There has been a lot of confusion and inaccurate information about the Navajo Nation Oil and Gas Company recently in commentary in local media accounts, social media and campaign speeches. We want to set the record straight and give you the facts.

Myth: Louis Denetsosie and Paul Frye lost $30,000,000 of NNOGC funds on the NNOGC Exploration and Production (E&P) office in Denver, Colorado, and the projects administered by the Denver office.

Fact: On several occasions, beginning in December 2007, NNOGC's Board took formal votes in support of opening and operating the Denver office. Those votes were under the prior administration and were unanimous.

Approximately $38,000,000 was spent on NNOGC's coal bed methane/Mancos shale project pursuant to an Operating Agreement between the Navajo Nation and NNOGC. This agreement was unanimously approved by the NNOGC Board of Directors in August 2009. Frances Totsoni seconded the motion for approval, and Perry Shirley and Wafaie Zaaza both voted for approval.

More than half of the investment — $24,800,000 — was paid to the Navajo Nation in bonuses and rents. Approximately $12,000,000 was spent on construction, drilling, coring and testing for 10 exploratory wells. This money is not "lost"; rather, it is an investment in Navajo resources that is required to determine if and where the most promising reserves are to be found. All wells were drilled in December 2011 through February 2012.

Current CEO Louis Denetsosie did not serve on the NNOGC Board when these decisions were made and had no involvement in them. He was Attorney General of the Navajo Nation when the Board of Directors approved the Denver office and when the Board approved the operating agreement. He had no role in recommending or approving the operating agreement. Members of Frye's law firm provided a legal review of the operating agreement but had no role in recommending or voting on it. That was the sole responsibility of the Board of Directors.

Myth: The current leadership gave themselves large pay raises.

Fact: In 2012 the Board of Directors sought input to determine if NNOGC employees and managers were adequately compensated compared to their peers at similar sized oil companies. The company commissioned a third-party study by an independent firm.

The study, presented to the Board of Directors by former CEO Robert Joe's consulting firm, found that NNOGC employees at most levels were underpaid compared to employees of similar sized oil companies. According to the report, "NNOGC's Executive wages are 31% to 46% below competitive market wages," and NNOGC executives were earning less than 60% of the average salary for comparable companies.

The study recommended NNOGC increase salaries of all managers by a total of $181,630.50.

In August 2012 the NNOGC Board of Directors – again, unanimously – approved wage and salary adjustments for NNOGC employees, including increasing the salary of the CEO and many others. As part of that, the salary for the CEO position was increased by less than $50,000. Salaries for many other employees were also increased. It is flat out wrong to say that the CEO gave himself any pay increase, much less a $100,000 pay increase as some have stated.

You have the right to the facts. The Navajo Nation, after all, is the sole owner of NNOGC. The company's assets and annual revenues are the Navajo people's assets and money.

Managed properly and in accordance with Navajo Nation values, NNOGC can provide financial security for generations to come.


Lennard Eltsosie is the Chairman of the Navajo Nation Oil and Gas Company.