Salazar owns up to decision for deepwater drilling ban

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, June 9 -- US Sec. of the Interior Ken Salazar told a Senate committee that while he consulted extensively with scientific experts, the decision to recommend a 6-month deepwater drilling moratorium in a May 27 report to President Barack Obama was his own, and that he would be responsible for its consequences.

Salazar’s response during the Energy and Natural Resources Committee’s fourth hearing on the Apr. 20 Macondo well blowout and subsequent oil spill came after committee member Mary L. Landrieu (D-La.) said she and other lawmakers received a letter from several scientists who were called in to review the report’s draft by the National Academy of Engineering.

The scientists said they broadly agreed with the report’s recommendations but did not support a 6-month suspension of deepwater drilling, Landrieu indicated at the June 9 hearing.

“These experts believe the report contains important recommendations,” Landrieu told him. “But they believe, as I do, that if it lasts longer than a few months—not 6 months—that it will wreak economic havoc on this region possibly worse than the spill itself.”

“You made the decision, and it’s your legal and proper right,” added Robert B. Bennett (R-Utah), another committee member. “But these people said they believe a blanket moratorium is not the answer, and that it will have impacts on the economy that could be greater than those from the oil spill.”

Pressed pause button
Salazar said, “The experts provided recommendations, and I appreciated them. It was my decision to issue the moratorium,” Salazar replied. He said the Obama administration had a choice of letting operations proceed as usual, shutting them down permanently (as suggested by several members of Congress), or “pressing the pause button until we have the sense that this will never happen again.” He added, “When we lift our finger from the pause button will depend on when we get that sense.”

Landrieu noted that while she did not have immediate access to estimates of the moratorium’s economic effects on Texas, Alabama, and Mississippi, the deepwater drilling suspension could affect the jobs of 330,000 Louisianans, or about 13.4% of its total workforce. Listing several offshore support service companies that she said are laying off workers and could go out of business, the senator asked Salazar if he would press BP PLC to absorb those costs as the spill’s responsible party. Salazar said that he would.

Salazar also explained that the deepwater drilling moratorium would not halt production from platforms in the gulf or severely restrict shallow-water drilling by producers complying with new safety requirements which the US Minerals Management Service announced on June 8 (OGJ Online, June 8, 2010).

“Our view is that companies that are doing a good job out there will have no trouble complying with them,” Salazar said. “We believe shallow-water drilling will be able to proceed because most of the companies will be able to meet these requirements.”

No binding commitment
A third member of the committee, Byron L. Dorgan (D-ND), noted that while BP executives have repeatedly said the company would pay costs resulting from the spill, there is no binding commitment for it to do so.

He proposed that the US Department of Justice formally arrange with BP to have it pay $10 billion, “just a bit more than its first-quarter profits,” into a Gulf Coast recovery fund administered by a special master chosen by the federal government and a counselor selected by BP.

“There are people now sitting on an empty Gulf Coast dock with a fishing boat that’s not being used who have to make payments at the end of the month. There are employees sitting in an empty cafe,” said Dorgan. “These people need help now.”

When he asked the secretary if a hurricane evacuation plan exists for spill recovery operations now that hurricane season has begun, Salazar said that he and US Sec. of Energy Steven Chu insisted that one be developed as the task force continues trying to stop the leak and clean up the spill.

Contact Nick Snow at nicks@pennwell.com.

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