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MMS - the three initials behind the BP Deepwater Horizon oil disaster

Phil England

17th May, 2010

BP is in trouble. Big trouble. But others are to blame for the ongoing oil leak in the Gulf of Mexico, and the US Mineral Management Service is at the top of the list...

On 20 April BP's Deepwater Horizon oil rig exploded. 11 workers were killed in the blast. According to the Center for Biological Diversity (CBD), the resultant oil spill is now the largest in US history - larger even than the infamous Exxon Valdez disaster.

From BP's original estimate of 1,000 barrels per day, experts now estimate that the rate could be nearer 70,000 barrels per day threatening the lives of many species - including many already endangered - in an area  of rich biodiversity in the fragile Mississippi River Delta ecosystem.

Some estimates for the total compensation bill for BP now come in at £18bn, and there will be a massive impact on the value of the company's already badly-tarnished brand.

In the wake of the disaster, there has been an eruption of investigations and inquiries: three different Congressional committees, the US Coast Guard and the Mineral Management Service (MMS) have all held public hearings, and the Justice Department has initiated an investigation that could result in criminal charges.

Most famously, representatives from BP, Haliburton and Transocean were grilled by the US Senate Committee on Energy and Natural Resources, in a session during which everyone sought to blame everyone else.

But all this has overshadowed the fact that the real scandal here is the lack of proper regulation by the Obama Administration. The Administration has been falling over itself to give the go ahead for new offshore drilling projects and actively ignoring the likelihood of environmental impacts.

According to The Washington Post, the Administration exempted BP from an Environmental Impact Assessment for the Deepwater Project when the MMS granted the company a license on 6 April 2009. This exemption (a 'categorical exclusion') was granted on the basis that the agency had already reached the conclusion that, in BP's own words, the 'impacts associated with the proposed action are minimal or non-existant'. Significantly, BP was also told (para 2.7) that 'a scenario for a potential blowout of the well (...)  is not required'.

How did the MMS get it so wrong?

Reporters put that very question to a nervous Whitehouse Press Secretary Robert Gibbs  on Wednesday 5th May:

REPORTER: …Why was BP exempted from the environmental impact analysis?

SECRETARY ROBERT GIBBS: Yeah, well, I—the—there are a series of reviews that have to—that have to—you have to go through in order to get drilling permits. The process by which was referenced in that article is part of the review that Secretary Salazar is undergoing.

REPORTER: Robert, does the White House believe it was a mistake, for this categorical exemption to be granted to BP for Deepwater Horizon?

SECRETARY ROBERT GIBBS: That’s part of the investigation. I don’t know the answer to that.

REPORTER: Okay, so that’s something that you’re looking into presently?

SECRETARY ROBERT GIBBS: I would say as the President asked Secretary Salazar to undertake a thirty-day review of what happened, that that would certainly be part of the process under which he would evaluate.

But it turns out that this was not a one-off error, but part of a systematic drive to open up offshore sites for drilling. Since January 2009 the Department of the Interior has given permission for more than 300 drilling operations, three lease sales and over 100 seismic surveys in the Gulf of Mexico without the necessary permits required under the Endangered Species and Marine Mammal Protection Acts. On Friday (14th May) the Center for Biological Diversity (CBD) filed a formal notice of intent to sue Interior Secretary Ken Salazar for these breaches.

According to The New York Times, the MMS 'routinely overruled its staff biologists and engineers who raised concerns about the safety and the environmental impact of certain drilling proposals in the gulf and in Alaska (...) Those scientists said they were also regularly pressured by agency officials to change the findings of their internal studies if they predicted that an accident was likely to occur or if wildlife might be harmed.'

Concerns raised by the National Oceanic and Atmospheric Administration have also been ignored.

What could possibly explain the Obama Administration's apparent rush to waive environmental safeguards and 'drill baby drill'?

