Offshore oil planning requires more science, spill commission told

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, Aug. 26 -- More robust science is clearly needed in federal offshore oil and gas planning, several witnesses told US President Barack Obama’s independent commission on the Gulf of Mexico oil spill and offshore drilling on Aug. 25. But they disagreed on whether it should come from agencies outside the US Department of the Interior or be increased within DOI’s Bureau of Ocean Energy Management, Regulation, and Enforcement (BOE).

Some witnesses said that BOE, when it was the US Minerals Management Service, became too dependent on the oil and gas industry for scientific guidance. This posed a conflict of interest since MMS was responsible for regulating federal offshore oil and gas activities and collecting revenues from onshore and offshore leases, they suggested.

They recommended that BOE start to use more scientific expertise from the US Environmental Protection Agency, National Oceanic and Atmospheric Administration, and other federal agencies to develop oil and gas strategies that consider broader environmental impacts. Two other witnesses, former MMS Directors S. Lisa Birnbaum and Randall B. Luthi, responded that increasing scientific expertise within the agency would be more effective.

Several environmental organizations have charged that MMS’s culture emphasized leasing and development without adequately considering impacts on other resources. “As a society, we are really good at gathering information and using the best available technology to analyze that information and incorporate it into our decision-making,” one witness, World Wildlife Fund Pres. Carter Roberts, told the commission.

“Yet our approach to oil has been antiquated at best, utterly dependent on information supplied by oil companies about what they can gain without adequate science to understand what could be lost,” Roberts said, adding, “It is time to bring science back into our decision-making.”

Three-year delay
Roberts recommended that DOI appoint an independent environmental science director who would work with other federal agencies to analyze necessary data without the competing pressure of also collecting royalties and fees. Roberts said there will need to be assurances that collected information is reliable, and suggested that no area be opened for leasing for 3 years while the data is analyzed. Federal science agencies and the US Coast Guard also should be directed to establish specific drilling permit requirements, he said.

A second witness, Margaret R. Caldwell, director of the Center for Ocean Solutions at Stanford University, said EPA, NOAA, and similar federal entities should be formally designated federal oil and gas cooperating agencies because their scientists are uniquely capable of advising BOE and DOI about environmental risks. “Once they have received this designation, BOE will have to engage them early and frequently in the planning process and respond to their recommendations,” she said.

Caldwell added that the US Outer Continental Shelf Lands Act (OCSLA) already designates coastal states and the US attorney general as primary federal oil and gas planning consultants. Bringing other federal agencies with their scientific expertise would improve the process, she said.

Some commission members showed interest in seeing more scientists from other federal agencies supply their views to the former MMS, which became BOE as part of a major reorganization by US Interior Sec. Ken Salazar on May 19 that included formally separating the agency’s minerals revenue management program from its leasing and resource management responsibilities.

William K. Reilly, a former EPA administrator who co-chairs Obama’s spill commission with former Florida Gov. and US Sen. D. Robert Graham, said he was very interested in seeing BOE consult NOAA and the White House Council on Environmental Quality more often. He also expressed disappointment that neither entity apparently was approached before the administration’s Mar. 31 announcement that it was considering an expanded offshore leasing program.

Already consulting
The existing process allows NOAA and other agencies with specific ocean responsibilities to comment at various stages of BOE’s 5-year OCS planning program development, NOAA Administrator Jane Lubchenco testified. The agency she leads has been particularly active since Obama became president, she said, adding, “Not all our concerns were acted upon. They were listened to, however, and many were incorporating into the final decisions.”

Lubchenco appeared most concerned about NOAA and similar agencies getting more responsibilities without bigger budgets, but added that she thinks environmental reviews are necessary at each offshore resource planning and leasing step. “I think there has been an honest attempt to make the best use of the information that’s available,” she said. “There have been instances where other information hasn’t been available, or we haven’t had enough time,” an apparent reference to a 30-day time limit established under the 2005 Energy Policy Act for responding to drilling permit applications. Salazar has asked Congress to repeal that requirement, and the US House made that a provision of its spill response bill.

CEQ Chairwoman Nancy H. Sutley, who testified alongside Lubchenco, said that the March offshore leasing announcement was not intended to preempt National Environmental Policy Act and Oil Pollution Act requirements. “We’ve had good cooperation going forward,” she said, adding that BOE already generates a lot of its own information from several sources which sometimes may not be well integrated because it is so massive.

Commission member Frances G. Beineke, president of the Natural Resources Defense Council, nevertheless suggested that the right kind of information wasn’t entering the federal offshore oil and gas planning process. “A lot of articles suggested that within MMS, a lot of scientific questions weren’t getting enough attention,” she said.

Birnbaum, who was MMS director from July 2009 until she resigned on May 27, noted that the agency hired its first science advisor, Alan D. Thornhill, in March to discuss science’s role at MMS and how to make it more robust. “There’s no question that more investment in science is needed, and I believe it should be at BOE, where it can focus on specific questions related to areas being considered for leasing,” she said.

‘At least co-equal’
“I’m a little bit dismayed to hear that scientists at other agencies felt they weren’t being heard,” Birnbaum continued in her first major Washington appearance since testifying before the US House Natural Resources Committee on May 26. “At the very least, science at MMS needs to be raised so it’s at least co-equal with other agencies.”

“We were actually very proud of what MMS scientists were doing,” said Luthi, who was MMS director from July 2007 to January 2009 after being deputy director of DOI’s US Fish and Wildlife Service. “There was one whale migration study in the Gulf of Mexico which was unprecedented.”

Other witnesses suggested that MMS was not able to keep scientific pace as the oil and gas industry moved into deeper water because the White House’s Office of Management and Budget kept cutting the agency’s scientific budget. This may have been because OMB felt data would not be needed because congressional moratoriums and presidential withdrawals kept oil and gas activity out of most of the federal OCS during the 1980s and 1990s, and the money could be spent for more immediate purposes elsewhere, they said.

MMS’s attention was dominated by royalty matters during that time, which kept it from considering emerging deepwater OCS issues, noted Thomas R. Kitsos, who was deputy and acting MMS director from 1998 to 2001. The agency’s overall budget also contract under Democratic as well as Republican administrations, according to Tyler Priest, global studies director at the University of Houston’s CT Bauer College of Business.

Birnbaum recommended that BOE upgrade technical requirements for offshore equipment and procedures, and create a more substantial body of regulation beyond the oil and gas industry’s recommended standards and practices. “While the US Coast Guard is responsible for implementing new OCS regulations, it has never acted on MMS’s invitations to comment before enactment,” she said.

“It was industry, not government, that developed the deepwater technology and equipment, and therefore it was not only necessary, but highly beneficial, to develop and maintain connections with industry to keep abreast of and regulate the latest technology and safety issues,” said Luthi, who became National Ocean Industries Association president on Mar. 1. “I was never under the impression that industry was calling the shots, but we certainly sought [its] input, and I believe rightly so.”

Contact Nick Snow at nicks@pennwell.com.

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