GULF SPILL:

Interior issues new round of BP violation notices

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This story was updated at 1:20 p.m. EST.

The Interior Department today issued a handful of new violations to BP PLC for alleged missteps in last year's oil spill in the Gulf of Mexico.

The violations come roughly two months after Interior issued more than a dozen citations to BP and its contractors Halliburton Co. and Transocean Ltd. for their roles drilling the failed Macondo well.

"Our federal regulations exist to ensure safe and environmentally-responsible activities. We will continue to be vigilant in enforcing those regulations," said James Watson, the new director of Interior's Bureau of Safety and Environmental Enforcement (BSEE), in a statement. "Further review of the evidence demonstrated additional regulatory violations by BP in its drilling and abandonment operations at the Macondo well."

Interior cited BP once for failing to conduct an accurate pressure test.

The company on four occasions also failed to suspend operations when the safe drilling margin identified in its drilling permit was not maintained, Interior said.

BP in an emailed statement said the violations issued today played no "causal role" in the Macondo accident. Spokesman Scott Dean said the company intends to appeal the new notices, as well as those issued several weeks ago.

The company, which has two months to appeal the violations, could face fines of up to $35,000 per incident, per day, according to the penalties in place at the time of the disaster.

Interior this summer raised civil penalties to $40,000, but agency officials have complained the amount is far too low to deter companies from risky behavior. An offshore oil rig can cost $500,000 to $1 million a day to operate.

The House last Congress passed a bill that would raise the cap to $75,000 a day or to $150,000 a day in cases where human or marine life, mineral deposits or the coastal or human environment are threatened. Penalties for "knowing and willful" violations of the Outer Continental Shelf Lands Act would rise from $100,000 to $10,000,000 under the bill.

The Senate Energy and Natural Resources Committee this Congress is vetting a bill that would make similar changes.

The latest violations are the result of a review by BSEE staff who were not involved in a joint Interior-Coast Guard investigation that explored the underlying data and evidence related to the Deepwater Horizon drilling operations.

Former BSEE Director Michael Bromwich last month said his agency is seeking ways to shorten the time it takes to issue violations, assess fines and receive payments (E&ENews PM, Nov. 28).

"In the past it has been a year or more," he said. "That's entirely unacceptable to me."

Today's violations come as BP and Halliburton are battling in court over who bears the blame for last year's disaster, which killed 11 men and released nearly 5 million barrels of oil into the Gulf.

BP in a legal filing this week said Halliburton intentionally "destroyed the results of physical slurry testing" on the well "in part because it wanted to eliminate any risk this evidence would be used against it at trial" (Greenwire, Dec. 6).