March 2011, Vol. 238 No. 3

Projects

Interior Forms New Agencies To Oversee Offshore Drilling

Secretary of the Interior Ken Salazar and Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) Director Michael Bromwich announced the structures and responsibilities of two new independent agencies that will carry out the offshore energy management and enforcement functions once assigned to the former Minerals Management Service (MMS).

Salazar and Bromwich also announced establishment of a permanent advisory body through which the nation’s leading scientific, engineering, and technical experts will provide input on improving offshore drilling safety, well containment, and spill response. Salazar has asked former Sandia National Laboratory Director Tom Hunter to lead the body, which will be called the Offshore Energy Safety Advisory Committee (Safety Committee). “We are moving ahead quickly and responsibly to establish the strong, independent oversight of offshore oil and gas drilling that is needed to ensure that companies are operating safely and in compliance with the law,” said Salazar.

“With Director Bromwich’s leadership, the recommendations of the National Commission on the BP Deepwater Horizon Oil Spill, and other outside guidance, we are making swift progress in implementing the reorganization plan we put in motion last year. With the leadership of Dr. Hunter, we will also bring together the top minds inside and outside government to help ensure that regulations, safety standards, and well-containment capabilities never again fall behind drilling technology and practices,” Salazar said.

“The former MMS was saddled with the conflicting missions of promoting resource development, enforcing safety regulations, and maximizing revenues from offshore operations,” said Bromwich. “Those conflicts, combined with a chronic lack of resources, prevented the agency from fully meeting the challenges of overseeing industry operating in U.S. waters. The reorganization is designed to remove those conflicts by clarifying and separating missions across the three agencies and providing each of the new agencies with clear missions and new resources necessary to fulfill those missions.”

On May 19, 2010, Salazar signed a Secretarial Order dividing the three conflicting missions of MMS into separate entities with independent missions. MMS was renamed the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) in mid-June as Bromwich was sworn in to more accurately describe the scope of the organization’s oversight. On Oct. 1, 2010, the revenue collection arm of the former MMS became the Office of Natural Resources Revenue.

Salazar and Bromwich detailed the structure of the two bureaus that will separately house: 1) the resource development and energy management functions of BOEMRE, and 2) the safety and enforcement functions of BOEMRE.

The Bureau of Ocean Energy Management (BOEM) will be responsible for managing development of the nation’s offshore resources in an environmentally and economically responsible way. Functions will include: Leasing, Plan Administration, Environmental Studies, National Environmental Policy Act (NEPA) Analysis, Resource Evaluation, Economic Analysis and the Renewable Energy Program.

The Bureau of Safety and Environmental Enforcement (BSEE) will enforce safety and environmental regulations. Functions will include: All field operations including Permitting and Research, Inspections, Offshore Regulatory Programs, Oil Spill Response, and newly formed Training and Environmental Compliance functions.

Salazar and Bromwich said the reforms strengthen the role of environmental review and analysis in BSEE and BOEM through various structural and organizational mechanisms. Those include:
• The creation of a first-ever Chief Environmental Officer in BOEM;
• Separating Environmental reviews from Leasing in the regions in BOEM;
• The development of a new Environmental Compliance and enforcement function in BSEE; and
• More prominent Oil Spill Response Plan review and enforcement in BSEE.

The Department plans to have the re-organization fully implemented by Oct. 1.

Separate and apart from the two independent bureaus BSEE and BOEM, the Offshore Energy Safety Advisory Committee (Safety Committee) will advise the Director and the Secretary on a variety of issues related to offshore energy safety, including drilling and workplace safety, well intervention and containment, and oil spill response. The Safety Committee also will facilitate collaborative research and development, training and execution in these and other areas relating to offshore energy safety.
The Committee will have 13 members representing federal agencies, industry, academia, national labs, and various research organizations. Hunter was a critical member of the scientific team deployed to assist with the containment and capping of the Macondo well. A Federal Register notice soliciting nominations is scheduled to be published soon.