States, oil industry sue Interior over offshore drilling cleanup rule

By Niina H. Farah | 06/18/2024 06:16 AM EDT

The BOEM regulation “imposes devastating and immediate effects on Gulf drilling,” challengers told a federal court.

Liz Murrill speaks with reporters outside the U.S. Supreme Court.

Louisiana Attorney General Liz Murrill (R) is leading a new lawsuit against an Interior Department rule related to offshore oil infrastructure that is at risk of abandonment. Francis Chung/POLITICO

Three Gulf Coast states are leading a lawsuit to block a new Interior Department rule aimed at securing billions of dollars from offshore oil companies for cleanup of abandoned wells and platforms.

The Bureau of Ocean Energy Management’s financial assurances rule — set to take effect later this month — requires companies the federal government considers to be at risk of bankruptcy to purchase supplemental bonds that would cover the costs of activities such as deconstructing offshore oil and gas platforms.

Republican attorneys general from Louisiana, Texas and Mississippi, along with a coalition of oil industry groups, asked the U.S. District Court for the Western District of Louisiana on Monday to overturn the rule, which they said “seeks to put small and mid-size independent oil and gas companies out of business.”


“Once again, Joe Biden is unlawfully attempting to kill Louisiana jobs and American energy security by making the financial burden required of offshore producers so exorbitant it is no longer feasible to operate,” said Louisiana’s Republican Attorney General Liz Murrill in a statement.