AP Investigation: Pearce Companies Rent Oilfield Equipment
SANTA FE, N.M. (AP) — Republican gubernatorial candidate and U.S. Rep. Steve Pearce owns two companies that actively lease oilfield equipment to undisclosed customers even as he campaigns to regulate a booming petroleum sector and expand an oil-dependent economy.
A spokesman for Pearce's campaign confirmed that the congressman's businesses, Trinity Industries and LFT, provide oilfield equipment rentals after The Associated Press found corporate registration documents that describe the activities.
Pearce frequently has invoked his past business success and expertise running an oilfield services business that he sold in 2003. He has derided Democratic opponent and U.S. Rep. Michelle Lujan Grisham's energy policies, in particular, her goals for renewable energy and limits on oil and natural gas exploration and methane releases. He calls them threats to the local economy and state finances.
Both candidates are campaigning on plans to diversify the state economy and move New Mexico away from energy's boom-and-bust cycles.
Pearce has reported holdings in Hobbs-based Trinity Industries that were worth between $5 million and $25 million in 2017. It and LFT, valued at between $1 million and $5 million, provided Pearce with income in 2017 of between $200,000 and $2 million, he said in a financial disclosure statement.
Pearce campaign spokesman Kevin Sheridan acknowledged that both companies engage in oilfield equipment rentals, but also include other holdings — some related to building rentals. He said the majority of Steve and Cynthia Pearce's personal financial holdings are professionally and independently managed, and that oilfield equipment rentals represent a small portion of investments.
Pearce's campaign declined to say what company or companies rent equipment from Trinity Industries and LFT.
Previously, Trinity has been described as a company that rented party equipment such as tables and chairs, which Sheridan said is not the case. He also said Trinity does not buy, sell or own oil and gas leases — although that purpose is listed on a state corporate registration form.
Pearce, a former Air Force and commercial pilot, made most of his personal fortune from an oilfield services company he ran with his wife, called Lea Fishing Tools that specialized in retrieving tools stuck in oil and gas wells. Lea Fishing Tools was sold in 2003 to the publicly traded company Key Energy Services, with Pearce putting assets into his renamed company Trinity Industries.
His critics have long highlighted extensive campaign donations from oil companies, even as he embraces industry-friendly policies including proposed exclusions from environmental review for mineral leases on public land.
In an interview in September, Pearce said he doesn't give the industry preferential treatment.
"It's a very significant industry in New Mexico and I don't put my thumb on the scale," Pearce said. "We hold them as accountable as anyone else."
Leading state Democrats have been pressuring Pearce to release copies of tax returns, after Lujan Grisham publicly posted five years of tax returns in late May in the final days of the Democratic primary.
"Now that voting has begun, voters deserve to know the truth about what else Steve Pearce is hiding from them," said James Hallinan, a spokesman for Lujan Grisham, on Tuesday as early voting began in New Mexico.
Pearce has said he plans to release his 2017 tax returns, but can't complete his tax filing until involved companies file their own delayed returns Oct. 15. Political candidates in New Mexico are not required to share their tax returns.
Pearce has said he is specially qualified to broker an agreement with the private sector to fix deteriorating roads in southeastern New Mexico that are ,worn down from trucks serving the oil and industry.
By contrast, Lujan Grisham is seeking to increase New Mexico's required percentage of renewable energy from solar and wind used to produce electricity.
"Unlike his opponent, Steve Pearce will not pick economic winners and losers," Sheridan said Monday in a statement. "Instead he will work to create good paying jobs in every sector of the economy and every corner of the state, including solar, wind, high tech, timber, mining, and oil and gas."
New Mexico state government and local public school districts, in particular, depend heavily on revenues from the oil industry. About one-third of the annual state budget is supported by the oil and natural gas sector — though that income has fluctuated wildly in recent years.