3. OFFSHORE DRILLING:

Spill commission to issue 'report card' on recommendations

Published:

The presidential commission that recommended sweeping improvements in drilling safety and oversight after the massive oil spill in the Gulf of Mexico last year is preparing an evaluation of how Congress, the Obama administration and industry responded to the call for action.

Fran Ulmer, one of seven members on the president's National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling, said today the panel would release its "report card" in the coming months.

"We've decided that's an important piece to holding everyone's feet to the fire -- to actually make sure that the lessons learned from the tragedy move us forward in a safe way," Ulmer said at a forum hosted by the Pew Environment Group in Washington, D.C.

Ulmer -- who was joined by former Interior Department drilling chief Michael Bromwich, a former U.S. Coast Guard admiral and the former mayor of Alaska's North Slope Borough -- said that while many of the commission's recommendations were implemented over the past year, Congress has largely failed to do its share.

She noted decisive steps Congress took following the Exxon Valdez oil spill in 1989, including requirements for double-hulled tankers and an oil spill liability fund.

A bill in the Senate Energy and Natural Resources Committee to implement some of the spill commission recommendations has stalled this Congress over disagreements involving the sharing of offshore revenues with coastal states. The House passed a comprehensive oil spill response bill in 2010, but progress on a reform bill in the current Republican-led House has been hard to come by.

Ulmer, who is chancellor of the University of Alaska, Anchorage, implored voters to demand action.

"I would urge the American people to not let the Deepwater Horizon tragedy become a second tragedy of not stimulating and permanently enabling not just the agencies but the nation to move forward on the lessons learned," she said.

The spill commission's report in early 2011 asked Congress to ensure Interior could police offshore drilling separately from revenue collection, to provide adequate funding, to raise the liability cap for spills and to direct the majority of the penalty money collected from BP PLC and the other companies involved in the disaster under the Clean Water Act to be returned to the Gulf states, among other recommendations (Greenwire, Jan. 11, 2011).

Arctic development 'scares us'

Panelists at this morning's forum discussed several other issues involving oil drilling in the Arctic Ocean, including the long-term impacts on native villages on the North Slope.

Edward Itta, former mayor of the North Slope Borough, said it was the long-term implication of oil and gas development in Arctic waters that concerns Alaska Natives, not individual wells.

"It's not the first well that makes us nervous or even the first 10 wells," he said. "The prospect of long-term oil and gas development out in the ocean frankly scares us."

Itta, who said he used to campaign against offshore drilling before becoming mayor, said North Slope residents have lived with onshore development from Prudhoe Bay for the last 40 years. "What started as a small enclave of industrial activity has now gradually spread over a vast area of our coastal plain," he said.

Bromwich said the current plan by Royal Dutch Shell PLC to drill up to six wells in the Chukchi Sea beginning this summer has attracted a "disproportionate" amount of attention and that the important thing is for regulators to keep a vigilant watch if, or when, drilling expands.

"These exploration plans, these spill response plans and, when they come in, these permit applications will be the most closely scrutinized exploration plans, spill response plans and applications to drill ever in the history of offshore drilling, period. And that's fine and that's good," he said. "But let's not lose sight of the big picture. The end game is what happens a year or two years, five years down the road when you have not just one company that's made all these commitments ... when other companies come in, they need to live up to those standards."

Itta also praised Shell for agreeing to comply with a shortened drilling window, to respect the migration of bowhead whales, to address the discharge of pollutants and to conduct voluntary research to study baseline environmental conditions. While it took a lawsuit in a federal circuit court to get the company's ear, it appears the Dutch oil giant is listening, he said.

"I'd like to commend Shell for from that day on seeming to respond to our concerns," he said.

Itta said he is hopeful that if oil exploration is allowed to proceed in the Arctic this summer, area residents will be able to share in some of the profits. That means constructing a pipeline that can ship the oil to the Trans-Alaska pipeline, rather than by carrying the oil away on tankers, he said.

His community has little reason otherwise to support the development, he said.

Spill response remains weak

Panel members agreed that while the United States has made great strides in preventing and containing spills, the ability to respond to oil once it is discharged into the ocean is still lacking.

Roger Rufe, a retired vice admiral for the Coast Guard, said the agency would be "pretty strapped" to provide relief to Shell in the event of a spill.

"Once oil's in the water, it's a mess," Rufe said. "We have never proven anywhere in the world, let alone in the ice, that we're very good at picking up 3 or 5 or 10 percent of the oil once it's in the water."

Under the terms of Shell's exploration plan, drilling activities must wrap up at least a month before the earliest onset of ice to allow sufficient response to any potential spills.

Bromwich said his agency focused on three areas -- spill prevention, capping technology and responding to spills -- but that the third leg has failed to advance as much as the rest.

"That is the one where progress is harder," he said. Oil spill response technology has advanced "painfully little" since the Exxon Valdez spill, Bromwich said, citing the commission report.