Obama extends offshore drilling ban, affecting proposed leases in Alaska, Virginia, Gulf

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Chief of agency overseeing offshore drilling quits

WASHINGTON — The head of the agency that oversees offshore drilling resigned under pressure Thursday and President Barack Obama tried to show he was moving aggressively to take charge of the Gulf Coast oil spill.

Interior Secretary Ken Salazar announced Elizabeth Birnbaum’s departure from the Minerals Management Service, and Obama said he would put an end to the “scandalously close relationship” between regulators and the oil companies they oversee.

Salazar made the announcement about Birnbaum at a congressional hearing where Birnbaum was to testify. She never showed, and her boss said she left government “on her own terms and her own volition.”

Hours later, Obama extended a freeze on new deepwater oil drilling and canceled or delayed proposed lease sales in the waters off Alaska and Virginia, and in the Gulf Coast.

At a White House news conference, Obama said regulators under his watch weren’t tough enough on the oil and gas industry and he promised to change that. He said they need more than the current 30 days to review applications for drilling permits and must pay closer attention to environmental laws.

Those steps were the result of a 30-day safety review of offshore drilling conducted by Salazar at Obama’s direction.

Birnbaum, in charge since July 2009, left after criticism from lawmakers of both parties over allegedly lax oversight of drilling and cozy ties with industry. Salazar recently announced he was breaking up the agency into three parts.

In a three-sentence resignation letter, Birnbaum wrote: “As you move forward with the reorganization of Minerals Management Service you will be requiring three new leaders. … I wish you every good fortune in the reorganization of the bureau.”

Lawmakers said the scope of the problems extended beyond Birnbaum’s leadership. An internal watchdog’s report alleged corruption at the agency during the Bush administration, and suggested that similar problems carried over into Obama’s.

“The departure of Elizabeth Birnbaum from MMS does not address the root problem,” said Rep. Nick Rahall, D-W.Va., chairman of the House Natural Resources Committee.

To California Rep. Darrell Issa, the top Republican on the House Oversight and Government Reform Committee, the agency “has been overrun by corruption and incompetence spanning multiple administrations and multiple personnel.” He cited “much larger issues that cannot be addressed by just reshuffling the deck.”

The 1,700-employee agency oversees drilling on federal lands and in federal water and collects an average of $13 billion in royalties.

It was a day of fast-moving developments, both in Washington and in the Gulf, where engineers watched for signs of success from the latest attempt to stanch the leak five weeks into the catastrophe.

Obama prepared for a firsthand look at the situation with a visit the Gulf Coast on Friday, his second since the accident.

The proposed drilling affected by Thursday’s announcements include Shell Oil’s plans to begin exploratory drilling this summer on Arctic leases as far as 140 miles off Alaskan shores. Now those wells will not be considered until 2011.

In Virginia, the lease sales that have been canceled were in an area of about 2.9 million acres 50 miles or more offshore. The sales had already been postponed indefinitely after the spill.

As for the Western Gulf, there was to have been a lease sale in New Orleans in August of 18.8 million acres, located from 9 to about 250 miles offshore. That has been canceled.

Associated Press writer Ben Evans contributed to this report.