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Congressional Committees Look at Offshore Drilling Safety and Economics

Congressional Committees Look at Offshore Drilling Safety and Economics

by Molly Davis
Jan. 27, 2011

Senators Wednesday called for adequate regulation of deep water drilling for oil while remaining aware of the resulting economic impacts on an industry that faces steep international competition.

The Senate Committee on Energy & Natural Resources reviewed the President’s Gulf of Mexico oil spill panel report, which said, "The immediate causes of the Macondo well blowout can be traced to a series of identifiable mistakes made by BP, Halliburton, and Transocean that reveal such systematic failures in risk management that they place in doubt the safety culture of the entire industry."

News Update:
Shell Test of spill containment dome
for arctic drilling fails

The report examined the others causes of the explosion at the Deepwater Horizon rig and the response to the April 20 catastrophe. That explosion, which killed 11 workers and destroyed the rig, caused a three-month oil spill of more than four million barrels of oil. The satellite image to right shows some of that spillage approaching Louisiana.

The commission recommended basic structural reforms to leasing and oversight, as well as research on the practice of deepwater drilling, which the panel said can be done safely. And it specifically called on Congress to establish a permanent safety and environment agency under an independent director in the Department of the Interior.

Click to enlarge Deepwater Horizon rig locator
Committee Chair Jeff Bingaman (D-NM) cited the safety, environmental and economic impacts of the Deepwater Horizon explosion.

“For all these reasons, we must ensure that we have systems in place in our government and in the industry so that this cannot happen again,” said Bingaman. “Beyond that, we should lead the world in development of these systems and technology and not settle for standards that are less rigorous than those of other nations.”

Attention has turned to possible spills
in the Arctic. Click for story
But Ranking Member Lisa Murkowski (R-AK) said that the panel should also consider the economic value of the offshore industry. She asked committee members to support her in compensating victims and holding companies accountable for liabilities, while also allowing deepwater drilling to continue.

Murkowski said that regions surrounding Alaska, specifically Russia in the Chukchi Sea and Canada in the Beaufort Sea – will drill in the Arctic even if the United States doesn’t.

“Alaska cannot be forced to sit in the middle of this activity – bearing all the same risk but none of the reward – while our pipeline runs dry and our jobs disappear,” said Murkowski. “While I support increased funding for research, I do not accept it as an excuse to cancel existing leases in the Arctic or to put off future lease sales indefinitely.”

Oil spill commission co-chairs Bob Graham, former senator (D) of Florida, and William Reilly, the former administrator of the Environmental Protection Agency, said reorganization without statutory clarification might be undone for the sake of efficiency as the memory of the Deepwater Horizon dims and warned against permitting that to happen.

The House Committee on Natural Resources also heard from Graham and Reilly later in the day. The Senate hearing link is here
and has a Webcast archive. (Please note the Wecast has an 18-minute, silent lead-in.)

The hearings followed the resignation January 25 of climate czar Carol Browner, the former administrator of the Environmental Protection Agency under Clinton and a chief architect of Obama’s stalled goal of passing greenhouse gas legislation.

White House Press Officer Robert Gibbs said today that it’s unclear whether Browner will be replaced.

“But I can assure you that regardless of the staffing inside the White House, first and foremost the President is committed to continuing our important investments in the innovation around clean energy manufacturing and in addressing the long-term problems and the continual -- our continual increase in our dependence on energy sources in other places in the world,” said Gibbs.