuit against ET Gathering & Processing, Enable Oklahoma Intrastate Transmission and Enable Energy Resources claims violations of the Oklahoma Antitrust Reform Act, violations of the Oklahoma Common Carrier statute, breach of contract, unjust enrichment, fraud, constructive fraud, bad faith breach of contract, civil conspiracy and negligence.

The lawsuit against Symmetry claims violations of the Oklahoma Antitrust Reform Act, breach of contract, unjust enrichment, fraud, constructive fraud, bad faith breach of contract, negligence, and breach of fiduciary duty.

The petitions can be read here and here.

Corporation Commissioner Kim David released a statement on Wednesday reacting to the AG's lawsuit:

"Corporation Commissioner Kim David today released a statement following the announcement from Attorney General Gentner Drummond that he filed lawsuits on behalf of the Grand River Dam Authority, against Enable entities and Symmetry Energy Solutions, as a result of his investigation of artificially inflated natural gas prices during Winter Storm Uri. 

“Shortly after joining the Corporation Commission, I formally asked Attorney General Gentner Drummond to investigate possible wrongdoing by natural gas marketers and pipeline operators during Winter Storm Uri. After heeding my request, the Attorney General, as the state’s chief prosecutor, opened an investigation and determined that a lawsuit is necessary to protect Oklahoma ratepayers.  

While these lawsuits were filed on behalf of the Grand River Dam Authority, I am hopeful that the Attorney General will pursue additional litigation against other companies so that all determined overpayments may be returned to Oklahoma ratepayers. I appreciate today’s announcement and will monitor these lawsuits as they move forward.”