Advocates Call On Salazar to Relinquish Interior Dept’s Oversight of Drilling Safety

His proposal to split MMS in three may not be enough to avoid conflict of interest

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WASHINGTON— Interior Secretary Ken Salazar yesterday took a bold step to reform the department’s cozy relationship with the oil and gas industry, proposing to divide the Minerals Management Service (MMS) into three separate parts, and abolish its name. (See Addendum below, for details.)

The move may still not be enough to satisfy environmentalists, who were encouraged by initial reform efforts but at the time still wary, unconvinced that the Interior Department could really clean up its own house.

Splitting up the conflicting duties of MMS is imperative, environmentalists say. But positioning the safety and environmental office in the Department of Interior is the equivalent of hiring a fox to guard the henhouse.

In an ideal world, environmental advocates emphasize, MMS’s safety and environmental division would be moved from Interior to another appropriate agency.

Likely candidates include the Environmental Protection Agency, the Department of Labor’s Occupational Safety and Health Administration, the U.S. Coast Guard or the Department of Transportation’s Pipeline and Hazardous Materials Safety Administration. 

“Interior has fundamentally been unable to manage MMS,” Erich Pica, president of the advocacy organization Friends of the Earth, told SolveClimate in a Wednesday interview. “MMS has an inordinate amount of responsibility. When they fail, they can destroy whole communities.”

Salazar might talk about change, Pica continued, but he likely won’t go far enough in taming an agency that has collected an average of $13 billion for the U.S. Treasury annually. About half of its $342 million budget for 2010 comes in fees and rental receipts from the energy industry.

“(MMS) has been a failure for at least 20 years,” Pica said. “We can’t rely on the Department of the Interior to reform itself.”

Sen. Barbara Boxer, the California Democrat who chairs the Senate Environment and Public Works Committee, also has spoken out in favor of the idea of moving the safety and environmental function of MMS out of Interior’s control.

Structure with More Integrity

Turning a division over to a different department or agency is difficult and politically challenging because politically adept cabinet members, always mindful of their legacy, are reluctant to dismantle their own authority.

Peter Van Tuyn, a longtime environmental attorney based in Anchorage, Alaska who counsels advocacy organizations, maintains that splitting MMS’s duties and moving the oversight duties out of Interior would provide a structure with more integrity.

“We need a secretary who has enough humility to recognize that he can make a stronger, not weaker, department by doing so,” Van Tuyn said in a Wednesday interview. "I have a lot of respect for Salazar. He needs to make some tough decisions.”

Salazar has vowed to reform MMS since he became Interior secretary in early 2009. His first order of business was cleaning up a division of 1,700 employees beset by a sex, drugs and illegal gifts scandal that erupted before Obama took office.

The former senator of Colorado has been in a harsher spotlight since a blowout preventer on the Deepwater Horizon rig failed April 20, leading to the BP spill that is dumping an estimated 5,000 to 25,000 barrels of oil and natural gas into the Gulf of Mexico daily. Almost one-third of this nation’s domestic oil production comes from the gulf.

MMS has been accused of being lax with safety requirements and remiss on heeding advice from scientists and engineers. Just last week, President Obama called for reform after noting the “cozy relationship” between MMS and the oil and gas industry.

Senators Blunt about "Safety Swamp" at MMS

A cool and collected Salazar, who testified at two different congressional hearings thus far this week, was flanked by Liz Birnbaum, the director of MMS, and deputy secretary David Hayes when he answered questions before the Senate Committee on Energy and Natural Resources for 2½ hours Tuesday. Hayes, Salazar said, took the lead role in the recent reorganization of MMS.

Most of the senators praised Salazar for his diligence and attentiveness during the BP crisis, today a month old. Hayes, who was dispatched to Louisiana the day after the rig exploded, left so quickly, Salazar told the senators, that he didn’t even have time to pack underwear or a toothbrush.

Salazar and his staff are delivering an overarching review of safety recommendations for offshore drilling that will be delivered to the president in late May. In the meantime, the Interior Department has halted all new offshore drilling.

Salazar did not flinch when Sen. Ron Wyden, D-Ore., told him that “this is an opportunity for you to drain the environmental safety swamp at MMS.”

“We are not afraid of the truth and we will get to the bottom of it,” Salazar said about his vow for a vigorous investigation. When asked later on if MMS employees ignored science when making decisions, he responded, “If I find someone in the department who has ignored the science, their heads will roll.”

During the Energy and Natural Resources hearing, Salazar called on Congress to craft organic legislation that would help to strengthen MMS and make accountability a priority. Afterward, he asked for elimination of a congressionally mandated requirement to approve or disapprove of exploration plans within 30 days of their submission.

