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Gulf Oil Spill Puts Spotlight on Regulator With Mixed Record

With news from the spill in the Gulf of Mexico oil rig getting worse -- a top Coast Guard official warned it could end up being "one of the most significant oil spills in U.S. history" -- questions are beginning to be asked about how it happened, and how it could have been prevented.   

As The Wall Street Journal reported this morning, the oil rig lacked a device--known as an acoustic control--that would've served as a safeguard of last resort. While the effectiveness of the $500,000 device is debated, the Journal points out that it is used by other oil-producing nations, including Brazil and Norway. Regulators in the U.S. were also considering requiring it a few years ago, but after industry objections decided that the devices were expensive and needed more study.

 

Are you a Gulf Coast resident? Do you have direct experience as a laborer, consultant, or contractor on offshore oil rigs? Or insight into how safety and emergency response decisions are made and implemented? Write reporter Abrahm Lustgarten (if needed, you can speak anonymously).

So which regulator oversees rigs and made that decision? It was the Department of Interior's Minerals Management Service, an agency that has had a spotty record over the past few years.

In 2008, we pointed out that MMS was in quite a bit of trouble for ethical violations by its officials. The scandal involved sex, drugs and (quite literally) sleeping with the very industry it was regulating. Here's how The New York Times summarized the government's investigation:

The investigation also concluded that several of the officials “frequently consumed alcohol at industry functions, had used cocaine and marijuana, and had sexual relationships with oil and gas company representatives.” The investigation separately found that the program’s manager mixed official and personal business. In sometimes lurid detail, the report also accuses him of having intimate relations with two subordinates, one of whom regularly sold him cocaine.

That hasn't been the end of MMS's troubles. According to an audit earlier this month by the Government Accountability Office, the regulator has hardly been a straight shooter on offshore drilling and the risks involved. The GAO found that MMS withheld data on offshore drilling in Alaska from regional staff members at the agency involved in environmental analyses. The report also found that MMS lacked sufficient guidelines to properly analyze the risks of drilling in the region.

"We found considerable variation among MMS’s ... regions in how they assess what constitutes a 'significant' environmental impact," reads the report (PDF). And on the withholding of data: "Some of its own scientists have alleged that their findings have been suppressed." (In a formal response to the report, the Department of the Interior said it "generally agrees" with the findings.) 

The Project on Government Oversight, a nonprofit watchdog, told us regulation wasn't a priority for MMS.

"It was an agency that was very strapped in its human resources, and essentially the priority for the agency was on production rather than on regulation and oversight," said Mandy Smithberger of POGO. She added that under Ken Salazar, who became secretary of the interior in January 2009, this may be changing, "but we have not seen material changes so far."

One step in the process that oil companies must go through to get approval for drilling involves submitting an exploration plan that lays out worst-case scenarios. The Huffington Post points out that MMS did not require BP -- which owns the well that blew up -- to file a plan for reacting to a "potential blowout," meaning an uncontrollable spill.  According to The Huffington Post's reporting, the more limited plan BP filed with MMS predicted that if worse came to worst, a spill would release 162,000 gallons of oil. The Deepwater Horizon spill has already exceeded that prediction.

That doesn't make MMS look very good, since one of its officials vouched for BP's plan at the time. From The Huffington Post again:

An MMS official certified that BP "has the capacity to respond, to the maximum extent practicable, to a worst-case discharge, or a substantial threat of such a discharge." But after the explosion, the scale of the accident required BP to get assistance from the Coast Guard, other federal agencies and other oil companies such as Shell, which is sending half a dozen vessels to help with the clean-up effort.

Maybe that $500,000 safeguard (the one that MMS said should be studied) doesn't seem so expensive anymore, compared with the $6 million per day BP is now paying in cleanup costs.

We spoke with two people involved in the industry, who have also worked with MMS, who said that the branch of MMS that deals with safety inspections has a solid reputation, unlike the scandal-ridden part that deals with collecting royalties from oil companies.

“They have a lot of good people doing their best,” said Tyler Priest, a professor at the University of Houston. Priest said he sits on an MMS advisory committee and has done studies for the agency. “I’ve seen what they do up close, and it is a quality organization.”

We have called MMS and will include its response as soon as we get it. 

Ryan Knutson contributed reporting to this story.