The fact that BP and and the rest of the oil industry has lobbied hard to extend offshore drilling? (BP alone spent $19m lobbying the US federal government in 2009 and gave more than $350,000 in campaign donations during the elections in 2008.)

The fact that the MMS has a history of corrupt relations with the industry it is supposed to regulate?

The fact that the MMS benefits financially to the tune of $13bn a year from the same companies to which it gives licenses?

The fact that the oil industry, awash with funds from the 2008 spike in oil prices, and facing declining reserves is exploring increasingly 'innovative' and damaging sources of oil including excessively deep offshore exploration, tar sands and biofuels?

The fact that Obama has embarked on an energy policy which puts the interests of the oil companies (and other vested interests) above the non-negotiable environmental limit imposed by climate change?

Obama's sorry

Later on Friday (hours after CBD had announced its lawsuit), President Obama appeared in the White House Rose Garden to make a speech that was a little more coherent attempt to answer the question posed to the White House Press Secretary on May 5th. He was flanked by a team of senior aides included Interior Secretary Salazar.

Rather belatedly he admitted that federal agencies should shoulder some of the blame:

'There's enough responsibility to go around. And all parties should be willing to accept it. That includes, by the way, the federal government. For too long, for a decade or more, there's been a cozy relationship between the oil companies and the federal agency that permits them to drill. It seems as if permits were too often issued based on little more than assurances of safety from the oil companies. That cannot and will not happen anymore. To borrow an old phrase, we will trust, but we will verify.'

So what's to be done?

'I've asked Secretary Salazar to conduct a top-to-bottom reform of the Minerals Management Service. This week, he announced that the part of the agency which permits oil and gas drilling and collects royalties will be separated from the part of the agency in charge of inspecting the safety of oil rigs and platforms and enforcing the law. That way, there's no conflict of interest, real or perceived.

'We've also ordered immediate inspections of all deepwater operations in the Gulf of Mexico. And we've announced that no permits for drilling new wells will go forward until the 30-day safety and environmental review that I requested is completed.

'We're also closing the loophole that has allowed some oil companies to bypass some critical environmental reviews. And today, we're announcing a new examination of the environmental procedures for oil and gas exploration and development.'

Hmm. Isn't that a little bit like locking ths stable door after the horse has bolted and putting the fox in charge of the hen house? After Deepwater blew, the MMS continued to issue licenses for new offshore drilling projects without the need for environmental review. Between 20th April and 5th May the MMS issued a total of 27 new drilling licences and was continuing to issue licenses as recently as 13th May.

As for entrusting Ken Salazar with a 'top to bottom' reform of the MMS, it is Salazar who has been spearheading the expansion of offshore drilling. According to the CBD, in 2006 he sponsored a Bill to open up the Gulf of Mexico to offshore drilling and criticised the MMS for not issuing enough offshore licences, then in 2010 he designed the Whitehouse's proposal to extend offshore drilling. And it is Salazar who as Interior Secretary approves MMS decisions in relation to offshore drilling.

Was the Center for Biological Diversity satisfied with Obama's statement? Hell no. Executive director Kierán Suckling said:

'The president had the opportunity today to take clear, decisive action to address the offshore oil-drilling scandal; instead, he chose to circle the horses around Secretary Salazar. That won’t stop the scandal from spreading and won’t protect the Gulf of Mexico from another disastrous oil spill.'

'The president should immediately rescind his March 2010 decision to expand offshore oil drilling to the Atlantic Coast, the eastern Gulf of Mexico, and Alaska. He should cancel Shell Oil’s permit to begin a very dangerous offshore oil drilling project in Alaska this summer. He should put a real stop to all new offshore drilling approvals, and he should order the MMS to halt all oil drilling in the Gulf of Mexico approved without environmental review.'

Acknowledgement: much of the material in this article comes from work undertaken by the Center for Biological Diversity - to whom many thanks. You can support them by taking some of their recommended actions or by making a donation

Phil England is a freelance writer and producer of Climate Radio.

 

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