Interior Department sets new rules for offshore drilling, a step toward lifting deepwater ban

Interior Dept. sets new offshore drilling rules

WASHINGTON — The Obama administration on Thursday imposed new rules to make offshore drilling safer, but said it was not yet ready to lift a temporary ban on deepwater drilling.

Interior Secretary Ken Salazar called offshore drilling inherently risky and said, “We will only lift the moratorium when I, as secretary of Interior, am comfortable that we have significantly reduced those risks.”

White House press secretary Robert Gibbs called the new regulations “a big step forward” and said they moved the administration closer to lifting the deepwater drilling ban.

“The president does not oppose the offshore exploration for oil,” Gibbs told reporters. “We need to do this in a way that is technologically safe, technologically proven,” to avoid catastrophic blowouts such as the massive BP spill in the Gulf of Mexico.

The new rules, which take effect immediately, include many recommendations made in a report Salazar released in May, including requirements that rigs certify that they have working blowout preventers and standards for cementing wells. The cement process and blowout preventer both failed to work as expected in the BP spill.

The April 20 spill, which was triggered by an explosion that killed 11 people, dumped an estimated 200 million gallons of oil in the Gulf. BP killed the well two weeks ago and expects to eventually pay at least $32 billion to handle the cleanup and damage claims.

Under the new rules, a professional engineer must independently inspect and certify each stage of the drilling process. Blowout preventers — the emergency cutoff equipment designed to contain a major spill — must be independently certified and capable of severing the drill pipe under severe pressure.

Companies also will be required to develop comprehensive plans to manage risks and improve workplace safety.

“We are raising the bar for safety, oversight and environmental protection,” he said Thursday in a speech at a Washington think tank. “The oil and gas industry needs to expect a dynamic regulatory environment as we bring offshore programs up to the gold standard we need to have.”

Salazar and other administration officials had said the new rules must be in place before the Interior Department lifts a ban on deepwater drilling. The ban is set to expire Nov. 30, but officials have said they hope to end it early.

The rules announced Thursday are not the final step, Salazar said, noting that the Interior Department is likely to propose requiring that blowout preventers have a second set of blind shear rams — the parts that can shear off and shut down wells in the event of a catastrophic spill.

Lee Hunt, chief executive of the International Association of Drilling Contractors, said the new rules could make offshore drilling safer, but would add layers to a regulatory process that’s all but shut down drilling in the Gulf. The government has approved just a handful of shallow-water drilling permits during the past few months, and oil companies are growing frustrated with the wait.

“All of this can be done,” Hunt said of the new rules. “The question is if we’re now getting to a choke point,” in which the permitting process grinds to a complete halt.

A spokesman for the American Petroleum Institute said the oil industry group will review the rules. The API has called for a clear, practical and well-defined review process that will protect the environment and allow drilling to resume.

“We cannot have an approval process that creates unpredictable delays that could place at risk the flow of domestic energy in our country,” said Erik Milito, a lobbyist for the group. Extended delays in permit approvals are likely to discourage investment in new projects — hampering job creation and restricting energy production, he said.

Richard Charter, senior policy adviser for Defenders of Wildlife, cheered the new rules. It’s hard to tell if they will make the Gulf safer, he said, but at least “it shows they’re not sweeping this under the rug. The era of ‘drill baby drill’ is over.”

Government regulators have long been criticized for a cozy relationship with the oil and gas industry — a situation Salazar and other Obama administration officials have vowed to fix.

Even after the temporary ban on exploratory drilling is lifted, drilling is unlikely to resume quickly.

“You’re not going to see drilling going on the next day, or even the next week,” Michael Bromwich, director of the agency that oversees offshore drilling, said this week. “It’s going to take some time.”

Associated Press writers Chris Kahn in New York and Erica Werner in Washington contributed to this story.