Congressmen urge re-evaluation of well control proposal
By: Jacob Batte, HoumaToday.com
November 13, 2015
Louisiana’s House delegation is making another push to halt the Obama Administration’s effort to revamp offshore equipment standards and well designs aimed at avoiding another BP Spill.
Announced in April, the so-called well control rule proposed by the Bureau of Safety and Environmental Enforcement aims to improve equipment standards and well designs to avoid a catastrophic spill like the one in the Gulf of Mexico in 2010.
But industry officials and congressman say the regulations could turn into a “de facto moratorium” for offshore drilling and add another burden to a business already suffering from low prices.
In a Nov. 6 letter to Secretary of the Interior Sally Jewell, written by U.S. Rep. Charles Boustany, R-Lafayette, and co-signed by the rest of the state’s House delegation, congressmen argue that the “one-size-fits-all approach” would increase the risk of another incident.
“It will also stifle innovation and delay implementation of new technologies which would improve safety and operations,” Boustany wrote. “We know this is not BSEE’s intent, and we urge re-evaluation of the proposed rule.”
Congressmen have directed their attention to Jewell because her department, through the Bureau of Safety and Environmental Enforcement, proposed the new mandates for drillers.
The proposal calls for stricter design requirements and operational procedures for oil well blowout preventers, a safety device whose failure was cited as a major cause of the BP oil spill. The proposed rule also includes reforms to well design and control, real-time well monitoring and third-party inspections and oversight for some of the processes used in deepwater drilling.
But industry representatives said they are also invested in safety, and the regulation does not take into account the numerous safety improvements that have been implemented since 2010.
Following the disaster, the federal Office of Inspector General made a number of safety recommendations to the Bureau of Safety and Environmental Enforcement. However, a 2014 audit showed few recommendations were followed and cited a lack of proper federal oversight as a key problem.
Critics of the proposal say its effects would reach beyond the industry and into coastal erosion and the local tax base. By slowing down coastal Louisiana’s biggest industry, they said, the proposal would decrease the amount of money flowing to local governments and to coastal work through the Gulf of Mexico Security Act.
“We believe it would undermine important efforts to restore our vanishing coastline,” Boustany wrote.
BSEE estimates that the rule would cost oil companies $883 million over 10 years, but the American Petroleum Institute claims the rule would cost the industry $32 billion during the same time frame.
API predicts that from 2017 to 2030, the proposed rule could cause the number of wells drilled to drop 26 percent from roughly 2,700 to 2,000.
At a hearing in New Orleans in September, Senators Bill Cassidy and David Vitter also criticized the proposal, characterizing the regulation as another attack on the oil and gas industry.