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The White House And Interior Secretary Deny Involvement In Lucrative Puerto Rico Energy Contract

Whitefish Energy, a two-person Montana-based company, was controversially awarded a $300 million contract to help restore Puerto Rico's power.

Posted on October 27, 2017, at 4:40 p.m. ET

Ramon Espinosa / AP

Whitefish Energy workers work on power line towers in Barceloneta, Puerto Rico, on Oct. 15.

The White House and Interior Secretary Ryan Zinke on Friday publicly denied any federal involvement in awarding a lucrative contract for restoring power in hurricane-ravaged Puerto Rico to a two-person Montana-based company.

"I had absolutely nothing to do with Whitefish Energy receiving a contract in Puerto Rico," Zinke, a Whitefish, Montana, native said in an unusual public statement. "I welcome all investigations into the allegations."

After reported earlier this month that Whitefish Energy Holdings LLC was awarded the $300 million contract, industry analysts were left confounded about how a company that had only two full-time employees and no office at the time the contract was granted, was awarded the monumental task of restoring power in the debt-ridden territory without a competitive bidding process.

The red flags prompted members of the House Committee on Natural Resources to look into the deal, while the governor of Puerto Rico called for an audit of the Puerto Rico Electric Power Authority’s (PREPA) energy contracts.

"This is a contract that was determined by the local authorities in Puerto Rico," White House press secretary Sarah Huckabee Sanders said during Friday's press briefing. "Not something that the federal government played a role in."

Sanders said that the White House will "look forward" to the results of the ongoing audit of the contract.

Two Democratic senators formally requested the Government Accountability Office investigate the "use of public money to reimburse work completed by Whitefish Energy." The senators raised several concerns about the contract, including the "potentially inflated costs of time and material in the contract relative to comparable" agreements."

Alan Diaz / AP

Ryan Zinke

Questions were also raised about the associations of Zinke with Whitefish Energy CEO Andy Techmanski as well as Trump campaign donations from Joe Colonnetta, the head of one of Whitefish Energy’s major funding sources.

In his statement, Zinke called reports of his possible involvement in the contract "baseless" and blamed the "dishonest media" and "political operatives."

The Interior secretary said that Whitefish Energy contacted him after being awarded the initial contract, "on which I took no action."

He also urged the Interior Department's Inspector General to investigate the matter. Techmanski has previously denied Zinke's involvement in the deal.

Sanders also denied that the contract had anything to do with one of Whitefish Energy's investors being a Trump campaign donor.

"The federal government has nothing to do with this contract or the process," Sanders reiterated during the briefing. "This was something solely determined by the Puerto Rican government."

The Federal Emergency Management Agency (FEMA) also denied involvement in Whitefish Energy's selection, saying that the decision to award the contract was "made exclusively by PREPA."

"Any language in any contract between PREPA and Whitefish that states FEMA approved that contract is inaccurate," FEMA said in a statement on Friday.

The federal agency said it had "significant concerns" with how PREPA procured the contract, adding that it had not confirmed whether the contract prices were reasonable.

FEMA said that it was seeking more information from PREPA about the contract and the process.

A BuzzFeed News investigation, in partnership with the International Consortium of Investigative Journalists, based on thousands of documents the government didn't want you to see.