Oil and Gas Agency to Split Environment, Safety from Leasing

WASHINGTON, DC, May 11, 2010 (ENS) – The federal agency that manages the nation’s natural gas, oil and other mineral resources is going to be reorganized to separate its safety and environmental enforcement functions from its leasing and permitting functions.

Interior Secretary Ken Salazar announced today that he intends to restructure the Minerals Management Service, MMS, to establish a separate and independent safety and environmental enforcement entity. The move is prompted in part by the Deepwater Horizon oil spill that continues to spread in the Gulf of Mexico.

“The job of ensuring energy companies are following the law and protecting the safety of their workers and the environment is a big one, and should be independent from other missions of the agency,” said Salazar.

Currently, the Minerals Management Service collects energy revenues on behalf of American taxpayers and enforces laws and regulations that apply to offshore energy operators.

Salazar said the MMS’s inspection, investigation, and enforcement operations will be separate and independent from the agency’s leasing, revenue collection, and permitting functions.

“We will responsibly and thoughtfully move to establish independence and separation for this critical mission so that the American people know they have a strong and independent organization holding energy companies accountable and in compliance with the law of the land,” the secretary said.

The change is part of a set of reforms that Salazar says will provide federal inspectors more tools, more resources, more independence, and greater authority to enforce laws and regulations that apply to oil and gas companies operating on the Outer Continental Shelf.

Boats sail through a sea of oil from the Deepwater Horizon in the Gulf of Mexico. May 8, 2010. (Photo courtesy U.S. Coast Guard)

“The tragedy aboard the Deepwater Horizon and the massive spill for which BP is responsible has made the importance and urgency of our reform agenda even clearer,” said Salazar.

“We have been, and will continue to be, aggressive in our response to BP’s spill,” he said, “but we must also aggressively expand the activities, resources, and independence of federal inspectors so they can ensure that offshore oil and gas operations are following the law, protecting their workers, and guarding against the type of disaster that happened on the Deepwater Horizon.”

The Union of Concerned Scientists today gave its approval to an Obama administration proposal to divide the Minerals Management Service, which oversees offshore drilling, into two agencies, saying the breakup was “long overdue.”

Francesca Grifo, director of the UCS Scientific Integrity Program, said, “Conflicts of interest must be minimized so that the agency charged with enforcing safeguards is able to focus solely on protecting workers and the environment.”

“Putting one agency in charge of enforcing safety regulations and collecting billions of dollars in oil and gas royalties was asking for trouble,” Grifo said. “Separating these functions would benefit all parties involved – the Department of Interior, the American public, and the oil companies that must rebuild public trust.”

The American Petroleum Institute, an industry organization, did not take issue with Salazar’s reorganization of the Minerals Management Service, but said it needs to see the details of the proposal.

“Our industry’s priority is to provide safe, technologically sound and environmentally responsible offshore operations and we remain committed to working with Secretary Salazar to achieve this goal,” API said in a statement.

“We remain committed to responding to the current situation and supporting the ongoing investigations,” said API, which has created two industry task forces in response to the Deepwater Horizon incident that held their first meeting in Houston Monday.

The task forces are not involved in the review of the incident, but bring together industry experts to identify best practices in offshore drilling equipment and operations, with the ultimate goal of enhancing safety and environmental protection. The task forces will provide recommendations to the Department of the Interior, which is tasked with submitting a report on the incident to President Barack Obama on May 28, 2010.

“The Gulf of Mexico oil spill demands that our industry get to work immediately to reexamine our offshore operations, procedure and technology to ensure our commitment to safety is uncompromised,” said API President and CEO Jack Gerard.

“In an effort to assist and complement the government, leading experts from across our industry are exploring whether any improvements in industry operations could result in improved offshore safety and stronger environmental protections,” Gerard said.

The oil and gas industry formed the task forces as a complement to the Outer Continental Shelf Safety Oversight Board, which the Department of the Interior established as part of the federal government’s ongoing review of offshore drilling issues brought to the fore by the Deepwater Horizon incident.

Copyright Environment News Service (ENS) 2010. All rights reserved.