Report: Ties between coal-processing firm and Alaska's attorney general go deeper than stock

Gov. Murkowski and Renkes promoted $1 billion coal pact dealing with a company whose stock Renkes has traded heavily

Posted: Monday, October 11, 2004

ANCHORAGE - The ties between KFx Inc. and state Attorney General Gregg Renkes run deeper than the stock ownership and consulting fees recently acknowledged, according to the Anchorage Daily News.

KFx, a Denver firm with a patented coal-drying process, is part of a $1 billion trade agreement between Alaska and Taiwan. Both Renkes and Gov. Frank Murkowski have promoted KFx as a company with a technology that could spur development of the Beluga coal beds west of Anchorage.

After reports surfaced recently that Renkes owns more than $100,000 in KFx stock, and once worked for the Colorado company as a paid adviser, the attorney general said he would sell his shares and donate the profits.

Besides selling his shares, Renkes has said he would move all of his investments into a blind trust to obliterate any suggestion that he has a conflict of interest.

Public records indicate that Renkes' history with KFx and related parties is longer and more involved. His connections include a shared business in the same office building as KFx, a common employee, prior work for a company that invested millions in a failed KFx plant, and a residential address two houses away from a KFx co-founder.

His 2004 disclosure report with the Alaska Public Offices Commission identifies Renkes as a director and shareholder of Reliable Power Inc., of Arlington, Va.

Reliable's other director is listed in public documents as John P. Venners, a lobbyist for and co-founder of KFx. Venners' brother, Ted, is KFx chief executive.

Reliable's business address is listed as 2300 Clarendon Blvd., the same address for Venners & Co., a lobbying company owned by John Venners, who was sanctioned by federal securities regulators in 2000 for manipulating KFx stock prices and paid a $10,000 fine.

KFx has also leased office space at 2300 Clarendon Blvd., according to KFx's latest annual report. Renkes and Venners appear to share at least one employee. The automated telephone directories at both Reliable and Venners & Co. list Scarlett Sasscers as an employee. Sasscers also works at Kanturk Partners, a newly formed merchant bank controlled by several KFx insiders, according to her voice mail listing.

Kanturk Partners is the company hoping to build a $350 million plant at Beluga that would use the KFx coal-drying process. Sasscers' name appears on an April 2002 press release issued by Reliable that quotes Renkes. The release announced the formation of a partnership between Reliable and Sumitomo Electric Industries.

Renkes also lived two doors down from Venners in McLean, Va., before moving to Juneau to take the attorney general's job in December 2002. Renkes lived at 624 Rivercrest Drive. Venners lives at 636 Rivercrest Drive, according to Fairfax County property records.

Renkes' connections with the Venners brothers and his knowledge of KFx and its technology run deeper. In 1999, Renkes was running his own Washington, D.C., lobbying firm after several years as chief of staff for then Sen. Murkowski and staff director of the Senate Energy and Natural Resources Committee.

He received a $40,000 payment that year from Thermo Ecotek Corp, a client, according to public records gathered by the Center for Responsive Politics. Thermo Ecotek invested about $68 million to develop and build a KFx plant in Wyoming in the late 1990s, according to company documents filed with the U.S. Securities and Exchange Commission.

The plant, in Gillette, Wyo., opened in April 1998. It experienced operational problems and closed the next year.

In October 2001, roughly 14 months before becoming Alaska attorney general, Renkes accepted 25,000 shares of KFx stock as payment for $91,250 worth of professional services, according to SEC filings.

As of Aug. 31, Renkes owned 13,100 shares of KFx.

Renkes disclosed nine KFx stock trades this year through August, according to required filings. Of the 94 different stocks in Renkes' investment portfolio this year, KFx was the most actively traded.

During his time with the Murkowski administration, Renkes has made at least two public appearances to promote the development of Alaska's coal deposits at Beluga, across Cook Inlet from Anchorage on the western shore. Representatives of KFx and Kanturk Partners attended the events in Anchorage.



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