Oil industry traded safety for energy dominance

In May, the Interior Department’s Bureau of Safety and Environmental Enforcement (BSEE) rolled out its latest rollback of offshore drilling safety rules that had been painstakingly developed during the Obama administration. After the devastating Deepwater Horizon explosion in the Gulf of Mexico in 2010 that killed 10 men and caused billions of dollars of environmental and economic damage, diligent career experts spent the next five years meeting with industry, academia, environmental organizations, and others to identify the regulatory improvements necessary to ensure offshore drilling safety. The guiding policy direction throughout that process was to protect worker safety and the environment.

Just two years after the Blowout Preventer and Well Control Rule was finalized — and long before many of its key provisions have even taken effect — the current administration is now proposing to eliminate or weaken requirements that were specifically aimed at preventing further disasters. BSEE’s guiding policy direction is now to encourage energy development and reduce ‘unnecessary regulatory burden.’

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BSEE appears to have succumbed to the criticism — usually whipped up by aggressive energy trade groups — that the rule developed previously went too far and was an overreaction to a “white-whale” event that will surely not happen again in our lifetimes.

 

Lost in this criticism, however, is recognition that the rule BSEE developed was not born just of the Deepwater Horizon. In the decades leading up to that catastrophe, the offshore regulatory environment could be described as lax at best. One of the most comprehensive examinations of the disaster, conducted by the National Commission on the BP Deepwater Horizon Oil Spill, concluded that weak regulatory oversight and an over-reliance on industry promises about what constitutes safe practices were as significant contributing factors as the failure of a piece of equipment, the blowout preventer, to seal the drill pipe and prevent the explosion.

The recurring theme throughout the Deepwater Horizon post-mortems was that regulators had been so captured by the industry they were meant to oversee that the regulatory structure in place was woefully insufficient and decades behind where it should have been. Compounding the problem was an industry found to have a disturbing lack of commitment to overall safety.

Which makes the specific provisions now targeted for rollback so concerning. For example, identified for elimination is the creation of a network of BSEE-approved third-party experts that would verify that key inspections, maintenance activities, and drilling operations are being performed safely.

While BSEE recognized the value of quality control programs that some companies have instituted, the agency was emphatic that creating this network was essential to ensuring accountability. In a complete turnaround — and before the network was even created — BSEE now asserts that this is just too much of a burden on industry.

Similarly marked for the chopping block are real-time monitoring requirements, which would ensure that operators have qualified onshore personnel serving as an “extra set of eyes” for offshore personnel.

Repeated Deepwater Horizon investigations found that multiple failures led up to the explosion — any one of which might have been addressed had there been sufficient review processes in place and “extra sets of eyes” to make sure everyone was reading from the same gauge.

BSEE’s new rollback rule also proposes to weaken equipment design and operational requirements, all in the name of saving money for industry. Gone is the requirement for a subsea accumulator — equipment meant to ensure that a pipe spewing gas uncontrollably could still be sealed up in the event of a power loss between the ocean floor and the drilling rig. 

Also proposed for cutting — a default safe drilling margin, which is a key pressure reading that helps prevent loss of well control. And as for equipment testing, BSEE now suggests that frequent testing of blowout preventers may just be too much of a burden.

All of this might be acceptable if there were new evidence showing that there has been such dramatic safety reform that less stringent government oversight is warranted. Instead, a review of BSEE’s civil penalty summaries provides a snapshot of the corners that continue to be cut in the Gulf — multiple losses of well control, falsifying blowout preventer testing results, failure to replace severely corroded piping, conducting operations without sufficient emergency response plans, and opting not to conduct safety testing on key equipment. 

To be sure, there are companies that have made a steadfast commitment to improved safety, and there are thousands of diligent, hard-working individuals working in the industry who focus on safety every day. It is also true, however, that those same individuals are under enormous pressure to find the next big development and get the job done quickly — all in an exceedingly complicated work environment surrounded by very real hazards.

And these pressures are now being compounded by an administration that is singularly focused on achieving “energy dominance” and repealing any perceived regulatory burden.

No longer is the focus on safety first — the very mission of the Bureau of Safety and Environmental Enforcement — which will only compel less-well-meaning companies to continue to cut corners.

The Deepwater Horizon disaster laid bare the unfortunate reality of decades of insufficient oversight. Multiple investigations pointed to a deficient safety culture and an atmosphere where the need to get to the big plays and produce under-budget prevailed. Far from being a rare, “white whale” event, the disaster was just about the least surprising event that could have occurred in the Gulf.

At a New Orleans vigil in 2011 to mark the one-year anniversary of the catastrophe, a local rabbi was quoted as saying: “People are quite rightly asking: How and when, and by whose insistence and stubborn support, will the public’s mind be refocused upon what happened in the Gulf?”

Eight years after that disaster, we should again be asking that question.

Elizabeth Klein is the deputy director of the State Energy & Environmental Impact Center at NYU School of Law.