Not even a year has gone by since the Deepwater Horizon exploded into flames killing 11 rig workers and causing the worst accidental oil spill disaster in history. Now BP is set to restart drilling in the Gulf of Mexico after it has been reported that U.S. regulators have given the discredited oil giant the go-ahead on 10 wells. Drilling will commence as early as July, The Guardian reports.
BP struck a deal with the U.S. government that gives federal regulators 24-hour access to their rigs, the Financial Times reports. In exchange, BP "will be allowed to drill 10 existing wells that were under way before the accident and which it needs in order to maintain or increase production on existing platforms, according to sources familiar with the situation." FT describes this deal as "a coup for Bob Dudley, BP’s chief executive".
The U.S. media is reporting a slightly different version than the story in the British press. According to the Wall Street Journal, BP is close to getting permission to restart drilling, but is still "waiting for final sign-off" by U.S. regulators. Melissa Schwartz, a spokesperson for the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE), the federal agency oversees Gulf resources, told The Hill that "there is no such deal".
"We don't make deals. We issue permits based on the merits of the application," Schwartz told The Hill. She said BP has not been issued any permit yet.
After BP spilled 4.9 million barrels of oil in the Gulf last year, the U.S. government could seek a fine of "up to $4,300 for for every barrel", which be at more than $21.07 billion. A clause in the U.S. Clean Water Act "allows the government to seek civil penalties in court for every drop of oil that spills into U.S. navigable waters". The basic fine is set at $1,100 per barrel spilled, which would be $5.39 billion in fines. If the a "federal court rules the spill resulted from gross negligence", then the penalty can grow to $4,300 per barrel.
Last year, Attorney General Eric Holder said "he planned to 'prosecute to the fullest extent of the law' any person or entity that the Justice Department determines has broken the law in connection with the oil spill." Civil and criminal investigations were started last May by the Obama administration. "Just last week," the NY Times reported, "the Justice Department confirmed that it was considering a range of civil and criminal penalties against BP, including potential manslaughter charges for the deaths of the rig workers, as part of its ongoing investigation into the accident."
A Clean Water Act fine would not be restricted by low $75 million cap set by Oil Pollution Act of 1990. (Legislation to amend the act to require BP and other polluters to pay the full cost of oil spills died in Congress after being blocked by Republicans.)
Gulf Coast states are seeking 80 percent of the fines levied against BP, McClatchy Newspapers reported last month. "The fines, levied as part of the Clean Water Act, are separate from the $20 billion BP already has dedicated to assist residents affected by the spill in the five Gulf Coast states: Mississippi, Louisiana, Texas, Florida and Alabama." Both senators for Louisiana, Democrat Mary Landrieu and Republican David Vitter, are also seeking additional money from BP for ecosystem repairs and restoration. "We can't sit back and let BP drag their feet with reports and studies on how Louisiana's coast was harmed" for 10 to 20 years, Vitter said.
BP has set aside just $40 billion to deal with the cleanup and claims coming from the environmental destruction caused by their spill. The full extent of the environmental damage from BP's spill is still being revealed. Court filings last month, for example, claim the toxic chemical dispersants used by BP to break up the oil hurt the cleanup crews. The number of dead cetaceans in Gulf may be 50 times higher than previous reported. Thousands of dolphins may have died because of the spill. Sea turtle deaths also have dramatically spiked in the Gulf. Shrimp trawlers are churning up oil that had settled at the bottom of the Gulf, as well. Tarballs from BP's spill are still washing up on shore at the wildlife refuge on Elmer's Island, Louisiana.
BP claims "it needs to resume drilling in the gulf in order to have the financial resources to pay the claims submitted by federal and state officials, and individuals and businesses," the NYT reports.
"BP is eager" to resume drilling in the Gulf. Dudley, BP's CEO "has pledged to make improving BP’s safety record his priority." BP has one of the worst safety records of any oil company operating in the U.S., ABC reported last summer. Dudley hopes that America's collective amnesia and a corporate trust me baby, this time it'll be different is good enough to get back drilling the Gulf.
"Gaining permission to resume drilling in the gulf would help Mr. Dudley to move BP beyond its painful and expensive recent history in the region, which has eroded shareholder trust. It would also give BP a boost of confidence," the NYT reports. Can we really afford to take BP at its word to boost its corporate ego? Has BP really changed? BP is using private security to keep reporters away from documenting the aftereffects of its spill, Mother Jones reported.
Already, the Obama administration has approved eight deepwater drilling permits in the Gulf. When the first permit was issued, SkyTruth, an environmental watchdog, noted that the approved application "doesn't address any of the obvious safety issues" such as "details evaluating what a worst-case spill scenario for this specific well would be in the event of an uncontrolled blowout".
Safety and transparency in offshore drilling is still lacking. SkyTruth noted a Rachel Maddow report that documented the first permit approved by BOEMRE had a cleanup plan "dated September 2009, seven months before the BP spill, and includes no new information or plans". So. "how can BOEMRE express such confidence in the ability to safely and effectively respond to a worst-case spill scenario if we're still relying on old cleanup plans"?
"The U.S. Gulf of Mexico is crucial to BP, which has 20 oilfields there. The company has sought to expand into other areas, but has faced big obstacles," the WSJ adds.
The Gulf of Mexico is crucial to the U.S. too. America has so much more to lose from another BP 'oilpocalypse' than just 20 oilfields.
A young heron sits dying amidst oil splattering underneath mangrove on an island impacted by oil from the Deepwater Horizon oil spill in Barataria Bay, along the the coast of Louisiana on Sunday, May 23, 2010.
(AP Photo/Gerald Herbert)
Keeping BP out of the Gulf until the checks covering the fines begin clearing the bank is leverage to reform BP, or at least get the cleanup money and fines the U.S. is due. Maybe the new that BP is poised to drill again is just a trial balloon to see if America still cares about what happens in the Gulf? I hope so.
Wouldn't it be better to exercise a modicum of caution before allowing BP, history's biggest unintentional oil spiller, back on the disaster scene?
Should BP first demonstrate that the corporation has learned from its mistakes and has improved its safety record? I think so. Should not BP first pay in full any fines levied by the Gulf states and the U.S. federal government and any civil judgements won against it without tying them up in court for decades to come before they can drill in the Gulf again? Keeping BP out is leverage the U.S. has over BP. I think we should use it.
Updated by Magnifico at Mon Apr 04, 2011 at 09:59 AM PDT
Per jsfox's comment, Interior Secretary Ken Salazar is pushing back against this story. "U.S. emphatic: no deal to let BP resume drilling, Reuters reports. Salazar said there has been a "misconception".
"There is absolutely no such agreement nor would there be such an agreement" with BP to resume drilling, Salazar said at a briefing while visiting the Mexican capital.