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API Calls Its Own Post-BP Reform Efforts ‘Strong,’ ‘Stronger,’ And ‘Strongest’

by Kiley Kroh and Michael Conathan

Yesterday, former members of the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling released a report card evaluating the progress made by the federal government, Congress, and industry toward implementing the critical reforms recommended by the Commission in their 2011 report.

None of them make the honor roll. While the harshest rebukes were aimed at Congress, the report card finds that overall, “in every category, much more needs to be done.”

Big Oil, on the other hand, touted the reforms made by the oil and gas industry. Oil & Gas Journal reported “the industry has always demonstrated a strong commitment to operate safely and responsibly offshore, and has deepened that [sic] the commitment in the nearly 2 years since the Macondo well accident.”

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Erik Milito, API’s upstream and industry operations group director, said “the bar continues to rise, the commitment is stronger, and the mechanisms are in place to support the strongest safety standards possible.”

Such assurances from API are dubious at best, considering the Commission’s 2011 report found a direct causal relationship between API’s role as the industry’s principal lobbyist and public policy advocate and “compromised” safety standards that were a direct contributor to the BP disaster:

API’s proffered safety and technical standards were a major casualty of this conflicted role … Because the Interior Department has in turn relied on API in developing its own regulatory safety standards, API’s shortfalls have undermined the entire federal regulatory system.

John Watson, CEO of oil giant Chevron, told USA Today that he’s confident production can occur safely, saying, “we’ve learned from the Macondo incident and others and have steadily improved our practices as an industry. We’re in a much better position as an industry today than we were a few years ago.”

That’s a questionable self-evaluation from a company recently slapped with an $11 billion lawsuit and criminal charges for a November 2011 spill off the coast Brazil and responsible for setting the ocean ablaze with a natural gas fire in Nigeria this year that burned for 46 days and took the lives of two workers.

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While both the federal government and industry have taken steps to improve the serious shortfalls in safety and oversight that led to the Deepwater Horizon disaster, a great deal remains to be done — especially as the industry looks to move into frontier areas like the Arctic that are fraught with uncertainty and risk.

The Commission gave the administration an overall grade of B, industry a C+ and Congress a D. (The ocean conservation group Oceana released a similar report card yesterday comprised of nothing but D’s and F’s.)

Let’s take a look at the commission’s findings.

Safety and Environmental Protection: B Spill Response and Containment: B-

While the former commissioners cited improvements in oversight and oil spill response in the wake of the BP spill, they emphasized that “these hold promise but continued improvements are required, and Congress has done nothing to make permanent the improvements that have been made.”

Impacts and Restoration: C

The former commissioners were “discouraged by the modest steps that have been taken” to implement their recommendations on impacts and restoration. Like the CAP-Oxfam report Beyond Recovery, the Commission’s report recommended that 80% of Clean Water Act fines charged to BP be dedicated to the long-term restoration of the Gulf Coast. The RESTORE Act has passed both the House and Senate, but Congress has yet to come to an agreement on its final passage.

Ensuring Adequate Resources: D

Although the Administration and Congress have provided increases in funding for the Department of the Interior to operate regulatory programs, the Commission recommended that the oil and gas industry should bear the cost of leasing and permitting review. Additionally, the liability for damages from offshore spills is held at $75 million — “a ceiling established over 20 years ago and which is much lower than the costs likely to be incurred today.” Congressional action is required both to create a self-funding program and raise the liability cap.

Frontier Areas — The Arctic: C

Though the commissioners found some progress being made in frontier areas, they “feel strongly that additional work must be done to understand the ecosystems of the Arctic and to establish the infrastructure necessary to protect this vulnerable and valuable region.”

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The importance of infrastructure and preparedness cannot be overstated — especially when taking into account the unprecedented mobilization of resources required to respond to the Gulf spill coupled with the extremely harsh conditions in the Arctic. As the CAP report Putting a Freeze on Arctic Ocean Drilling: America’s Inability to Respond to an Oil Spill in the Arctic detailed, infrastructure, science, and oil spill response capacities are all severely lacking in this region.

“The risks will only increase as drilling moves into deeper waters with harsher, less familiar environmental conditions. Delays in taking the necessary precautions threaten new disasters, and their occurrence could, in turn, seriously threaten the nation’s energy security,” writes the Commission.

In this context, even mediocre grades could fail to prevent a disaster of epic proportions.

Kiley Kroh is the Associate Director of Ocean Communications at the Center for American Progress. Michael Conathan, Director of Ocean Policy, and Erin Gustafson, Energy and Environmental Policy intern, contributed to this piece.