Rosenberg_BP_Presentationx - oilpoliticsrpi

steamonlyOil and Offshore

Nov 8, 2013 (3 years and 7 months ago)

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Factors in the Matrix That Caused the BP Gulf
Disaster: The Failure of Regulatory Oversight

Matthew Rosenberg


According to the
Center for Responsive Politics
, the oil
industry spent
$175,189,824

on lobbying in 2009, with the 4
largest contributors comprising:


1.
Exxon Mobil
-

$27,430,000

2.
Chevron Corp
-

$20,815,000

3.
ConocoPhillips
-

$18,069,858

4.
BP
-

$15,990,000



According to
The Washington Post
,
3 of every 4
lobbyists for
the oil/gas industry has worked for the Federal
government, including
18

former members of Congress and
more than a
dozen

former MMS employees.


1953
-

Outer Continental Shelf Lands Act (OCSLA)



1969
-

National Environmental Policy Act (NEPA)



1982
-

Federal Oil and Gas Royalty Management
Act



1990
-

Oil Pollution Act of 1990


January 1982
-

Created to expand drilling on the
OCS, and to reform royalty collection



Dual Mandate:


Regulatory Oversight
-

Environmental and Safety




Revenue Collection and Leasing
-

Area
-
Wide Sales



Other agencies have lesser roles in regulation:
U.S. Coast Guard, EPA, and NOAA


Safety Regulations:


Initially: Onus on the Regulator


Technical Requirements


Announced and Unannounced Inspections



Later: Onus on the Regulated


2005 MMS Regulation:


“The lessee or operator is in the best position to determine the
environmental effects of its proposed activity based on
whether the operation is routine or non
-
routine.”



Activities of the Federal government impeded the
ability of the MMS to adopt new practices


Budget Shortfalls


Obstruction


Lack of Expertise Within the Agency


No certification of inspectors


Failed to conduct research regarding the
implications of catastrophic spills



Emphasis of Revenue over Regulation


Culture of accepting gifts from corporations at
Denver and Louisiana offices




According to the Outer Continental Shelf
Safety Oversight Board, the MMS lacks


“a formal, bureau
-
wide compilation of rules, regulations,
policies, or practices pertinent to inspections, nor does it
have a comprehensive handbook addressing inspector roles
and responsibilities.”



Single inspectors are utilized, rather than teams



Lack of communication between regional
offices led to inconsistencies in policy


No environmental impact statement (EIS) or
“worst case analysis”



BP’s Oil Spill Response Plan approved by the
MMS was not specific to the
Macondo

Well



No site
-
specific review, and the requirement
for an EIS was exempted from the Gulf of
Mexico under the OCSLA

1.
The separation of financial and regulatory goals is
vital to preventing conflicts of interest within
agencies


2.
More oversight is required of regulatory agencies to
ensure that they are operating in accordance with
their mandates


3.
Cross
-
agency collaboration may help to fill the
kinds of gaps in organizational expertise which
hamstrung the MMS


4. The impact of political pressures on the conduct of
government must be reduced





Is the United States government the ideal entity
to regulate deepwater drilling? If not, who
might be better positioned?


Are there other incentives that motivate
corporate compliance with regulation beyond
the bottom line?


Was it the weakness of legislation or
enforcement which led to the observed
breakdowns, or was it some combination of
both?







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-
09
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30
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091.asp
>

Eggen
, Dan, and Kimberly
Kindy
. "Three of Every Four Oil and Gas Lobbyists Worked for Federal Government."

Washington Post
-

Politics, National, World &
D.C. Area News and Headlines
-

Washingtonpost.com
. The Washington Post, 22 July 2010. Web. 12 Feb. 2011.
<
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Politics, National, World & D.C. Area News
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<
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-

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>

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Service
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>

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-

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>