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Louisiana lawmakers attack proposed offshore drilling rules

 

By:  Michael DeMocker, NOLA.com

 

Louisiana lawmakers lashed out at the Obama administration this week as final deliberations over new offshore drilling regulations began in Washington, D.C.

Reps. Steve Scalise, R-Jefferson, and Garret Graves, R-Baton Rouge, called the proposed rules, born in the wake of the Deepwater Horizon disaster, a “de facto moratorium” on drilling and predicted the rules would discourage oil and gas exploration off Louisiana’s coast.

“You’re punishing people that haven’t done anything wrong,” Scalise said Friday (Feb. 5). “That tells me they’re trying to kill drilling in the Gulf of Mexico.”

Secretary of the Interior Sally Jewell introduced the rules last April. They would tighten manufacturing standards for key rig equipment, including blowout preventers similar to the one that failed in the 2010 Deepwater Horizon accident that killed 11 men and sent millions of gallons of oil flowing into Gulf waters. They would also set more rigorous schedules for testing and inspecting oil rigs as they drill into the ocean floor.

But the regulations, which took five years to craft, come as the price of a barrel plummets and oil companies lay off workers.

The Department of the Interior sent a draft of the rules Thursday to the Office of Management and Budget to estimate their economic impact on the oil and gas industry. It could be weeks, even months, before a final decision is reached.

The congressmen upbraided the rules package as a short-sighted, one-size-fits-all solution that doesn’t take into account the dynamic nature of offshore drilling. Not every underwater reservoir is the same in size or pressure, Scalise said, making it difficult to apply the same regulations to every rig.

Pointing to a recent study from an oil industry group called the Gulf Economic Survival Team, which predicted the rules would lead oil exploration to drop by as much as 55 percent and cancel thousands of jobs, they also accused the administration of not consulting oil and gas companies that had improved their own safety standards since that rig over the Macondo well exploded.

That disaster was caused by oil giant BP’s decision to bypass safety measures in order to save costs, Graves said.

“It’s not the rules or safety regulations pre-Macondo. It was the performance of the company,” he said. “Changing the regulations that weren’t being complied with from the beginning isn’t going to solve the problem.”

Greg Julian, a spokesman for the Interior Department’s Bureau of Safety and Environmental Enforcement, said that the study the lawmakers cited was based on the rules’ original draft, not the latest version that includes some accommodations to the industry.

He also said that self-imposed safety measures among a few operators wasn’t enough to improve standards everywhere.

“Even though a number of operators have made adjustments, they don’t have the force or rule of law, and not every operator has taken those safety standards on board,” he said.

Julian questioned whether drilling companies had truly improved safety, noting that problems on rigs were reported in 2014 at a rate similar to the time period before the Macondo well disaster. And the BSEE put out a safety alert Monday after recording several incidents of bolts in blowout preventers failing.

Julian said the rules were not set in stone and that federal agencies were working closely with industry leaders on possible changes to make them more palatable. One example, he said, was regulators’ willingness to lengthen the time period between certain inspections to lessen the frequency at which rigs would have to shut down.

And under the proposed rules, the industry as a whole could see a reduction in those costs associated with preventable accidents, he said.

“They’re will be cost savings in terms of saving lives, preventing spillage of oil,” Julian said. “And you can’t place a value on the savings of a loss of life.”