It appears that President Obama and some Democratic congressional members are uncovering years of Corporate mis-use and (mostly Bush and GOP appointed) “government officials” corruption..shining a bright light on it all…but, will the dingbats on the right give any credit for the ongoing investigations, Corporate corruption, collusion and the other reports of government official malfeance…? Probably not..one would assume those on the right love being ripped off, killed and poisoned..and would rather not have that (socialist) President intervene and protect, on their behalf

I guess you can blame Mother Nature for Hurricane Katrina, after all, the winds and waves are natural events.  But this time, the devastation of that region of the Gulf Coast is our fault. We did this. Think of the Life that we destroyed there.

Katrina may have been the work of Mother Nature but the bigger disaster was caused by the failure of government officials to update a levee system many knew would fail. The elimination of the marshland buffer zones between the gulf and New Orleans certainly helped.

We now see yet another failure of government, more specifically one George W. Bush and his government detroying conservative cronies. How many disasters like this one do we have to see that industry self regulation pushed by the Free Market system does not work.

If you want to learn more about some of the ways they have been undermining government for over 30 years, I suggest reading “The Wrecking Crew”. With groups like the Tea Party misdirecting the American public even more, the situation will get much worse before it gets better.

Mary McCurnin

May 3, 2010, 5:51 p.m.

Brain,
FYI,For the city of New Orleans Katrina is not considered a natural disaster. It is considered an engineering disaster. The hurricane had left the city. The levees did not function as promised. Even the Corp acknowledges this now.

Piggy Oil Companies:
I do not think oil companies clean up the oil because they care about the environment.  I think they just want the oil back! If our economy gets any worse, we are just going to look at an oil spill as an opportunity for cheaper gas.  We will all drive down with our tanks and clean it up ourselves.  However, to add insult to injury,  the oil companies only have to spend up to 75 million for the clean up. Which I am sure they will just make it back by charging us more at the pump.  Leaving them with zero accountability.  Let me guess, the American Tax Payer has to pay anything that goes over 75 million?  THAT’S CALLED A BAIL OUT!  Apparently, the oil companies are also too big to fail.  I think there should be a law that says that oil companies have to give American’s free oil that is equivalent to whatever they spilt.  Now that sounds more fair to me!  However, they instead make a 10 BILLION DOLLAR profit.

When gas went up in the 90s,  President Clinton responded “It looks like someone is playing politics.”  Who knows, maybe that was the day that a law being passed that stipulated they had to pay more than 75 million.  Maybe they rose the gas rates to remind the President that they have the power to create and economic crisis, with one stroke of a pen.  HOW DARE THESE OIL PIGGIES HOLD OUR PRESIDENTS AND THE AMERICAN ECONOMY HOSTAGE WITH THREATS OF ECONOMIC SABOTAGE! 

Piggy Banks:
But there is a bigger spill on the horizon my friend.  This spill is going to effect every coast line in America.  It is called the GREAT FORECLOSURE SPILL!  It will also keep bubbling and bubbling and bubbling foreclosures.  It is still going to happen, even though the American Tax Payer funded TARP with a potential 581 BILLION DOLLARS as BAIL OUT money to the piggy banks.  I mean if the government is in the lending business, why not have just loaned it to the American homeowner directly?  I mean these piggy banks caused the whole mortgage crisis in the first place.  TARP gave one bank $45 BILLION DOLLARS!  Now that bank is potentially “playing politics” with the modification process.  While dealing with the piggy banks, President Obama and Bush had the same look of fear on their face as President Clinton did with the oil companies.
HOW DARE THESE PIGGY BANKS HOLD OUR PRESIDENTS AND THE AMERICAN ECONOMY HOSTAGE WITH THREATS OF ECONOMIC SABOTAGE! 


I dedicate to both the Piggy Oil Companies and Piggy Banks the following song by George Harrision and John Lennon. Appropriately titled “Piggies”  I invite you to listen to it on youtube as you read the words

http://www.youtube.com/watch?v=NTmeHM-Hojg&feature=related

Have you seen the little piggies
Crawling in the dirt
And for all the little piggies
Life is getting worse
Always having dirt to play around in.

Have you seen the bigger piggies
In their starched white shirts
You will find the bigger piggies
Stirring up the dirt
Always have clean shirts to play around in.

In their ties with all their backing
They don’t care what goes on around
In their eyes there’s something lacking
What they need’s a damn good whacking.

Everywhere there’s lots of piggies
Living piggy lives
You can see them out for dinner
With their piggy wives
Clutching forks and knives to eat their bacon.

I AM FIGHTING BACK AT piggybankblog.com

Please send an email to BofA CEO with “I SUPPORT JOHN WRIGHT VS. BANK OF AMERICA”: .(JavaScript must be enabled to view this email address)

Divided we may have fell America.  But UNITED WE WILL STAND!

Sincerely,
Johns-wright@hotmail

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