Sparing the Arctic

Two short-term fixes Van Tuyn is urging of Salazar include giving Congress authority to vet the head of MMS—which has never been necessary up to this point because the agency was launched in the early 1980s via a secretarial order—and reviewing all recent decisions on oil exploration.

“There’s been a significant tear in the safety net with what happened in the Gulf of Mexico,” he said. “To make sure Interior is doing no further harm, you have to make sure recent work by MMS is OK and has integrity.”

Specifically, Van Tuyn is referring to a ruling that allows Shell Oil to begin exploratory drilling July 1 in the Beaufort and Chukchi seas off the Alaskan coast. The Alaska Wilderness League has teamed up with handfuls of other conservation organizations and groups representing indigenous people to fight this plan because there is a such a limited capacity to respond to spills in icy, harsh Arctic conditions.

A March 2010 GAO report found serious flaws with how Alaska’s MMS regional office fulfilled its responsibilities under the National Environmental Policy Act (NEPA). The report said management was selective about sharing information on the environmental analysis with staff and only divulged it on need-to-know basis; suppressed or altered science; provided insufficient guidance on NEPA; and had no clear plans or policy on how to define what exactly constitutes a significant environmental impact.

“What it really comes down to is this,” Van Tuyn said. “If Salazar and Obama are to be believed that they put science over everything else, they will not let Arctic drilling go on this summer. That will be their litmus test.”

Reinventing MMS Could Spawn an Ocean Ethic

Salazar’s call for organic legislation encouraged Van Tuyn to imagine that substantive change could happen at MMS if oversight and enforcement powers are placed outside Interior.

“In an ideal world, we’d be asking how we as a government would manage human interactions with the oceans,” Van Tuyn said. “Let’s get an ocean ethic to show that the United States cares about its oceans, sustainable development and ecosystem protection. Right now we have no unifying theme.”

If a national ocean policy emerged, he hypothesized, that could spur creation of a separate federal department that manages how this country handles its salt water resources when it comes to activities such as fisheries, oil and gas drilling, and conservation. In theory, that agency would lay out a science-based master plan that would specifically designate where drilling was appropriate, so MMS could handle leasing and other related duties.

“The Obama administration had started out on the right foot with its call for a national ocean policy that balanced extraction with preservation,” Van Tuyn said. “With this latest spill, we’ve got the ability and the known need to think about this as a solution for the medium and long term.”

Friends of the Earth Not Holding Breath on Change Front

Salazar and the Obama administration knew MMS was a rogue agency early on because of less-than-complimentary press coverage and a series of searing reports from the Government Accountability Office and inspector general, Pica of Friends of the Earth, said.

While it’s admirable that Salazar is contrite in taking the blame for MMS safety lapses during interviews and as the star witness during congressional hearings, Pica wonders why the Interior secretary wasn’t more proactive earlier in his term.

“Congress has also been complicit,” Pica said. “But right now, every day that BP fails to contain the spill and we learn about new incompetence, the cacophony of these failures will force Congress to do something.

“Now it’s a matter of having the political will to take this agency on.”


(Photos: US Coast Guard and US Fish and Wildlife Service)


Addendum: What Salazar is Currently Proposing

Interior Secretary Ken Salazar said Wednesday afternoon that he will be visiting with Minerals Management Services in Denver, New Orleans and Virginia during the next month or so to explain his decision to split MMS into three divisions—all under the Interior umbrella.

As promised, he signed a secretarial order Wednesday that divides responsibilities among a new Bureau of Ocean Energy Management, Bureau of Safety and Environmental Enforcement, and Office of Natural Resources Revenue.

The two bureaus and one office are intended to eliminate conflicting missions inherent in MMS’s current organization.

More details about the reorganization of 38-year old MMS will be released during May and June, Salazar said. Interior officials will collaborate with Congress and the White House Office of Management and Budget to put the changes into effect. For instance, questions still remain about how funding will be handled.

Another goal is to have Congress draft legislation to establish the agencies by law. During the early years of the Reagan administration, Interior Secretary James Watt used a secretarial order to form MMS in 1982.

Briefly, Salazar wants to divide the 1,700 MMS employees this way:

  • About 700 workers will shift to the ocean energy bureau, which will oversee conventional and renewable offshore energy development. Duties will include resource evaluation, planning and leasing.
  • About 300 employees will move to the safety and enforcement bureau. They will be responsible for oversight, inspections, safety and environmental protection of all offshore energy activities. Salazar refers this bureau as the police that will make energy companies accountable.
  • Another 700 employees will be moved to an office responsible for onshore and offshore royalty and revenue functions. That includes asset management, auditing and compliance and the collection and distribution of revenue.

Wilma Lewis, the Interior assistant secretary for land and minerals management, will direct and supervise the 1,000 employees in the two bureaus. Rhea Suh, the Interior assistant secretary for policy, management and budget, will be in charge of the new office.