Offshore Drilling Restrictions
Salazar’s La. visit doesn’t satisfy drillers, pols
By CAIN BURDEAU
HOUMA, La. — Oil and natural gas industry leaders and Louisiana elected officials expressed frustration Monday that a meeting with Interior Secretary Ken Salazar didn’t lead to more progress on easing restrictions on offshore drilling.
Salazar traveled to Louisiana on Monday to meet with offshore oil and natural gas drillers who’ve cried foul over new rules put in place by the Obama administration for the Gulf of Mexico since the BP oil spill.
“If the regulators want to sit around and figure out what rules and regulations to come up with, if they wait much longer they won’t have much industry to regulate,” said James W. Noe, the head of the Shallow Water Energy Security Coalition, an industry group pushing to get the Obama administration to speed up permitting.
Salazar said he would continue working with the offshore drilling industry, but he stopped short of announcing any major breakthrough.
“We recognize that we have some difficult issues to work through,” Salazar said after meeting with industry leaders at an offshore platform building yard in Houma, a city southwest of New Orleans with deep ties to oil and gas drilling.
“There are new rules of the road, and the new rules of the road are taking some time to put into place,” Salazar said. “We are committed to oil and gas production down here … We’re going to do it in a way that is safe.”
Drillers argue that new safety and environmental rules announced in October have impeded new drilling in both shallow waters and deeper waters, threatening the industry’s future. The rules were put in place as a condition to lifting a moratorium on new deepwater drilling in the Gulf of Mexico after the April 20 Deepwater Horizon rig explosion that killed 11 crew members and led to the release of more than 200 million gallons of oil.
The new rules focus on making sure blowout preventers work properly. In the case of the BP explosion, the blowout preventer failed to shut off the leaking well as it was designed to. Also, the new rules require companies to be prepared for worst-case oil spill scenarios.
“We all came expecting, hoping, for a new policy decision, a breakthrough in terms of permitting, at least a new set of permits issued, and we heard none of that,” said U.S. Sen. David Vitter, R-La., after meeting Salazar. “That was extremely disappointing … There is an enormous logjam in terms of permitting right now, so much so that it amounts to a de facto mora”
Last Thursday, U.S. Sen. Mary Landrieu, D-La., cited “notable progress” in her talks with the Interior Department and decided to lift a hold on the nomination of Jacob Lew to be director of the Office of Management and Budget. She had placed a hold on Lew’s nomination to protest the Obama administration’s actions on drilling since the Gulf of Mexico oil spill. In exchange for lifting her hold, Landrieu asked Salazar to travel to Louisiana and provide some clarity to the rules.
But Landrieu said she was “extremely disappointed” by Salazar. She was not in Houma for the meeting.
“Our industry leaders are skeptical and have every right to be,” she said.
Despite the disagreements, some progress was announced Monday.
Michael Bromwich, the director of the Bureau of Ocean Energy Management, Regulation and Enforcement, said regulators had agreed to expedite permitting for new gas wells by taking a “tiered-approach” to worst-case oil spill scenarios. The industry has asked for wells to be permitted in a tiered-approach that takes into account the range of particular dangers of each well.
Landrieu called the “commitment to the tiered permitting process … a start.” But she added that “the Gulf Coast needs much more clarity and specificity to move forward.”
Also, Salazar said there was a push to beef up the staff of BOEMRE, the agency that reviews offshore permits. The agency has requested funds for 24 new employees to review permits, Salazar said.
And it’s not as though new drilling has come to a complete halt.
Since June, when new rules for shallow wells went into place, regulators have approved 16 new permits, officials said. Shallow water wells are those drilled in waters up to 500 feet deep.
Still, regulators have not approved a single new deepwater well, which are drilled in waters deeper than 500 feet. The most promising oil reserves in the Gulf are in deeper waters.