Former FERC Official Hired By Company With $1.8 Million Stake In Spectra Energy Pipeline Project He Had Reviewed

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An engineering company with a $1.8 million stake in a Spectra Energy natural gas project hired a former top Federal Energy Regulatory Commission (FERC) official who had been managing the environmental review process for the sameย project.

Douglas Sipe, who served as Outreach Manager in the Office of Energy Projects at FERC, left the Commission in mid 2014 to work for Willbros, a large oil and gas engineering and construction firm based inย Houston.

Following a 16-year career at FERC, Sipe was named Willbrosโ€™ Vice President of Regulatory & Public Affairs, a newly createdย position.

Before leaving FERC, Sipe served as the Environmental Project Manager for the pre-filing and early filing review processes of Spectra Energyโ€™s then-proposed Algonquin Incremental Market (AIM) pipelineย project.

The project, eventually approved by FERC in March 2015, is a major capacity upgrade for the companyโ€™s existing Algonquin Pipeline carrying fracked gas from Pennsylvania through New Jersey and New York and into Connecticut, Rhode Island andย Massachusetts.

In the months before leaving FERC, Sipe led the Commissionโ€™s team overseeing AIMโ€™s environmental review, met regularly with stakeholders, and conducted public scoping meetings with concerned citizens living near theย project.

On hiring Sipe, a Willbros spokesperson said: โ€œDoug brings us critical bandwidth in the areas of regulatory compliance, environmental permitting and stakeholderย outreach.โ€

According to FERC records, Sipe led public meetings on AIM in Cortland, New York, Danbury and Norwich, Connecticut, and Dedham, Massachusetts in September and October 2013, listening to and addressing residentsโ€™ concerns over the project. Another document shows Sipe leading a FERC teleconference meeting on the project in Januaryย 2014.

Within five months, Sipe would be working for Willbros, which is one of Spectraโ€™s main contractors on Algonquin and its otherย pipelines.

According to Spectraโ€™s financial disclosures to FERC, its subsidiary company constructing AIM, Algonquin Gas Transmission LLC, paid Willbros nearly $1.8 million in 2013 and 2014 alone โ€“ the time period when Sipe moved from FERC toย Willbros.

From Spectraโ€™s subsidiary Algonquin Gas Transmissionโ€™s report to FERC, showing payment to Willbros for work conducted inย 2014

As part of AIM, Willbros designed the upgrade for Spectraโ€™s compressor station in the town of Chaplin,ย Connecticut.

Documents obtained by DeSmog from the Connecticut Department of Energy and Environmental Protection, show Willbrosโ€™ work on the station began in early 2013 and lasted throughoutย 2014.

This shows Sipe served on the project while still at FERC asย Willbros, his future employer, was already working on AIM.

From a Spectra Energy application to modify its Chaplin, CT compressor station, showing contracted work by Willbros throughoutย 2013

Furthermore, the unit within Willbros contracted by Spectra to design the station โ€“ Willbros Professional Services โ€“ was the same unit Sipe joined when hired byย Willbros.

This unit was sold in late 2015 to TRC, another one of Spectraโ€™s main pipeline contractors.ย ย 

More Question Marks About FERCโ€™sย Independence

This case of revolving doors โ€“ where a former government regulator goes on to profit from the energy project he was entrusted to review โ€“ further highlights the tight relationship between FERC and the industry it regulates, as reported byย DeSmog.

Sipe, who earlier this year co-founded the engineering and consulting company MDM Solutions as a subsidiary of MDM Services, declined to provide a comment toย DeSmog.

Willbros did not return a request forย comment.

A FERC spokesperson said in response: โ€œFERC does not comment on personnel matters. However, all FERC employees have a duty to maintain the highest standards of integrity in government. As part of that duty, all FERC employees are required to notify our Designated Agency Ethics Official for guidance and, if necessary, recusals, if they are seeking outside employment. All FERC staff get training on these and other ethics procedures everyย year.โ€

Main image: Federal Energy Regulatory Commission HQ at Washington, DC. Credit: Flickr/Branderguard

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Itai Vardi is a sociologist and freelance journalist. He lives and works in Boston,ย Massachusetts.

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