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Offshore Drilling Regulators Had Concerns, but Let Industry Self-Police

When regulators at the Minerals Management Service had concerns about the safety equipment for offshore oil rigs, the agency did not impose stronger regulations and instead allowed industry to police itself, according to two pieces in The New York Times and The Wall Street Journal today.

The agency has been scrutinized for its role in the massive BP oil spill in the Gulf of Mexico, particularly for failing to follow up on concerns it had -- several years before the BP incident -- about equipment that should have stopped the spill but did not.

The New York Times reports that in 2000 and in 2009, MMS "warned oil companies" about problems with a device called a blowout preventer, "reminding them that they needed to have ‘a reliable back-up system in place.'" And yet, despite those concerns:

More than a decade ago, with the support of the industry, the agency reduced the frequency of inspections of blowout preventers from once a week to once every 14 days, citing the disruptions that these tests caused to oil drilling and extraction efforts.

This isn't the first time MMS showed itself to be particularly sensitive to the effect of regulation on oil companies.

The Wall Street Journal reported last week that the regulatory agency had once considered requiring a backup shutoff device -- in addition to the primary blowout preventer -- called an acoustic switch. When the industry argued against having to adopt the $500,000 device, MMS backed down and said the device was "not recommended because they tend to be very costly."

The Journal reports today that MMS also commissioned a researcher to study the reliability of blowout preventers. In 2002, the researcher recommended that the devices include a second "ram shear" to close off the pipe, in case the first didn't work, but MMS ignored the recommendation.

Apparently, that researcher had the right idea. The Deepwater Horizon rig had only one ram shear, and that shear didn't do its job. Requiring the industry to add a second ram shear, however, would've meant imposing an extra expense.

In 2007, MMS released a report citing an "encouraging" decrease in fatalities caused by blowouts from 1992-2006. Officials have cited it as evidence that offshore drilling has become safer in recent years.

But the safety record of U.S. offshore drilling "compares unfavorably" to the records of other major oil-producing countries, according to the Journal. Offshore oil workers in the U.S. were more than four times as likely to be killed than workers in European waters, according to data from the International Association of Drilling Contractors.

MMS officials told the Journal that the agency "plans to toughen its oversight." To the Times, however, MMS' current deputy director Walter Cruickshank "disputed that the agency has a history of deference to the industry or a pattern of lax oversight."

"We have inspectors going off shore every day that the weather allows," Cruickshank told the Times. "The enforcement is quite strict."

In this particular case, the great government regulators changed the rules to allow BP to drill without a blow out plan. It is quite right to allow oil companies to operate without regulation, but when they destroy private and public property and lives as a result of negligence, the Chairmen, CEO, board members and other people in the company responsible need to be incarcerated and their property seized to compensate the victims. When that happens, these incidents will stop and we won’t need a monster like the EPA penalizing us with taxes and higher energy costs when we are not the ones who did it.

what we need is political will…....

It’s impossible to compensate the vast ecosystem surrounding this site for the catastrophic damage done.  And it makes no sense to me to allow a disaster like this to take place, and then after the fact to compensate those affected.  We should prevent disasters like this.  To accomplish that, we need stringent regulations on this industry.  These companies can’t be trusted to regulate themselves any more than the insurance industry or Wall Street can be trusted.